Document:

NEW ULM TELECOM, INC. EXHIBIT 10.2 TO FORM 8-K DATED DECEMBER 31, 2007

Exhibit 10.2  

EXECUTION COPY

MLA No. RX0583

MASTER LOAN AGREEMENT

          THIS MASTER LOAN AGREEMENT (as the same may
be amended, modified, supplemented, extended or restated as provided herein
from time to time, this “Agreement”),
dated as of January 4, 2008, is made between COBANK,
ACB (“CoBank”)
and NEW ULM TELECOM, INC., a
Minnesota corporation (the “Borrower”).

          WHEREAS, from time to time CoBank may make
loans to the Borrower, and in order to reduce the amount of paperwork
associated therewith, CoBank and the Borrower would like to enter into a master
loan agreement; 

          NOW, THEREFORE, in consideration of the
foregoing, intending to be legally bound hereby, and in consideration of CoBank
making one or more loans to the Borrower, CoBank and the Borrower agree as
follows: 

          SECTION 1. Supplements. In the event the
Borrower desires to borrow from
CoBank and CoBank is willing to lend to the Borrower, or in the event CoBank
and the Borrower desire to consolidate any existing loans hereunder, the
parties will enter into a supplement to this Agreement (each supplement, as it
may be amended, modified, supplemented, extended or restated from time to time,
a “Supplement” and,
collectively, the “Supplements”).
Each Supplement will set forth CoBank’s commitment to make a loan or loans
(each, a “Loan” and,
collectively, the “Loans”)
to the Borrower, the amount of the Loan(s), the purpose of the Loan(s), the
interest rate or rate options applicable to the Loan(s), the repayment terms of
the Loan(s), and any other terms and conditions applicable to the Loan(s). Each
Loan will be governed by the terms and conditions contained in this Agreement
and in the Supplement and in the Note relating to that Loan. 

          SECTION 2. Availability. Advances under the
Loans will be made available on any day on which CoBank and the Federal Reserve
Banks are open for business (a “Business
Day”) upon the telephonic or written request of an authorized
employee of the Borrower. Requests for advances under the Loans must be received
no later than 12:00 noon Central time on the date the advance is desired or at
such earlier date and time as may be specified in the relevant Supplement.
Advances under the Loans will be made available by wire transfer of immediately
available funds. Wire transfers will be made to such account or accounts as may
be designated in writing by the Borrower. 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 designated in writing by the Borrower to
request advances under a Delegation and Wire and Electronic Transfer
Authorization form with CoBank, so long as any funds advanced are wired to an
account previously designated in writing by the Borrower. 

          SECTION 3. Notes and Payments. The
Borrower’s obligation to repay the Loans made under each Supplement shall be
evidenced by a promissory note in form and content acceptable to CoBank (such
notes, as they may be amended, modified, supplemented, extended, restated or
replaced from time to time, collectively, the “Notes”, and each a “Note”).
The Borrower is to make each payment which it is required to make under the
terms of this Agreement, each Supplement, each Note, any Interest Rate
Agreement (as hereinafter defined in this Section 3) provided by CoBank
and all security and other instruments and documents relating hereto and
thereto (this Agreement, the Supplements, the Notes, Interest Rate Agreements
provided by CoBank, and all such instruments and documents, including, without
limitation, all security and guarantee documents described in Section 5 of this
Agreement or any Supplement to this Agreement, as they may be amended modified,
supplemented, extended or restated from time to time, collectively, at any
time, the “Loan Documents”)
by wire transfer of immediately available funds, by check, or by automated
clearing house (ACH) or by other similar cash handling processes as specified
by separate agreement between the Borrower and CoBank. Wire transfers shall be
made to ABA No. [omitted] for
advice to and credit of CoBank (or to such other account as CoBank may direct
by notice). The Borrower shall give CoBank telephonic notice no later than
12:00 noon Central time of its intent to pay by wire. Funds received by wire
before 3:00 p.m. Central time shall be credited on the day received and funds
received by wire after 3:00 p.m. Central time shall be credited on the next
Business Day. Checks shall be mailed to CoBank, at Department 167, Denver,
Colorado 80291-0167 (or to such other place as CoBank may direct by notice).
Credit for payment by check will not be given until the later of: (i) the day
on which CoBank receives immediately available funds; or (ii) the next Business
Day after receipt of the check. If any date on which a payment is due under any
Loan Document is not a Business Day, then such payment shall be made on the
next Business Day and such extension of time shall be included in the
calculation of interest due.  

“Interest Rate Agreement” means any
interest rate swap, hedge, cap, collar or similar agreement or arrangement, in
form and content acceptable to CoBank, designed to protect the Borrower against
fluctuations in interest rates. 

          SECTION 4. Mandatory Repayments; Application.

                    (A)
Mandatory Repayments. The Borrower
shall repay the Loans as provided in this Subsection 4(A). 

	
 

	
 

	
 

	
                    (1)
Repayments from Insurance Proceeds.
 The Borrower shall repay the Loans in an amount equal to all Net Proceeds (as
 hereinafter defined in this Subsection 4(A)) received by the Borrower
 or any of its Subsidiaries (as hereinafter defined in this Subsection 4(A))
 (the Borrower and its Subsidiaries, collectively, the “Loan Parties” and each a “Loan
Party”) that are insurance
 proceeds from any Asset Disposition (as hereinafter defined in this Subsection
 4(A)) to the extent that such proceeds are not used to repair or replace
 the lost, damaged or destroyed asset or assets in the business of such Loan
 Party within 180 days of receipt by such Loan Party of such Net Proceeds. All
 such repayments shall be applied in accordance with Subsection 4(B) of
 this Agreement. 

	
 

	
 

	
 

	
“Asset Disposition” shall mean the
 disposition, whether by sale, lease, transfer, loss, damage, destruction,
 condemnation or otherwise, by any Loan Party of any or all of such Loan
 Party’s assets, other than (a) bona fide sales of inventory to customers for
 fair value in the ordinary course of business, (b) dispositions of obsolete
 equipment not used or useful in the business of such Loan Party, or (c)
 dispositions of assets permitted under Subsection 9(E) of this
 Agreement. 

	
 

	
 

	
 

	
“Net Proceeds” shall mean the cash
 proceeds received by any Loan Party from any Asset Disposition, debt or
 equity issuance (including insurance proceeds, awards of condemnation, and
 payments under notes or other debt securities received in connection with any
 Asset Disposition), net of (i) the reasonable costs of such sale, lease,
 transfer, issuance or other disposition (including taxes attributable to such
 sale, lease, transfer, issuance or other disposition) and (ii) amounts
 applied to repayment of Indebtedness (as hereinafter defined in Subsection
 8(I)(1) of this Agreement), other than Indebtedness outstanding
 hereunder, secured by a lien on the asset or property disposed. 

	
 

	
 

	
 

	
“Subsidiary” or “Subsidiaries” shall mean, with
 respect to any entity, any corporation, partnership, association, limited
 liability company, joint venture or other business entity of which more than
 50% of the total voting power of shares of stock (or equivalent ownership or
 controlling interests) entitled (without regard to the occurrence of any
 contingency) to vote in the election of directors, managers or trustees
 thereof is at the time owned or controlled, directly or indirectly, by that
 entity or one or more Subsidiaries of that entity or any combination thereof.
 

	
 

	
 

	
 

	
                    (2)
Repayments from Asset Disposition.
 Immediately upon receipt by any Loan Party of Net Proceeds (other than
 insurance proceeds) from any Asset Disposition, the Borrower shall repay the
 Loans in an amount equal to such Net Proceeds. All such repayments shall be
 applied in accordance with Subsection 4(B) of this Agreement. 

	
 

	
 

	
 

	
                    (3)
Repayments from Debt Incurrence or Equity
 Issuances. Immediately upon receipt by any Loan Party of Net
 Proceeds relating to the issuance by any Loan Party of any public or private
 debt (other than Indebtedness permitted under Subsection 9(A) of this
 Agreement) or any equity, Borrower shall repay the Loans in an amount equal
 to such Net Proceeds. All such repayments shall be applied in accordance with
 Subsection 4(B). 

                    (B)
Application of Mandatory Repayments; Payment of
Breakage Fees, Etc. All repayments made pursuant to Subsection
4(A) of this Agreement shall be applied first pro rata to all term Loans,
based upon the principal amount then outstanding, and then pro rata to all
revolving Loans, based upon the principal amount of the Commitments (as defined
in the Supplements evidencing the revolving Loans); provided, however,
that all such repayments made pursuant to Subsection 4(A) of this
Agreement by Hutchinson Acquisition Corporation (“Hutchinson”) or any of its Subsidiaries shall be applied
first to repay the outstanding principal balance of Loan No. RX0584 evidenced by that certain Master
Loan Agreement, as it may be amended, restated, supplemented or otherwise
modified from time to time (the “Hutchinson
MLA”), dated as of the date hereof, between Hutchinson and
CoBank, as supplemented by that 

certain First
Supplement to the Master Loan Agreement, dated as of the date hereof, between
Hutchinson and CoBank, that certain Second Supplement to the Master Loan
Agreement, dated as of the date hereof, between Hutchinson and CoBank, and that
certain Third Supplement to the Master Loan Agreement, dated as of the date
hereof, between Hutchinson and CoBank, as each may be amended, restated, supplemented
or otherwise modified from time to time (the “Hutchinson Supplements” and together with the Hutchinson
MLA, the “Hutchinson Loan”)
in accordance with Subsection 4(B) of the Hutchinson MLA; and provided, further,
however, that all repayments from the Net Proceeds of the sale of the
assets described on Schedule 9(E) shall be applied first and only to the
repayment of the term Loan outstanding under the Third Supplement to the Master
Loan Agreement, dated as of the date hereof, between Hutchinson and CoBank, and
Hutchinson or its Subsidiary, as the case may be, may retain any excess Net
Proceeds of such sale following repayment in full of such Loan. The parties
hereto contemplate that immediately upon the closing of the Hutchinson Loan,
Hutchinson will merge with and into Hutchinson Telephone Company, with
Hutchinson Telephone Company being the survivor of such merger and having all
rights and obligations of Hutchinson pursuant to the terms of the Hutchinson
Loan (the “Merger”). After
the Hutchinson Loan has been paid off in full and all revolving commitments
pursuant thereto have been reduced in full, all repayments made pursuant to Subsection
4(A) of this Agreement by the Borrower or any of its Subsidiaries,
including Hutchinson and its Subsidiaries, shall be applied to any Loan set
forth in any Supplement entered into under this Agreement in accordance with
this Subsection 4(B). All term Loan repayments made pursuant to this Section
4 will be applied to principal installments in the inverse order of their
maturity and to such portions or Portions (as defined in the Supplements
evidencing the term Loans) of the term Loans as CoBank shall specify, and all
repayments on revolving Loans will be applied to such portions or Portions (as
defined in the Supplements evidencing the revolving Loans) of the revolving
Loans as CoBank shall specify. The Commitments (as defined in the Supplements
evidencing the revolving Loans) also shall be permanently reduced to the extent
and in the amount that the Borrower is required, pursuant to this Section 4,
to apply mandatory repayments to be made pursuant to this Section 4
(whether or not any advances are then outstanding and available to be repaid
thereunder) to revolving Loans, in the inverse order of the Commitment Adjustment
Dates (as such terms are defined in the Supplements evidencing the revolving
Loans). All reductions provided for in this Section 4 shall be in
addition to any voluntary reductions and all scheduled reductions and,
accordingly, may result in the termination of the Commitments prior to the
Maturity Dates (as defined in the Supplements evidencing the revolving Loans).
All repayments required or permitted hereunder shall be accompanied by payment
of all applicable Surcharges (as defined in the Supplements evidencing the
Loans) and accrued interest on the amount repaid. 

