10-K

UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-K

(X)   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ending December 31, 2023

(  )    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from______to______

Commission File Number: 0-3024

NUVERA COMMUNICATIONS, INC.

(Exact name of registrant as specified in its charter)

Minnesota (State or other jurisdiction of incorporation or organization) 41-0440990 (I.R.S. Employer Identification No.)

27 North Minnesota Street

New Ulm, Minnesota 56073

(Address of principal executive offices)

Registrant's telephone number, including area code:  (507) 354-4111

Securities registered pursuant to Section 12 (g) of the Act: 

Title of each class                                                      Trading Symbol                            Name of each exchange on which registered

Common Stock - $1.66 par value                                     NUVR                                                                   OTCQB Marketplace

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  ☐   No  ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.  Yes  ☐ No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☒  No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒  No  ☐

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large, accelerated filer,” “accelerated filer,” “non-accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. ☐  Large, accelerated filer  ☒  Accelerated filer  ☐  Non-accelerated filer  ☒  Smaller reporting company  ☐  Emerging growth company ☐

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐     

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐  No  ☒

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock - $1.66 par value	NUVR	OTCQB Marketplace

The aggregate market value of the registrant’s common stock held by non-affiliates computed by reference to the price at which the common stock was sold, as of the last business day of the registrant’s most recently completed second fiscal quarter was $55,420,052. This calculation is based upon the closing price of $13.50 of the stock on June 30, 2023, as quoted on the OTCQB Marketplace. Without asserting that any director or executive officer of the registrant, or person owning 5% or more of the registrant’s common stock, is an affiliate, the shares of which they are the beneficial owners have been deemed to be owned by affiliates solely for this calculation.

As of March 15, 2024, the registrant had 5,133,207 shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s Proxy Statement for the 2024 Annual Meeting of Stockholders to be held on May 23, 2024, are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission (SEC) within 120 days of the registrant’s fiscal year ended December 31, 2023.

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TABLE OF CONTENTS

PART I		Page
Item 1.	Business	5
Item 1A.	Risk Factors	19
Item 1B.	Unresolved Staff Comments	27
Item 1C.	Cybersecurity	27
Item 2.	Properties	29
Item 3.	Legal Proceedings	30
Item 4.	Mine Safety Disclosures	30
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	30
Item 6.	Reserved	31
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 8.	Financial Statements and Supplementary Data	48
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	81
Item 9A.	Controls and Procedures	81
Item 9B.	Other Information	82
Item 9C.	Disclosures Regarding Foreign Jurisdictions That Prevent Inspection	82
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	83
Item 11.	Executive Compensation	83
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	83
Item 13.	Certain Relationships and Related Transactions, and Director Independence	83
Item 14.	Principal Accountant Fees and Services	83
SIGNATURES		84
PART IV
Item 15.	Exhibits and Financial Statement Schedules	85
Item 16.	From 10-K Summary	87

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CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

The SEC encourages companies to disclose forward-looking information so that investors can better understand a company’s prospects and make informed investment decisions. Certain statements in this Annual Report on Form 10-K, including those relating to the impact on future revenue sources, pending and future regulatory orders, continued expansion of the fiber communications network and expected changes in the sources of our revenue and cost structure resulting from our entrance into new communications markets, are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect, among other things, our current expectations, plans and strategies, and anticipated financial results. These forward-looking statements reflect, among other things, our current expectations, plans, strategies, and anticipated financial results. There are a number of risks, uncertainties and conditions that may cause the actual results of Nuvera Communications, Inc. and its subsidiaries (“Nuvera,” the “Company,” “we” or “our” or “us”) to differ materially from those expressed or implied by these forward-looking statements. Many of these circumstances are beyond our ability to control or predict. Moreover, forward-looking statements necessarily involve assumptions on our part. These forward-looking statements generally are identified by the words “believes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “may,” “will,” “would,” “seeks,” “targets,” “continues,” “should,” “will be,” “will continue,” or similar expressions. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Nuvera and its subsidiaries to be different from those expressed or implied in the forward-looking statements. These risks and uncertainties may include, but are not limited to: i) unfavorable general economic conditions that could negatively affect our operating results; ii) substantial regulatory change and increased competition; iii) our possible pursuit of acquisitions could be expensive or not successful; iv) we may not accurately predict technological trends or the success of new products; v) shifts in our product mix may result in declines in our operating profitability; vi) possible consolidation among our customers; vii) a failure in our operational systems or infrastructure could affect our operations; viii) data security breaches; ix) possible replacement of key personnel; x) elimination of governmental network support we receive; xi) our current debt structure may change due to increases in interest rates or our ability to comply with lender loan covenants and xii) possible customer payment defaults. For these forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in federal securities laws. Shareholders and the investing public should understand that these forward-looking statements are subject to risks and uncertainties which could affect our actual results and cause actual results to differ materially from those indicated in the forward-looking statements. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements that appear throughout this report. Furthermore, these statements speak only as of the date they are made. Except as required under federal securities laws or the rules and regulations of the SEC, we disclaim any intention or obligation to update or revise publicly any forward-looking statements. Undue reliance should not be placed on forward-looking statements. 

Website Access to SEC Reports

Our website at www.nuvera.net provides information about our products and services, along with general information about Nuvera and its management and financial results. Copies of our most recent Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, can be obtained, free of charge, as soon as reasonably practical after these reports are electronically filed or furnished to the SEC. To obtain this information, visit our website noted above and select “About Us – Investors” to view Nuvera SEC filings,” or call (844) 354-4111. The SEC also maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding public companies, including Nuvera Communications, Inc. Any reports filed with the SEC may also be obtained from the SEC’s Reference Room at 100F Street, NE, Washington, DC 20549.

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Code of Business Conduct and Ethics

Our Board of Directors (BOD) have adopted a Code of Business Conduct and Ethics that is applicable to all directors, the chief executive officer (CEO), chief financial officer (CFO) and to all other employees of Nuvera. All employees of Nuvera have undergone training on this Code of Business Conduct and Ethics. The information required by Item 406 of Regulation S-K is contained under “Code of Business Conduct” in the definitive proxy statement (2024 Proxy Statement) and is incorporated by reference. Our BOD has also adopted written charters for its committees that comply with the NASDAQ Global Select Market. Copies of the committee charters are available on our website above or by contacting us at (844) 354-4111.  

PART I

Item 1.   Business

Company Overview and History

Nuvera is a diversified communications Company headquartered in New Ulm, Minnesota with more than 118 years of experience in the communications business. We operate in one principal business segment: the Communications Segment.

Our principal line of business is the operation of seven communications companies. Our original business was founded in 1905 and consisted of the operation of a single communications company (New Ulm Rural Telephone Company). In 1984, we changed our name to New Ulm Telecom, Inc. In 1986, we acquired Western Telephone Company (WTC). In 1993, we acquired Peoples Telephone Company (PTC). In 2008, we acquired Hutchinson Telephone Company (HTC). In 2012, we acquired Sleepy Eye Telephone Company (SETC). In 2018, we acquired Scott-Rice Telephone Co. (Scott-Rice). Our businesses consist of connecting customers to our advanced fiber communications network, providing managed services, switched service and dedicated private lines, connecting customers to long distance service providers and providing many other services associated with our businesses. Our businesses also provide Internet protocol television (IPTV), cable television services (CATV), Internet access services, including high-speed broadband access, and long-distance service. We also install and maintain communications systems to the areas in and around our service territories in southern Minnesota and northern Iowa. In 2008 we acquired Hutchinson Telecommunications, Inc. This company operates in and around the city of Litchfield, Minnesota and operates under less regulatory oversight than our other communications companies. In 2010, we acquired the cable TV system in the city of Glencoe and operate Glencoe under the Hutchinson Telecommunications, Inc. communications company. This Company offers the same services as our other communications companies. In 2000, we changed our marketing name to NU-Telecom and operated under that name in our markets. In 2018, we changed our marketing name to Nuvera and currently operate under that name in our markets.

Recent Business Development

On March 31, 2023, Nuvera and the other owners of FiberComm, LC (Fibercomm) sold 100% of their interest in FiberComm to ImOn Communications, LLC. FiberComm has been providing high quality Internet and voice services to businesses in the Sioux City, Iowa market for over 20 years. Nuvera owned a 20% interest in FiberComm through its wholly owned subsidiary PTC. Nuvera announced the execution of the FiberComm sale agreement in January 2023. Nuvera recognized a gain of $4,660,775, net of escrow true ups, in book value in connection with the sale of the FiberComm interest. Prior to the sale of Nuvera’s equity investment in FiberComm, Nuvera had guaranteed a portion of a ten-year loan owed by FiberComm, set to mature on April 30, 2026. On March 31, 2023, upon closing of the sale, the loan was paid and Nuvera was released from their guarantee of loan.

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On December 15, 2021, the Company announced plans to build and deploy gigabit-speed (Gig or Gbps) fiber Internet across its network creating crucial access to the fastest speeds available for rural communities, small cities and suburban areas across Minnesota. Nuvera’s investment in a fiber-to-the-home (FTTH) network infrastructure will allow more underserved communities across Minnesota to leverage the quality of life and economic opportunity that access to a state-of-the-art network provides. The Company will continue to build and deploy the Gig-speed service over the next few years. Nuvera’s fiber network gives customers affordable access to a range of speeds from 100 Megabits per second (Mbps) to 1 Gig. Nuvera’s goal is to bring Gig-speed service to as many communities as possible.

Nuvera’s fiber Internet prices range from $50 per month to $100 per month for Gig-speed services. Customers can choose the right speed at an affordable price, including low-income households through Federal programs.

The Communications Segment operates the following communications companies and has investment ownership interests as follows:

Communications Segment

● Communications Companies:

• Nuvera Communications, Inc., the parent Company;

• Hutchinson Telephone Company, a wholly owned subsidiary of Nuvera;

• Peoples Telephone Company, a wholly owned subsidiary of Nuvera;

• Scott-Rice Telephone Co., a wholly owned subsidiary of Nuvera;

• Sleepy Eye Telephone Company, a wholly owned subsidiary of Nuvera;

• Western Telephone Company, a wholly owned subsidiary of Nuvera; and

•  Hutchinson Telecommunications, Inc., a wholly owned subsidiary of HTC, located in Litchfield and Glencoe, Minnesota

● Our investments and interests in several of the following entities include some management responsibilities:

• Broadband Visions, LLC (BBV) – 24.30% subsidiary equity ownership interest. BBV provides video headend and Internet services;

• Independent Emergency Services, LLC (IES) – 14.29% subsidiary equity ownership interest. IES is a provider of E-911 services to the State of Minnesota as well a number of counties located in Minnesota; and

• Fiber Minnesota, LLC (FM) – 7.54% subsidiary equity ownership interest. FM is a Minnesota state-wide network that provides connectivity for regional businesses.

We report the business operations of our seven communications companies and their associated services as a single segment that we refer to as the Communications Segment. 

The Communications Segment operates the following communications companies: Nuvera, HTC, PTC, Scott-Rice, SETC, WTC and Litchfield, Minnesota. Nuvera, HTC, Scott-Rice, SETC, WTC and Litchfield are independent communications companies that are regulated by the Minnesota Public Utilities Commission at the state level, while PTC is an independent communications company that is regulated by the Iowa Utilities Board at the state level. Our communications companies located in Redwood Falls and Litchfield are currently not under the same level of regulatory oversight as our other communications companies. As of December 31, 2023 we served 33,280 data connections and 13,656 access lines in many Minnesota communities. We provide broadband and/or voice services in Arlington, Bellechester, Cologne, Courtland, Dassel, Evan, Goodhue, Hanska, Hector, Hutchinson, Klossner, Litchfield, Mazeppa, Elko New Market, New Ulm, Prior Lake, Redwood Falls, Sanborn, Savage, Searles, Sleepy Eye, Springfield and White Rock, as well as the adjacent rural areas of Blue Earth, Brown, Goodhue, McLeod, Meeker, Nicollet, Redwood, Rice, Scott and Wabasha counties in south central Minnesota. We also serve the community of Aurelia, Iowa as well as the adjacent rural areas surrounding Aurelia. The Communications Segment also operates multiple IPTV and CATV systems in Minnesota (including the cities of Cologne, Courtland, Glencoe, Goodhue, Hanska, Hutchinson, Litchfield, Mayer, Elko New Market, New Germany, New Ulm, Plato, Prior Lake, Redwood Falls, Sanborn, Savage, Sleepy Eye and Springfield) and one IPTV system in Aurelia, Iowa. These systems serve 8,214 customers.

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The Communications Segment derives its principal revenues from (i) voice service charges to its residential and business subscribers, (ii) access charges to Interexchange Carriers (IXCs) for providing the carriers access to our local phone networks and (iii) the provisioning of video and data services.

None of our communications companies are dependent upon any single customer or small group of customers. No single customer accounted for 10% or more of our consolidated revenues in any of the last two years.

We provide a variety of business communication services to small, medium and large business customers, including many services over our advanced fiber-optic (fiber) network. The services we offer include scalable high speed broadband Internet access and voice over Internet protocol (VoIP) phone services, which range from basic service plans to virtual hosted systems. Our hosted VoIP package utilizes our soft switching technology and enables our customers to have the flexibility of employing new telephone advances and features without investing in a new telephone system. This package includes voice service, calling features, IP business telephones and unified messaging, which integrates multiple technologies into a single system and allows the customer to receive and listen to voice messages through e-mail. 

In addition to Internet and VoIP services, we also offer a variety of commercial data connectivity services in select markets including private line and Ethernet services to provide high bandwidth across point-to-point and multiple site networks.

We receive most of our revenues through the following sources:

Voice Service – We receive recurring revenue for basic local voice services that enable end-user customers to make and receive telephone calls within a defined local calling area for a flat monthly fee. In addition to subscribing to basic local telephone services, our customers may choose from multiple voice service plans with a variety of custom calling features such as call waiting, call forwarding, caller identification and voicemail. Our VoIP digital phone service is also available as an alternative to the traditional telephone line.   

Network Access – We provide access services to other communications carriers for the use of our facilities to terminate or originate long distance calls on our fiber network. Additionally, we bill monthly subscriber line charges (SLCs) to substantially all our customers for access to the public switched network. These monthly SLCs are regulated and approved by the Federal Communications Commission (FCC). In addition, network access revenue is derived from several federally administered pooling arrangements designed to provide support and distribute funding to us.   

Video Service – We provide a variety of enhanced video services on a monthly recurring basis to our customers. Depending on geographical market availability, our video services range from limited basic service to advanced digital TV, which includes several plans each with hundreds of local, national music channels including premium and pay-per-view channels as well as video-on-demand service. Certain customers may also subscribe to our advanced video services, which consist of high-definition (HD) TV, digital video recorders (DVR) and Whole Home DVR. Our Whole Home DVR allows customers the ability to watch recorded shows on any TV in the house, record multiple shows at one time and utilize an intuitive on-screen guide and user interface. Video subscribers also have access to our TV Everywhere service which allows subscriber access to full episodes of available shows, movies and live screens using a computer or mobile device. We also receive monthly recurring revenue from our subscribers for providing commercial TV programming in competition with local CATV, satellite dish TV and off-air TV service providers. We serve twenty-two communities with our IPTV services and five communities with our CATV services.

Data Service – We provide high speed Internet to business and residential customers depending on the nature of the network facilities that are available, the level of service selected and the location. Our revenue is earned based on the offering of various flat rate packages based on the level of service, data speeds and features. We also provide e-mail and managed services, such as web hosting and design, on-line file back up and on-line file storage.  

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Alternative Connect America Cost Model (A-Cam)/Federal Universal Service Fund (FUSF) – The Company currently receives funding based on the A-CAM, except for Scott-Rice, which receives funding from the FUSF. Scott-Rice’s settlements from the National Exchange Carriers Association (NECA) pools are based on nationwide average schedules, which includes the pooling and redistribution of revenues based on a company’s actual or average costs. See below for a discussion regarding A-CAM and FUSF.

Other – Our customers are billed for toll and long-distance services on either a per call or flat-rate basis. This also includes the offering of directory assistance, operator service and long-distance private lines. We also generate revenue from directory publishing through an outside vendor, sales and service of customer premise equipment (CPE), bill processing and other customer services. Our directory publishing revenue in our telephone directories recurs monthly. We also provide retail sales and service of cellular phones and accessories through Telespire, a national wireless provider. We resell these wireless services as Nuvera Wireless, our branded product. We receive both recurring revenue for our wireless services, as well as revenue collected for the sale of wireless phones and accessories. 

Sales and Marketing

The key components of our overall marketing strategy include:

● Positioning ourselves as a single point of contact for our customers’ communications needs;

● Providing customers with a broad array of data, voice and communications solutions;

● Identifying and broadening commercial customer needs by developing solutions and providing integrated service offerings;

● Offering digital self-service tools and apps including an enhanced website, automated consumer online orders, appointment reminders, robust wireless home networking (Wi-Fi) apps, user guides and troubleshooting tools and videos;

● Providing excellent customer service, including centralized customer support to coordinate installation of new services, repair and maintenance functions and creating more self-service tools through our online customer portal;

● Developing and delivering new services to meet evolving customer needs and market demands; and

● Leveraging our local presence and strong reputation across our market areas.

We currently offer our services through customer service call centers, our website and commissioned sales representatives.  Our customer service call centers and dedicated sales teams serve as the primary sales channels for consumer, commercial and carrier services.  Our sales efforts are supported by digital media, direct mail, bill inserts, radio, TV and Internet advertising, public relations activities, community events and customer promotions. We sell our Gig consumer fiber broadband service through our fiber network, which we launched in late 2021 in select markets.  

In addition to our customer service call centers, customers can contact us through our website, online chat and social media channels. Our online customer portal enables customers to pay their bills, manage their accounts, order new services and utilize self-service help and support. Our priority is to continue enhancing our comprehensive customer care system to produce a high level of customer satisfaction and loyalty, which is important to our ability to reduce churn and generate recurring revenues.

Business Strategies

Transform our Company into a dominant fiber-gig broadband provider:

On December 15, 2021, the Company announced plans to build and deploy Gig-speed fiber Internet across its network creating crucial access to the fastest speeds available for rural communities, small cities and suburban areas across Minnesota. The five-year build plan, which began in late 2021, will when complete, include approximately 60,000 location passings to fiber enabling Gig-capable services by 2025. In 2023, we upgraded 17,132 locations with fiber services and faster broadband speeds and plan to upgrade more than 10,400 locations in 2024. This marks the biggest fiber deployment project in our Company’s history. In addition to best-in-class upload and download speeds, we believe the resulting fiber network will offer better reliability, improved speed consistency, and a lower operating cost relative to competing broadband network technologies. Given these benefits, we believe that our fiber deployment strategy will allow us to realize meaningful improvements to our operating results, broadband subscriber penetration and customer retention.  

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We believe our customers place a value on the fact that we are a local company whose goal is to meet their total communications needs. The success of this vision depends on the following strategies:

● We have and will continue to upgrade our fiber networks through our five-year build plan and enhance our products and services to take advantage of the latest technology including advanced high-bandwidth capabilities and services, expansion of our fiber network for wholesale and retail customers, Fiber-to-the-Tower services for wireless carriers and last mile fiber builds to residential and business customers. We intend to continue to introduce new services that draw upon our core competencies, and we believe are attractive to our target customers. In considering new services and market expansion, we look for market opportunities that we believe present growth opportunities.

● As consumer demands for bandwidth continue to increase, our focus is on enhancing our broadband services, and progressively increasing broadband speeds. We began an extensive fiber-to-the-premise (FTTP) overbuild in portions of New Ulm in 2021 and all our service territories in 2022. We currently offer speeds of up to 1 Gbps in select areas where fiber is available, and up to 100 Mbps and 60 Mbps in areas where 1 Gbps is not yet available. As we continue to increase broadband speeds, we are also able to simultaneously expand the array of services and content offerings that the fiber network provides.

● We market services to our residential and business customers. Data connections continue to increase because of consumer trends towards increased Internet usage and our enhanced product and service offerings.

● Our consumer broadband speed allows us to continue to meet the needs of our customers and the demand for higher speed resulting from the growing trend of over-the-top (OTT) content viewing. The availability of faster speeds also complements our Wi-Fi and supports our TV everywhere service and allows our subscribers to watch their favorite programs at home or away on a computer, smartphone or tablet.

● We tailor our services to commercial customers by developing solutions to fit their specific needs. We provide services to a wide range of commercial customers from sole proprietors and other small businesses to multi-location corporations. Our business suite of services includes local and long-distance calling plans, hosted voice services using network servers, the added capacity for multiple phone lines, scalable broadband Internet, online back up and business directory listings.