          SECTION 5. Security. The Borrower’s
obligations under the Loan Documents shall be secured by a statutory first lien
on all equity which the Borrower may now own or hereafter acquire or be
allocated in CoBank. In addition, the Borrower’s obligations under this
Agreement, the Supplements, the Notes, the Interest Rate Agreements provided by
CoBank and the other Loan Documents shall be secured as provided in the
Supplements, and shall be guaranteed as provided in the Supplements. The
Borrower agrees, and agrees to cause each other Loan Party to take such steps
(including the execution of such 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 as is described in the
Supplements. 

          SECTION 6. Conditions Precedent. 

                    (A)
Conditions to Initial Supplement.
CoBank’s obligation to extend credit under the initial Supplement is subject to
the conditions precedent that CoBank receive, in form and substance reasonably
satisfactory to CoBank, each of the following: 

	
 

	
 

	
 

	
                 (1)
This Agreement, Etc. A duly executed
 original of this Agreement and all instruments and documents contemplated
 hereby. 

	
 

	
 

	
 

	
                 (2)
Delegation Form. A duly completed and
 executed original of a CoBank Delegation and Wire and Electronic Transfer
 Authorization form. 

	
 

	
 

	
 

	
                 (3)
Security. (i) A duly executed copy of
 each of the security documents required by Section 8 of the First Supplement
 to the Master Loan Agreement, dated as of the date hereof, between the
 Borrower and CoBank (the “First
 Supplement”) and by Section 8 of the Second Supplement to the
 Master Loan Agreement, dated as of the date hereof, between the Borrower and
 CoBank (the “Second Supplement”),
 and (ii) such evidence as CoBank shall require that all steps required by
 CoBank to obtain and perfect its lien on the security have been taken and
 that such lien has the priority contemplated by this Agreement. 

	
 

	
 

	
 

	
                 (4)
Corporate Structure. Evidence of
 satisfactory corporate and capital structure of the Loan Parties, to be
 determined in CoBank’s reasonable discretion. 

	
 

	
 

	
 

	
                 (5)
Discharge of Indebtedness. Evidence
 satisfactory to CoBank of the repayment of all existing Indebtedness of the
 Loan Parties, and the release of all related liens upon the receipt of funds
 from the Loans, except as permitted in Subsection 9(A) of this
 Agreement. 

	
 

	
 

	
 

	
                 (6)
Origination Fee. Payment by the
 Borrower, on the Closing Date (as defined in Section 3 of the First
 Supplement), of a non-refundable origination fee in the amount of $62,500. 

                    (B)
Conditions to Each Supplement. CoBank’s
obligations, if any, to extend credit under, each Supplement, including the
initial Supplement, is subject to the conditions precedent that CoBank
receives, in form and content reasonably satisfactory to CoBank, each of the
following: 

	
 

	
 

	
 

	
                    (1)
Supplement. A duly executed original
 of such Supplement, the Note relating thereto, and all other instruments and
 documents contemplated by such Supplement. 

	
 

	
 

	
 

	
                    (2)
Evidence of Authority. Such certified
 board resolutions, evidence of incumbency, and other evidence that CoBank may
 require that the Supplement, the Note relating thereto and all other
 instruments and documents executed in connection therewith, and, in the case
 of the initial Supplement, this Agreement and all instruments and documents
 executed in connection herewith, have been duly authorized and executed. 

	
 

	
 

	
 

	
                    (3)
Consents and Approvals. Such evidence
 as CoBank may reasonably require that all required regulatory and other
 consents and approvals have been obtained and are in full force and effect. 

	
 

	
 

	
 

	
                    
(4) Fees and Other Charges. Payment of all
 fees and other charges provided for herein or in such Supplement which are
 due. 

	
 

	
 

	
 

	
                    (5)
Insurance. Such evidence as CoBank
 may require that Loan Parties are in compliance with Subsection 8(D)
 of this Agreement. 

	
 

	
 

	
 

	
                    (6)
Evidence of Perfection. Such evidence
 as CoBank may require that CoBank has a duly perfected first-priority
 security interest in all collateral contemplated by this Agreement and the
 Supplement. 

	
 

	
 

	
 

	
                    (7)
Opinions of Counsel. Opinions of
 counsel (who shall be reasonably acceptable to CoBank) to the Borrower and
 any other party to the Loan Documents (other than CoBank) relating to such
 Supplement reasonably acceptable to CoBank. 

                    (C)
Conditions to Each Advance. CoBank’s
obligation under each Supplement to make any Loan or advance to the Borrower
thereunder is subject to the further conditions set forth in such Supplement
and the following conditions precedent: 

	
 

	
 

	
 

	
                    (1)
Representations and Warranties. That
 the representations and warranties of the Borrower and any other party to any
 Loan Document (other than CoBank) contained in this Agreement, any Supplement
 and any other Loan Document be true and correct in all material respects on
 and as of the date of such advance, as though made on and as of such date
 (and the request for each Loan or advance shall be deemed a remaking of such
 representations and warranties as of such date by such parties). 

	
 

	
 

	
 

	
                    (2)
Events of Default. That no Event of
 Default (as defined in Section 10 of this Agreement) or event which
 solely with the giving of notice and/or the passage of time could reasonably
 be expected to become an Event of Default hereunder (a “Potential Default”), shall have
 occurred and be continuing. 

	
 

	
 

	
 

	
                    (3)
Other Information. That CoBank
 receive such other information regarding the condition, financial or
 otherwise, and operations of the Borrower and any 

	
 

	
 

	
 

	
other party
 to any Loan Document (other than CoBank) as CoBank shall reasonably request
 and such other opinions, certificates or documents as CoBank shall reasonably
 request. 

          SECTION 7. Representations and Warranties.
The execution by the Borrower of each Supplement and each request for an
advance thereunder constitutes a representation and warranty to CoBank that: 

                    (A)
Application. Each representation and
warranty and all other information set forth in any application or other
document submitted in connection with, or to induce CoBank to enter into, such
Supplement is correct in all material respects as of the date of the Supplement
or request for advance, except for representations and warranties that are
date-specific, which shall be correct in all material respects as of the
reference date. 

                    (B)
Disclosure. No representation or
warranty of the Borrower contained in this Agreement, the financial statements
referred to in Subsection 7(F) of this Agreement, any other document,
certificate or written statement furnished to CoBank by or on behalf of any
Loan Party for use in connection with the Loan Documents contains any untrue
statement of a material fact or omitted, omits or will omit to state a material
fact necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made. 

                    (C)
Organization; Powers; Etc. Each Loan
Party (i) is duly incorporated, organized, or formed (as applicable), validly
existing, and in good standing under the laws of its state of incorporation,
organization or formation (as applicable); (ii) is duly qualified to do
business and is in good standing in each jurisdiction in which the character of
its properties or the nature of its business requires such qualification unless
the failure to so qualify will not have a Material Adverse Effect (as
hereinafter defined); (iii) has all requisite legal and corporate, partnership
or limited liability company power (as applicable) to own and operate its
assets and to carry on its business and to enter into and perform its
obligations under the Loan Documents to which it is a party; and (iv) has duly
and lawfully obtained and maintained all licenses, certificates, permits,
authorizations, approvals, and the like which are necessary in the conduct of
its business, or which may be otherwise required by law, which if not obtained
and maintained, could have a Material Adverse Effect (as hereinafter defined). 

“Material Adverse Effect” means a
material adverse effect upon (a) the condition (financial or otherwise),
operations, properties or business of any Loan Party or any guarantor of the
Borrower’s obligations hereunder, or (b) the ability of any Loan Party to
perform its obligations under the Loan Documents or any guarantor of the
Borrower’s obligations hereunder to which it is a party. 

                    (D)
Due Authorization; No Violations; Etc.
The execution and delivery by each Loan Party of, and the performance by each
Loan Party of its obligations under, the Loan Documents to which it is a party
have been duly authorized by all requisite corporate, partnership or limited
liability company action (as applicable) and do not and will not (i) violate
its articles or certificate of incorporation, articles or certificate of
organization or articles or certificate of formation (as applicable), its
bylaws, partnership agreement or operating agreement (as 

applicable),
any provision of any law, rule or regulation, any judgment, order or ruling of
any court or Governmental Authority (as hereinafter defined in Section 18 of
this Agreement) any agreement or any indenture, mortgage, or other instrument
to which any Loan Party is a party or by which any Loan Party or any of their
respective properties are bound, or (ii) be in conflict with, result in a
breach of, or constitute with the giving of notice or lapse of time, or both, a
default under any such agreement, indenture, mortgage, or other instrument. All
actions on the part of the shareholders, partners or members (as applicable) of
each Loan Party necessary in connection with the execution and delivery by each
Loan Party of, and the performance by each Loan Party of their respective
obligations under, the Loan Documents to which it is a party have been taken
and remain in full force and effect.  

                    (E)
Binding Agreement. Each of the Loan
Documents to which any Loan Party is a party is, or when executed and delivered
will be, the legal, valid, and binding obligation of such Loan Party,
enforceable against such Loan Party in accordance with its terms, subject only
to limitations on enforceability imposed by (i) applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting creditors’
rights generally, and (ii) general equitable principles. 