● We believe that we have several advantages over our competition, including an advanced fiber communications network, competitive pricing and costs, outstanding service quality, a strong reputation, a high level of commitment to the communities we serve and a direct billing relationship with a vast majority of the customers we serve in our service territories. We manage the potential decline in communications network access and voice service revenues by offering value-added services such as higher Internet speeds, HD IPTV, DVR services, managed services, customized communications solutions, along with outstanding customer service as a competitive differentiator.

● We continue to seek ways to improve our internal processes and gain operational efficiencies. While focusing resources on revenue growth and market share gains, we continually challenge our management team and employees at all levels to seek efficiencies and enhance our customers’ experience. We continue to invest in our fiber networks and train our employees to achieve customer service excellence.

● Our current customer base provides a recurring revenue stream generating stable cash flow. Our focus remains on growing our services and supporting product lines to generate sufficient cash flow to fund our current operations, service our debt, fund our capital expenditure needs, pay dividends and expand our business. We have allocated resources to maintain and upgrade our fiber network while focusing on optimizing returns by completing strategic capital outlays that will make our fiber network more efficient and cost effective while providing the products and services that our customers desire in the markets we serve.

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● We intend to continue to pursue a disciplined process of evaluating acquisitions of businesses as well as organic growth opportunities of market expansion and/or products which are complementary to our business portfolio. 

● Across all our service territories, we have successfully managed capital expenditures to optimize returns through disciplined planning and targeted investment of capital. For example, strategic investments in our fiber networks allows significant flexibility to expand our commercial footprint, offer competitive products and services and provide services in a cost-efficient manner while maintaining our reputation as a high-quality service provider. We will continue to invest in strategic growth initiatives to enhance and expand our fiber network to new markets and customers to optimize new business, backhaul and wholesale opportunities.

● Commercial services are expected to be a key growth area in the future. We are focused on enhancing our broadband and commercial product suite and are continually enhancing our commercial product offerings to meet the needs of our business customers. We overbuilt our existing networks with advanced fiber networks in the commercial areas of New Ulm, Prior Lake and Hutchinson in 2021, 2020 and 2019. We tailor our services for business customers by developing solutions to fit their specific needs. Additionally, we are continuously enhancing our suite of managed and cloud services, which increases efficiency and enables greater scalability and reliability for businesses. We are utilizing multiple software platforms to gather relevant leads and for customer relations management.

● In addition to Internet and VoIP services, we also offer a variety of commercial data connectivity services in select markets including Ethernet services; software defined wide area network (SD-WAN), a software-based network technology that provides a simplified management and automation of SD-WAN connections; multi-protocol label switching; and private line services to provide high bandwidth connectivity across point-to-point and multiple site networks. We offer a suite of cloud-based services, which includes a hosted unified communications solution that replaces the customer’s on-site phone systems and data networks, managed network security services and data protection services, including back-up and disaster recovery.

Competition

We compete in a rapidly evolving and highly competitive industry and expect competition will continue to intensify as consolidations and mergers occur within the industry. Regulatory developments and technological advances over the past several years have increased opportunities for alternative communications service providers, which in turn have increased competitive pressures on our business. These alternative providers often face fewer regulations and have lower cost structures than we do. In addition, several of our competitors have consolidated with other communication providers and as a result are generally larger, have more financial and business resources and have greater geographical reach to provide services. Our competitive advantages include: our strong commitment and presence in the communities we serve, knowledge of these markets, our experienced voice service and support team, and our ability to offer more flexible communications solutions than our larger competitors.

The long-range effect of competition on the delivery of communications services and equipment will depend on technological advances, regulatory actions at both the federal and the state levels, court decisions, and possible additional future federal and state legislation. Past federal and state legislation have tended to expand competition in the communications industry. 

Alternatives to our service include customers leasing private line switched voice and data services in or adjacent to our service territories that permit the bypassing of our communications facilities. In addition, microwave transmission services, wireless communications, fiber/coaxial cable deployment, VoIP, satellite and other services also permit the bypassing of our local exchange network. These alternatives to local exchange service represent a potential threat to our long-term ability to provide local exchange services at economical rates.

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To meet competition, present in our industry, we are deploying the latest FTTH technology to deliver our data, video and voice services at a higher bandwidth, enabling us to provide our services at much higher speeds. 

We compete in the cities of Redwood Falls, Litchfield and Glencoe, Minnesota. These communications companies are currently not under the same level of regulatory oversight as our communications companies. Lumen Technologies is the existing communications company in these markets. Competition also exists in the other communities and areas served by us for traditional telephone service from wireless communications providers and we also expect competition to increase from service providers offering VoIP. We experience competition in the Minnesota communities of Glencoe, Hutchinson, Litchfield, Elko New Market, New Ulm, Prior Lake, Redwood Falls, Savage, Sleepy Eye and Springfield in the provisioning of video services. Comcast is the existing incumbent provider of video services in the New Ulm market. Mediacom is the existing incumbent provider of video services in the Hutchinson, Litchfield, Elko New Market, Prior Lake, Redwood Falls, Savage, Sleepy Eye and Springfield markets. Several other communications providers compete with us in our markets in providing Internet services. We have responded to these competitive pressures by creating active programs to market our products and enhance our infrastructure to create higher customer value.  

We are experiencing competition for some of our other services from IXCs, such as customer billing services, dedicated private lines and network switching. The provisioning of these services is contractual in nature and is primarily directed by the IXCs. Other services, such as directory advertising, operator services and cellular communications are open to competition, based primarily on service and customer experience.

We expect competition to remain a significant factor affecting our operating results and that the nature and extent of that competition will continue to increase in the future. See Part I – Item 1A – “Risk Factors – Risks Relating to Our Business”.

Human Capital Resources

As of December 31, 2023, we employed approximately 214 employees, including part-time employees. We also use temporary employees in the normal course of our business. Our employees are the cornerstone of our success. We are committed to providing meaningful, challenging work and opportunities for professional growth in a positive environment. To attract and retain qualified and experienced employees, we offer compensation and benefit packages, which we believe are competitive within the industry and the local markets in which we operate. Our benefit packages, may include, among other items, incentive compensation based on the achievement of financial targets, healthcare and insurance benefits, health savings and flexible spending accounts, a 401(k) savings plan with an employer match, paid time off, and wellness and employee assistance programs. Additionally, for certain eligible employees, we provide long-term incentive compensation, in the form of non-qualified stock options (Options). In addition, we are committed to providing employees continuing education and training programs in order for employees to achieve career goals and professional growth.

We embrace diversity and inclusion and seek to hire and retain high-quality employees of all backgrounds and experiences. Honoring our employees as individuals is key to our culture. We believe diversity of backgrounds contributes to different ideas, which in turn drives better results for customers. We respect differences and diversity as qualities that enhance our efforts as a team and believe embracing diversity and a culture of inclusion makes our Company a better place to work. We believe in and support the principles incorporated in all anti-discrimination and equal employment laws.

We also strive to create and provide a safe, healthful and secure workplace that is free from discrimination or harassment. Our workplace policies and procedures protect against behavior that creates an offensive, hostile, or intimidating work environment. Safety is a top priority, and we have a strong, ongoing commitment to ensure employees are properly trained and have appropriate safety and emergency equipment. In response to the COVID-19 pandemic, we implemented safety protocols and procedures to protect our employees, customers and business partners. These procedures included transitioning as many employees as possible to remote work-from-home arrangements, providing additional safety training and personal protective equipment for customer and business-facing employees, and complying with social distancing and other health and safety measures as required by federal, state and local governmental agencies.

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Materials and Supplies

The materials and supplies that are necessary for our operations are available from a variety of sources. We are not dependent on any particular supplier or group of affiliated suppliers for our equipment needs.

Regulation

The following summary provides a high-level overview, but may not include all present and proposed federal, state and local legislation and regulations affecting the communications industry. Some legislation and other regulations are currently the subject of judicial proceedings, legislative hearings and administrative proposals that could change the manner in which this industry operates. At this time, we cannot predict the outcome of any of these developments or their potential impact on us. Regulation can change rapidly in the communications industry and these changes could have an adverse effect on us in the future.

Overview

Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP), rules and regulations of the SEC and, where applicable, conform to the accounting principles as prescribed by federal and state telephone utility regulatory authorities.

The services we offer are subject to varying levels of regulatory oversight. Federal and state regulatory agencies share responsibility for enforcing statutes and rules relative to the provision of communications services. Our interstate communications services are subject to regulation by the FCC. Intrastate services are governed by the relevant state regulatory commission. The Telecommunications Act of 1996 (TA96) and the rules enacted under it also gave oversight of interconnection arrangements and access to network elements to the state commissions. Our TV services are governed by FCC rules and municipal franchise agreements. There are also varying levels of regulatory oversight depending on the nature of the services offered or if the services are offered by a communications company.

Our communications companies located in Redwood Falls, Litchfield and Glencoe provide services with less regulatory oversight than our other local communications companies. A company must file for interexchange authority to operate with the appropriate public utility commission in each state it serves. Our communications companies located in Redwood Falls, Litchfield and Glencoe provide a variety of services to both residential and business customers in multiple jurisdictions.

Federal Regulatory Framework

All carriers must comply with the FCC Act of 1934 (FCA34) as amended that requires, among other things, that our interstate services be provided at just and reasonable rates and on non-discriminatory terms and conditions. The TA96 amended the FCA34 and has had a dramatic effect on the competitive environment in the communications industry. In addition to these laws, we are also subject to rules promulgated by the FCC and could be affected by any regulatory decisions or orders they issue.

The TA96 and Local Competition

The primary goal of the TA96 and the FCC’s rules promulgated under it was to open local communications markets to competition while enhancing universal service. To some extent, Congress pre-empted the local authority of states to oversee local communications services.

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The TA96 imposes a number of requirements on all local communications providers including:

● To interconnect directly or indirectly with other carriers; 

● To allow others to resell services;

● To provide for number portability to allow end-users to retain their telephone number when changing providers;

● To ensure dialing parity;

● To ensure that competitor customers have non-discriminatory access to telephone numbers, operator services, directory assistance and directory listing services; and

● To allow competitors access to telephone poles, ducts, conduits and rights-of-way, and to establish reciprocal compensation arrangements for the transport and termination of communications traffic.

Access Charges

Access charges refer to the compensation received by local exchange carriers (LECs) for the use of their networks by an IXC. We provide two types of access services: special access and switched access. Special access is provided through dedicated circuits that connect other carriers to our network and is structured on a flat monthly fee basis. Switched access rates that are billed to other carriers are based on a per-minute of use fee basis. The FCC regulates prices that we charge for interstate access charges. There has been a trend toward lowering the rates charged to carriers accessing local networks and the application of a SLC as a flat rate on end-user bills. Regulation, competition, carriers optimizing their network costs and lower demand for dedicated lines have resulted in lower access rates and overall lower minutes of use on our network, which has affected our network access revenues.  

Interstate access rates are established by the nationwide pooling of companies known as NECA. The FCC established NECA in 1983 to develop and administer interstate access service rates, terms and conditions. Revenues are pooled and redistributed on the basis of each company’s actual or average costs. There has been a change in the composition of interstate access charges in recent years, shifting more of the charges to the end user and reducing the amount of access charges paid by IXCs. We believe this trend will continue. 

Intrastate access rates are filed with the regulatory commissions in Minnesota and Iowa.

Wireline Interstate

Our communications companies participate in the NECA common line pool where end-user common line funds collected are pooled. A portion of our communications companies’ revenue are based on settlements distributed from this pool. Our communications companies also participate in the NECA traffic-sensitive pool. These pool settlements are adjusted periodically.

Access rates for our communications companies located in Redwood Falls, Litchfield and Glencoe were established according to an order issued by the FCC in 2001. Under that order, the switched access rates charged by a competitive carrier can be no higher than the rates charged by the communications company with whom we compete.  

Intercarrier Compensation (ICC) and FUSF Reform 

The FCC released the National Broadband Plan in April 2010 recommending significant changes to the access charge policy and processes. This was followed on November 18, 2011, by FCC Order 11-161 (the Transformation Order), with comprehensive rules reforming all forms of ICC and implementing a new support mechanism for the deployment of broadband. Generally, the ICC reform sets forth a path towards a “bill & keep” regime which eliminates compensation for termination of traffic received from another carrier. The timeline for this transition had numerous steps depending on the type of traffic exchanged and the regulated status of the affected LEC.   

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These rules have been clarified in several orders on Reconsideration and have had an impact on our companies by reducing our terminating ICC, including intrastate and interstate access charges.  

The FCC Transformation Order also confirmed the applicability of access charges on VoIP traffic and eliminated reciprocal compensation charges for termination of local wireless traffic. Despite these changes IXCs and others are still quite aggressive in disputing carrier access charges and/or the applicability of access charges to their traffic.

Due to the combination of rate reforms instituted by the FCC, competitive substitution by wireless and other carriers and decreased use of the switched network, the aggregate amount of interstate network access charges paid by long distance carriers to access providers such as our Company, has decreased and we project that this decline will continue. For the year ended December 31, 2023, communications network access revenue represented 5.8% of our operating revenue, down from 7.2% for the year ended December 31, 2022. This excludes any funding received from FUSF and the A-CAM for broadband funding (see below for more information).

FUSF

The FUSF was originally established to overcome geographic differences in costs of providing voice service and to enable all citizens to communicate over networks regardless of geographical location and/or personal income. The FCC established universal service policies at the national level under terms contained in the Telecommunications Act of 1934. The TA96 requires explicit FUSF mechanisms and enlarged the scope of universal service to include four distinct programs:

● High-Cost program that supports local carriers operating in high-cost regions of the country to ensure reasonably based telephone rates;   

● Lifeline (low-income) Subscribers program that includes the Link Up and Lifeline programs that provide support for service initiation and monthly fees and have eligibility based on subscriber income;

● Rural Health Care Providers program that supports communication services used by rural health care providers and provides them with toll free access to an Internet service provider (ISP); and

● Schools and Libraries program, also called the E-Rate program that provides support funding to schools and libraries for communications services, Internet access and internal connections.

In its Transformation Order released November 18, 2011, the FCC adopted rules which dramatically reform the universal service program and ICC regime. These rules eliminated the legacy Local Switching support, but also provide for a new Connect America Fund (CAF) support for rate of return carriers to make up some of their access revenue reductions and provide direct support to PriceCap carriers (i.e. the larger, national LECs such as Verizon and AT&T) for broadband build outs. The new rules have caused rates for end users to increase as ICC is reduced and the legacy mandate for ubiquitous voice service shifts toward broadband availability as a key outcome of the program. 

FUSF high-cost payments are distributed by NECA and are only available to carriers that have been designated as an eligible telecommunications carrier (ETC) by a state commission. Each of our communications companies has been designated as an ETC. Our communications companies located in Redwood Falls, Litchfield and Glencoe are also eligible to be designated as ETCs if they meet the requirements of the program and meet a public interest standard as determined by the appropriate state regulatory agency. Our communications companies located in Redwood Falls, Litchfield and Glencoe are currently not receiving FUSF support. All ETCs must certify annually to the Universal Service Administrative Company or their appropriate state regulatory commission that the funds they receive from the FUSF are being used in the manner intended. The states must then certify to the FCC which carriers have met this standard. The Transformation Order expands the information that must be reported to the State Commissions to include information on broadband availability, plans for expansion to unserved and underserved areas, in addition to information about voice services. To some extent, these levels of scrutiny make the receipt of a consistent level of FUSF payments each year more difficult to predict.   

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For the year ended December 31, 2023, we recorded an aggregate of $3,526,006 from FUSF, consisting of $1,609,041 of CAF support, $1,349,317 of Broadband Loop Support (BLS) and $567,648 for Consumer Broadband-only Loop Support (CBOL) funding. Our net FUSF in 2023 comprised 4.5% of our total revenue for the year. For the year ended December 31, 2022, we received an aggregate of $2,770,698 from FUSF, consisting of $1,467,845 of CAF support and $1,302,853 of BLS. Our net FUSF in 2022 comprised 4.2% of our total revenue for the year. We receive no State USF as the states in which we operate have not established state USF mechanisms. 

On December 12, 2023, the Company announced that it confirmed eligibility for Consumer Broadband-only Loop Support (CBOL) funding through the Universal Service Administration Company (USAC). The incremental funding will be used to continue to support the Company’s multi-year fiber construction initiative. The Company began receiving a monthly benefit in November of 2023 with the first payment receipt confirmed in December. On an annualized basis this new program will provide $3.9 million of new funding based on the tariff filing and the Company’s expected line counts. The monthly CBOL subsidy formula is reviewed and subject to revision on an annual basis and subject to changed based on updated USAC funding criteria July 1 of each year.

In 2019, the Company elected to receive funding from A-CAM, except for Scott-Rice, which still receives funding from the FUSF.  

A-CAM

The FUSF was established as part of the TA96 and provides subsidies to communications providers as means of increasing the availability and affordability of advanced communications services. In 2011, significant reform was introduced, including the creation of the CAF, to help modernize the FUSF and promote support of these communications services in the nation’s high-cost areas. In 2016, the FCC announced additional reform to further transition the CAF from supporting the provision of voice services to the provision of broadband services. On March 30, 2016, the FCC issued a Report and Order (2016 Order) that adopts the following changes to the FUSF for rate-of-return carriers:

● Establishes a voluntary cost model;   

● Creates specific broadband deployment obligations; 

● Provides a mechanism for support of broadband-only deployment; 

● Gradually reduces the authorized rate-of-return from 11.25 percent to 9.75 percent;

● Eliminates support in those local areas served by unsubsidized competitors;

● Establishes “glide-path” transition periods for all the new changes; and

● Maintains the $2 billion budget established by the 2011 Transformation Order.

While the 2011 FUSF Transformation Order established CAF Phase I and CAF Phase II as high-cost support mechanisms for the price-cap carriers (i.e., the larger, national LECs such as Verizon and AT&T), it was not as specific about how subsidies would change for the rate-of-return carriers (i.e., the smaller LECs, including all rural LECs). In contrast, the 2016 Order focused on the rate-of-return carriers, announced specific changes to existing funding mechanisms as well as a new funding mechanism, and provided rural communications providers with greater certainty about future support.

One of the major changes introduced by the 2016 Order was the creation of the A-CAM, a new CAF support mechanism for rate-of-return carriers. Utilization of the A-CAM was voluntary; and rate-of-return carriers may have instead chosen to continue relying on the legacy support mechanism known as interstate common line support, but then modified and renamed CAF BLS. Each carrier needed to decide which support mechanism to elect, and must have elected one or the other, per state.

On February 25, 2019, the FCC issued Public Notice DA 19-115, which contained revised offers of A-CAM support and associated revised service deployment obligations. On February 27, 2019, the Company’s BOD authorized and directed the Company to accept the FCC’s revised offer of A-CAM support and the revised associated service deployment obligations. Under the revised FCC offer Notice, the Company will be entitled to annually receive (i) $596,084 for its Iowa operations and (ii) $8,354,481 for its Minnesota operations. The Company will receive the revised A-CAM offer over the next 10 years starting in 2019. The Company will use the support that it receives through the A-CAM program to meet its defined broadband build-out obligations, which the Company is currently completing. A letter of acceptance to elect the revised A-CAM support was filed by the Company with the FCC on March 8, 2019. The FCC accepted the Company’s letter on March 11, 2019.

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On September 29, 2023, Nuvera announced that it had notified the FCC that the Company had decided to remain on the current A-CAM funding, rather than moving to the Enhanced A-CAM (E-ACAM) program that the FCC introduced earlier in 2023. A-CAM and E-ACAM are FCC administered programs to subsidize the deployment of broadband to rural areas. E-ACAM is a successor to this program which requires participating carriers to offer broadband and voice services at speeds of 100/20 Mbps or faster to all E-ACAM required locations within its study area. Broadband providers were required to choose one of the two funding options and notify the FCC by September 29, 2023.

Build-out obligations: A-CAM carriers under the original A-CAM program must complete deployment of 10 Mbps downstream/1 Mbps upstream service to a number of eligible locations equal to 40 percent of fully funded locations by the end of 2020, to 50 percent of fully funded locations by the end of 2021, to 60 percent of fully funded locations by the end of 2022, to 70 percent of fully funded locations by the end of 2023, to 80 percent of fully funded locations by the end of 2024, to 90 percent of fully funded locations by the end of 2025, and to 100 percent of fully funded locations by the end of 2026. A-CAM carriers who elected additional funding and additional obligations under the revised A-CAM program must complete deployment of 25 Mbps downstream/3 Mbps upstream service to a number of eligible locations equal to 40 percent of fully funded locations by the end of 2022, to 50 percent of fully funded locations by the end of 2023, to 60 percent of fully funded locations by the end of 2024, to 70 percent of fully funded locations by the end of 2025, to 80 percent of fully funded locations by the end of 2026, to 90 percent of fully funded locations by the end of 2027, and to 100 percent of fully funded locations by the end of 2028. As of December 31, 2023, Nuvera has completed the deployment of 10/1 service to 99.5% of its funded locations and 25/3 service to 60.3% of its funded locations in Minnesota and has completed deployment of 10/1 service to 100% of its funded locations and 25/3 service to 76.5% of its funded locations in Iowa. 

Infrastructure Investment and Jobs Act

The Infrastructure Investment and Jobs Act (Infrastructure Act) passed on March 31, 2021, and included $65.0 billion toward broadband. The broadband Internet portion of the Infrastructure Act is aimed at increasing Internet coverage for more universal access, including for rural, low-income, and tribal communities. 65% of this funding is set aside specifically for underserved communities. Additionally, this measure is designed to help make Internet access more affordable and increase digital literacy.

The Infrastructure Act set aside $42.5 billion for Broadband Equity, Access and Deployment grants. The National Telecommunications and Information Administration administers the grant program and is in the process of soliciting comments before issuing final rules.

Privacy and Data Security Regulation

The FCA34 generally restricts the nonconsensual collection and disclosure to third parties of communication company customers’ personally identifiable information by communication companies, except for rendering service, conducting legitimate business activities related to the service, and responding to legal requests. We are also subject to various state and federal regulations that provide protections for customer proprietary network information (CPNI) related to our voice services. The FCC expects broadband Internet access service providers such as us to take reasonable, good faith steps to comply with existing statutory requirements to protect broadband CPNI and plans to propose new privacy and data security rules for broadband ISPs. The FCC has recently imposed substantial civil penalties and remediation obligations on several companies for alleged privacy and data security violations.

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The Federal Trade Commission (FTC) exercises authority over privacy protections, generally, using its existing authority over unfair and deceptive acts or practices to apply greater restrictions on the collection and use of personally identifiable and other information relating to customers. It also has undertaken numerous enforcement actions against parties that do not provide sufficient security protections against the loss of unauthorized disclosure of this type of information. We also are subject to stringent data security and data retention requirements on website operators and online services. Other privacy-oriented laws have been extended by courts to online video providers and are increasingly being used in privacy lawsuits, including class actions, against providers of video materials online.

We are also subject to state and federal laws and regulations regarding data security that primarily apply to sensitive personal information that could be used to commit identity theft. Most states have security breach notification laws that generally require a business to give notice to consumers and government agencies when certain information has been disclosed, due to a security breach, and the FCC has adopted security breach rules for voice services. Several states have also enacted general data security requirements to safeguard consumer information, including the proper disposal of consumer information.

The National Institute of Standards and Technology, in cooperation with other federal agencies and owners and operators of United States critical infrastructure, have developed a voluntary framework that provides a prioritized, flexible, repeatable, performance-based and cost-effective approach to cybersecurity risk. It is compendiums of existing cross-sector cyber-defense processes, practices and protocols that can help companies identify, assess and manage their cyber risks and vulnerabilities, and several governmental agencies have encouraged compliance with this framework. Additionally, in December 2015, Congress enacted the Cybersecurity Act of 2015, which is intended to encourage and facilitate the sharing of security threat and defensive measure information with government agencies and other companies, to strengthen the country’s overall cybersecurity protections. Finally, there are pending legislative proposals that could impose new requirements on owners and operators of critical infrastructure and the FCC is considering expanding its cybersecurity guidelines or adopting new cybersecurity requirements.    

Network Architecture and Technology

We have and plan to continue to make significant investments in our technologically advanced fiber communications networks and continue to enhance and expand our fiber network by deploying technologies to provide additional capacity to our customers. As a result, we can deliver high-quality, reliable data, video and voice services in the markets we serve. Our wide-ranging fiber network provides an easy reach into existing and new areas. By bringing the fiber network into the customer premises, we can increase our service offerings, quality and bandwidth services. Our existing fiber network enables us to efficiently respond and adapt to changes in technology and can support the rising customer demand for bandwidth in order to support the growing amount of data devices in our customer’s homes and businesses.

Our fiber networks are supported by advanced 100% digital switches, with a core fiber network connecting all our remote exchanges. We continue to replace our copper cable network to increase bandwidth to provide additional products and services to our marketable homes. We are replacing our existing copper cable with fiber cable throughout our network and to all customer premises that take our services, resulting in a 100% fiber network that supports all the inter-office and host-remote links, as well as all business parks within our service areas that take our service. In addition, this fiber infrastructure provides the connectivity required to provide broadband and long-distance services to our residential and commercial customers. Our fiber network utilizes FTTP and fiber-to-the-node networks to offer residential and commercial services.

We operate advanced fiber networks which we own or have entered into long-term leases for fiber network access. At December 31, 2023, our fiber networks consisted of approximately 3,538 route miles.

At December 31, 2023, we passed 35,173 locations with FTTP. We intend to continue to make strategic enhancements to our fiber network including improvements in overall network reliability and increases to our broadband speeds. We offer data speeds of up to 1 Gbps in select markets, and up to 100 Mbps and 60 Mbps in markets where 1 Gbps is not yet available, depending on the geographical region.

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We also provide fixed wireless broadband service to homes and small businesses from 30 towers, 6 of which we own, with the remaining towers being leased. 13 of these towers utilize Citizens Broadband Radio Service (CBRS) spectrum. We have secured 21 licenses in 12 CBRS spectrum counties in Minnesota and Iowa which allows us to offer high-speed Internet to unserved, under-served and hard to serve rural areas.

Environmental Regulation

We are subject to federal, state and local laws and regulations governing the use, storage, disposal of, and exposure to, hazardous materials, the release of pollutants into the environment and the remediation of contamination. We could be subject to environmental laws that impose liability for the entire cost of cleanup at a contaminated site, regardless of fault or the lawfulness of the activity that resulted in contamination. We believe that our operations are in compliance with all applicable environmental laws and regulations.

Employees

As of March 1, 2024, we had 200 full-time equivalent employees dedicated to Nuvera’s operations. In addition, as of March 1, 2024, we had an additional 8 full-time equivalent employees that are employed by Nuvera but are dedicated to IES. IES is a minority equity subsidiary of Nuvera and Nuvera acts as the managing entity for IES.

Intellectual Property

Intellectual property is necessary for our operations but is not material to our overall operations.

Executive Officers of the Registrant

The names and ages of all our executive officers and the positions held by them as of March 1, 2024, are as follows:

Name and Age	Position with the Company	Age
Glenn H. Zerbe	President and CEO	58
Barbara A.J. Bornhoft	Vice-President, Chief Operating Officer (COO) and Corporate Secretary	67
Curtis O. Kawlewski	CFO and Treasurer	57

Our executive officers are appointed annually and serve at the discretion of our BOD. Mr. Zerbe, President and CEO; Ms. Bornhoft, Vice-President, COO and Corporate Secretary; and Mr. Kawlewski, CFO and Treasurer have written employment contracts. There are no familial relationships between any director and executive officers.

Mr. Zerbe has been President and CEO since September of 2019. Prior to that time, he served as Vice President of Sales for Frontier Communications Corporation until March 2019, where he held positions of increasing responsibility since joining Frontier in 2011. Prior to his employment with Frontier, Mr. Zerbe had more than 20 years of sales, marketing and management experience in the communications industry, with companies such as Spanlink, Cisco Systems, SBC, AT&T and IBM. Mr. Zerbe serves as Chairman of the Board for IES and BBV, both equity subsidiaries of ours. In addition, Mr. Zerbe serves on the Board of Governors of FM, also equity subsidiary of ours.

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Ms. Bornhoft has been Vice President, COO and Corporate Secretary since 1998. Ms. Bornhoft has been employed with the Company since 1990. Ms. Bornhoft serves as a board member for BBV, in addition to serving as President for both IES and BBV, both equity subsidiaries of ours.

Mr. Kawlewski has been CFO and Treasurer since 2009. Mr. Kawlewski also serves as the Treasurer for IES and BBV, both equity subsidiaries of ours.

Item 1A.          Risk Factors.

Our operations and financial results are subject to various risks and uncertainties, including but not limited to those described below, that could adversely affect our business, financial condition, results of operations, cash flows and the trading price of our common stock.

Risks Relating to Our Business

We expect to continue to face significant competition in all parts of our business and the level of competition could intensify among our customer channels. The communications industry is highly competitive. We face actual and potential competition from many existing and emerging companies, including other incumbent and competitive communications companies, long-distance carriers and resellers, wireless companies, ISPs, satellite companies and CATV companies, and, in some cases, new forms of providers who can offer competitive services through software applications requiring a comparatively small initial investment. Due to consolidations and strategic alliances within the industry, we cannot predict the number of competitors we will face at any given time.

The wireless business has expanded significantly and has caused many subscribers with traditional telephone and land-based Internet access services to give up those services and rely exclusively on wireless service. In addition, consumers’ options for viewing TV shows have expanded as content becomes increasingly available through alternative sources. Some providers, including TV and CATV content owners, have initiated OTT services that deliver video content to TV, computers and other devices over the Internet. OTT services can include episodes of highly rated TV series in their current broadcast seasons. They can also include original content and broadcast or sports content like those that we carry, but that is distinctive and exclusively available through the alternative source. Consumers can pursue each of these options without foregoing any of the other options. We may not be able to successfully anticipate and respond too many of the various competitive factors affecting the industry, including regulatory changes that may affect our competitors and us differently, new technologies, services and applications that may be introduced, changes in consumer preferences, demographic trends, and discount or bundled pricing strategies by competitors.

Competitors in the markets we serve may enjoy certain business advantages, including size, financial resources, favorable regulatory position, a more diverse product mix, brand recognition and connection to virtually all our customers and potential customers. The largest cable operators also enjoy certain business advantages, including size, financial resources, ownership of or superior access to desirable programming and other content, a more diverse product mix, brand recognition and first-in-field advantages with a customer base that generates positive cash flow for its operations.  Our competitors continue to add features, increase data speeds and adopt aggressive pricing and packaging for services comparable to the services we offer. Their success in selling services that are competitive with ours among our various customer channels could lead to revenue erosion in our business. We face intense competition in our markets for long-distance, Internet access, video service and other ancillary services that are important to our business and to our growth strategy.  If we do not compete effectively, we could lose customers, revenue and market share.

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Our future growth is primarily dependent upon our expansion strategy, which may or may not be successful. We are strategically focused on driving growth by expanding our broadband network to provide services in communities that are in, near or adjacent to our network. This expansion strategy includes our FTTH broadband service. This strategy is relatively new in the marketplace and the success of our strategy will depend on the degree to which we are able to successfully establish and continue to enhance this build, which is not assured. This strategy requires considerable management resources and capital investment, and it is uncertain whether and when it will contribute to positive free cash flow and the degree to which we will otherwise achieve our strategic objectives, on a timely basis or at all. As a result, we expect our capital expenditures to exceed the cash flow provided from continuing operations through 2024. Additionally, we must obtain franchises, construction permits and other regulatory approvals to commence operations in these communities. Delays in entering into regulatory agreements, receiving the necessary franchises and construction permits, procuring needed contractors, materials or supplies, and conducting the construction itself could adversely impact our scheduled construction plans and, ultimately, our expansion strategy. Difficulty in obtaining necessary resources may also adversely affect our ability to expand into new markets as could our ability to adequately market a new brand to customers unfamiliar to us as we expand to markets where we do not currently operate. We may face resistance from competitors who are already in markets we wish to enter. If our expectations regarding our ability to attract customers in these communities are not met, or if the capital requirements to complete the network investment or the time required to attract our expected level of customers are incorrect, our financial performance and returns on investment may be negatively impacted.

We must adapt to rapid technological changes. If we are unable to take advantage of technological developments, or if we adopt and implement them at a slower rate than our competitors, we may experience a decline in the demand for our services. Our industry operates in a technologically complex environment. New technologies are continually developed, and existing products and services undergo constant improvement. Emerging technologies offer consumers a variety of choices for their communication and broadband needs. To remain competitive, we will need to adapt to future changes in technology to enhance our existing offerings and to introduce new or improved offerings that anticipate and respond to the varied and continually changing demands of our various customer channels. Our business and results of operations could be adversely affected if we are unable to match the benefits offered by competing technologies on a timely basis and at an acceptable cost, or if we fail to employ technologies desired by our customers before our competitors do so.

New technologies, particularly alternative methods for the distribution, access and viewing of content, have been, and will likely continue to be, developed that will further increase the number of competitors that we face and drive changes in consumer behavior. Consumers seek more control over when, where and how they consume content and are increasingly interested in communication services outside of the home and in newer services in wireless Internet technology and devices such as tablets, smartphones and mobile wireless routers that connect to such devices. These new technologies, distribution platforms and consumer behaviors may have a negative impact on our business.

In addition, evolving technologies can reduce the costs of entry for others, resulting in greater competition and significant new advantages for competitors. Technological developments could require us to make significant new capital investments to remain competitive with other service providers. If we do not replace or upgrade our network and its technology on a timely basis, we may not be able to compete effectively and could lose customers. We may also be placed at a cost disadvantage in offering our services. Technology changes are also allowing individuals to bypass communications companies and cable operators entirely to make and receive calls, and to provide for the distribution and viewing of video programming without the need to subscribe to traditional voice and video products and services. Increasingly, this can be done over wireless facilities and other emerging mobile technologies in addition to traditional wired networks. Wireless companies are aggressively developing networks using next-generation data technologies, which can deliver high-speed Internet service via wireless technology to a large geographic footprint. As these technologies continue to expand in availability and reliability, they could become an effective alternative to our high-speed Internet services. Although we use fiber-optics in parts of our networks and are building a new FTTP network, including in some residential areas, we continue to rely on coaxial cable and copper transport media to serve customers in many areas. The facilities we use to offer our video services, including the interfaces with customers, are undergoing a rapid evolution, and depend in part on the products, expertise and capabilities of third parties. If we cannot develop new services and products to keep pace with technological advances, or if such services and products are not widely embraced by our customers, our results of operations could be adversely impacted.

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Shifts in our product mix may result in a decline in operating profitability. Margins vary among our products and services. Our profitability may be impacted by technological changes, customer demands, regulatory changes, the competitive nature of our business and changes in the product mix of our sales. These shifts may also result in our long-lived assets becoming impaired or our inventory becoming obsolete. We review long-lived assets for potential impairment if certain events or changes in circumstances indicate that impairment may be present.

Public health threats, such as the outbreak of COVID-19, could have a material adverse effect on our business, results of operations, cash flows and stock price.  We may face risks associated with public health threats or outbreaks of epidemic, pandemic or communicable diseases, such as the outbreak of the COVID-19 and its variants. The COVID-19 pandemic had in the short-term and may in the long-term adversely impact the global economy, financial markets and supply chains. The outbreak had resulted in federal, state and local governments implementing mitigation measures, including shelter-in-place orders, travel restrictions, limitations on business, school closures, vaccination and testing requirements and other measures. Governments had enacted fiscal and monetary stimulus measures to counteract the impacts of COVID-19.

As a critical infrastructure provider, we continued to operate our business and provide services to our customers. Although we are considered an essential business, the outbreak of COVID-19 and any preventive or protective actions implemented by governmental authorities may have a material adverse effect on our operations, customers and suppliers and could do so for an indefinite period. Adverse economic and market conditions because of COVID-19 could also adversely affect the demand for our products and services and may also impact the ability of our customers to satisfy their obligations to us. In addition, concerns regarding the economic impact of COVID-19 have caused volatility in financial and other capital markets, which has and may continue to adversely affect the market price of our common stock and our ability to access capital markets. In response to the COVID-19 pandemic, we have transitioned a substantial number of our employees to telecommuting and remote work arrangements, which may increase the risk of a security breach or cybersecurity attack on our information technology systems that could impact our business.

We cannot reasonably estimate at this time the resulting future financial impact of COVID-19 on our business, but the prolonged effect of it could have a material adverse effect to our results of operations, financial condition and liquidity. The extent to which the COVID-19 pandemic may adversely impact our business, results of operations, financial condition and liquidity will depend on future developments, which are highly uncertain and unpredictable, including the severity and duration of the outbreak, current and new variants of COVID-19, the availability and distribution of effective treatments and vaccines, the effectiveness of actions taken to contain or mitigate its effects and any resulting economic downturn, recession or depression in the markets we serve.

We receive support from various funds established under federal and state laws, and the continued receipt of that support is not assured. A significant portion of our revenues come from network access and subsidies. An order adopted by the FCC in 2011 (2011 Order) significantly impacted the amount of support revenue we receive from the USF, CAF and ICC. The 2011 Order reformed core parts of the USF, broadly recast the existing ICC scheme, established the CAF to replace support revenues provided by the USF and redirected support from voice services to broadband services.

We receive subsidy payments from various federal and state universal service support programs, including high-cost support, Lifeline and E-Rate programs for schools and libraries. The total cost of the various FUSF programs has increased significantly in recent years, putting pressure on regulators to reform the programs and to limit both eligibility and support. We cannot predict future changes that may impact the subsidies we receive. However, a reduction in subsidies support may directly affect our profitability and cash flows.

In 2022 and 2023, we received $11.72 million and $12.48 million in payments under the federal A-CAM and FUSF programs.

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We cannot predict future changes that may have an impact on the subsidies we receive. However, a reduction in subsidies support may directly affect our profitability and cash flows. In addition, the federal debt limit continues to be actively debated as plans for long-term national fiscal policy are discussed. Moreover, over the last decade, including 35 days beginning on December 22, 2018, the United States government has shut down several times and some regulatory agencies have had to furlough employees and stop some activities. Further, the outcome of any budget discussion could have a significant effect on programs that support us. The failure of Congress to approve future budgets or increase the debt ceiling of the of the United States on a timely basis or decrease funding for any of these programs could delay or result in the loss of support payments we receive.

Any delay or reduction in federal support may directly affect our profitability and cash flows and have an adverse effect on our business, results of operations and financial condition.

A disruption in our networks and infrastructure could cause service delays or interruptions, which could cause us to lose customers and incur additional expenses. Our customers depend on reliable service over our fiber network. The primary risks to our network infrastructure include physical damage to lines, security breaches, capacity limitations, power surges or outages, software defects and disruptions beyond our control, such as natural disasters and acts of terrorism. From time to time in the ordinary course of business, we experience short disruptions in our service due to factors such as physical damage, inclement weather and service failures of our third-party service providers. We could experience more significant disruptions in the future. Disruptions may cause service interruptions or reduced capacity for customers, either of which could cause us to lose customers and incur unexpected expenses.

There have been recent media reports alleging that certain lead sheathed copper cables that are part of our copper network may present general health or environmental risks in areas where those facilities are deployed. We have not been given access to the test methodology or the test results on which those reports are based, so we are unable to access the accuracy or implications of those reports. We are currently researching our network for lead cable in service that was identified in the media reports. Until that time, we cannot predict what actions, if any, we may ultimately take with respect to the lead sheathed cable in our network or the potential financial, operational, regulatory or reputational impacts of the situation on us.

A cyber-attack may lead to unauthorized access to confidential customer, personnel and business information that could adversely affect our business. Attempts by others to gain unauthorized access to organizations' information technology systems are becoming more frequent and sophisticated and are sometimes successful. These attempts may include covertly introducing malware to companies' computers and networks, impersonating authorized users or "hacking" into systems. We seek to prevent, detect and investigate all security incidents that do occur; however, we may be unable to prevent or detect a significant attack in the future. Significant information technology security failures could result in the theft, loss, damage, unauthorized use or publication of our confidential business information, which could harm our competitive position, subject us to additional regulatory scrutiny, expose us to litigation or otherwise adversely affect our business. If a security breach results in misuse of our customers' confidential information, we may incur liability as a result.

Our operations require substantial capital expenditures, and our business, financial condition, results of operations and liquidity may be impacted if funds for capital expenditures are not available when needed. We require significant capital expenditures to maintain, upgrade and enhance our network facilities and operations. While we have historically been able to fund capital expenditures from cash generated from operations and borrowings under our revolving credit facility, the other risk factors described in this section could materially reduce cash available from operations or significantly increase our capital expenditure requirements, which may result in our inability to fund the necessary level of capital expenditures to maintain, upgrade or enhance our network. This could adversely affect our business, financial condition, results of operations and liquidity.

We may be unable to obtain necessary hardware, software and operational support from third-party vendors. We depend on third-party vendors to supply us with a significant amount of hardware, software and operational support necessary to provide certain of our services, to maintain, upgrade and enhance our network facilities and operations, and to support our information and billing systems. Some of our third-party vendors are our primary source of supply for certain products and services for which there are few substitutes. The global supply chains were impacted by the COVID-19 pandemic, and may be impacted by future pandemics, which may cause a delay in the development, manufacturing and shipping of products and in some cases an increase in product costs. If any of these vendors should experience financial difficulties, experience supply chain issues, have demand that exceeds their capacity or can no longer meet our specifications or provide products or services we need or at reasonable prices, our ability to provide some services may be hindered, in which case our business, financial condition and results of operations may be adversely affected.