                    (F)
Financial Statements, Budgets, Projections, Etc.
All financial statements of any entity submitted to CoBank in connection with,
or to induce CoBank to enter into, this Agreement or any Supplement fairly and
fully present the financial condition of such entity in all material respects
and the results of such entity’s operations for the periods covered thereby,
and are prepared in accordance with generally accepted accounting principles (“GAAP”) consistently applied,
except, in
the case of any unaudited financial statements, the omission of footnotes and,
in the case of any interim financial statements, the omission of footnotes and
normal year-end adjustments. As of the date of such financial statements, there
were no material liabilities of such entity, fixed or contingent, not reflected
in such financial statements or the notes thereto. Since the date of such
financial statements, there has been no material adverse change in the
financial condition or operations of such entity. All budgets, projections,
feasibility studies, and other documentation submitted by any Loan Party to
CoBank in connection with, or to induce CoBank to enter into, such Supplement
are based upon assumptions that are reasonable and realistic, and as of the
date of such Supplement or request for advance, no fact has come to light, and
no event or transaction has occurred, which would cause any such assumption not
to be reasonable or realistic. 

                    (G)
Consents and Approvals. 

                    Except
as contemplated in Section 18 of this Agreement, no consent, permission,
authorization, order or license of any Governmental Authority or of any party
to any agreement to which any Loan Party is a party or by which it or any of
its respective property may be bound or affected, is necessary at the time this
representation is being made or remade in connection with the project,
acquisition or other activity being financed by such Supplement, the execution,
delivery, performance or enforcement of the Loan Documents or the creation and
perfection of the liens and security interests granted thereby, except as such
have been obtained and are in full force and effect or which are required in
connection with the enforcement of or exercise of remedies under any Loan
Document.  

                    (H)
Compliance. Each Loan Party is in
compliance with all of the terms of the Loan Documents to which it is a party
and no Event of Default or Potential Default exists. 

                    (I)
Compliance with Laws. Each Loan Party
is in compliance in all material respects with all laws, rules, regulations,
ordinances, codes, orders, and the like (collectively, “Laws”), the failure to comply with
which could reasonably be expected to have a Material Adverse Effect. 

                    (J)
Environmental Compliance. Without
limiting the provisions of Subsection 7(I) of this Agreement, other than
as disclosed on Schedule 7(J) to this Agreement, all property owned or
leased by any of the Loan Parties and all operations conducted by them are in
compliance in all material respects with all Laws relating to environmental
protection, the failure to comply with which could have a Material Adverse
Effect. 

                    (K)
Litigation. There are no pending legal,
arbitration, or governmental actions or proceedings to which any Loan Party is
a party or to which any their respective properties are subject which, if
adversely determined, could have a Material Adverse Effect, and to the best of
the Borrower’s knowledge, no such actions or proceedings are threatened or
contemplated. 

                    (L)
Principal Place of Business; Records.
The principal place of business and chief executive office of the Borrower and
the place where the records required by Subsection 8(F) of this
Agreement are kept is at the address of the Borrower shown in Section 15
of this Agreement. 

                    (M)
Employee Benefit Plans. Each Loan Party
is in compliance in all material respects with the applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and the regulations and
published interpretations thereunder, the failure to comply with which could
have a Material Adverse Effect. 

                    (N)
Taxes. Each Loan Party has filed or
caused to be filed prior to delinquency all federal, state and local tax returns
that are required to be filed, and has paid and shall continue to pay when due
all taxes as shown on such returns, and has paid and shall continue to pay when
due all other taxes, assessments and governmental charges or levies upon it and
its property, income, profits and assets which are due and payable, except
where the payment of such tax, assessment, government charge or levy is being
contested in good faith and by appropriate proceedings and adequate reserves in
compliance with GAAP have been set aside on such Loan Party’s books therefor. 

                    (O)
Investment Company Act. No Loan Party
is an “investment company” as that term is defined in, or is otherwise subject
to regulation under, the Investment Company Act of 1940, as amended. 

                    (P)
Use of Proceeds. The funds to be
borrowed under this Agreement and each Supplement will be used only as
contemplated thereby. No part of such funds will be used to purchase any
“margin securities” or otherwise in violation of the regulations of the Federal
Reserve System. 

                    (Q)
Subsidiaries. The Loan Parties have no
Subsidiaries other than as set forth on Schedule 7(Q) to this Agreement.
The Loan Parties are the registered and beneficial owners of the specified percentage
of the shares of issued and outstanding capital stock or other equity interests
of each of the Subsidiaries as set forth on Schedule 7(Q), which stock
and other equity interests are owned free and clear of all liens (other than
liens and security interests permitted by Subsection 9(B) of this
Agreement), warrants, options, rights to purchase, rights of first refusal and
other interests of any person other than CoBank. The stock or other equity
interests of each such Subsidiary has been duly authorized and validly issued
and is fully paid and non-assessable. 

                    (R)
Licenses; Permits; Etc. Each Loan Party
is the valid holder of all franchises, licenses, certificates, permits,
authorizations, approvals and the like which are material to the conduct of its
business or which may be required by law, including, without limitation, all
licenses and permits of the Federal Communications Commission (the “FCC”), the Minnesota Public Utilities
Commission (the “PUC”) and
the public utility commissions of any other states in which any Loan Party
operates, and all such franchises, licenses, certificates, permits,
authorizations, approvals, and the like are in full force and effect. 

                    (S)
Credit Agreements, Etc. Set forth on Schedule
7(S) hereto is a complete and correct list of all loan agreements,
incentives, guarantees, material contingent liabilities, Capital Leases (as
defined in Subsection 8(I) of this Agreement), and other credit
agreements (including agreements for the issuance of letters of credit) in
effect on the date of this Agreement in respect of which any Loan Party is in
any manner directly or contingently obligated to any party other than CoBank,
taking into account the use of the proceeds of the Loans. 

                    (T)
Title to Properties. Each Loan Party
has such title or leasehold interest in and to the real property owned or
leased by it as is necessary or desirable to the conduct of its business and
valid and legal title or leasehold interest in and to all of its personal
property, including those reflected on the financial statements of the Borrower
delivered pursuant to Subsection 8(H) of this Agreement, except those
which have been disposed of by a Loan Party subsequent to such date which
dispositions have been in the ordinary course of business or as otherwise
expressly permitted hereunder. 

                    (U)
Material Contracts. Each Loan Party has
performed all of its material obligations under all Material Contracts (as
hereinafter defined in this Subsection 7(U)) and, to the best knowledge
of such Loan Party, each other party thereto is in compliance with each such
Material Contract. Each such Material Contract is in full force and effect in
accordance with the terms thereof. The Borrower has made available a true and
complete copy of each such Material Contract for inspection by CoBank. 

“Material Contract” means (a) any
contract or any other agreement, written or oral, of any Loan Party involving
monetary liability of or to any such person in an amount in excess of $250,000
per annum and (b) any other contract or agreement, written or oral, of any Loan
Party the failure to comply with which could reasonably be expected to have a
Material Adverse Effect; provided, however, that any contract or agreement
which is terminable by a party other than any Loan Party without cause upon
notice of 90 days or less shall not be considered a Material Contract. 

                    (V)
Intellectual Property. Each Loan Party
owns, or possesses through valid licensing arrangements, the right to use all
patents, copyrights, trademarks, trade names, service marks, technology
know-how and processes used in or necessary for the conduct of its business as
currently or anticipated to be conducted (collectively, the “Intellectual Property Rights”) without
infringing upon any validly asserted rights of others. No event has occurred
which permits, or after notice or lapse of time or both would permit, the
revocation or termination of any such rights. No Loan Party has been threatened
with any litigation regarding Intellectual Property Rights that would present a
material impediment to the business of any such person. 

                    (W)
Liens. The property of each Loan Party
is subject to no lien, security interest or other encumbrance except as
permitted pursuant to Subsection 9(B) of this Agreement. 

          SECTION 8. Affirmative Covenants. Unless
otherwise agreed to in writing by CoBank, while this Agreement is in effect,
the Borrower will, and will cause each other Loan Party to: 

                    (A)
Existence, Licenses. Etc. (i) Preserve
and maintain in full force and effect its existence and good standing in the
jurisdiction of its incorporation, organization or formation (as applicable);
(ii) qualify and remain qualified to transact business in all jurisdictions
where such qualification is required by applicable Laws unless the failure to
so qualify will not have a Material Adverse Effect; and (iii) obtain and
maintain all licenses, franchises, certificates, permits, authorizations,
approvals and the like, which if not obtained and maintained, could reasonably
be expected to have a Material Adverse Effect. 

                    (B)
Compliance with Laws and Agreements.
Comply in all material respects with (i) all Laws, the failure to comply with
which could reasonably be expected to have a Material Adverse Effect, and (ii)
all agreements, indentures, mortgages, and other instruments to which any Loan
Party is a party or by which it or any of its property is bound, the failure to
comply with which could have a Material Adverse Effect. 

                    (C)
Compliance with Environmental Laws.
Without limiting the provisions of Subsection 8(B) of this Agreement,
comply in all material respects with, and cause all persons occupying or
present on any properties owned or leased by it to so comply with, all Laws
relating to environmental protection, the failure to comply with which could
have a Material Adverse Effect. 

                    (D)
Insurance. Maintain insurance with
insurance companies or associations reasonably acceptable to CoBank in such
amounts and covering such risks as are usually carried by companies engaged in
the same business and similarly situated, and make such increases in the type
or amount of coverage as CoBank may reasonably request. All such policies
insuring any collateral for the Borrower’s obligations to CoBank shall have
lender or mortgagee loss payable clauses or endorsements in form and substance
reasonably acceptable to CoBank. Such proceeds shall be applied to the extent
applicable as provided in the Loan Documents governing such collateral. At
CoBank’s request, the Borrower agrees to deliver to CoBank such proof of
compliance with this Subsection 8(D) as CoBank may reasonably require. 

                    (E)
Property Maintenance. Maintain and
preserve all of its property and each and every part and parcel thereof that is
necessary to or useful in the ordinary conduct of its business in good repair,
working order, and condition, ordinary wear and tear excepted, and in
compliance in all material respects with all applicable Laws, and make all
alterations, replacements, and improvements thereto as may from time to time be
necessary in order to ensure that its properties remain in good working order
and condition and compliance. The Borrower agrees that upon the occurrence and
continuing existence of an Event of Default, at CoBank’s request, the Borrower
will furnish to CoBank, at the Borrower’s own expense, a report on the
condition of any Loan Party’s property prepared by a professional reasonably
satisfactory to CoBank. 