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Video content costs are substantial and continue to increase. We expect video content costs to continue to be one of our largest operating costs associated with providing video service. Video programming content includes network programming designed to be shown in linear channels, as well as the programming of local over-the-air TV stations that we retransmit. The cable industry has experienced continued increases in the cost of programming, especially the cost of sports programming and local broadcast station retransmission content. Programming costs are generally assessed on a per-subscriber basis, and therefore, are directly related to the number of subscribers to which the programming is provided. Our relatively small subscriber base limits our ability to negotiate lower per-subscriber programming costs. Larger providers can often qualify for discounts based on the number of their subscribers. This cost difference can cause us to experience reduced operating margins, while our competitors with a larger subscriber base may not experience similar margin compression. In addition, escalators in existing content agreements can result in cost increases that exceed general inflation. While we expect video content costs to continue to increase, we may not be able to pass such cost increases on to our customers, especially as an increasing amount of programming content becomes available via the Internet at little or no cost. Also, some competitors or their affiliates own their programming, and we may not be able to secure license rights to that programming. As our programming contracts with content providers expire, there is no assurance that they will be renewed on acceptable terms or that they will be renewed at all, in which case we may not be able to provide such programming as part of our video services packages and our business and results of operations may be adversely affected.

Our ability to attract and/or retain certain key management and other personnel in the future could have an adverse effect on our business. We rely on the talents and efforts of key management personnel, many of whom have been with our Company or in our industry for decades. While we maintain long-term and emergency transition plans for key management personnel and believe we could either identify internal candidates or attract outside candidates to fill any vacancy created by the loss of any key management personnel, the loss of one or more of our key management personnel could have a negative impact on our business.

Acquisitions present many risks, and we may be unable to realize the anticipated benefits of acquisitions. From time to time, we make acquisitions and investments or enter into other strategic transactions. In connection with these types of transactions, we may incur unanticipated expenses; fail to realize anticipated benefits; have difficulty integrating the acquired businesses; disrupt relationships with current and new employees, customers and vendors; incur significant indebtedness or have to delay or not proceed with announced transactions. The occurrence of any of the foregoing events could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may face significant challenges in combining the operations of an acquired business with ours in a timely and efficient manner. The failure to successfully integrate an acquired business and to successfully manage the challenges presented by the integration process may result in our inability to achieve anticipated benefits of the acquisition, including operational and financial synergies. Even if we are successful in integrating acquired businesses, we cannot guarantee that the integration will result in the complete realization of anticipated financial synergies or that they will be realized within the expected time frames.

Increasing attention to, and evolving expectations for, environmental, social, and governance (ESG) initiatives could increase our costs, harm our reputation, or otherwise adversely impact our business.

Companies across multiple industries are facing increasing scrutiny from a variety of stakeholders related to their ESG practices. Expectations regarding voluntary ESG initiatives and disclosures may result in increased costs (including but not limited to increased costs related to compliance, stakeholder engagement, contracting and insurance), changes in demand for certain offerings, enhanced compliance or disclosure obligations, or other adverse impacts our business, financial condition, or results of operations.

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While we may at times engage in voluntary initiatives (such as voluntary disclosures, certifications, or goals, among others) to improve the ESG profile our Company and/or offerings or to respond to stakeholder demands, such initiatives may be costly and may not have the desired effect. Expectations around companies’ management of ESG matters continues to evolve rapidly, in many instances due to factors that are out of control. While we commit to certain initiatives or goals, we may not ultimately be able to achieve them due to cost, technological, or other constraints. Moreover, actions or statements that we may take based on expectations, assumptions, or third-party information that we currently believe to be reasonable may subsequently be determined to be erroneous or be subject to misinterpretation. Even if this is not the case, our current actions may subsequently be determined to be3 insufficient by various stakeholders, and we may be subject to investor or regulator engagement on our ESG initiatives and disclosures, even if such initiatives are currently voluntary.

Certain market participants, including major institutional investors and capital providers, use third-party benchmarks and scores to assess companies’ ESG profiles in making investments or voting decisions. Unfavorable ESG ratings could lead to increased negative investor sentiment towards us, which could negatively impact our share price as well as our access to and cost of capital. To the extent ESG matters negatively impact our reputation, it may also impede our ability to compete as effectively to attract and retain employees, customers, or business partners, which may adversely impact our operations. In addition, we expect there will likely be increasing levels of regulation, disclosure-related and otherwise, with respect to ESG matters, which will likely lead to increased costs as well as scrutiny that could heighten all the risks identified in this risk factor. Additionally, many of our customers and suppliers may be subject to similar expectations, which may augment or create additional risks, including risks that may be known to us.  

Risks Relating to Current Economic Conditions

Weak economic conditions may have a negative impact on our business, results of operations and financial condition. Downturns in the economic conditions in the markets and industries we serve could adversely affect demand for our products and services and have a negative impact on the results of our operations. Economic weakness or uncertainty may make it difficult for us to obtain new customers and may cause our existing customers to reduce or discontinue the services to which they subscribe. This risk may be worsened by the expanded availability of free or lower cost services, such as streaming or OTT services or substitute services, such as wireless phones and public Wi-Fi networks. Weak economic conditions may also have an impact on the ability of third parties to satisfy their obligations to us.

Risks Relating to Our Stock

The price of our common stock may be volatile and may fluctuate substantially, which could negatively affect the holders of our common stock. The market price of our common stock may fluctuate widely as a result of various factors including, but not limited to, period-to-period fluctuations in our operating results, the volume of the sales of our common stock, the limited number of holders of our common stock and the resulting limited liquidity in our common stock, dilution, developments in the communications industry, the failure of securities analysts to cover our common stock, changes in financial estimates by securities analysts, competitive factors, regulatory developments, labor disruptions, general market conditions and market conditions affecting the stock of communications companies. Communications companies have, in the past, experienced extreme volatility in the trading prices and volumes of their securities, which has often been unrelated to operating performance. High levels of market volatility may have a significant adverse effect on the market price of our common stock. In addition, in the past, securities class action litigation has often been instituted against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert management's attention and resources, which could have a material adverse impact on our business, financial condition, results of operations, liquidity and/or the market price of our common stock.

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Our organizational documents could limit or delay another party’s ability to acquire us and, therefore, could deprive our investors of a possible takeover premium for their shares. Several of the provisions in our Articles of Incorporation could make it difficult for another company to acquire us. Among other things, these provisions:

●      Restrict any one individual or entity from beneficially owning more than seven percent of the outstanding capital stock of the corporation.

We also are subject to laws that may have a similar effect. For example, federal and certain state telecommunications laws and regulations generally prohibit a direct or indirect transfer of control over a business without prior regulatory approval. These laws and regulations make it difficult for another company to acquire us, and therefore could limit the price that investors might be willing to pay in the future for shares of our common stock.

Risks Relating to Our Indebtedness and Our Capital Structure

We have a substantial amount of debt outstanding due to our FTTP initiatives, which could adversely affect our business and restrict our ability to fund working capital and planned capital expenditures. As of December 31, 2023, we had $124.2 million of debt outstanding. Our substantial amount of expected indebtedness could adversely impact our business, including:

● We may be required to use a substantial portion of our cash flow from operations to make principal and interest payments on our debt, which will reduce funds available for operations, capital expenditures, future business opportunities and strategic initiatives;

● We may have limited flexibility to react to changes in our business and our industry;

● It may be more difficult for us to satisfy our other obligations;

● We may have a limited ability to borrow additional funds or to sell assets to raise funds if needed for working capital, capital expenditures to complete our FTTH initiatives, acquisitions or other purposes;

● We may become more vulnerable to general adverse economic and industry conditions, including changes in interest rates; and

● We may be at a disadvantage compared to our competitors that have less debt.

We cannot guarantee that we will generate sufficient revenues to service our debt and have adequate funds left over to achieve or sustain profitability in our operations, meet our working capital and capital expenditure needs or compete successfully in our markets.

We may not be able to refinance our existing debt if necessary, or we may only be able to do so at a higher interest rate. We may be unable to refinance or renew our credit facilities and our failure to repay all amounts due on the maturity dates would cause a default under the credit agreement. Alternatively, any renewal or refinancing may occur on less favorable terms. If we refinance our credit facilities on terms that are less favorable to us than the terms of our existing debt, our interest expense may increase significantly, which could impact our results of operations and impair our ability to use our funds for other purposes.

Our variable-rate debt subjects us to interest rate risk, which could have an impact on our cost of borrowing and operating results. Certain of our debt obligations are at variable rates of interest and expose us to interest rate risk. Increases in interest rates could have a negative impact on the results of our operations and operating cash flows. We utilize Interest Rate Swap Agreements (IRSAs) to convert a portion of our variable-rate debt to a fixed-rate basis. However, we do not maintain interest rate hedging agreements for all our variable-rate debt and our existing hedging agreements may not fully mitigate our interest rate risk, may prove disadvantageous or may create additional risks. Changes in fair value of cash flow hedges that have been de-designated or determined to be ineffective are recognized in earnings. Significant increases or decreases in the fair value of these cash flow hedges could cause favorable or adverse fluctuations in the results of our operations.

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Risks Related to the Regulation of Our Business

We are subject to a complex and uncertain regulatory environment, and we face compliance costs and restrictions greater than those of many of our competitors. Our businesses are subject to regulation by the FCC and other federal, state and local entities. Rapid changes in technology and market conditions have resulted in changes in how the government addresses communications, video programming and Internet services. Many businesses that compete with our communications companies are comparatively less regulated. Some of our competitors are either not subject to utilities regulation or are subject to significantly fewer regulations. In contrast to our subsidiaries regulated as cable operators and satellite video providers, competing on-demand and OTT providers and motion picture and digital video disc firms have almost no regulation of their video activities. Recently, federal and state authorities have become more active in seeking to address critical issues in each of our product and service markets. The adoption of new laws or regulations, or changes to the existing regulatory framework at the federal, state or local level, could require significant and costly adjustments that could adversely affect our business plans. New regulations could impose additional costs or capital requirements, require new reporting, impair revenue opportunities, potentially impede our ability to provide services in a manner that would be attractive to our customers and potentially create barriers to enter new markets or to acquire new lines of business. We face continued regulatory uncertainty in the immediate future. Not only are these governmental entities continuing to move forward on these matters, but their actions remain subject to reconsideration, appeal and legislative modification over an extended period, and it is unclear how their actions will ultimately impact our business. We cannot predict future developments or changes to the regulatory environment or the impact such developments or changes may have on us.

Increased regulation of the Internet could increase our cost of doing business. Current laws and regulations governing access to, or commerce on, the Internet are limited. As the significance of the Internet continues to expand, federal, state and local governments may adopt new rules and regulations applicable to, or apply existing laws and regulations to, the Internet. During 2017, the FCC adopted an order eliminating its previous classification of Internet service as a telecommunications service regulated under Title II of the TA96. This effectively limits the FCC’s authority over ISPs. The FCC retained rules requiring ISPs to disclose practices associated with blocking, throttling and paid prioritization of Internet traffic. The FCC order has been challenged in court and the outcome of the challenge cannot be determined at this time.  

The outcome of pending matters before the FCC and the FTC and any potential congressional action cannot be determined at this time but could lead to increased costs for the Company in connection with our provision of Internet services and could affect our ability to compete in the markets we serve.

We are subject to extensive laws and regulations relating to the protection of the environment, natural resources and worker health and safety. Our operations and properties are subject to federal, state and local laws and regulations relating to the protection of the environment, natural resources and worker health and safety, including laws and regulations governing and creating liability in connection with the management, storage and disposal of hazardous materials, asbestos and petroleum products. We are also subject to laws and regulations governing air emissions from our fleet vehicles. As a result, we face several risks, including:

● Hazardous materials may have been released at properties that we currently own or formerly owned (perhaps through our predecessors). Under certain environmental laws, we could be held liable, without regard to fault, for the costs of investigating and remediating any actual or threatened contamination at these properties and for contamination associated with disposal by us, or by our predecessors, of hazardous materials at third-party disposal sites;

● We could incur substantial costs in the future if we acquire businesses or properties subject to environmental requirements or affected by environmental contamination. In particular, environmental laws regulating wetlands, endangered species and other land use and natural resources may increase the costs associated with future business or expansion or delay, alter or interfere with such plans;

● The presence of contamination can adversely affect the value of our properties and make it difficult to sell any affected property or to use it as collateral; and

● We could be held responsible for third-party property damage claims, personal injury claims or natural resource damage claims relating to contamination found at any of our current or past properties.

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The cost of complying with environmental requirements could be significant. Similarly, the adoption of new environmental laws or regulations, or changes in existing laws or regulations or their interpretations, could result in significant compliance costs or unanticipated environmental liabilities.

Effects of climate change may impose risk of damage to our infrastructure, our ability to provide services, and may cause changes in federal and state regulation, all of which may result in potential adverse impacted to our financial results. Extreme weather events precipitated by long-term climate change have the potential to directly damage network facilities or disrupt our ability to build and maintain portions of our network. Any such disruption could delay network deployment plans, interrupt service for our customers, increase our costs and have a negative effect on our operating results. The potential physical damage effects of climate change, such as increased frequency and severity of storms, droughts, floods, fires, freezing conditions, sea-level rise, and other climate-related events, could adversely affect our operations, infrastructure, and financial results. Operational impacts resulting from the potential physical effects of climate change, such as damage to our network infrastructure, could result in increased costs and loss of revenue. We could incur significant costs to improve the climate resiliency of our infrastructure and otherwise prepare for, respond to, and mitigate such physical effect of climate change. We are not able to accurately predict the materiality of any potential losses or costs associated the physical effects of climate change.

Further, customers, consumers, investors and other stakeholders are increasingly focusing on environmental issues, including climate change, water use, deforestation, plastic waste, and other sustainability concerns. Concern over climate change or other ESG matters may result in new or increased legal and regulatory requirements to reduce or mitigate impacts to the environment and reduce the impact of our business on climate change, which could increase our costs for monitoring and compliance. Further, climate change regulations may require us to alter our proposed business plans or increase our operating costs due to increased regulation or environmental considerations and could adversely affect our business and reputation. 

Our business may be impacted by new or changing tax laws or regulations and actions by federal, state, and/or local agencies, or by how judicial authorities apply tax laws.  Our operations are subject to various federal, state and local tax laws and regulations. In connection with the products and services we sell, we calculate, collect, and remit various federal, state, and local taxes, surcharges and regulatory fees to numerous federal, state and local governmental authorities. In many cases, the application of tax laws is uncertain and subject to differing interpretations, especially when evaluated against new technologies and communications services, such as broadband Internet access and cloud related services. Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the law are issued or applied. Changes in tax laws, or changes in interpretations of existing laws, could materially affect our financial position, results of operations and cash flows. For example, the Tax Cuts and Jobs Act of 2017, a major federal tax reform, which had a significant impact on our tax obligations and effective income tax rate.

Item 1B.  Unresolved Staff Comments

Not required for a smaller reporting company.

Item 1C.  Cybersecurity Risks

Material Effects from Cybersecurity Incidents

Our business is subject to risk from cybersecurity threats and incidents, including attempts to gain unauthorized access to our systems or networks, or those of our managers, employees, and third-party vendors and service providers, to disrupt operations, corrupt data or steal confidential or personal information and other cybersecurity breaches. Nuvera considers cybersecurity risk a serious threat to our assets and our people and has put processes in place designed to mitigate the risk and impact of any such cybersecurity threat or incident.

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Our operations rely on the secure, accurate and timely receipt, storage, transmission, use, disclosure, and other processing of confidential and other information (including personal information) in our systems and networks. We also rely on the secure, accurate and timely receipt, storage, transmission, use, disclosure, and other processing of confidential and other information in the systems and networks of our customers and third parties, including suppliers, sellers and servicers, financial market utilities, and other third parties. Cybersecurity risks for companies like ours continue to increase. Like many companies and government entities, from time to time we have been, and expect to continue to be, the target of attempted cybersecurity incidents and other information security threats, including those from nation-state and nation-state supported actors.

As of the date of this report we have not experienced or aware of any cybersecurity incidents resulting, or reasonably likely to result in, a material impact to our company, including to our business, financial condition, and results of operations. There is no assurance that our cybersecurity risk management program will prevent cybersecurity incidents from having such impacts in the future.

Additionally, insider threats also remain a risk given our workforce diversification to include contractors, remote workers, part-time employees, and full-time employees. As referenced above, our third-party vendors and service providers and their supply chain connections remain a potential source of risk.

For additional information, see Risk Factors – Risks Related to Our Business. Potential cybersecurity threats are changing rapidly and advancing in sophistication. We may not be able to protect our systems and networks, or the confidentiality of our confidential or other information (including personal information), from cybersecurity incidents and other unauthorized access, disclosure, and disruption.

Cybersecurity Risk Management and Strategy

Our cybersecurity program is built upon the National Institute for Standards and Technology and other best practice frameworks. We employ processes for assessing, identifying, and managing material risks from cybersecurity threats, including engaging an independent cybersecurity consultant to audit our systems and procedures, make recommendations for improvement and monitor remediation of any identified risks. We also conduct random vulnerability testing including network penetration testing, phishing and social engineering tests. In addition, we also require Systems and Organization Control (“SOC”) type reports from our service providers for our payroll and human resources system and stock administrator.

Although we maintain systems and controls designed to prevent cybersecurity breaches from occurring, and we have processes to identify and mitigate threats, the development and maintenance of these systems, controls and processes is costly and requires ongoing monitoring and updating as technologies change and efforts to overcome security measures become increasingly sophisticated. Moreover, despite our efforts, the possibility of a breach occurring cannot be eliminated entirely. As we engage in more electronic transactions with service customers and vendors, and rely more on cloud-based information systems, the related security risks will increase, and we will need to expend additional resources to protect our technology and information systems. In addition, there can be no assurance that our internal information technology systems or those of our third-party contractors, or our consultants’ efforts to implement adequate security and control measures, will be sufficient to protect us against breakdowns, service disruption, data deterioration or loss in the event of a system malfunction, or prevent data from being stolen or corrupted in the event of a cyberattack, security breach, industrial espionage attacks or insider threat attacks which could result in financial, legal, business or reputational harm.

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Cybersecurity Governance

All employees of the Company have ownership in managing cybersecurity and data privacy risks, however, oversight responsibility is shared by our BOD, Audit Committee and cybersecurity management team. The Audit Committee is responsible for our cybersecurity policies and provides regularly updates to the BOD Our cybersecurity management team, in conjunction with our third-party chief information security officer (“CISO”), conduct regular assessment and management of material risks from cybersecurity threats, including review with our internal cybersecurity management team. All employees and consultants are directed to report to our cybersecurity management team any irregular or suspicious activity that could indicate a cybersecurity threat or incident. 

Our cybersecurity management team has primary responsibility for identifying, assessing and managing our exposure to cybersecurity threats and incidents, subject to oversight by the Audit Committee of the BOD of the processes we establish to assess, monitor and mitigate that exposure.

If a potentially material cybersecurity threat or incident is identified or discovered, the Company’s Cybersecurity Management Team will trigger our incidence response plan, including notifying our CEO, CFO, General Counsel and other relevant business executives. Our Cybersecurity Management Team, along with our CISO, will work with the appropriate leaders and employees in any impacted business groups, as well as appropriate personnel in our finance, legal and other impacted departments, to assess the risks to the Company and potential impact while determining appropriate remediation steps. If executive management determines that a cybersecurity threat or incident could be material to the Company, our management will notify the Audit Committee, who will escalate the risk to our full BOD, depending on an assessment of the risk.

Item 2.   Properties

We are primarily focused on the provision of communication services and our properties are used primarily for administrative support and to house and safeguard our operating equipment. On December 31, 2023, our gross property, plant and equipment totaled $328,639,174 (net balance of $155,550,572).

We own our corporate headquarters, which are currently located at 27 North Minnesota Street, New Ulm, Minnesota. We also own office facilities and related equipment for administrative personnel, central office buildings and operations in Minnesota and Iowa.

In addition to land and structures, our property consists of equipment necessary for the provision of communication services, including central office equipment, CPE and connections, pole lines, towers, remote terminals, aerial and underground cable and wire facilities and associated outside plant for use in providing our services, telephone switches, fiber networks and fiber communications network equipment, vehicles, furniture and fixtures, computers and other equipment.

In addition to plant and equipment we wholly-own we utilize poles, towers, cable and conduit systems jointly owned with other entities and lease space on facilities from other entities. These arrangements are in accordance with written agreements customary in the industry. We also have appropriate easements, rights of way and other arrangements for the accommodation of our pole lines, underground conduits, aerial and underground cables and wires. 

We believe our properties are suitable and adequate to provide modern and effective communications services within our service areas, including local dial-tone, long distance service, broadband, TV and dedicated and switched long-haul transport. We also believe our properties and equipment are adequately insured. See Note 6 – “Long-Term Debt” for descriptions of the mortgages and collateral relating to the above referenced properties. See Note 1 – “Business Description and Summary of Significant Accounting Policies” and Note 4 – “Property, Plant and Equipment” for a description of our depreciation policies and information relating to the above referenced properties and equipment and their respective depreciation.

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Item 3.   Legal Proceedings

Other than the litigation incidental to our business, there are no pending material legal proceedings to which we are a party or to which any of our property is subject.  

Item 4.   Mine Safety Disclosures

Not Applicable.

PART II

Item 5.   Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our common stock is quoted on the OTCQB Marketplace under the symbol "NUVR." As of March 1, 2024 there were 1,227 registered stockholders and approximately 763 beneficial owners of Nuvera stock.

The Company’s Articles of Incorporation restrict any one individual or entity from beneficially owning more than seven percent of the outstanding capital stock of the corporation. Specific details of this restriction are contained in Article III of the Company’s Articles of Incorporation.   

Issuer Purchases of Equity Securities (registered pursuant to Section 12 of the Exchange Act)

Repurchases of Nuvera common stock are made to support the Company’s stock-based employee compensation plans and for other corporate purposes. In May 2019, Nuvera announced the adoption of a $4.0 million stock repurchase program running through the end of 2021. Under the stock repurchase program, repurchases could be made from time to time using a variety of methods, including through open market purchase or in privately negotiated transactions in compliance with the rules of the SEC and other applicable legal requirements. The Company did not purchase any shares in 2023 nor the last three quarters of 2022 and there are no dollar amounts set aside for future repurchases under any stock repurchase plans.

In two transactions that closed on February 25, 2022, and February 28, 2022, Nuvera purchased 75,000 shares each from two shareholders, for a total of 150,000 shares at a price of $21.25 per share for a total purchase price of $3,187,500. The shares were purchased pursuant to a privately negotiated purchase agreement between Nuvera and the shareholders. The stock purchase was authorized by the Nuvera BOD, and a waiver was obtained from CoBank, ACB (CoBank) to facilitate the sale. See Nuvera’s Form 8-K filed with the SEC on March 2, 2022, for more information regarding this stock purchase. 

Dividends and Restrictions

We declared a quarterly dividend of $0.14 per share for the second and first quarters of 2023, which totaled $717,721 for the second quarter and $713,050 for the first quarter. We declared a quarterly dividend of $0.14 per share for the fourth, third, second and first quarters of 2022, which totaled $711,841 for the fourth, third, and second quarters and $708,407 for the first quarter.  

On September 29, 2023, the BOD of Nuvera announced that it was suspending dividend payments to its shareholders and will not declare or pay a dividend in the third quarter of 2023. In addition, the BOD of Nuvera did not declare or pay a dividend for the fourth quarter of 2023 as well. The BOD’s action reflects the Company’s commitment to maximize available capital for the foreseeable future as it executes on its Nuvera Gig Cities™ project. This decision focuses available capital on deploying fiber and capturing the growth opportunity in new and existing markets in southern Minnesota. Nuvera believes this investment in the largest infrastructure project in Company history is strengthening its competitive position as a regional provider.

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There are security and loan agreements underlying our current CoBank credit facility that contain restrictions on our distributions to stockholders and investment in, or loans, to others. See below and Note 6 – “Long-Term Debt” for additional information.

Our loan agreements include restrictions on our ability to pay cash dividends to our stockholders. However, we were allowed to pay dividends in an amount up to $3,000,000 in any year if no default or event of default had occurred. Our current Total Leverage Ratio as of December 31, 2023, was 5.03 which exceeded our original maximum total leverage of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.

Our BOD reviews quarterly dividend declarations based on our anticipated earnings, capital requirements and our operating and financial conditions. The cash requirements of our current dividend payment practices are in addition to our other expected cash needs.

Item 6.   Remove and Reserved

Item 7.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our historical financial statements and the related notes contained elsewhere in this report.

Results of Operations

Overview

Nuvera has an advanced fiber communications network and offers a diverse array of communications products and services. We provide broadband Internet access, video services and managed and hosted solutions services. In addition, we provide local voice service and network access to other communications carriers for connections to our networks as well as long distance service.

Our operations consist primarily of providing services to customers for a monthly charge. Because many of these services are recurring in nature, backlog orders and seasonality are not significant factors. Our working capital requirements include financing the construction of our advanced fiber networks. We also require capital to maintain our advanced fiber networks and infrastructure; fund the payroll costs of our highly skilled labor force; maintain inventory to service capital projects, maintain our communication equipment customers; pay dividends and provide for the carrying value of trade accounts receivable (AR), some of which may take several months to collect in the normal course of business.

In 2023, we have seen our overall revenues increase primarily due to Internet growth mentioned above. However, we continue to see accelerated losses in our voice and video service customers as those customers make choices about their entertainment needs and personal finances. We have also experienced increased costs in 2023 which have affected our margins. In addition, we had anticipated increased inflation and future supply chain issues in the inventory, equipment and fiber we use in our business and had therefore purchased a large amount of these items to mitigate these potential issues and not disrupt our business operations.  

With respect to liquidity, we continue to evaluate costs and spending across our organization. This includes evaluating discretionary spending and non-essential capital investment expenditures. As of December 31, 2023, we have $15.8M of our bank revolver available for use if the need arises. The Company may seek additional financing to continue to fund its fiber expansion plans and meet current and future liquidity needs.  

We will continue to actively monitor the situation and may take further actions that alter our operations as may be required by federal, state or local authorities or that we determine are in the best interests of our employees, customers, suppliers and shareholders.

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Executive Summary

Highlights:

● On December 21, 2023, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and increased the Company’s existing credit facility from an aggregate principal amount of $130.0 million to $140.0 million. Under the Agreements, among other things, (i) the Company’s revolving loan was increased from $30.0 million to $40.0 million and (ii) the Company operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on December 21, 2023, for further details regarding the new credit agreements with CoBank.

● On December 12. 2023, the Company announced that it confirmed eligibility for CBOL funding through the USAC. The incremental funding will be used to continue to support the Company’s multi-year fiber construction initiative. The Company began receiving a monthly benefit in November of 2023 with the first payment receipt confirmed in December. On an annualized basis this new program will provide $3.9 million of new funding based on the tariff filing and the Company’s expected line counts. The monthly CBOL subsidy formula is reviewed and subject to revision on an annual basis and subject to changed based on updated USAC funding criteria July 1 of each year.

● On September 29, 2023, the BOD of Nuvera announced that it is suspending dividend payments to its shareholders and will not declare or pay a dividend in the 2023 third quarter. The BOD’s action reflects the Company’s commitment to maximize available capital for the foreseeable future as it executes on its Nuvera Gig Cities™ project. This decision focuses available capital on deploying fiber and capturing the growth opportunity in new and existing markets in southern Minnesota. Nuvera believes this investment in the largest infrastructure project in Company history is strengthening its competitive position as a regional provider.

● On March 31, 2023, Nuvera and the other owners of FiberComm sold 100% of their interest in FiberComm to ImOn Communications, LLC. FiberComm has been providing high quality Internet and voice services to businesses in the Sioux City, Iowa market for over 20 years. Nuvera owned a 20% interest in FiberComm through its wholly owned subsidiary PTC. Nuvera announced the execution of the FiberComm sale agreement in January 2023. Nuvera recognized a gain of $4,060,775, net of escrow true-ups, in book value in connection with the sale of the FiberComm interest. Prior to the sale of Nuvera’s equity investment in FiberComm, Nuvera had guaranteed a portion of a ten-year loan owed by FiberComm, set to mature on April 30, 2026. On March 31, 2023, upon closing of the sale, the loan was paid and Nuvera was released from their guarantee of loan. 

● In 2023, the Company was awarded a grant from Redwood County under the Community Development Block Grant administered by the Southwest Minnesota Housing Partnership. The grant was to be used to build broadband fiber to residential customers in areas that qualify as low to moderate income. The Company was awarded $1,559,643 to complete this project. The Company has not received any funds for this project as of December 31, 2023.

● In 2022, the Company was awarded two separate county grants from Nicollet County and Goodhue County to cover costs of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities. The Company was eligible to receive up to $2,139,562 to complete these projects. We have received $639,562 on these projects as of December 31, 2023.

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●	On December 8, 2022, the Company was awarded four broadband grants from the Minnesota Department of Employment and Economic Development (DEED). The grants will provide up to 45.0% to 50.0% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities and businesses in the Company’s service area. The Company is eligible to receive $8,594,688 of approximately $18,139,749 total project costs. The Company will provide the remaining 55.0% to 50% matching funds. Construction and expenditures for these projects began in the spring of 2023. We have not received any funds for these projects as of December 31, 2023.
●	On July 15, 2022, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and secured a new credit facility in the aggregate principal amount of $130.0 million. Under the Agreements, among other things, (i) the Company received a $50.0 million term loan to replace existing debt, (ii) a $50.0 million delayed draw term loan, (iii) the Company’s revolving loan was increased from $20.0 million to $30.0 million, (iv) the maturity date of the term loans were set at July 15, 2029, and the maturity day of the revolving loan was set at July 15, 2027, and (iii) the Company operating subsidiaries’ agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on July 20, 2022, for further details regarding the new credit agreements with CoBank.
●	On December 15, 2021, the Company announced plans to build and deploy Gig fiber Internet across its network creating crucial access to the fastest speeds available for rural communities, small cities and suburban areas across Minnesota. “This is a transformational moment for Nuvera as we make a future-focused investment in the communities we serve by providing the most reliable FTTP access to Gig-speed services,” said Glenn Zerbe, CEO. “Our homes, businesses and communities need reliable and affordable connections to school, workplaces and entertainment, as an important and growing part of everyday life.” “Nuvera’s investment in FTTH network infrastructure will allow more underserved communities across Minnesota to leverage the quality of life and economic opportunity that access to a state-of-the-art network provides now and for years to come,” said State Senator Nick Frentz, DFL-North Mankato. The Company will continue to build and deploy the Gig-speed service over the next few years. “We’re excited to create ‘Nuvera Gig Cities’ in the communities we serve while also expanding access to fiber-based Internet service at a range of speeds,” said Zerbe. “Nuvera’s fiber network gives customers affordable access to a range of speeds from 100 Mbps to 1 Gig at prices that are the same whether you’re in rural Goodhue or suburban Prior Lake.” Nuvera’s goal is to bring Gig-speed service to as many communities as possible.
	Nuvera’s fiber Internet prices range from $50 per month to $100 per month for Gig-speed services. Customers can choose the right speed at an affordable price, including low-income households through Federal programs.
	In 2023, we planned to upgrade 17,000 passings with fiber services and faster broadband speeds. These passings included current customers from our old copper network and new edge out passings. As of December 31, 2023, we have succeeded in upgrading 17,132 passings with these fiber services.
●	On January 29, 2021, the Company was awarded five broadband grants from the DEED. The grants will provide up to 35.4% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved or underserved communities and businesses in the Company’s service area. The Company is eligible to receive $1,918,037 of the approximately $5,419,617 total project costs. The Company will provide the remaining 64.6% of the matching funds. Construction and expenditures for these projects began in the spring of 2021 We have received $1,918,037 for these projects as of December 31, 2023.

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● Net loss in 2023 totaled $3,214,694, which was a $10,411,396, or 144.7% decrease compared to 2022. This decrease was primarily due to an impairment of goodwill in our HTC operating unit, partially offset by the gain recorded on the sale of Fibercomm. This decrease was also impacted by an increase in interest expense and a decrease in operating income, all of which are described below.

● Consolidated revenue for 2023 totaled $65,791,968, which was a $77,499 increase compared to 2022. This increase was primarily due to increases in data services, FUSF subsidies, and other revenues, offset by decreases in voice service, network access revenue, and video services, all of which are described below.

Business Trends

Included below is a synopsis of business trends management believes will continue to affect our business in 2024.

Voice and switched access revenues are expected to continue to be adversely impacted by future declines in access lines due to competition in the communications industry from CATV providers, VoIP providers, wireless, other competitors and emerging technologies. As we experience access line losses, our switched access revenue will continue to decline consistent with industry-wide trends. A combination of changing minutes of use, carriers optimizing their network costs, lower demand for dedicated lines and downward rate pressures may affect our future voice and switched access revenues. Access line losses totaled 1,770 or 11.47% in 2023 compared to 2022 due to the reasons mentioned above.

The expansion of our advanced fiber communications network, growth in broadband connection sales along with continued migration to higher connectivity speeds and the sales of Internet value-added services such as on-line data backup and hosted and managed service solutions are expected to continue to offset the revenue declines from the access line trends discussed above.

To be competitive, we continue to invest in our fiber broadband network and continue to focus on the research and deployment of advanced technological products that include broadband services, wireless services, private line, VoIP, digital video, IPTV and hosted and managed services.

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The table below presents our revenue by technology and advanced fiber-build progress for the last five quarters:

Nuvera Communications, Inc.
Reporting by Technology
	Q4 2022				Q1 2023				Q2 2023				Q3 2023				Q4 2023
Premise Passings
Fiber - NuFiber/Gig-Cities		18,041				19,714				22,135				27,429				35,173
Non-Fiber		44,572				43,512				41,389				37,436				31,755
Total Passings		62,613				63,226				63,524				64,865				66,928
% Fiber Coverage		28.8%				31.2%				34.8%				42.3%				52.6%
Internet/Broadband Connections/Share
Fiber Gig-Cities
Residential		5,290				6,440				6,962				8,075				9,525
Business		634				697				729				795				903
Totals		5,924		32.8%		7,137		36.2%		7,691		34.7%		8,870		32.3%		10,428		29.6 %
Non-Fiber
Residential		19,827				18,687				18,267				17,267				16,159
Business		1,691				1,617				1,575				1,475				1,381
Totals		21,518		48.3%		20,304		46.7%		19,842		47.9%		18,742		50.1%		17,540		55.2 %
Total Broadband Connections		27,442		43.8%		27,441		43.4%		27,533		43.3%		27,612		42.6%		27,968		41.8 %
%  Broadband on Fiber		21.6%				26.0%				27.9%				32.1%				37.3%
Broadband Customer Revenue/ARPU
Internet/BB Revenue/ARPU
Fiber Gig-Cities
Residential	$	920,803	$	66.36	$	1,256,140	$	65.16	$	1,357,318	$	65.84	$	1,521,998	$	66.62	$	1,824,719	$	67.10
Business	$	418,805	$	226.14	$	409,114	$	219.15	$	410,323	$	213.52	$	456,968	$	219.40	$	471,078	$	182.70 *
Totals	$	1,339,608	$	85.18	$	1,665,254	$	79.90	$	1,767,641	$	79.69	$	1,978,966	$	79.69	$	2,295,797	$	77.11
Non-Fiber
Residential	$	3,634,461	$	59.15	$	3,370,915	$	60.11	$	3,291,003	$	59.69	$	3,139,666	$	59.33	$	2,895,759	$	58.54
Business	$	510,427	$	99.10	$	539,694	$	104.45	$	551,931	$	105.97	$	530,347	$	107.05	$	503,995	$	118.20
Totals	$	4,144,888	$	62.24	$	3,910,609	$	63.70	$	3,842,934	$	63.41	$	3,670,013	$	63.41	$	3,399,754	$	63.27
Total Internet/BB Revenue	$	5,484,496			$	5,575,863			$	5,610,575			$	5,648,979			$	5,695,551
% Revenue from Fiber		24.4%				29.9%				31.5%				35.0%				40.3%
Other Internet Reveneue	$	1,255,619			$	1,240,686			$	1,263,995			$	1,232,986			$	1,240,438
Total Internet Revenue	$	6,740,115			$	6,816,549			$	6,874,570			$	6,881,965			$	6,935,989
All Other Revenue	$	9,578,092			$	9,546,398			$	9,410,117			$	9,488,513			$	9,837,867
Total Revenue	$	16,318,207			$	16,362,947			$	16,284,687			$	16,370,478			$	16,773,856
* Nuvera has experienced a decrease in its Fiber Gig-Cities Business ARPU.  This is primarily due to the aggressive conversion of our smaller business customers from non-fiber to fiber. Certain historical numbers have changed to conform with the current year's presentation.

We continue to evaluate our operating structure to identify opportunities for increased operational efficiencies and effectiveness. This involves evaluating opportunities for task automation, network efficiency and the balancing of our workforce based on the current needs of our customers.

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Financial results for the Communications Segment for the years ended December 31, 2023, and 2022 are included below:

Communications Segment
	2023		2022		Increase (Decrease)
Operating Revenues
Voice Service	$	5,263,385	$	5,694,428	$	(431,043)	-7.6%
Network Access		3,819,297		4,759,084		(939,787)	-19.7%
Video Service		12,061,703		12,497,458		(435,755)	-3.5%
Data Service		27,509,073		27,028,332		480,741	1.8%
A-CAM/FUSF		12,479,376		11,721,412		757,964	6.5%
Other		4,659,134		4,013,755		645,379	16.1%
Total Operating Revenues		65,791,968		65,714,469		77,499	0.1%
Cost of Services, Excluding Depreciation      and Amortization		31,178,838		30,179,770		999,068	3.3%
Selling, General and Administrative		9,937,451		9,916,482		20,969	0.2%
Depreciation and Amortization Expenses		15,440,415		14,108,246		1,332,169	9.4%
Total Operating Expenses		56,556,704		54,204,498		2,352,206	4.3%
Operating Income	$	9,235,264	$	11,509,971	$	(2,274,707)	-19.8%
Net Income (Loss)	$	(3,214,694)	$	7,196,702	$	(10,411,396)	-144.7%
Capital Expenditures	$	55,547,283	$	37,977,118	$	17,570,165	46.3%
Key metrics
Access Lines		13,656		15,426		(1,770)	-11.5%
Video Customers		8,214		9,099		(885)	-9.7%
Data Connections		33,280		32,675		605	1.9%

Revenue

Voice Service – We receive recurring revenue for basic voice services that enable end-user customers to make and receive telephone calls within a defined local calling area for a flat monthly fee. In addition to subscribing to basic local voice services, our customers may choose from multiple voice service plans with a variety of custom calling features such as call waiting, call forwarding, caller identification and voicemail. Voice service revenue was $5,263,385, which was $431,043 or 7.6% lower in 2023 compared to 2022. This decrease was primarily due to a decrease in access lines, which was the result of an accelerated industry trend of customers moving to other communications options or dropping their access lines altogether, partially offset by a combination of rate increases introduced into several of our markets in the past few years.

The number of access lines we serve as a Company have been decreasing, which is consistent with a general industry trend, as customers are increasingly utilizing other technologies, such as wireless phones and IP services.

Network Access – We provide access services to other communications carriers for the use of our facilities to terminate or originate long distance calls on our fiber network. Additionally, we bill SLCs to substantially all our customers for access to the public switched network. These monthly SLCs are regulated and approved by the FCC. In addition, network access revenue is derived from several federally administered pooling arrangements designed to provide network support and distribute funding to communications companies. Network access revenue was $3,819,297, which was $939,787 or 19.7% lower in 2023 compared to 2022. This decrease was primarily due to lower minutes of use on our network and lower special access revenues, which was the result of an accelerated industry trend of customers moving to other communications options or dropping their access lines altogether.

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In recent years, IXCs and others have become more aggressive in disputing both interstate carrier access charges and the applicability of access charges to their network traffic. We believe that long distance and other communication providers will continue to challenge the applicability of access charges either before the FCC or directly with the LECs. We cannot predict the likelihood of future claims and cannot estimate the impact.

Video Service – We provide a variety of enhanced video services on a monthly recurring basis to our customers. We receive monthly recurring revenue from our subscribers for providing commercial TV programming in competition with local CATV, satellite dish TV and off-air TV service providers. We serve twenty-two communities with our IPTV services and five communities with our CATV services. Video service revenue was $12,061,703, which was $435,755 or 3.5% lower in 2023 compared to 2022. This decrease was primarily due to a decrease in video customers, partially offset by a combination of rate increases introduced into several of our markets over the past few years. The decrease in video customers, continues to be an accelerated industry trend of customers moving to other video options.    

Data Service – We provide high speed Internet to business and residential customers depending on the nature of the network facilities that are available, the level of service selected and the location. Our revenue is earned based on the offering of various flat rate packages based on the level of service, data speeds and features. We also provide e-mail and managed services, such as web hosting and design, on-line file back up and on-line file storage. Data service revenue was $27,509,073, which was $480,741 or 1.8% higher in 2023 compared to 2022. This increase was primarily due to an increase in fiber customers, customers upgrading their packages and speeds, and the implementation of a monthly equipment charge to our customers, partially offset by a decrease in non-fiber customers. We expect continued growth in this area will be driven by completing our advanced FTTP network, expansion of our service areas and marketing managed service solutions to businesses.