                    (F)
Books and Records. Keep adequate
records and books of account in which complete and accurate entries will be
made in accordance with GAAP consistently applied. 

                    (G)
Inspection. Permit CoBank or its
representatives, upon reasonable notice and during normal business hours or at
such other times as the parties may agree, to examine any Loan Party’s
properties, books, and records, and to discuss any Loan Party’s affairs,
finances, and accounts, with any Loan Party’s officers, directors, employees,
and independent certified public accountants. 

                    (H)
Reports and Notices. Furnish, or cause
to be furnished, to CoBank: 

	
 

	
 

	
 

	
                    (1)
Annual Financial Statements. As soon
 as available, but in no event later than 120 days after the end of each
 fiscal year of the Borrower occurring during the term hereof, annual,
 audited, consolidated financial statements of the Borrower and its
 Subsidiaries prepared in accordance with GAAP consistently applied and in a
 format that demonstrates any accounting or formatting change that may be
 required by the various jurisdictions in which the business of the Borrower
 and its Subsidiaries is conducted (to the extent not inconsistent with GAAP).
 Such financial statements shall: (i) be audited by independent, nationally
 recognized, certified public accountants selected by the Borrower and
 reasonably acceptable to CoBank; (ii) be accompanied by a report of such
 accountants containing an unqualified opinion thereon acceptable to CoBank;
 (iii) be prepared in reasonable detail, and in comparative form; and (iv)
 include a balance sheet, a statement of income, a statement of stockholders’
 equity, a statement of cash flows, and all notes and schedules relating
 thereto. 

	
 

	
 

	
 

	
                    (2)
Quarterly Financial Statements. As
 soon as available but in no event later than 60 days after the end of each of
 the first three fiscal quarters of each fiscal year of the Borrower occurring
 during the term hereof, unaudited quarterly consolidated financial statements
 of the Borrower and its Subsidiaries, in each case prepared in accordance
 with GAAP consistently applied (except for the omission of footnotes and for
 the effect of normal year-end audit adjustments) and in a format that
 demonstrates any accounting or formatting change that may be required by
 various jurisdictions in which the business of the Borrower and its
 Subsidiaries is conducted (to the extent not inconsistent with GAAP). Each of
 such financial statements shall (i) be prepared in reasonable detail and in
 comparative form, including a comparison of actual 

	
 

	
 

	
 

	
performance
 to the budget for such quarter and year-to-date, delivered to CoBank under Subsection
 8(H)(3) of this Agreement, and (ii) include a balance sheet, a statement
 of income for such quarter and for the period year-to-date, and such other
 quarterly statements as CoBank may specifically request which quarterly statements
 shall include any and all supplements thereto. 

	
 

	
 

	
 

	
                    (3)
Budget. As soon as reasonably
 available, but in no event later than 90 days after the beginning of each
 fiscal year of the Borrower occurring during the term hereof, Board and
 management approved operating and capital assets budgets of the Borrower and
 its Subsidiaries for such fiscal year. 

	
 

	
 

	
 

	
                    (4)
Notice of Default. Promptly after
 becoming aware thereof, notice of (i) the occurrence of any Potential Default
 or Event of Default under any of the Loan Documents; and (ii) the occurrence
 of any breach, default, event of default, or other event or the occurrence of
 any other condition which with the giving of notice or lapse of time, or
 both, could become a breach, default, or event of default under any
 agreement, indenture, mortgage, or other instrument (other than the Loan
 Documents) to which it is a party or by which it or any of its property is
 bound or affected the occurrence of which could reasonably be expected to
 have a Material Adverse Effect; provided, however, that the
 failure to give such notice shall not affect the right and power of CoBank to
 exercise any and all of the remedies specified herein. 

	
 

	
 

	
 

	
                    (5)
Notice of Non-Environmental Litigation.
 Promptly after the commencement thereof, notice of the commencement of all
 actions, suits, or proceedings before any Governmental Authority affecting
 any Loan Party which, if determined adversely, could reasonably be expected
 to have a Material Adverse Effect. 

	
 

	
 

	
 

	
                    (6)
Notice of Environmental Litigation.
 Without limiting the provisions of Subsection 8(H)(5) of this
 Agreement, promptly after receipt thereof, notice of the receipt of all
 pleadings, orders, complaints, indictments, or any other communication
 alleging a condition that may require any Loan Party to undertake or to
 contribute to a cleanup or other response under all Laws relating to
 environmental protection, or which seek penalties, damages, injunctive relief,
 or criminal sanctions related to alleged violations of such Laws, or which
 claim personal injury or property damage to any person as a result of
 environmental factors or conditions. 

	
 

	
 

	
 

	
                    (7)
Regulatory and Other Notices.
 Promptly after filing, receipt or becoming aware thereof, copies of any
 filings or communications sent to and notices or other communications
 received by any Loan Party from any Governmental Authority, including,
 without limitation, the Securities and Exchange Commission, the FCC, the PUC,
 or any other state utility commission relating to any material noncompliance
 by such Loan Party with any Laws or with respect to any matter or proceeding
 the effect of which, if adversely determined, could have a Material Adverse Effect.
 

	
 

	
 

	
 

	
                    (8)
Material Adverse Change. Promptly
 after becoming aware thereof, notice of any matter which has had or could
 reasonably be expected to have a Material Adverse Effect. 

	
 

	
 

	
 

	
                    (9)
Compliance Certificates. Concurrently
 with each statement required to be furnished pursuant to Subsection
 8(H)(1) or 8(H)(2) of this Agreement, a compliance certificate in
 the form attached hereto as Exhibit A executed by the chief financial
 officer of the Borrower. 

	
 

	
 

	
 

	
                    (10)
Management Letters. Promptly after
 receipt thereof, a copy of any management letters submitted to any Loan Party
 by its independent certified public accountants. 

	
 

	
 

	
 

	
                    (11)
ERISA Reportable Events. Within 30
 days after it becomes aware of the occurrence of any Reportable Event (as
 defined in Section 4043 of ERISA) applicable to any Loan Party, a statement
 describing such Reportable Event and the actions it proposes to take in
 response to such Reportable Event. 

	
 

	
 

	
 

	
                    (12)
Other Information. Such other
 information regarding the condition, financial or otherwise, or operations of
 any Loan Party as CoBank may, from time to time, reasonably request. 

                    (I)
Financial Covenants. All of the
following financial covenants shall, except as expressly provided otherwise, be
determined on a consolidated basis and in accordance with GAAP consistently
applied: 

	
 

	
 

	
 

	
                    (1)
Total Leverage Ratio. The Borrower
 shall maintain at all times, measured and reported on a consolidated basis as
 of the last day of each fiscal quarter, a Total Leverage Ratio (as
 hereinafter defined in this Subsection 8(I)(1) less than or equal to
 the ratio set forth opposite the period identified below: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Period

	
 

	
 

	
Total Leverage Ratio

	
 

	
 

	
 

	 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
March 31,
 2008 through December 31, 2009

	
 

	
4.50:1.00

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
January 1,
 2010 through December 31, 2010

	
 

	
4.25:1.00

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
January 1,
 2011 through December 31, 2011

	
 

	
4.00:1.00

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
January 1,
 2012 through December 31, 2012

	
 

	
3.75:1.00

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
January 1,
 2013 and thereafter

	
 

	
3.50:1.00

	
 

	
 

	
 

	
 

	
“Total Leverage Ratio” means the ratio
 derived by dividing (i) Indebtedness (as hereinafter defined in this Subsection
 8(I)(1)) on the date of the calculation by (ii) EBITDA (as
 hereinafter defined in this Subsection 8(I)(1)) for the then most
 recently completed four fiscal quarters; provided, that (a) for the
 fiscal quarter ending March 31, 2008, EBITDA shall be calculated for the then
 most recently completed fiscal quarter multiplied by four, (b) for the fiscal
 quarter ending June 30, 2008, EBITDA shall be calculated for the then most
 recently completed two fiscal quarters multiplied by two, and (c) for the
 fiscal quarter ending September 30, 2008, EBITDA shall be calculated for the
 then most recently completed three fiscal quarters multiplied by 1.33. 

	
 

	
 

	
 

	
“Indebtedness” means the sum of (i)
 obligations for borrowed money, including the principal amount of any
 outstanding Loans, (ii) obligations representing the deferred purchase price
 of property or services other than accounts payable arising in connection
 with the purchase of goods or services on terms customary in the trade and
 not outstanding more than 90 days unless contested in good faith, (iii)
 obligations, whether or not assumed, secured by liens or a pledge of or an
 encumbrance on the proceeds or production from property now or hereafter
 owned or acquired, (iv) obligations which are evidenced by notes, bonds,
 debentures, acceptances or other instruments, (v) net termination obligations
 under Interest Rate Agreements not hedging Borrower’s interest rate under the
 Loans, calculated as of any date of calculation as if such agreements or
 arrangements were terminated as of such date, (vi) that portion of any obligation
 with respect to leases of real or personal property which is required to be
 capitalized under GAAP or which is treated as operating leases under
 regulations applicable to them but which otherwise would be required to be
 capitalized under GAAP (each a “Capital
 Lease”), (vii) the net present value of future extraordinary
 executive compensation, and (vii) obligations with respect to principal under
 guarantees and other contingent obligations with respect to the payment of
 money, whether or not due and payable. 

	
 

	
 

	
 

	
“EBITDA” means the sum of (i)
consolidated net income, or deficit, as the case may be (excluding
extraordinary gains and losses and the write up of any asset), plus (ii) the
following items, to the extent deducted in determining consolidated net
income: (a) total interest expense (including non-cash interest), (b)
provision for income taxes, (c) depreciation and amortization expenses, (d)
unrealized losses on financial derivatives recognized in accordance with SFAS
No. 133, (e) extraordinary executive compensation, minus (iii) the following
items, to the extent included in determining consolidated net income: (x)
unrealized gains on financial derivatives recognized in accordance with SFAS
No. 133, (y) interest, dividend and patronage income, and (z) income from
unconsolidated subsidiaries, partnerships and joint ventures. EBITDA shall be
measured for the then most recently completed four fiscal quarters, adjusted
to give effect to any acquisition, sale or other disposition, directly or
through a subsidiary, of any operation or business (or any portion thereof)
during the period of calculation as if such acquisition, sale or other
disposition occurred on the first day of such period of calculation.  

	
 

	
 

	
 

	
                    (2)
Debt Service Coverage Ratio. The
 Borrower shall maintain at all times, measured and reported on a consolidated
 basis as of the last day of each fiscal quarter, a Debt Service Coverage
 Ratio (as hereinafter defined in this Subsection 8(I)(2)) equal to or
 greater than the ratio set forth opposite the period identified below: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Periods

	
 

	
 

	
Debt Service Coverage Ratio

	
 

	
 

	
 

	 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
March 31,
 2008 through December 31, 2010

	
 

	
2.25:1.00

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
January 1,
 2011, and thereafter

	
 

	
1.50:1.00

	
 

	
 

	
 

	
 

	
“Debt Service Coverage Ratio” means the
ratio derived by dividing (i) the total of: (a) EBITDA plus (b)
cash interest, dividends and patronage income minus (c) cash income
taxes and dividends and distributions by (ii) the sum of: (y) all
principal payments  

	
 

	
 

	
 

	
scheduled
 (as opposed to mandatory repayments pursuant to Section 4 of this
 Agreement or any voluntary prepayments) to be made on Indebtedness (or
 scheduled reductions in commitments on lines of credit to the extent such
 reductions would cause the repayment of principal amounts then outstanding
 under such lines) plus (z) cash interest expense, each for the then
 most recently completed four fiscal quarters; provided that (i) for
 the fiscal quarter ending March 31, 2008, each item shall be calculated for
 the then most recently completed fiscal quarter, (ii) for the fiscal quarter
 ending June 30, 2008, each item shall be calculated for the then most
 recently completed two fiscal quarters, and (iii) for the fiscal quarter
 ending September 30, 2008, each item shall be calculated for the then most
 recently completed three fiscal quarters. 

	
 

	
 

	
 

	
                    (3)
Equity to Total Assets Ratio. The
 Borrower shall maintain at all times, measured and reported on a consolidated
 basis as of the last day of each fiscal quarter, an Equity to Total Assets
 Ratio (as hereinafter defined in this Subsection 8(I)(3)) of greater
 than 40%. 

	
 

	
 

	
 

	
“Equity to Total Assets Ratio” means the
ratio derived by dividing (i) the result of (a) total assets minus (b)
total liabilities by (ii) total assets, each as of the date of calculation. 

	
 

	
 

	
 

	
                    (4)
Maximum Annual Capital Expenditures.
 Commencing with the year ending December 31, 2008, capital expenditures of
 the Borrower and its Subsidiaries, measured and reported on a consolidated basis
 as of each fiscal year end, shall not for such fiscal year exceed the sum of
 (i) $6,000,000 plus (ii) the excess, if any, of $6,000,000 over the
 actual amount of capital expenditures for the immediately preceding fiscal
 year if the Total Leverage Ratio for the fiscal quarter in which such capital
 expenditure is made or for any succeeding fiscal quarter for the fiscal year
 in which any capital expenditure is made is equal to or greater than
 3.00:1.00 on a pro forma basis. 

                    (J)
Capital. Acquire non-voting
participation certificates in CoBank in such amounts and at such times as
CoBank may from time to time require in accordance with its Bylaws and Capital
Plan (as each may be amended from time to time), except that the maximum amount
of non-voting participation certificates that the Borrower may be required to
purchase in connection with a Loan may not exceed the maximum amount permitted
by the Bylaws at the time the Supplement relating to such Loan is entered into
or such Loan is renewed or refinanced by CoBank. The rights and obligations of
the parties with respect to such non-voting participation certificates and any
patronage or other distributions made by CoBank shall be governed by CoBank’s
Bylaws and Capital Plan (as each may be amended from time to time). 

                    (K)
Taxes. File or caused to be filed prior
to delinquency all federal, state and local tax returns that are required to be
filed, and pay when due all taxes as shown on such returns, and pay when due
all other taxes, assessments and governmental charges or levies upon any Loan
Party and any Loan Party’s property, income, profits and assets which are due
and payable, except where the payment of such tax, assessment, government
charge or levy is being contested in good faith and by appropriate proceedings
and adequate reserves in compliance with GAAP have been set aside on such Loan
Party’s books therefor. 

          SECTION 9. Negative Covenants. Unless
otherwise agreed to in writing by CoBank, while this Agreement is in effect the
Borrower will not and will cause the other Loan Parties not to: 

                    (A)
Borrowings. Create, incur, assume, or
allow to exist, directly or indirectly, any Indebtedness except for (i)
Indebtedness to CoBank, (ii) Indebtedness under purchase money security
agreements and Capital Leases, the aggregate principal amount of which shall
not exceed $100,000 at any one time, and (iii) Indebtedness of the Loan Parties
existing as of the date hereof and described on part (i) of Schedule
7(S). 

                    (B)
Liens. Create, incur, assume, or allow
to exist any mortgage, deed of trust, pledge, lien (including the lien of an
attachment, judgment, or execution), security interest, or other encumbrance of
any kind upon any of its property, real or personal except as hereinafter
provided. The foregoing restrictions shall not apply to (i) liens in favor of
CoBank; (ii) liens for taxes, assessments, or governmental charges that are not
past due, unless the same are being contested in good faith and by appropriate
proceedings and then only if and to the extent reserves required by GAAP have
been set aside therefor; (iii) liens, pledges, and deposits under workers’
compensation, unemployment insurance, social security and similar laws; (iv)
liens, deposits, and pledges to secure the performance of bids, tenders,
contracts (other than contracts for the payment of money), and like obligations
arising in the ordinary course of its business; (v) liens imposed by law in
favor of mechanics, materialmen, warehousemen, lessors and like persons that
secure obligations that are not past due, unless the same are being contested
in good faith and by appropriate proceedings and then only if and to the extent
reserves required by GAAP have been set aside therefor; (vi) liens constituting
encumbrances in the nature of zoning restrictions, easements and rights or
restrictions of record on the use of real property of any Loan Party that, in
the reasonable judgment of CoBank, do not materially detract from the value of
such real property or impair the use thereof in such Loan Party’s business;
(vii) judgment liens, provided enforcement thereof is effectively stayed and
the claims secured thereby are being contested in good faith by appropriate
proceedings and for which reserves have been established in accordance with
GAAP; (viii) purchase money security interests and Capital Leases securing
Indebtedness permitted under Subsection 9(A)(ii) of this Agreement in an
amount not to exceed the cost incurred to acquire or lease such property,
provided further that such security interests and leases do not encumber any
property other than the items purchased with the proceeds thereof or leased
thereby; (ix) liens securing guarantees in effect on or prior to the date
hereof and described on part (ii) of Schedule 7(S); (x) liens in
favor of Rural Telephone Finance Cooperative (“RTFC”), provided such liens only encumber Hutchinson’s
patronage capital in RTFC; and (xi) customary offset rights arising in the
ordinary course of business of brokers and depository banks arising under
applicable Law or the terms of a Loan Party’s deposit agreement with such
entity. 

                    (C)
Contingent Liabilities. Assume,
guarantee, become liable as a surety, endorse, contingently agree to purchase,
or otherwise be or become liable, directly or indirectly (including, but not
limited to, by means of a maintenance agreement, an asset or stock purchase
agreement, or any other agreement designed to ensure any creditor against loss),
for or on account of the obligation of any person or entity, except (i) for
Indebtedness to CoBank, (ii) those certain guarantees existing as of the date
hereof and described on part (iii) of Schedule 7(S), (iii) for
other Indebtedness the aggregate principal amount of which shall not exceed 

$200,000 at
any one time, and (iv) by the endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of a Loan Party’s
business. 

                    (D)
Fundamental Changes. (i) Unless, and
only to the extent required by law, amend, modify or waive any provision of its
articles or certificate of incorporation, articles or certificate of
organization, articles or certificate of formation (as applicable), bylaws, partnership
agreement or operating agreement (as applicable), (ii), except for the Merger,
merge or consolidate with any other entity or acquire all or substantially all
of the assets of any person or entity, (iii) form or create any Subsidiary,
(iv) commence operations under any other name (without providing CoBank 30
days’ prior written notice thereof), organization, or entity, including any
joint venture, or (v) issue any additional capital stock or ownership
interests. 

                    (E)
Transfer of Assets. Sell (including,
without limitation, pursuant to a sale and leaseback transaction) transfer,
lease (including, without limitation, pursuant to a lease and leaseback
transaction), enter into any contract for the sale, transfer or lease of, or
otherwise dispose of, any of its assets, except (i) bona fide sales of
inventory in the ordinary course of its business, (ii) dispositions of obsolete
equipment not used or useful in the business of a Loan Party in the ordinary
course of business, (iii) those Investments described in Subsection 9(F)
(excluding the Investments described in clause (ii) of Subsection
9(F)), which are marketable, for fair market value; (iv) distributions
permitted by Subsection 9(I) of this Agreement; (v) leases of real
property between the Loan Parties; (vi) the assets, rights and Investments
described on Schedule 9(E) for fair market value, and (vii) the personal
property identified in that certain Mutual Termination Agreement, dated as of
even date herewith, by and among Walter S. Clay, Borrower, and Hutchinson
Telephone Company. 

                    (F)
Loans and Investments. After the date
hereof, make any loan or advance to, invest in, purchase or make any commitment
to purchase any stock, bonds, notes, or other securities of, any person or
entity, excluding customary deposit and similar accounts with banking
institutions arising in the ordinary course of a Loan Party’s business (each,
whether made directly or indirectly, an “Investment”)
other than (i) the Investments existing on the date hereof as set forth on Schedule
9(F) and Schedule 9(E), (ii) stock or other securities of, or
investments in CoBank or CoBank investment services or programs, (iii)
marketable direct obligations issued or unconditionally guaranteed by the United
States government or issued by any agency thereof and backed by the full faith
and credit of the United States, in each case maturing within one year from the
date of acquisition thereof, (iv) commercial paper maturing no more than one
year from the date issued and, at the time of acquisition, having a rating of
at least A- from Standard & Poor’s Rating Service or at least A3 from
Moody’s Investors Service, Inc., (v) certificates of deposit or bankers’
acceptances maturing within 1 year from the date of issuance thereof issued by,
or overnight reverse repurchase agreements from, any commercial bank organized
under the laws of the United States of America or any state thereof or the
District of Columbia having combined capital and surplus of not less than $500,000,000,
(vi) time deposits maturing no more than 30 days from the date of creation
thereof with commercial banks having membership in the Federal Deposit
Insurance Corporation in amounts at any one such institution not exceeding the
lesser of $100,000 or the maximum amount of insurance applicable to the
aggregate amount of Borrower’s deposits at such institution, (vii) additional
units in ENTEL Communications, LLC (“Entel”)
with a purchase price not to exceed $2,100,000, and 

(viii) other
Investments in an aggregate amount (based upon original acquisition cost
thereof) outstanding at any time not exceeding $250,000. 