A-CAM/FUSF – The Company currently receives funding based on the A-CAM, except for Scott-Rice, which receives funding from the FUSF. Scott-Rice’s settlements from the NECA pools are based on nationwide average schedules, which includes the pooling and redistribution of revenues based on a company’s actual or average costs. See Note 2 – “Revenue Recognition” for a discussion regarding A-CAM and FUSF.

A-CAM/FUSF support totaled $12,479,376, which was $757,964 or 6.5% higher in 2023 compared to 2022. This increase was primarily due to higher FUSF support received for Scott-Rice BLS funding and higher CAF support funding for our operating companies. On December 12, 2023, the Company announced that if confirmed eligibility for CBOL funding through USAC. The incremental funding will be used to continue to support the Company’s multi-year fiber construction initiative. The Company began receiving a monthly benefit in November of 2023 with the first payment receipt confirmed in December. On an annualized basis this new program will provide $3.9 million of new funding based on the tariff filing and the Company’s expected line counts. The monthly CBOL subsidy formula is reviewed and subject to revision on an annual basis and subject to change based on updated USAC funding criteria July 1 of each year.

Other Revenue – Our customers are billed for toll and long-distance services on either a per call or flat-rate basis. This also includes the offering of directory assistance, operator service and long-distance private lines. We also generate revenue from directory publishing through an outside vendor, sales and service of CPE, bill processing and other customer services. Our directory publishing revenue in our telephone directories recurs monthly. We also provide retail sales and service of cellular phones and accessories through Telespire, a national wireless provider. We resell these wireless services as Nuvera Wireless, our branded product. We receive both recurring revenue for our wireless services, as well as revenue collected for the sales of wireless phones and accessories. Other revenue was $4,659,134, which was $645,379 or 16.1% higher in 2023 compared to 2022. This increase was primarily due to a paper bill fee that was instituted in December of 2022 and an increase in the sales and installation of CPE, partially offset by a decrease in directory publishing revenues and long-distance revenues.

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Cost of Services (Excluding Depreciation and Amortization Expense)

Cost of services (excluding depreciation and amortization expense) was $31,178,838, which was $999,068 or 3.3% higher in 2023 compared to 2022. This increase was primarily due to higher costs associated with increased maintenance and support agreements on our equipment and software, and increased costs to maintain a highly skilled workforce. These increases were partially offset by lower programming costs from video content providers due to a loss of video customers. We have experienced increased inflation in our operations in 2023 and expect future inflationary pressures could affect our costs to operate our business.     

Selling, General and Administrative Expenses

Selling, general and administrative expenses were $9,937,451, which was $20,969 or 0.2% higher in 2023 compared to 2022. This increase reflects the increased costs associated with our FTTP network initiative, partially offset by cost containment efforts implemented in 2023 and 2022. We have experienced increased inflation in our operations in 2023 and expect future inflationary pressures could affect our costs to operate our business.    

Depreciation and Amortization Expense

Depreciation and amortization expense was $15,440,415, which was $1,332,169 or 9.4% higher in 2023 compared to 2022. This increase in depreciation expense was primarily due to an increase in our FTTP network assets to aid in our transition to a new advanced FTTP network, reflecting our continual investment in technology and infrastructure in order to meet our customers’ demands for products and services.     

Operating Income

Operating income was $9,235,264, which was $2,274,707 or 19.8% lower in 2023 compared to 2022. This decrease was primarily due to higher costs of services and depreciation, all of which are described above.

See Consolidated Statements of Operations (for discussion below)

Other Income (Expense) and Interest Expense   

Other income in 2023 and 2022, included a patronage credit earned with CoBank, which was a result of our debt agreements with them. The patronage credit allocated and received in 2023 was $692,371, compared to $567,468 allocated and received in 2022. This increase was primarily due to higher outstanding debt balances and increased interest rates on our non-swapped debt in connection with our term debt credit facility and our increased revolving credit facility with CoBank to support our fiber-build initiative. CoBank determines and pays the patronage credit annually, generally in the first quarter of the calendar year, based on its results from the prior year. We record these patronage credits as income when they are received.

Interest and dividend income decreased $80,100 in 2023 compared to 2022. This decrease was primarily due to decreases in dividend income earned on our investments.

Interest expense increased $3,331,625 in 2023 compared to 2022. This increase was primarily due to higher outstanding debt balances and increased interest rates on our non-swapped debt in connection with our increased term debt credit facility and our increased revolving credit facility with CoBank to support our fiber-build initiative.   

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The gain on sale of investments in 2023 primarily reflects the sale of FiberComm by Nuvera and the other owners of FiberComm to ImOn Communications LLC on March 31, 2023. The Company recognized a $217,876 unrealized gain on one of its investments for the year ended December 31, 2022.

Other investment income decreased $121,282 in 2023 compared to 2022. Other investment income is primarily from our equity ownerships in several partnerships and limited liability companies. Other investment income was lower in 2023 compared to 2022, primarily due to the sale of FiberComm in the first quarter of 2023.

Income Taxes

Income tax expense decreased by $383,007 in 2023 compared to 2022 as we recorded income tax expense of $2,315,656 in 2023 and $2,698,663 in 2022. This decrease was primarily due to decreased operating income and increased interest expense partially offset by the gain from the sale of our Fibercomm equity investment on March 31, 2023. The effective income tax rate was approximately (257.6%) for 2023 and 27.3% 2022. The difference between the effective tax rate and the federal statutory tax rate are reconciled in Note 8 – “Income Taxes.” 

Non-GAAP Measures

In addition to the results reported with GAAP, we also use certain non-GAAP measures such as net earnings before interest expense, income taxes, and depreciation and amortization (EBITDA) and adjusted EBITDA to evaluate operating performance and to facilitate the comparison of our historical results and trends. These financial measures are not a measure of financial performance under GAAP and should not be considered in isolation or as a substitute for net income as a measure of performance and net cash provided by operating activities as a measure of liquidity. They are not, on their own, necessarily indicative of cash available to fund cash needs as determined in accordance with GAAP. The calculation of these non-GAAP measures may not be comparable to similarly titled measures used by other companies. Reconciliations of these non-GAAP measures to the most directly comparable financial measures presented in accordance with GAAP are provided below.

Adjusted EBITDA is comprised of EBITDA, adjusted for certain items as permitted or required under our credit facility as described in the reconciliations below. These measures are a common measure of operating performance in the communications industry and are useful, with other data, as a means to evaluate our ability to fund our estimated uses of cash.

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The following table is a reconciliation of net income to adjusted EBITDA for the years ended December 31, 2023, and 2022.

		2023		2022
Net Income (Loss)	$	(3,214,694)	$	7,196,702
Add (subtract):
Interest Expense, net of interest income		6,809,319		3,481,846
Income tax expense (benefit)		2,315,656		2,698,663
Depreciation and amortization		15,440,415		14,108,246
EBITDA		21,350,696		27,485,457
Adjustments to EBITDA:
Other, net ¹		3,497,953		(1,610,018)
Investment distributions ²		(44,922)		(46,305)
Non-cash, stock-based compensation ³		221,749		64,301
Adjusted EBITDA	$	25,025,476	$	25,893,435
¹  Includes the equity earnings from our investments, gain on sale of investment, patronage income,    impairment of goodwill, interest during construction and certain other miscellaneous items.
²  Includes other cash distributions received from our investments less dividend income.
³  Represents compensation expenses in connection with the issuance of stock awards,       which, because of the non-cash nature of these expenses, are excluded from    adjusted EBITDA.

Liquidity and Capital Resources

Capital Structure

Nuvera’s total capital structure (long-term and short-term debt obligations, net of unamortized loan fees plus stockholders’ equity) was $220,897,881 at December 31, 2023, reflecting 44.4% equity and 55.6% debt. This compares to a capital structure of $181,134,049 as of December 31, 2022, reflecting 56.6% equity and 43.4% debt. In the communications industry, debt financing is most often based on operating cash flows. Specifically, our current use of our credit facilities is in a ratio of approximately 5.03 times debt to EBITDA (as defined in the loan documents). which is well within acceptable limits for our agreements and our industry. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30, 2023. Our management believes adequate operating cash flows and other internal and external resources, such as our cash on hand and new credit facility are available to finance ongoing operating requirements, including capital expenditures, business development, debt service and temporary financing of trade AR.

Liquidity Outlook

Our short-term and long-term liquidity needs arise primarily from (i) capital expenditures; (ii) working capital requirements needed to support our growth; (iii) debt service; (iv) dividend payments on our stock and (v) potential acquisitions.

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Our primary sources of liquidity for the year ended December 31, 2023, were proceeds from cash generated from operations and cash reserves held at the beginning of the period. As of December 31, 2023, we had a working capital surplus of $22,779,883. In addition, as of December 31, 2023, we had $15.8 million available under our revolving credit facility to fund any short-term working capital needs. The Company may seek additional financing to continue to fund its fiber expansion plans and meet current and future liquidity needs. The Company may seek additional financing to continue to fund its fiber expansion plans and meet current and future liquidity needs. The working capital surplus as of December 31, 2023, was primarily the result of increased inventories to support our fiber-build initiative and a delay in principal payments to CoBank as a part of our new debt facility with them.   

We have not conducted a public equity offering. We operate with original equity capital, retained earnings and additions to indebtedness in the form of senior debt and bank lines of credit.

Cash Flows

We expect our liquidity needs to include capital expenditures, payment of interest and principal on our indebtedness, income taxes and dividends. We use our cash inflow to manage the temporary increases in cash demand and utilize our revolving credit facility to manage more significant fluctuations in liquidity caused by growth initiatives.

While it is often difficult for us to predict the impact of general economic conditions, we believe that we will be able to meet our current and long-term cash requirements primarily through our operating cash flows and debt financing and anticipate that we will be able to plan for and match future liquidity needs with future internal and available external resources. 

We periodically seek to add growth initiatives by either expanding our network or our markets through organic or internal investments or through strategic acquisitions. We believe we can adjust the timing or the number of our initiatives according to any limitations which may be imposed by our capital structure or sources of financing.

The following table summarizes our cash flow:

	For Year Ended December 31
	2023		2022		Increase (Decrease)
Net cash provided by (used in):
Operating activities	$	18,985,481	$	26,524,265	$	(7,538,784)	-28.42%
Investing activities		(62,845,478)		(53,624,237)		(9,221,241)	-17.20%
Financing activities		44,809,345		25,104,379		19,704,966	78.49%
Change in cash	$	949,348	$	(1,995,593)	$	2,944,941	147.57%

Cash Flows from Operating Activities

Cash generated by operations for the year ended December 31, 2023, was $18,985,481, compared to cash generated by operations of $26,524,265 in 2022. The decrease in cash from operating activities in 2023 was primarily due to lower operating income and the timing of the increase/decrease in assets and liabilities.

Cash generated by operations continues to be our primary source of funding for existing operations, debt service and dividend payments to stockholders. Cash as of December 31, 2023, was $1,259,904, compared to $310,556 on December 31, 2022.

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Cash Flows Used in Investing Activities

We operate in a capital-intensive business. We continue to upgrade our advanced fiber networks for changes in technology to provide advanced services to our customers.

Cash flows used in investing activities were $62,845,478 for the year ended December 31, 2023, compared to $53,624,237 used in investing activities in 2022. Capital expenditures relating to our fiber initiative and on-going operations were $55,547,283 in 2023 and $37,977,118 in 2022. Materials and supply expenditures increased by $13,404,354 in 2023 compared to $15,651,923 in 2022. These increases were primarily due to a large purchase of these items to support our fiber-build initiatives and to avoid anticipated supply chain issues and increased inflation we were expecting in future periods. This was offset by proceeds from the sale of our FiberComm equity investment. Our investing expenditures were financed with cash flows from our current operations and advances on our line of credit and delayed draw term loan when needed. We believe that our current operations and new debt financing from CoBank will provide adequate cash flows to fund our plant additions for the upcoming year; however, funding from our revolving credit facility is available if the timing of our cash flows from operations does not match our cash flow requirements. As of December 31, 2023, we had $15.8 million available under our existing revolving credit facility to fund capital expenditures and other operating needs.

Cash Flows Provided by Financing Activities

Cash provided by financing activities for the year ended December 31, 2023, was $44,809,345. This included loan proceeds from our delayed draw term loan of $40,000,000, loan origination fees of $151,237, changes in revolving credit facility of $4,281,191, grants received for construction of plant of $2,110,162, and the distribution of $1,430,771 of dividends to stockholders. Cash provided by financing activities for the year ended December 31, 2022, was $25,104,379. This included long-term debt repayments of $57,330,775, loan proceeds of $56,063,223, loan origination fees of $1,165,859, changes in our revolving credit facility and delayed draw term loan of $33,172,860, grants received for plant construction of $396,360, the repurchase of common stock of $3,187,500 and the distribution of $2,843,930 of dividends to stockholders. The change in cash flows used in financing activities in 2023 was primarily due to changes in our revolving credit facility and delayed draw term loan associated with our new credit agreement with CoBank to fund our fiber initiative.

Working Capital

We had a working capital surplus (i.e. current assets minus current liabilities) of $22,779,883 as of December 31, 2023, with current assets of approximately $41.4 million and current liabilities of approximately $18.6 million, compared to a working capital surplus of $18,161,983 as of December 31, 2022. The ratio of current assets to current liabilities was 2.23 and 2.56 as of December 31, 2023, and 2022. The working capital surplus as of December 31, 2023, was primarily the result of increased inventories to support our fiber-build initiative and a delay in principal payments to CoBank as part of our new debt facility with them.  

As of December 31, 2023, other than our total leverage ratio, we were in compliance with all stipulated financial ratios in our loan agreements. As of December 31, 2022, we were in compliance with all stipulated financial ratios in our loan agreements.   

Our current Total Leverage Ratio as of December 31, 2023, was 5.03 which exceeded our original maximum total leverage of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.

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Long-Term Debt and Revolving Credit Facilities

Our long-term debt obligations as of December 31, 2023, were $124,166,273 (excluding long-term loan origination fees). Our long-term debt obligations as of December 31, 2022, were $79,885,082 (excluding long-term loan origination fees).

On July 15, 2022, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and secured a new credit facility in the aggregate principal amount of $130.0 million.

Under the Agreements, among other things, (i) the Company received a $50.0 million term loan to replace existing debt, (ii) a $50.0 million delayed draw term loan, (iii) the Company’s revolving loan was increased from $20.0 million to $30.0 million, (iv) the maturity date of the term loans were set at July 15, 2029, and the maturity day of the revolving loan was set at July 15, 2027, and (v) the Company’s operating subsidiaries’ agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on July 20, 2022, for further details regarding the new credit agreements with CoBank.

On December 21, 2023, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and increased the Company’s existing credit facility from an aggregate principal amount of $130.0 million to $140.0 million. Under the Agreements, among other things, (i) the Company’s revolving loan was increased from $30.0 million to $40.0 million and (ii) the Company operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on December 21, 2023, for further details regarding the new credit agreements with CoBank.

Under the new credit agreement, the Company and its respective subsidiaries have entered into security agreements under which substantially all the assets of Nuvera and its respective subsidiaries have been pledged to CoBank as collateral. In addition, Nuvera and its respective subsidiaries have guaranteed all the obligations under the credit facility. The credit agreement contains certain customary events of default, which include failure to make payments when due, the material inaccuracy of representations or warranties, failure to observe or perform certain covenants, cross-defaults, bankruptcy and insolvency-related events, certain judgments, certain ERISA-related events, or a change in control (as defined in the credit agreement).

Our Long-Term Debt consists of the following notes:

New Credit Agreement

● TERM A-1 LOAN - $50,000,000 term note with interest payable quarterly. Final maturity date of this note is July 15, 2029. Twelve quarterly principal payments of $625,000 are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of $937,500 commencing on December 31, 2028, through maturity date. A final balloon payment of $39,687,500 is due at maturity of this note on July 15, 2029. We have currently drawn $50,000,000 on this Term Loan as of December 31, 2023.

● DELAYED DRAW TERM LOAN - $50,000,000 Delayed Draw Term Loan with interest on any outstanding amounts payable quarterly.  Final maturity date of this loan is July 15, 2029. Twelve quarterly principal payments of 1.25% of the outstanding loan balance are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of 1.875% of the outstanding loan balance commencing on December 31, 2028, through maturity date. A final balloon payment of the balance of the Delayed Draw Term Loan is due at maturity of this note on July 15, 2029. We currently have drawn $50,000,000 on this Delayed Draw Term Loan as of December 31, 2023.

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●

REVOLVING LOAN - $40,000,000 revolving loan with interest payable quarterly. Final maturity date of this note is July 15, 2027. We currently have drawn $24,166,273 on this revolving note as of December 31, 2023.

The term loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 2.15% above the applicable base rate. The margin for base rate loans for term loans increases as our “Leverage Ratio” increases. The revolving loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 1.90% above the applicable base rate. The margin for base rate loans for revolving loans increases as our “Leverage Ratio” increases.

We generally use variable-rate debt to finance our operations, capital expenditures and acquisitions. These variable-rate debt obligations expose us to variability in interest payments due to changes in interest rates. The terms of our credit facility with CoBank require that we enter into interest rate agreements designed to protect us against fluctuations in interest rates, in an aggregate principal amount and for a duration determined under the credit facility.

Under the new credit facility, Nuvera has the ability to enter into IRSAs in connection with amounts borrowed from CoBank. In connection with the closing of the new credit facility, the Company “rolled over” its two exiting IRSAs. 

As described in Note 7 – “Interest Rate Swaps,” on August 1, 2018, we entered into an IRSA with CoBank covering 25 percent of our then existing debt balance or $16,137,500 of our aggregate indebtedness to CoBank on August 1, 2018. As of December 31, 2023, our IRSA covered $9,798,200, with a weighted average interest rate of 6.11%. 

As described in Note 7 – “Interest Rate Swaps,” on August 29, 2019, we entered into a second IRSA with CoBank covering an additional $42,000,000 of our then aggregate indebtedness to CoBank on August 29, 2019. As of December 31, 2023, our IRSA covered $27,462,606, with a weighted average interest rate of 4.44%.  

Our remaining outstanding debt of $86.9 million remains subject to variable interest rates at an effective weighted average interest rate of 8.55%, as of December 31, 2023.

As of December 31, 2023, our unused revolving credit facility of $15.8 million are subject to an unused commitment fee of 0.25% annually, until drawn. Once drawn, this debt would be subject to an effective weighted average interest rate based on current rate of interest in effect at the time.

Our loan agreements include restrictions on our ability to pay cash dividends to our stockholders. However, we are allowed to pay dividends in an amount up to $3,000,000 in any year if no default or event of default have occurred. Our current Total Leverage Ratio as of December 31, 2023, was 5.03, which exceeded our maximum total leverage ratio of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.   

Our credit facility requires us to comply with specified financial ratios and tests. These financial ratios include total leverage ratio, debt service coverage ratio and equity to total assets ratio. As of December 31, 2023, we were in compliance with all the stipulated financial ratios in our loan agreements.

There are security and loan agreements underlying our current CoBank credit facility that contain restrictions on our distributions to stockholders and investment in, or loans, to others. Also, our credit facility contains restrictions that, among other things, limits or restricts our ability to enter into guarantees and contingent liabilities, incur additional debt, issue stock, transact asset sales, transfers or dispositions, and engage in mergers and acquisitions, without CoBank approval.  

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See Note 6 – “Long-Term Debt” for information pertaining to our long-term debt and current effective interest rates.  

Guarantees

We had previously guaranteed a portion of the obligations of our Nuvera subsidiary joint venture investment in FiberComm. See Note 13 – “Guarantees.”

Critical Accounting Policies and Estimates

Management’s discussion and analysis of financial condition and results of operations stated in this 2023 Annual Report on Form 10-K are based upon Nuvera’s consolidated financial statements that have been prepared in accordance with GAAP, rules and regulations of the SEC and, where applicable, conform to the accounting principles as prescribed by federal and state telephone utility regulatory authorities. We presently give accounting recognition to the actions of regulators where appropriate. The preparation of our financial statements requires our management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and liabilities at the date of the financial statements and during the reporting period. Actual results may differ from these estimates. Our senior management has discussed the development and selection of accounting estimates and the related Management Discussion and Analysis disclosure with our Audit Committee. For a summary of our significant accounting policies, see Note 1 – “Business Description and Summary of Significant Accounting Policies.” 

Revenue Recognition

See Note 2 – “Revenue Recognition” for a discussion of our revenue recognition policies.

Allowance for Credit Losses

AR are recorded at amortized cost less an allowance for credit losses (AFCLs) that are not expected to be recovered. The gross amount of AR is recorded net of the corresponding AFCLs in the consolidated balance sheets. We maintain AFCLs resulting from the expected failure or inability of our customers to make their required payments. We recognize the AFCLs based on management’s expectation of the asset’s collectability. The allowance is based on multiple factors including historical experience with bad debts, the credit quality of the customer base, the aging of such receivable and current macroeconomic conditions, as well as management’s expectation of conditions in the future, as applicable. Our AFCLs are recorded on a monthly basis based on the aging of our overall AR. Our AR collection policy includes internal collection efforts after an AR balance is past 30 days due with service being suspended after approximately 40 days and terminated upon 60 days past due.    