                    (G)
Change in Business. Engage in any business activity or
operation different from or unrelated to such Loan Party’s present business
activities and operations. 

                    (H)
Disposition of Licenses. Sell, assign, transfer or
otherwise dispose of, or attempt to dispose of, in any way, or fail to preserve
and maintain any franchise, license, certificates, permits, authorization,
approvals and the like which may be required by law or which are material to
the conduct of its business, the disposition of which could have a Material
Adverse Effect. 

                    (I)
Dividends and Other Distributions. Directly or
indirectly declare, order, pay, make or set apart any sum for any dividend or
any other distribution of assets to the Borrower’s shareholders or retire,
redeem, purchase or otherwise acquire for value any capital stock or other
ownership interest of the Borrower; provided, however, the
Borrower may declare or pay lawful distributions or purchase or acquire its
capital stock (i) in an aggregate amount of up to $2,050,000 in any fiscal year
if no Potential Default or Event of Default then exists or will result in the
succeeding 12 months after such distribution or stock repurchase, based in each
case upon the budgets delivered to CoBank pursuant to Subsection 8(H)(3)
of this Agreement and reasonably acceptable to CoBank and (ii) in any amount in
any fiscal year if (a) the Borrower’s Total Leverage Ratio for the fiscal
quarter in which the dividend or distribution is made and each remaining
succeeding fiscal quarter of the fiscal year in which the dividend or
distribution is made on a pro forma basis equals or is less than 3.50:1.00 and
(b) no Potential Default or Event of Default then exists or will result in the
succeeding 12 months after such distribution or stock repurchase, based in each
case upon the budgets delivered to CoBank pursuant to Subsection 8(H)(3)
of this Agreement and reasonably acceptable to CoBank. 

                    (J)
Transactions with Affiliates. Directly or indirectly
to enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property or the rendering of any service) with any
Affiliate (as hereinafter defined) or with any director, officer or employee of
any Loan Party or any Affiliate of any Loan Party, except (i) the transactions
in the ordinary course of and pursuant to the reasonable requirements of the
business of such Loan Party and upon fair and reasonable terms which are fully
disclosed to CoBank and are no less favorable to such Loan Party than would be
obtained in a comparable arm’s length transaction with a person or entity that
is not an Affiliate, (ii) transactions among the Loan Parties, (iii) payment of
compensation to directors, officers and employees in the ordinary course of
business for services actually rendered in their capacities as directors,
officers and employees, provided such compensation is reasonable and comparable
with compensation paid by companies of like nature and similarly situated, and
(iv) deferred extraordinary executive compensation as described in Schedule
9(J). Notwithstanding the foregoing, upon the election of CoBank, no
payments may be made with respect to any items set forth in clause (i) of the
preceding sentence upon the occurrence and during the continuation of a
Potential Default or an Event of Default. 

“Affiliate” means any person or entity:
(i) directly or indirectly controlling, controlled by, or under common control
with, any Loan Party; (ii) directly or indirectly owning or holding five 

percent (5%)
or more of any equity interest in any Loan Party; or (iii) five percent (5%) or
more of whose voting stock or other equity interest is directly or indirectly
owned or held by any Loan Party, provided that the beneficial, and not the
legal, holder of title to any equity interest in any Loan Party shall be deemed
an Affiliate. For purposes of this definition, “control” (including with
correlative meanings, the terms “controlling,” “controlled by” and “under
common control with”) means the possession directly or indirectly of the power
to direct or cause the direction of the management and policies of a person,
whether through the ownership of voting securities or by contract or otherwise. 

                    (K)
Management Fees and Compensation. Directly or
indirectly pay any management, consulting or other similar fees to any person,
except legal or consulting fees paid to persons or entities that are not
Affiliates of any Loan Party for services actually rendered and in amounts
typically paid by entities engaged in such Loan Party’s business and deferred
extraordinary executive compensation as described in Schedule 9(J). 

                    (L)
Negative Pledge to Other Entities. Grant a negative
pledge upon any of its property, real or personal, in favor of any other lender
of any Loan Party, except in connection with indebtedness under purchase money
security agreements and Capital Leases permitted under clause (ii) of Subsection
9(A) of this Agreement, provided that such negative pledge only relates to
items purchased with the proceeds thereof or leased thereby.  

          SECTION
10. Events of Default. Each of the following shall
constitute an “Event of Default”
under this Agreement: 

                    (A)
Payment Default. The Borrower should fail to make any
payment to CoBank when due hereunder, under any Note, any Supplement, any
Interest Rate Agreement provided by CoBank or under any other Loan Document to
which it is a party, or should fail to make any investment in CoBank required
to be made hereunder when due. 

                    (B)
Representations and Warranties. Any opinion, certificate
or like document furnished to CoBank by or on behalf of any Loan Party, or any
representation or warranty made herein, in any Note, any Supplement or in any
other Loan Document, or any factual statement made in any certificate delivered
in connection therewith shall prove to have been false or misleading in any
material respect on or as of the date made or deemed made. 

                    (C)
Certain Affirmative Covenants. Any Loan Party should
fail to perform or comply with any covenant set forth in Section 8 of this
Agreement (other than Subsections 8(H)(4) through Subsection 8(H)(8)
and Subsection 8(I)) and such failure continues for 30 days after
written notice thereof shall have been delivered by CoBank to the Borrower. 

                    (D)
Other Covenants and Agreements. The Borrower should
fail to perform or comply with Subsections 8(H)(4) through Subsection
8(H)(8), Subsection 8(I), or any other covenant or agreement
contained herein or in any other Loan Document or should use the proceeds of
any Loan for an unauthorized purpose. 

                    (E)
Cross-Default. (i) The occurrence of a breach,
default, or event of default under any other Loan Document, (ii) the failure,
after any applicable grace period, on the part of any Loan Party or any other
entity that is a party to any other Loan Document, to observe, keep 

or perform any
covenant or agreement contained in any other Loan Document, or (iii) the
failure, after any applicable grace period, on the part of any Loan Party or
any other entity that is a party to any other Loan Document to observe, keep or
perform any covenant or agreement contained in any agreement (other than the
Loan Documents) between such entity and CoBank or any affiliate of CoBank
(including, without limitation, Farm Credit Leasing Services Corporation),
including, without limitation, any guaranty, loan agreement, lease, security
agreement, subordination agreement, mortgage, deed to secure debt, or deed of
trust. 

                    (F)
Other Indebtedness. Any Loan Party or any other
guarantor of the Borrower’s obligations hereunder should fail to pay when due
any Indebtedness in a principal amount in excess of $250,000or any other event occurs which, under any
agreement or instrument relating to such Indebtedness or obligation, has the
effect of accelerating or permitting the acceleration of such Indebtedness or
obligation, whether or not such Indebtedness or obligation is actually
accelerated or, whether or not such Indebtedness is actually accelerated or the
right to accelerate is conditioned on the giving of notice, the passage of
time, or otherwise, or such person or entity commences the exercise of its
remedies against such Loan Party or such guarantor or any of their respective
assets. 

                    (G)
Judgments. A judgment, decree, or order for the
payment of money in excess of $250,000 should be rendered against any Loan
Party or other any guarantor of the Borrower’s obligations hereunder and
either: (i) enforcement proceedings should have been commenced; (ii) a lien
prohibited under Subsection 9(B) of this Agreement shall have been
obtained; or (iii) such judgment, decree, or order should continue unsatisfied
and in effect for a period of 30 consecutive days without being vacated,
discharged, satisfied, or stayed pending appeal. 

                    (H)
Insolvency, Etc. Any Loan Party or any other guarantor
of the Borrower’s obligations hereunder should: (i) become insolvent or should
generally not, or should be unable to, or should admit in writing its inability
to, pay its debts as they come due; or (ii) suspend its business operations or
a material part thereof or make an assignment for the benefit of creditors; or
(iii) apply for, consent to, or acquiesce in the appointment of a trustee,
receiver, or other custodian for it or any of its property or, in the absence
of such application, consent, or acquiescence, a trustee, receiver, or other
custodian is so appointed; or (iv) commence or have commenced against it any
proceeding under any bankruptcy, reorganization, arrangement, readjustment of
debt, dissolution, or liquidation Law of any jurisdiction, which, in the case
of a proceeding commenced against any Loan Party or any other guarantor of the
Borrower’s obligations hereunder, is not dismissed within 45 days. 

                    (I)
Material Adverse Change. Any event, change or
condition not referred to elsewhere in this Section 10 should occur
which results in a Material Adverse Effect. 

                    (J)
Guarantees, Etc. Any guarantee, suretyship,
subordination agreement, maintenance agreement, or other agreement furnished in
connection with the Borrower’s obligations hereunder and under any Supplement
or any Note shall, at any time, cease to be in full force and effect, or shall
be revoked or declared null and void, or the validity or enforceability thereof
shall be contested by the guarantor, surety or other maker thereof
(individually or collectively, the “Guarantor”),
or the Guarantor shall deny any further liability

or obligation
thereunder, or shall fail to perform its obligations thereunder, or any
representation or warranty set forth therein shall be breached, or the
Guarantor shall breach or be in default under the terms of any other agreement
with CoBank (including any loan agreement or security agreement), or a default
set forth in Subsection 10(F) through Subsection 10(I) of this
Agreement shall occur with respect to the Guarantor or the Guarantor shall die
or be determined to be legally incompetent. 

                    (K)
Security. Any security agreement or other agreement
executed by any of the Loan Parties or any other entity (other than CoBank)
intended to create a valid and perfected first-priority lien in favor of
CoBank, security interest or security title in property as described in a
Supplement shall for any reason (other than upon payment in full of the
obligations secured thereby) fail (i) to create a valid and perfected lien,
security interest, or security title (subject only to such exceptions as are
therein permitted) as contemplated by the Supplement, or (ii) to secure
thereunder the obligations purported to be secured thereby. 

                    (L)
ERISA Pension Plans. (i) Any Loan Party or any
guarantor of the Borrower’s obligations hereunder fails to make full payment
when due of all amounts which, under the provisions of any employee benefit
plans or any applicable provisions of the Internal Revenue Code of 1986, as
amended from time to time and all rules promulgated thereunder, and any
successor statute and regulations (the “IRC”),
are required to pay as contributions thereto, and such failure results in or
could reasonably be expected to have a Material Adverse Effect; or (ii) an
accumulated funding deficiency occurs or exists whether or not waived, with
respect to any such employee benefit plans; or (iii) any employee benefit plan
of any Loan Party or any guarantor of the Borrower’s obligations hereunder
loses its status as a qualified plan under the IRC and such loss results in or
could reasonably be expected to have a Material Adverse Effect. 

                    (M)
Licenses and Permits. (i) The loss, suspension or
revocation of, or failure to renew, any franchise, license, certificate,
permit, authorization, approval or the like now held or hereafter acquired by
any Loan Party, if such loss, suspension, revocation or failure to renew could
reasonably be expected to have a Material Adverse Effect or (ii) receipt of
notice from any regulatory or Governmental Authority to the effect that such
authority intends to replace the management of any Loan Party or assume control
over any Loan Party. 

                    (N)
Material Contracts. Any Loan Party should breach or be
in default under a Material Contract in any material respect.

                    (O)
Change in Control or Management. The Borrower should
fail to own, in the aggregate, directly or indirectly, 100% of the outstanding
equity interests of the Subsidiaries existing on the date hereof.

          SECTION
11. Remedies. Upon the occurrence and during the
continuance of an Event of Default or any Potential Default, CoBank shall have
no obligation to continue to extend credit to the Borrower under any Note or
any Supplement and may discontinue doing so at any time without prior notice.
Upon the occurrence of an Event of Default under Subsection 10(H) of
this Agreement, the entire unpaid principal balance of the Loans, all accrued
interest thereon, and all other amounts payable under this Agreement, all
Supplements, all Notes and all other Loan Documents and all other agreements
between CoBank and the Borrower shall become 

immediately
due and payable without protest, presentment, demand or further notice of any
kind, all of which are hereby expressly waived by the Borrower. In addition,
upon the occurrence and during the continuance of any Event of Default, CoBank
may:

                    (A)
Termination and Acceleration. Terminate any commitment
and declare the entire unpaid principal balance of the Loans, all accrued
interest thereon, and all other amounts payable under this Agreement, all
Supplements, all Notes and the other Loan Documents to be immediately due and
payable. Upon such a declaration, the unpaid principal balance of the Loans and
all such other amounts shall become immediately due and payable, without
protest, presentment, demand, or further notice of any kind, all of which are
hereby expressly waived by the Borrower. 

                    (B)
Enforcement. Proceed to protect, exercise, and enforce
such rights and remedies as may be provided by this Agreement, any other Loan
Document or under applicable Laws. Each and every one of such rights and
remedies shall be cumulative and may be exercised from time to time, and no
failure on the part of CoBank to exercise, and no delay in exercising, any
right or remedy shall operate as a waiver thereof, and no single or partial
exercise of any right or remedy shall preclude any other or future exercise
thereof, or the exercise of any other right. Without limiting the foregoing,
CoBank may hold and/or set off and apply against the Borrower’s obligations to
CoBank the proceeds of any equity in CoBank, any cash collateral held by
CoBank, or any balances held by CoBank for the Borrower’s account (whether or
not such balances are then due). 

                    (C)
Application of Funds. Apply all payments received by
it to the Borrower’s obligations to CoBank in such order and manner as CoBank
may elect in its sole discretion; provided that any payments received from any
guarantor or from any disposition of any collateral provided by such guarantor
shall only be applied against obligations guaranteed by such guarantor.  

                    (D)
Default Rate of Interest. In addition to the rights
and remedies set forth above and notwithstanding any Note or Supplement: (i) if
the Borrower fails to purchase any equity in CoBank when required or fails to
make any payment to CoBank when due, then at CoBank’s option in each instance,
such obligation or payment shall bear interest from the date due to the date
paid at 4% per annum in excess of the rate of interest that would otherwise be
applicable to such obligation or payment (and in the case of payment
obligations for other than principal on the Loans, 6.50% in excess of CoBank’s
announced “Base Rate”), (ii) upon the occurrence and during the continuance of
an Event of Default, at CoBank’s option in each instance, the unpaid balances
of the Loans shall bear interest at 4% per annum in excess of the rate(s) of
interest that would otherwise be in effect on the Loans under the terms of the
Notes and Supplements and (iii) after the maturity of any Loan, whether by
reason of acceleration or otherwise, the unpaid principal balance of the Loan
(including without limitation, principal, interest, fees and expenses) shall
automatically bear interest at 6.50% per annum in excess of CoBank’s announced
“Base Rate”. All interest provided for herein shall be payable on demand and
shall be calculated from the date any such payment was due to the date paid on
the basis of a year consisting of 360 days. 

          SECTION
12. Complete Agreement, Amendments. This Agreement,
the Notes, the Supplements and the other Loan Documents are intended by the
parties to be a complete and final expression of their agreement. No amendment,
modification, or waiver of any provision of this Agreement or the other Loan
Documents, and no consent to any departure by any Loan Party herefrom or
therefrom, shall be effective unless approved by CoBank and contained in a
writing signed by or on behalf of CoBank, and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given. In the event this Agreement is amended or restated, each such
amendment or restatement shall be applicable to all Notes and Supplements
hereto. Each Note and each Supplement shall be deemed to incorporate all of the
terms and conditions of this Agreement as if fully set forth therein. Without
limiting the foregoing, any capitalized term utilized in any Note or any
Supplement (or in any amendment to this Agreement or any Note or any
Supplement) and not otherwise defined in the Note or the Supplement (or
amendment) shall have the meaning set forth herein. 

          SECTION
13. Other Types of Credit. From time to time, CoBank
may issue letters of credit or extend other types of credit to or for the
account of the Borrower. In the event the parties desire to do so under the
terms of this Agreement, such extensions of credit may be set forth in any
Supplement and this Agreement shall be applicable thereto. 

          SECTION
14. Applicable Law. Except to the extent governed by
applicable federal law, this Agreement, each Note and each Supplement shall be
governed by and construed in accordance with the laws of the State of Colorado,
without reference to choice of law doctrine. 

          SECTION
15. Notices. All notices hereunder or under any Note
or any Supplement shall be in writing and shall be deemed to be duly given upon
delivery if personally delivered or sent by telegram or facsimile transmission
(electronic confirmation received), or 3 days after mailing if sent by express,
certified or registered mail, to the parties at the following addresses (or
such other address for a party as shall be specified by like notice): 

	
 

	
 

	
 

	
 

	
If to CoBank,
 as follows:

	
 

	
If to the
 Borrower, as follows:

	
 

	
 

	
 

	
 

	
CoBank, ACB

	
 

	
New Ulm
 Telecom, Inc.

	
Interchange
 Tower, Suite 300

	
 

	
400 Second
 Street North

	
600 Highway
 169 South

	
 

	
P.O. Box 697

	
Minneapolis,
 MN 55426-1219

	
 

	
New Ulm,
 Minnesota 56073-0697

	
Attn: 

	
Communications
 and Energy

	
 

	
Attn:
 Manager

	
 

	
Banking Group

	
 

	
Fax No.:
 507-354-1982

	
Fax No.:
 (303) 796-1433

	
 

	
 

	
 

	
 

	
 

	
 

	
with a copy
 to:

	
 

	
with a copy
 to:

	
 

	
 

	
 

	
 

	
CoBank, ACB

	
 

	
Lindquist
 & Vennum PLLP

	
5500 South
 Quebec Street

	
 

	
4200 IDS
 Center

	
Greenwood
 Village, Colorado 80111

	
 

	
80 South
 Eighth Street

	
Attn: 

	
Communications
 and Energy

	
 

	
Minneapolis,
 Minnesota 55402

	
 

	
Banking
 Group

	
 

	
Attn: Thomas
 Lovett

	
Fax No.:
 303-224-2718

	
 

	
Fax No.:
 612-371-3207

	
 

	
 

	
 

	
 

          SECTION
16. Costs, Expenses and Taxes. To the extent allowed by
law, the Borrower agrees to pay all reasonable out-of-pocket costs and expenses
(including the fees and expenses of counsel retained or employed by CoBank)
incurred by CoBank in connection with the origination, negotiation,
documentation, administration, amendment, waiver, extension, collection, and
enforcement of this Agreement and the other Loan Documents, including, without
limitation, all costs and expenses incurred in obtaining, perfecting,
maintaining, determining the priority of, and releasing any security for the
Borrower’s obligations to CoBank, and any stamp, intangible, transfer, or like
tax payable in connection with this Agreement or any other Loan Document or the
recording hereof or thereof. 

          SECTION
17. Effectiveness and Severability. 

          This Agreement
shall continue in effect until: (i) all indebtedness and obligations of the
Borrower under this Agreement, all Supplements, all Notes and all other Loan
Documents shall have been paid or satisfied; (ii) CoBank has no commitment to
extend credit to or for the account of the Borrower under any Supplement; and
(iii) either party sends written notice to the other terminating this
Agreement. Any provision of this Agreement or any other Loan Document which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or thereof. 

          SECTION
18. Regulatory Approvals. Upon any action by CoBank to
commence the exercise of remedies hereunder, or under the Supplements or other
Loan Documents, the Borrower hereby undertakes and agrees on behalf of itself
and its Subsidiaries to cooperate and join with CoBank and to cause its
Subsidiaries to cooperate and join with CoBank in any application to any
regulatory body (including the FCC, the PUC or any other state commission),
administrative agency, court or other forum (any such entity, a “Governmental Authority”) 

with respect
thereto and to provide such assistance in connection therewith as CoBank may
request, including, without limitation, the preparation of filings and
appearances of officers and employees of the Borrower and its Subsidiaries
before such Governmental Authority, in each case in support of any such
application made by CoBank, and neither the Borrower nor its Subsidiaries
shall, directly or indirectly, oppose any such action by CoBank before any such
Governmental Authority. 

          SECTION
19. Successors and Assigns. This Agreement, each Note,
each Supplement, and the other Loan Documents shall be binding upon and inure
to the benefit of the Borrower and CoBank and their respective successors and
assigns, except that the Borrower may not assign or transfer its rights or
obligations under this Agreement, any Supplement or any other Loan Document
without the prior written consent of CoBank. 