Our AFCLs was $150,000 and $140,000 as of December 31, 2023, and 2022.  

Valuation of Goodwill

We have goodwill on our books related to prior acquisitions of communications company properties. As discussed more fully in Note 5 – “Goodwill and Intangibles,” and in accordance with GAAP, goodwill is reviewed for impairment annually or more frequently if an event occurs or circumstances change that would reduce the fair value below its’ carrying value. We perform our annual fair value evaluation in the fourth quarter of each year.    

The impairment test for goodwill involves measuring a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Any excess of the carrying value of the reporting unit goodwill over the implied fair value of the reporting unit goodwill will be recorded as an impairment loss.

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In 2023 and 2022, we engaged an independent valuation firm to aid in the completion of an annual impairment test for existing goodwill acquired. For 2023 and 2022, the testing resulted in no impairment to goodwill for Scott-Rice and SETC and no impairment to goodwill for HTC for 2022 as the determined fair value was sufficient to pass the impairment test. For 2023, the testing resulted in an impairment to goodwill for HTC of $9.3 million as the determined fair value was not sufficient to pass the impairment test.  We used a combination of Income (Discounted Cash Flow Method or DCF Method) and Market Approaches to estimate the fair value of the goodwill on our books related to prior acquisitions of communications company properties. The assumptions used in the estimates of fair value were based on projections provided by our management and a rate of return based on market information observed in debt and traded equity securities. Their Market Approaches considered market multiples observed in companies comparable to ours, traded on public exchange or over the counter, or transacted in a merger or acquisition transaction.

Assumptions used in our 2023 DCF model include the following:

     ● A 10.00% weighted average cost of capital based on an industry weighted average cost of capital;

     ● A 1.5% terminal revenue growth rate.

The most significant amount of goodwill recorded on our books was due to the acquisitions of HTC, SETC and Scott-Rice. The carrying value of the goodwill was $40,603,029 as of December 31, 2023, and $49,903,029 as of December 31, 2022. The reduction in goodwill was the result of the HTC impairment charge in 2023.

In 2023, we tested the SETC and Scott-Rice goodwill. Based on the DCF model approach that was used, we determined the estimated enterprise fair value of our reporting units exceeded the carrying amount of that reporting units by approximately 16.8% and 9.4% for SETC and Scott-Rice, respectively, which indicated that we had no impairment as of December 31, 2023. In 2023, we tested the HTC goodwill. Based on the DCF model approach that was used, we determined that the carrying amount of that reporting unit exceeded the enterprise’s fair value of that reporting unit and resulted in an impairment of $9.3 million. Future negative changes relating to our financial operations could result in a potential impairment of goodwill.  

Due to changes in financial and credit markets, and overall valuations of communications properties, the Company determined that the carrying value of the HTC reporting unit exceeded its fair value in 2023, which resulted in the impairment listed above. The non-cash impairment charge of $9.3 million did not and is not expected to have any impact on the Company’s operations.

Income Taxes

The provision for income taxes consists of an amount for taxes currently payable and a provision for tax consequences deferred to future periods. Deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax basis. Significant components of our deferred taxes arise from differences (i) in the basis of property, plant and equipment due to the use of accelerated depreciation methods for tax purposes, as well as (ii) in partnership investments and intangible assets due to the difference between book and tax basis. Our effective income tax rate is normally higher than the United States tax rate due to state income taxes and permanent differences.

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. As required by GAAP, we recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

In accordance with GAAP, we record net unrecognized tax benefits that, if recognized, would affect the income tax provision when recorded. See Note 8 – “Income Taxes.”  

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As of December 31, 2022, we had $19,787 of unrecognized tax benefits that if recognized would affect the tax rate. As of December 31, 2023, the uncertain tax position was reduced to $0 due to a lapse in statute of limitations for the year the position originated.  

We are primarily subject to United States, Minnesota, Iowa, Nebraska, North Dakota and Wisconsin income taxes. Tax years subsequent to 2019 remain open to examination by federal and state tax authorities. During the year ending December 31, 2022, we settled our examination by the State of Minnesota. The examination did not have a material effect on our financial statements. Our policy is to recognize interest and penalties related to income tax matters as income tax expense. As of December 31, 2023, and 2022 we had $0 and $3,518 of interest or penalties accrued that related to income tax matters.

Property, Plant and Equipment

We record impairment losses on long-lived assets used in operations when events and circumstances indicate the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. In assessing the recoverability of long-lived assets, we compare the carrying value to the undiscounted future cash flows the assets are expected to generate. If the total of the undiscounted future cash flows is less than the carrying amount of the assets, we would write down those assets based on the excess of the carrying amount over the fair value of the assets. Fair value is generally determined by calculating the discounted future cash flows expected from those assets. Changes in these estimates could have a material adverse effect on the assessment of long-lived assets, thereby requiring a write-down of the assets. Write-downs of long-lived assets are recorded as impairment charges and are a component of operating expenses. We have reviewed our long-lived assets and concluded that no impairment charge on these long-lived assets is necessary.

We use the group life method (mass asset accounting) to depreciate the assets of our communication companies. Communications plant acquired in a given year is grouped into similar categories and depreciated over the remaining estimated useful life of the group. When an asset is retired, both the asset and the accumulated depreciation associated with that asset are removed from the books. Due to rapid changes in technology, selecting the estimated economic life of communications plant and equipment requires a significant amount of judgment. We periodically review data on the expected utilization of new equipment, asset retirement activity and net salvage values to determine adjustments to our depreciation rates.

Grant money received from governmental entities for reimbursement of capital expenditures is accounted for as a reduction from the cost of the asset. As the grant was to be used in the Company’s regulated network, the Company accounts for this funding as aid to construction as outlined in the FCC’s Part 32 “Uniform System of Accounts for Telecommunications Companies.” The resulting balance sheet presentation reflects the Company’s net investment in the assets in our property, plant and equipment. Depreciation is calculated and recorded based on the reduced cost of the investment, therefore the impact of prior grants received is reflected in earnings as a reduction in depreciation. Grant funds are shown as inflows in the financing activities section of the statement of cash flows.

Equity Method Investment

We are an investor in several partnerships and limited liability corporations. Our percentages of ownership in these joint ventures range from 7.54% to 24.30%. We use the equity method of accounting for these investments, which reflects original cost and the recognition of our share of the net income or losses from the respective operations.  

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Incentive Compensation

We engaged an outside consultant in 2005 to advise us in our development of an Employee Incentive Plan (EIP) for employees other than executive officers and a Management Incentive Plan (MIP) for our executive officers. Both plans were implemented in 2006. Both plans are cash/stock-based/Option-based incentive plans. Payments on each plan are based on an achievement of objectives of measurable corporate and operational performance with financial targets. The financial targets include the achievement of specified certain operating income before interest, taxes, depreciation and amortization criteria, while the operational targets are based upon fiber passings, fiber connections, and net Internet customer additions. The EIP permits the issuance of up to 200,000 shares of our Common Stock in stock awards.  

We accrue an estimated liability each year for these potential payouts and reverse that accrual if the incentive payout targets are not met and paid out. Incentive payouts, if earned, are typically paid in late March of the year following the target year and after the filing of our Annual Report on Form 10-K.  

On February 24, 2017, our BOD adopted the Nuvera Communications, Inc. 2017 Omnibus Stock Plan (2017 OSP) effective May 25, 2017. The shareholders of the Company approved the 2017 OSP at the May 25, 2017, Annual Meeting of Shareholders. The purpose of the 2017 OSP was to enable Nuvera and its subsidiaries to attract and retain talented and experienced people, closely link employee compensation with performance realized by shareholders, and reward long-term results with long-term compensation. The 2017 OSP enables us to grant stock incentive awards to current and new employees, including officers, and to Board members and service providers. The 2017 OSP permits stock incentive awards in the form of Options (incentive and non-qualified), stock appreciation rights, restricted stock, restricted stock units (RSU’s), performance stock, performance units, and other awards in stock or cash. The 2017 OSP permits the issuance of up to 625,000 shares of our Common Stock in any of the above stock awards.

See Note 15 – “Stock Based Compensation” for a detailed discussion of our incentive compensation and RSUs. 

Recent Accounting Developments

See Note 1 – “Business Description and Summary of Significant Accounting Policies” for a discussion of recent accounting developments.

Item 7A.    Quantitative and Qualitative Disclosures about Market Risk

Not required for a smaller reporting company.

Item 8.   Financial Statements and Supplementary Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Nuvera Communications, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Nuvera Communications, Inc. (a Minnesota corporation) and subsidiaries (the Company) as of December 31, 2023, and 2022, and the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity and cash flows for the years then ended, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements, present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023, and 2022, and the consolidated results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

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Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.  The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Evaluation of Goodwill for Impairment

Description of the Matter

At December 31, 2023, the Company’s goodwill balance was $40,603,029. As discussed in Note 5 to the consolidated financial statements, reporting unit goodwill is tested for impairment at least annually or when events or circumstances indicate the fair value of a reporting unit may be below its carrying value. This analysis involves comparing the carrying value of a reporting unit’s equity against the estimated fair value of the reporting unit’s equity which is determined using discounted cash flow (DCF) models and market-based approaches using market multiples of peer companies which offer comparable services to its reporting units. These fair value estimates are sensitive to significant assumptions, such as cash flow projections, operating and EBITDA margins, discount rates, terminal values, subscriber growth, and capital investment. These assumptions are affected by expectations about future market and economic conditions.

Auditing management’s annual impairment tests for goodwill was complex because of the significant judgment required to evaluate the management assumptions described above used to determine the fair value of the reporting units.

During the year ended December 31, 2023, the Company performed a quantitative goodwill impairment test, which resulted in an impairment charge of $9.3 million related to the Hutchinson Telephone Company reporting unit.

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How We Addressed the Matter in Our Audit

We obtained an understanding of the controls over the Company’s goodwill impairment review processes. This included controls over management’s use of both an outside specialist and internal review of the valuation models and the significant assumptions noted above, utilized in both the DCF and market valuation methods.

To test the estimated fair value of the Company’s reporting units, we involved our valuation specialists to assist us in performing our audit procedures. Our procedures included, among others, testing the valuation methodology used and the significant assumptions within the valuation methodology. For example, we compared the significant assumptions to current industry, market and economic trends, and other guideline companies in the same industry and to other factors. Where appropriate, we evaluated whether changes to the company’s business model, customer base and other factors would affect the significant assumptions. We also assessed the historical accuracy of management’s past estimates, tested the clerical accuracy of the valuation calculations, and performed independent sensitivity analyses. In addition, we tested management’s reconciliation of the cumulative fair value of its reporting units to the market capitalization of the Company.

We have served as the Company’s auditor since 2008.

Olsen Thielen & Co., Ltd (251)

Roseville, Minnesota

March 15, 2024

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
	2023		2022
OPERATING REVENUES:
Voice Service	$	5,263,385	$	5,694,428
Network Access		3,819,297		4,759,084
Video Service		12,061,703		12,497,458
Data Service		27,509,073		27,028,332
A-CAM/FUSF		12,479,376		11,721,412
Other Non-Regulated		4,659,134		4,013,755
Total Operating Revenues		65,791,968		65,714,469
OPERATING EXPENSES:
Plant Operations (Excluding Depreciation     and Amortization)		15,168,203		14,383,362
Cost of Video		9,520,628		10,042,132
Cost of Data		4,817,072		4,118,439
Cost of Other Non-Regulated Services		1,672,935		1,635,837
Depreciation and Amortization		15,440,415		14,108,246
Selling, General, and Administrative		9,937,451		9,916,482
Total Operating Expenses		56,556,704		54,204,498
OPERATING INCOME		9,235,264		11,509,971
OTHER INCOME (EXPENSE):
Interest During Construction		720,659		284,871
CoBank Patronage Dividends		692,371		567,468
Interest/Dividend Income		181,081		261,181
Interest Expense		(6,817,430)		(3,485,805)
Gain on Sale of Investments		3,970,496		217,876
Impairment of Goodwill		(9,300,000)		-
Other Investment Income		418,521		539,803
Total Other Income (Expense)		(10,134,302)		(1,614,606)
INCOME (LOSS) BEFORE INCOME TAXES		(899,038)		9,895,365
INCOME TAXES EXPENSE		2,315,656		2,698,663
NET INCOME (LOSS)	$	(3,214,694)	$	7,196,702
NET INCOME (LOSS) PER SHARE
Basic	$	(0.63)	$	1.41
Diluted	$	(0.62)	$	1.41
DIVIDENDS PER SHARE	$	0.2800	$	0.5600
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic		5,116,953		5,090,407
Diluted		5,190,289		5,115,801
The accompanying notes are an integral part of these consolidated financial statements.

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
	2023		2022
NET INCOME (LOSS)	$	(3,214,694)	$	7,196,702
OTHER COMPREHENSIVE GAIN (LOSS):
Unrealized Gains (Losses) on Interest Rate Swaps		(871,834)		3,097,827
Income Tax Expense (Benefit) Related to Unrealized     Gains (Losses) on Interest Rate Swaps		248,821		(884,119)
OTHER COMPREHENSIVE GAIN (LOSS):		(623,013)		2,213,708
COMPREHENSIVE INCOME (LOSS)	$	(3,837,707)	$	9,410,410
The accompanying notes are an integral part of these consolidated financial statements.

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 2023 AND 2022
ASSETS
	2023		2022
CURRENT ASSETS:
Cash	$	1,259,904	$	310,556
Receivables, Net		3,411,892		3,725,422
Income Taxes Receivable		-		283,665
Materials, Supplies and Inventories		34,438,857		23,617,800
Prepaid Expenses and Other Current Assets		2,245,160		1,886,480
Total Current Assets		41,355,813		29,823,923
INVESTMENTS & OTHER ASSETS:
Goodwill		40,603,029		49,903,029
Intangibles		14,488,608		16,363,192
Other Investments		8,322,252		11,016,246
Right of Use Asset		1,348,290		1,341,029
Financial Derivative Instruments		1,342,628		2,214,462
Other Assets		884,122		461,445
Total Investments and Other Assets		66,988,929		81,299,403
PROPERTY, PLANT & EQUIPMENT:
Communications Plant		277,357,371		219,891,050
Other Property & Equipment		32,433,191		29,836,775
Video Plant		18,848,612		16,096,032
Total Property, Plant and Equipment		328,639,174		265,823,857
Less Accumulated Depreciation		173,088,602		159,632,293
Net Property, Plant & Equipment		155,550,572		106,191,564
TOTAL ASSETS	$	263,895,314	$	217,314,890
The accompanying notes are an integral part of these consolidated financial statements.

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (continued) DECEMBER 31, 2023 AND 2022
LIABILITIES AND STOCKHOLDERS' EQUITY
	2023		2022
CURRENT LIABILITIES:
Current Portion of Long-Term Debt, Net of    Unamortized Loan Fees	$	-	$	-
Accounts Payable		12,803,435		7,012,264
Checks Written in Excess of Cash Balance		2,270,832		-
Accrued Income Taxes		581,098		-
Other Accrued Taxes		253,490		243,965
Deferred Compensation		45,797		62,765
Accrued Compensation		1,562,115		2,051,316
Other Accrued Liabilities		1,059,163		2,291,630
Total Current Liabilities		18,575,930		11,661,940
LONG-TERM DEBT, Net of Unamortized     Loan Fees		122,891,638		78,552,197
NONCURRENT LIABILITIES:
Loan Guarantees		-		169,565
Deferred Income Taxes		23,032,099		22,737,530
Unrecognized Tax Benefit		-		23,304
Other Accrued Liabilities		1,132,799		1,236,949
Deferred Compensation		256,605		351,553
Total Noncurrent Liabilities		24,421,503		24,518,901
COMMITMENTS AND CONTINGENCIES:		-		-
STOCKHOLDERS' EQUITY:
Preferred Stock - $1.66 Par Value, 10,000,000 Shares    Authorized, No Shares Issued and Outstanding		-		-
Common Stock - $1.66 Par Value, 90,000,000 Shares Authorized,    5,133,207 and 5,093,213 Shares Issued and Outstanding		8,555,345		8,488,689
Accumulated Other Comprehensive Gain		959,442		1,582,455
Unearned Compensation		-		79,892
Retained Earnings		88,491,456		92,430,816
Total Stockholders' Equity		98,006,243		102,581,852
TOTAL LIABILITIES AND     STOCKHOLDERS' EQUITY	$	263,895,314	$	217,314,890
The accompanying notes are an integral part of these consolidated financial statements.

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$	(3,214,694)	$	7,196,702
Adjustments to Reconcile Net Income to Net Cash     Provided by Operating Activities:
Depreciation and Amortization		15,649,902		14,294,377
Gain on Sale of Investments		(4,062,759)		-
Impairment of Goodwill		9,300,000		-
Unrealized (Gains) Losses on Investments		92,263		(217,876)
Undistributed Earnings of Other Equity Investment		(280,000)		(515,963)
Noncash Patronage Refund		(123,745)		(133,467)
Stock Issued in Lieu of Cash Payment		471,092		398,424
Distributions from Equity Investments		128,048		210,917
Stock-based Compensation		221,749		64,301
Changes in Assets and Liabilities:
Receivables		(190,494)		34,677
Income Taxes Receivable		283,665		1,121,957
Inventories for Resale		41,522		10,238
Prepaid Expenses		(358,652)		89,882
Other Assets		(458,211)		(40,627)
Accounts Payable		49,249		199,257
Checks Written in Excess of Cash Balance		2,270,832		-
Accrued Income Taxes		581,098		-
Other Accrued Taxes		9,525		(16,048)
Other Accrued Liabilities		(1,833,079)		1,524,133
Deferred Income Tax		520,086		2,349,440
Deferred Compensation		(111,916)		(46,059)
Net Cash Provided by Operating Activities		18,985,481		26,524,265
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to Property, Plant, and Equipment, Net		(55,547,283)		(37,977,118)
Materials and Supplies for Construction		(13,404,354)		(15,651,923)
Proceeds from Sale of Equity Investments		5,876,305		-
Other, Net		229,854		4,804
Net Cash Used in Investing Activities		(62,845,478)		(53,624,237)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal Payments of Long-Term Debt		-		(57,330,775)
Loan Proceeds		40,000,000		56,063,223
Loan Origination Fees		(151,237)		(1,165,859)
Changes in Revolving Credit Facility		4,281,191		33,172,860
Grants Received for Construction of Plant		2,110,162		396,360
Repurchase of Common Stock		-		(3,187,500)
Dividends Paid		(1,430,771)		(2,843,930)
Net Cash Used in Financing Activities		44,809,345		25,104,379
NET CHANGE IN CASH		949,348		(1,995,593)
CASH at Beginning of Period		310,556		2,306,149
CASH at End of Period	$	1,259,904	$	310,556
Supplemental cash flow information:
Cash paid for interest	$	7,131,224	$	1,505,687
Net cash paid (received) for income taxes	$	930,807	$	(770,934)
The accompanying notes are an integral part of these consolidated financial statements.

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NUVERA COMMUNICATIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022
				Accumulated Other Comprehensive Income (Loss)
	Common Stock					Unearned Compensation		Retained Earnings		Total Equity
	Shares	Amount
BALANCE on December 31, 2021	5,210,053	$	8,683,422	$	(631,253)	$	259,620	$	90,338,806	$	98,650,595
Directors Stock Plan	19,818		33,030						354,412		387,442
Employee Stock Plan	4,676		7,793						92,741		100,534
Restricted Stock Grant							(30,712)				(30,712)
Non-Cash, Share-Based Compensation									95,013		95,013
Exercise of RSU's	8,666		14,444				(149,016)		134,572		-
Repurchases of Common Stock	(150,000)		(250,000)						(2,937,500)		(3,187,500)
Net Income									7,196,702		7,196,702
Dividends									(2,843,930)		(2,843,930)
Unrealized Gain on Interest Rate Swap					2,213,708						2,213,708
BALANCE on December 31, 2022	5,093,213		8,488,689		1,582,455		79,892		92,430,816		102,581,852
Directors Stock Plan	27,716		46,193						341,277		387,470
Employee Stock Plan	5,652		9,420						74,230		83,650
Restricted Stock Grant							(21,884)				(21,884)
Non-Cash, Share-Based Compensation									243,633		243,633
Exercise of RSU's	6,626		11,043				(58,008)		46,965		-
Net Loss									(3,214,694)		(3,214,694)
Dividends									(1,430,771)		(1,430,771)
Unrealized Gain on Interest Rate Swap					(623,013)						(623,013)
BALANCE on December 31, 2023	5,133,207	$	8,555,345	$	959,442	$	0	$	88,491,456	$	98,006,243
The accompanying notes are an integral part of these consolidated financial statements.