          SECTION
20. Consent to Jurisdiction. To the maximum extent
permitted by law, the Borrower agrees that any legal action or proceeding with
respect to this Agreement or any of the other Loan Documents may be brought in
the courts of the State of Colorado, or of the United States of America for the
District of Colorado, all as CoBank may elect. By execution of this Agreement,
the Borrower hereby irrevocably submits to each such jurisdiction, expressly
waiving any objection it may have to the laying of venue by reason of its
present or future domicile. Nothing contained herein shall affect the right of
CoBank to commence legal proceedings or otherwise proceed against the Borrower
in any other jurisdiction or to serve process in any manner permitted or
required by law. 

          SECTION
21. Waiver of Jury Trial. THE BORROWER AND COBANK
HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY SUPPLEMENT, ANY OTHER
LOAN DOCUMENT, OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF
THIS AGREEMENT AND THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.
THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL
DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER
OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THE
BORROWER AND COBANK ACKNOWLEDGE THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THE WAIVER
IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL CONTINUE TO RELY ON THE
WAIVER IN THEIR RELATED FUTURE DEALINGS. THE BORROWER AND COBANK FURTHER
WARRANT AND REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL
COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING
THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THE LOAN DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE
LOANS. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A 

TRIAL BY THE
COURT. THE BORROWER AND COBANK ALSO WAIVE ANY BOND OR SURETY OR SECURITY UPON
SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF COBANK. 

          SECTION
22. Counterparts. This Agreement, each Note, each
Supplement and any other Loan Document may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original and shall be binding
upon all parties and their respective permitted successors and assigns, and all
of which taken together shall constitute one and the same agreement. 

          SECTION
23. Participations, Etc. From time to time, CoBank may
sell to one or more banks, financial institutions or other lenders a
participation in one or more of the loans or other extensions of credit made
pursuant to this Agreement and any Note and any Supplement. However, no such
participation shall relieve CoBank of any commitment made to the Borrower
hereunder. In connection with the foregoing, CoBank may disclose information
concerning the Borrower, any other Loan Party and any guarantor of the
Borrower’s obligation hereunder and under such Note and such Supplement, if
any, to any participant or prospective participant, provided that such
participant or prospective participant agrees to keep such information
confidential. CoBank agrees that all loans that are made by CoBank and that are
retained for its own account and are not included in a sale of a participation
interest shall be entitled to patronage distributions in accordance with the
bylaws of CoBank and its practices and procedures related to patronage
distribution. Accordingly, all loans that are included in a sale of a
participation interest may not receive patronage distributions. Patronage
distributions in the event of a sale of a participation interest shall be
governed by CoBank’s Bylaws and Capital Plan (as each may be amended from time
to time). A sale of a participation interest may include certain voting rights
of the participants regarding the Loan hereunder (including, without
limitation, the administration, servicing and enforcement thereof). CoBank agrees
to give written notification to the Borrower of any sale of a participation
interest. 

[Signatures commence on following page.]

          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 their respective duly authorized officer as
of the date first shown above. 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
NEW ULM TELECOM, INC.

	
 

	
 

	
 

	
 

	
 

	
By:    /s/ 
Nancy Blakenhagen 

	
 

	
 

	
 

	
 

	
Name: Nancy
 Blakenhagen

	
 

	
 

	
Title: Chief
 Financial Officer

	
 

	
 

	
 

	
 

	 
	
 

	
COBANK, ACB

	
 

	
 

	
 

	
 

	
 

	
By:    /s/  Roger
Opp 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
Name: Roger
 Opp,

	
 

	
 

	
 

	
Title:   Vice
 PresidentNEW ULM TELECOM, INC. EXHIBIT 10.3 TO FORM 8-K DATED DECEMBER 31, 2007

Exhibit 10.3  

CLOSING TABLE COPY

Loan
No. ML RX0583-T1

FIRST SUPPLEMENT

TO THE MASTER LOAN AGREEMENT

          This
FIRST SUPPLEMENT TO THE MASTER LOAN AGREEMENT
(as the same may be amended, modified, supplemented, extended or restated from
time to time, this “First 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 First Supplement shall
have the meanings assigned to them in the MLA.

          SECTION 1. The Term Loan. On the terms and
conditions set forth in the MLA and this First Supplement, CoBank agrees to
make a loan to the Borrower (the “Loan”), by means of a single advance,
on the Closing Date (as defined in Section 3 of this First Supplement)
in an aggregate principal amount not to exceed $15,000,000 (the “Commitment”).
Under the Loan, amounts borrowed and later repaid or prepaid may not 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”) and (ii)
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 8 of this First Supplement, the
Loan will be advanced in a single advance on the date on which all conditions
precedent to the Loan are satisfied (the “Closing Date”); 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).

	
 

	
 

	
 

	
          (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 First 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 

First Supplement to the Master Loan Agreement/New Ulm
Telecom, Inc.
Loan No. RX0583-T1

	
 

	
 

	
 

	
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 First
  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. “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 First Supplement becomes effective.
  The Interest Period for Portions accruing interest at the LIBOR option shall
  end on the day in the next 

2

First Supplement to the Master Loan Agreement/New Ulm
Telecom, Inc.
Loan No. RX0583-T1

	
 

	
 

	
 

	
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 First 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 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, 

3

First Supplement to the Master Loan Agreement/New Ulm
Telecom, Inc.
Loan No. RX0583-T1

	
 

	
 

	
 

	
on any
  Business Day, subject to Subsections 4(A)(2), 4(A)(3) and 4(A)(4)
  of this First 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
  5 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 First 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 First 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 5, interest at the applicable
  fixed rate shall accrue 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 

4

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

Loan No. RX0583-T1

	
 

	
 

	
 

	
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 First
  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:

	
 

	
 

	
 

	
 

	
 

	
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 

5

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

Loan No. RX0583-T1

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

          SECTION 5. 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.
All voluntary prepayments pursuant to this Section 5 shall be applied to
scheduled principal installments under Subsection 6(A) of this First Supplement
in the inverse order of their maturities and to such Portions of the Loan as
the Borrower specifies in writing, or in the absence of such direction, as
CoBank specifies. 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 5,
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 

6

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

Loan No. RX0583-T1

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 6. Repayment. 

          (A) Scheduled
Repayments. Commencing on March 31, 2008, and on each June 30,
September 30, December 31 and March 31 occurring thereafter (each such date a “Payment
Date”), through and including December 31, 2010, the outstanding principal
balance of the Loan shall be repaid in twelve consecutive quarterly equal
principal payments of $125,000 on each such date, and, commencing on March 31,
2011, and on each Payment Date occurring thereafter, through and including
December 31, 2014 (the “Maturity Date”), the outstanding principal
balance of the Loan shall be repaid in sixteen consecutive quarterly equal
principal payments of $250,000 on each such date. On the Maturity Date, the
amount of the then unpaid principal balance of the Loan and any and all other
amounts due and owing hereunder or under any other Loan Document relating to
this Loan shall be due and payable. If any Payment Date is not a Business Day,
then the installment then due shall be paid on the next Business Day and shall
continue to accrue interest until paid.  

          (B) Applications of Repayments; Related Interest and
Surcharge Payments. All repayments made pursuant to this Section
6 will be applied to such Portions of the Loan as the Borrower directs in
writing and, in the absence of such direction, as CoBank specifies. At the time
of each repayment pursuant to this Section 6, the Borrower must pay any
applicable Surcharge (as defined in and as calculated in Section 5 of
this First Supplement).

          SECTION 7. 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 

7

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

Loan No. RX0583-T1

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 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, and (iv) 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

8

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

Loan No. RX0583-T1

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 reasonably 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 8. Additional Conditions Precedent.
In addition to the conditions precedent set forth in the MLA, CoBank’s
obligation to make the Loan is subject to the satisfaction of the following
conditions precedent on or before the date of such advance: 

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

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

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

          (D) 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;

9

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

Loan No. RX0583-T1

          (E) 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;

          (F) 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;

          (G) Representations and Warranties. That
the representations and warranties of each Loan Party contained in the MLA,
this First 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;

          (H) Closing 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

          (I) 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.           

          SECTION 9. Additional Affirmative
Covenants. In addition to the affirmative covenants set forth in Section 8 of
the MLA, the Borrower will and will cause each of its Subsidiaries to:

          (A) Mortgages. Deliver, no more than 90
days after the Closing Date (or, in the case of the Guarantor Mortgage of PTC,
no more than one year after the Closing Date), or such other date as CoBank in
its sole discretion shall agree in writing, the Mortgage and the Guarantor
Mortgages, pursuant to which the Borrower and certain Loan Party Guarantors
grant to CoBank a lien on all of their personal and real property located at
the properties described in Exhibits B(1) and (B)(2) hereto, subject only to
the liens permitted by Subsection 9(B) of the MLA, in form and substance
reasonably satisfactory to CoBank, together with such other related documents,
including without limitation, Uniform Commercial Code fixture filings,
landlords consents, and certificates and opinions, as CoBank shall reasonably
request.

10

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

Loan No. RX0583-T1

          (B) Alliance Bank Control Agreement.
Deliver to CoBank no more than 30 days after the Closing Date, a fully executed
Account Control Agreement for Borrower’s accounts with Alliance Bank, in form
and substance reasonably satisfactory to CoBank.

          (C) Title Insurance. Deliver, no more than
90 days after the Closing Date, title insurance for the real property described
in Exhibit B(1) hereto, and, no more than one year after the date hereof, title
insurance for the real property described in Exhibit B(2).

          (D) EN-TEL Pledge. Use commercially
reasonable efforts to deliver, no more than 90 days after the Closing Date, a
membership interest pledge agreement pursuant to which Hutchinson I grants to
CoBank a first-priority security interest in all of its then owned and
thereafter acquired ownership interests in EN-TEL Communications, LLC.

          (E) SHAL, LLC Pledge. Deliver, no more than
90 days after the Closing Date, a stock pledge agreement and a membership
interest pledge agreement pursuant to which Hutchinson II grants to CoBank a
first-priority security interest in all of its then owned and thereafter
acquired ownership interest in SHAL, LLC.

          (F) WTC Stock Certificate. Deliver, no more
than 5 days after the Closing date, any and all original stock certificates
evidencing Borrower’s ownership interest in WTC, in form and content reasonably
acceptable to CoBank.

[Signatures Follow on Next Page]

11

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

Loan No. RX0583-T1

          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]

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

Loan No. RX0583-T1

[Signatures Continued from Previous Page]

	
 

	
 

	
 

	
 

	
COBANK, ACB

	
 

	
 

	
 

	
 

	
By: 

	
/s/ Roger
  Opp

	
 

	
 

	 

	
 

	
 

	
Roger Opp

	
 

	
 

	
Vice
  President

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