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NOTE 1 – BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Nuvera is a diversified communications company headquartered in New Ulm, Minnesota with more than 118 years of experience in the communications business. Our principal line of business is the operation of seven communications companies. Our businesses consist of connecting customers to our state-of-the-art, advanced fiber communications network, providing managed services, switched service and dedicated private lines, connecting customers to long distance service providers and providing many other services associated with our Company. We also provide IPTV, CATV, Internet access services, including high-speed broadband access, and long-distance service. We also install and maintain communications systems to the areas in and around our service territories in southern Minnesota and northern Iowa. 

Basis of Presentation and Principles of Consolidation

Our accounting policies conform to GAAP and rules and regulations of the SEC and, where applicable, conform to the accounting principles as prescribed by federal and state telephone utility regulatory authorities. We presently give accounting recognition to the actions of regulators where appropriate in preparing general purpose financial statements for most public utilities. In general, the type of regulation covered by this statement permits rates (prices) for some services to be set at levels intended to recover the estimated costs of providing regulated services or products, including the cost of capital (interest costs and a provision for earnings on stockholders’ investments).

Our consolidated financial statements report the financial condition and results of operations for Nuvera and its subsidiaries in one business segment: the Communications Segment. Inter-company transactions have been eliminated from the consolidated financial statements.

Classification of Costs and Expenses

Cost of services (excluding depreciation and amortization expense) includes all costs related to the delivery of communication services and products. These operating costs include all costs of performing services and providing related products including engineering, network monitoring and transportation costs.

Selling, general and administrative expenses include direct and indirect selling expenses, customer service, billing and collections, advertising and all other general and administrative costs associated with our operations.

Use of Estimates

The preparation of our consolidated financial statements in conformity with GAAP requires our management to make estimates and judgements that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and liabilities at the date of the financial statements and during the reporting period. The estimates and judgements used in the accompanying consolidated financial statements are based on our management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from those estimates and assumptions.

Revenue Recognition

See Note 2 – “Revenue Recognition” for a discussion of our revenue recognition policies.

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Accounts Receivables and Allowance for Credit Losses

As of December 31, 2023, and 2022 our consolidated AR totaled $3,411,892 and $3,725,422, net of the AFCLs. We believe our receivables as of December 31, 2023, and 2022 are recorded at their fair value.

AR consists primarily of amounts due to the Company from normal business activities. We maintain an AFCLs based on our historical loss experience, current conditions and forecasted changes including but not limited to changes related to the economy, our industry and business. Uncollectible accounts are written-off (removed from AR and charged against the AFCLs) when internal collection efforts have been unsuccessful. Subsequently, if payment is received from the customer, the recovery is credited to the AFCLs.

As of December 31, 2023, and 2022, the fair value of our net AR approximated their carrying values; therefore, no fair value adjustment for fresh start accounting was required. Our AFCLs increased during the year ended December 31, 2023, compared to 2022.

Allowance for Credit Losses

AR are recorded at amortized cost less an AFCLs that are not expected to be recovered. The gross amount of AR is recorded net of the corresponding AFCLs in the consolidated balance sheets. We maintain AFCLs resulting from the expected failure or inability of our customers to make their required payments. We recognize the AFCLs based on management’s expectation of the asset’s collectability. The allowance is based on multiple factors including historical experience with bad debts, the credit quality of the customer base, the aging of such receivable and current macroeconomic conditions, as well as management’s expectation of conditions in the future, as applicable. Our AFCLs is recorded on a monthly basis based on the aging of our overall AR. Our AR collection policy includes internal collection efforts after an AR balance is 30 days due with service being suspended after approximately 40 days and terminated upon 60 days past due.   

The following table summarizes the activity in the AFCLS for the years ended December 31, 2023, and 2022:

	Year Ended December 31
	2023		2022
Balance at beginning of year	$	140,000	$	80,000
Provision charged to expense		175,559		206,398
Write-offs, less recoveries		(165,559)		(146,398)
Balance at end of year	$	150,000	$	140,000

Inventories

Inventory includes parts, materials and supplies stored in our warehouses to support basic levels of service and maintenance as well as scheduled capital projects and equipment awaiting configuration for customers. Inventory also includes (i) parts and equipment shipped directly from vendors to customer locations while in transit and (ii) parts and equipment returned from customers that are returned to vendors for credit. Our inventory value as of December 31, 2023, and 2022 was $34,438,857 and $23,617,800.

We value inventory using the lower of cost or net realizable value. Like our AFCLs, we make estimates related to the valuation of inventory. As of December 31, 2023, and 2022, we had no inventory reserve. We adjust our inventory carrying value for estimated obsolescence or unmarketable inventory to the net realizable value based upon assumptions about future demand and market conditions. As market and other conditions change, we may establish additional inventory reserves at a time when the facts that give rise to a lower value are warranted. We use the average cost method of inventory costing.

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Property, Plant and Equipment

We record impairment losses on long-lived assets used in operations when events and circumstances indicate the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. In assessing the recoverability of long-lived assets, we compare the carrying value to the undiscounted future cash flows the assets are expected to generate. If the total of the undiscounted future cash flows is less than the carrying amount of the assets, we would write down those assets based on the excess of the carrying amount over the fair value of the assets. Fair value is generally determined by calculating the discounted future cash flows expected from those assets. Changes in these estimates could have a material adverse effect on the assessment of long-lived assets, thereby requiring a write-down of the assets. Write-downs of long-lived assets are recorded as impairment charges and are a component of operating expenses. We have reviewed our long-lived assets and concluded that no impairment charge on our long-lived assets is necessary.

We use the group life method (mass asset accounting) to depreciate the assets of our communications companies. Communications plant acquired in a given year is grouped into similar categories and depreciated over the remaining estimated useful life of the group. When an asset is retired, both the asset and the accumulated depreciation associated with that asset are removed from the books. Due to rapid changes in technology, selecting the estimated economic life of communications plant and equipment requires a significant amount of judgment. We periodically review data on the expected utilization of new equipment, asset retirement activity and net salvage values to determine adjustments to our depreciation rates. In 2022, we accelerated depreciation on our copper cable networks as we transition to a new FTTP network. Other than this change, we have not made any other significant changes to the lives of these assets in the two-year period ended December 31, 2023.

Grant money received from governmental entities for reimbursement of capital expenditures is accounted for as a reduction from the cost of the asset. As the grant was to be used in the Company’s regulated network, the Company accounts for this funding as aid to construction as outlined in the FCC’s Part 32 “Uniform System of Accounts for Telecommunications Companies.” The resulting balance sheet presentation reflects the Company’s net investment in the assets in our property, plant and equipment. Depreciation is calculated and recorded based on the reduced cost of the investment, therefore the impact of prior grants received is reflected in earnings as a reduction in depreciation. Grant funds are shown as inflows in the financing activities section of the statement of cash flows.

Goodwill and Intangible Assets

We amortize our definite-lived intangible assets over their estimated useful lives. Customer relationships are amortized over fourteen to fifteen years, regulatory rights are amortized over fifteen years and trade names are amortized over three to five years. Intangible assets with finite lives are amortized over their respective estimated useful lives. In accordance with GAAP, goodwill and intangible assets with indefinite useful lives are not amortized but tested for impairment at least annually. See Note 5 – “Goodwill and Intangibles” for a more detailed discussion of the intangible assets and goodwill. Our goodwill balance was $40,603,029 and $49,903,029 as of December 31, 2023, and 2022. The reduction in goodwill in 2023 was the result of the HTC impairment recognized in 2023. In the fourth quarter of 2023 and 2022 we completed our annual impairment tests for existing acquired goodwill. This testing resulted in no impairment charges to goodwill for SETC and Scott-Rice as of December 31, 2023. This testing did result in an impairment charge to goodwill for HTC of $9.3 million as of December 31, 2023. 

Financial Derivative Instruments and Fair Value Measurements

We have adopted the rules prescribed under GAAP for our financial assets and liabilities. GAAP includes a fair value hierarchy that is intended to increase consistency and comparability in fair value measurements and related disclosures. The fair value hierarchy is based on inputs to valuation techniques used to measure fair value that is either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions. The fair value hierarchy consists of the following three levels:

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Level 1:	Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2:	Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs that are derived principally from or corroborated by observable market data.
Level 3:	Inputs are derived from valuation techniques where one or more significant inputs or value drivers are unobservable.

We have used financial derivative instruments to manage our overall cash flow exposure to fluctuations in interest rates. We accounted for derivative instruments in accordance with GAAP that requires derivative instruments to be recorded on the balance sheet at fair value. Changes in the fair value of derivative instruments must be recognized in earnings unless specific hedge accounting criteria are met, in which case, the gains and losses are included in other comprehensive income rather than in earnings.

We have entered into IRSAs with our lender, CoBank to manage our cash flow exposure to fluctuations in interest rates. These instruments are designated as cash flow hedges and are effective at mitigating the risk of fluctuations on interest rates in the marketplace. Any gains or losses related to changes in the fair value of these derivatives are accounted for as a component of accumulated other comprehensive gain (loss) for as long as the hedge remains effective.

The fair value of our IRSAs is discussed in Note 7 – “Interest Rate Swaps”. The fair value of our swap agreements was determined based on Level 2 inputs.

The fair value of our Goodwill is discussed in Note 5 – “Goodwill and Intangibles”. The fair value of our Goodwill was determined based on Level 3 inputs.

Other Financial Instruments

Other Investments - We conducted an evaluation of our investments in all of our investees in connection with the preparation of our audited financial statements as of December 31, 2023. As of December 31, 2023, we believe the carrying value of our investments is not impaired.

Debt – We estimate the fair value of our long-term debt based on the discounted future cash flows we expect to pay using current rates of borrowing for similar types of debt. Fair value of the debt approximates carrying value.

Other Financial Instruments - Our financial instruments also include cash equivalents, trade AR and accounts payable where the current carrying amounts approximate fair market value.

Investments and Other Assets

We are a co-investor with other communication companies in several partnerships and limited liability companies. These joint ventures make it possible to offer services to customers, including digital video services and fiber transport services that we would have difficulty offering on our own. These joint ventures also make it possible to invest in new technologies with a lower level of financial risk. We use the equity method of accounting for these investments that reflects original cost and recognition of our share of the net income or losses from the respective operations. See Note 16 – “Segment Information” for a listing of our investments.

Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at fair value where there are readily determinable fair values. Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at cost where there are no readily determinable fair values.  See Note 12 – “Other Investments” for additional information regarding our investments.

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Advertising Expense

Advertising is expensed as incurred. Advertising expense charged to operations was $1,022,312 and $723,261 in 2023 and 2022. 

Interest During Construction

We include an average cost of debt for the construction of plant in our communications plant accounts.

Income Taxes

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. Accordingly, deferred tax assets and liabilities arise from the difference between the tax basis of an asset or liability and its reported amount in the financial statements and operating and tax credit carryforwards. Deferred tax assets and liabilities are determined using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. We recognize interest and penalties related to income tax matters as income tax expense. Income tax expense or benefit is the tax payable or refundable, respectively, for the period plus or minus the change in deferred tax assets and liabilities during the period.

GAAP requires us to recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. See Note 8 – “Income Taxes” for additional information regarding income taxes.

Collection of Taxes from Customers

Sales, excise and other taxes are imposed on most of our sales to nonexempt customers. We collect these taxes from our customers and remit the entire amounts to governmental authorities. Our accounting policies dictate that we exclude these taxes collected and remitted from our revenues and expenses.

Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments and receivables. We deposit our cash investments in high credit quality financial institutions accounts which, at times, may exceed federally insured limits. We have not experienced any losses in these accounts and do not believe we are exposed to any significant credit risk. Concentrations of credit risk with respect to trade receivables are limited due to our large number of customers.

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Earnings and Dividends Per Share

The basic and diluted net income per share are calculated as follows:

	Year Ended December 31, 2023				Year Ended December 31, 2022
	Basic		Diluted		Basic		Diluted
Net Income (Loss)	$	(3,214,694)	$	(3,214,694)	$	7,196,702	$	7,196,702
Weighted-average common shares outstanding		5,116,953		5,190,289		5,090,407		5,115,801
Net income (loss) per share	$	(0.63)	$	(0.62)	$	1.41	$	1.41

The weighted-average shares outstanding, basic and diluted are calculated as follows:

	Year Ended December 31, 2023		Year Ended December 31, 2022
	Basic	Diluted	Basic	Diluted
Weighted-average common shares outstanding	5,116,953	5,116,953	5,090,407	5,090,407
Dilutive RSU's/Options	-	73,336	-	25,394
Weighted-average common shares outstanding	5,116,953	5,190,289	5,090,407	5,115,801

Nuvera’s BOD reviews quarterly dividend declarations based on our anticipated earnings, capital requirements and our operating and financial conditions.

Recent Accounting Developments

Effective January 1, 2022, we adopted Accounting Standards Update (ASU) No. 2021-10 “Disclosures by Business Entities about Government Assistance.” ASU 2021-10 requires disclosure by business entities of the types of government assistance received, the method of accounting for such assistance and the effects of the assistance on its financial statements. The adoption of this guidance did not have a material impact on our related disclosures.

In March 2020, the Financial Accounting Standards Board (FASB) issued ASU 2020-04, “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional guidance for a limited period to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. During the quarter ended June 30, 2022, we novated a certain hedging relationship to one our IRSAs by changing the reference rated from the London Inter-Bank Offered Rate to a secured overnight financing rate (SOFR). The amendment did not have a material impact on our consolidated financial statements.   

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosures relating to the credit quality of trade and other receivables, including information relating to management’s estimate of AFCLs. The Company is required to adopt ASU 2016-13 for fiscal periods beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption as of December 15, 2018, was permitted. As of January 1, 2022, the Company adopted ASU 2016-13 and the adoption did not have a significant impact on our consolidated financial statements.

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We have reviewed all other significant newly issued accounting pronouncements and determined that they are either not applicable to our business or that no material effect is expected on our financial position and results of operations.

NOTE 2 – REVENUE RECOGNITION

The Company recognizes revenue based on the following single principles-based, five-step model that is applied to all contracts with customers. These steps include (1) identify the contract(s) with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when each performance obligation is satisfied.  

Our revenue contracts with customers may include a promise or promises to deliver services such as broadband, video or voice services. Promised services are considered distinct as the customer can benefit from the services either on their own or together with other resources that are readily available to the customer and the Company’s promise to transfer service to the customer is separately identifiable from other promises in the contract. The Company accounts for services as separate performance obligations. Each service is considered a single performance obligation as it provides a series of distinct services that are substantially the same and have the same pattern of transfer.

The transaction price is determined at contract inception and reflects the amount of consideration to which we expect to be entitled in exchange for transferring service to the customer. This amount is generally equal to the market price of the services promised in the contract and may include promotional or bundling discounts. Most of our prices are based on tariffed rates filed with regulatory bodies or standard company price lists. The transaction price excludes amounts collected on behalf of third parties such as sales taxes and regulatory fees. Conversely, nonrefundable up-front fees, such as service activation and set-up fees, which are immaterial to our overall revenues, are included in the transaction price. In determining the transaction price, we consider our enforceable rights and obligations within the contract. We do not consider the possibility of a contract being cancelled, renewed or modified, which is consistent with Accounting Standards Codification (ASC 606-10-32-4).

The transaction price is allocated to each performance obligation based on the standalone selling price of the service, net of the related discount, as applicable.

Revenue is recognized when performance obligations are satisfied by transferring service to the customer as described below.

Significant Judgments

The Company often provides multiple services to a customer. Provision of CPE and additional service tiers may have a significant level of integration and interdependency with the subscription voice, video, Internet or connectivity services. Judgement is required to determine whether the provision of CPE, installation services and additional service tiers are considered distinct and accounted for separately, or not distinct and accounted for together with the subscription services.

Allocation of the transaction price to the distinct performance obligations in bundled service subscriptions requires judgement. The transaction price for a bundle of services is frequently less than the sum of standalone selling prices of each individual service. Bundled discounts are allocated proportionally to the selling price of each individual service within the bundle. Standalone selling prices for the Company’s services are directly observable.

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Disaggregation of Revenue

The following table summarizes revenue from contracts with customers for the years ended December 31, 2023, and 2022:

	Twelve Months Ended December 31,
	2023		2022
Voice Service¹	$	5,818,241		6,254,287
Network Access¹		3,938,587		4,898,470
Video Service¹		12,061,703		12,497,213
Data Service¹		25,214,978		24,680,039
Directory²		597,189		645,250
Other Contracted Revenue³		2,695,719		2,755,039
Other4		2,014,586		1,353,475
Revenue from customers		52,341,003		53,083,773
Subsidy and other revenue outside scope of ASC 6065		13,450,965		12,630,696
Total revenue	$	65,791,968	$	65,714,469
¹ Month-to-Month contracts billed and consumed in the same month.
² Directory revenue is contracted annually, however, this revenue is recognized monthly over the contract period as the advertising is used.
³ This includes long-term contracts where the revenue is recognized monthly over the term of the contract.
4 This includes CPE and other equipment sales.
5 This includes governmental subsidies and lease revenue outside the scope of ASC 606.

For the year ended December 31, 2023, approximately 76.50% of our total revenue was from month-to-month and other contracted revenue from customers. Approximately 20.44% of our total revenue was from revenue sources outside of the scope of ASC 606. The remaining 3.06% of total revenue was from other sources including CPE and equipment sales and installation.

For the year ended December 31, 2022, approximately 78.72% of our total revenue was from month-to-month and other contracted revenue from customers. Approximately 19.22% of our total revenue was from revenue sources outside of the scope of ASC 606. The remaining 2.06% of total revenue was from other sources including CPE and equipment sales and installation.

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A significant portion of our revenue is derived from customers who may generally cancel their subscriptions at any time without penalty. As such, the amount of revenue related to unsatisfied performance obligations is not necessarily indicative of the future revenue to be recognized from our existing customer base. Revenue from customers with a contractually specified term and non-cancelable service period will be recognized over the term of such contracts, which is generally three to ten years for these types of contracts.

Nature of Services

Revenues are earned from our customers primarily through the connection to our advanced fiber networks, digital and commercial TV programming, Internet services (high-speed broadband), and hosted and managed services. Revenues for these services are billed based on set rates for monthly service or based on the amount of time the customer is utilizing our facilities. The revenue for these services is recognized over time as the service is rendered.

Voice Service – We receive recurring revenue for basic local services that enable end-user customers to make and receive telephone calls within a defined local calling area for a flat monthly fee. In addition to subscribing to basic local telephone services, our customers may choose from multiple voice service plans with a variety of custom calling features such as call waiting, call forwarding, caller identification and voicemail. Our VOIP digital phone service is also available as an alternative to the traditional telephone line. Customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

Network Access – We provide access services to other communication carriers for the use of our facilities to terminate or originate long distance calls on our fiber network. Additionally, we bill monthly SLCs to substantially all our customers for access to the public switched network. These monthly SLCs are regulated and approved by the FCC. In addition, network access revenue is derived from several federally administered pooling arrangements designed to provide support and distribute funding to us.

Revenues earned from other communication carriers accessing our network are based on the utilization of our network by these carriers as measured by minutes of use on the network or special access to the network by the individual carriers monthly. Revenues are billed at tariffed access rates for both interstate and intrastate calls and are recognized into revenue monthly based on the period the access was provided.

The NECA pools and redistributes the SLCs to various communication providers through the CAF. These revenues are earned and recognized into revenue monthly. Any adjustments to these amounts received by NECA are adjusted for in revenue upon receipt of the adjustment.

Video Service – We provide a variety of enhanced video services on a monthly recurring basis to our customers.  Depending on geographical market availability, our video services range from limited basic service to advanced digital TV, which includes several plans each with hundreds of local, national music channels including premium and pay-per-view channels as well as video-on-demand service. Certain customers may also subscribe to our advanced video services, which consist of HD TV, DVR and Whole Home DVR. Our Whole Home DVR allows customers the ability to watch recorded shows on any TV in the house, record multiple shows at one time and utilize an intuitive on-screen guide and user interface. Video subscribers also have access to our TV Everywhere service which allows subscriber access to full episodes of available shows, movies and live screens using a computer or mobile device. We also receive monthly recurring revenue from our subscribers for providing commercial TV programming in competition with CATV, satellite dish TV and off-air TV service providers. Customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

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Data Service – We provide high speed Internet to business and residential customers depending on the nature of the network facilities that are available, the level of service selected and the location. Our revenue is earned based on the offering of various flat packages based on the level of service, data speeds and features. We also provide e-mail and managed services, such as web hosting and design, on-line file back up and on-line file storage. Data customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

Directory – Our directory publishing revenue in our telephone directories recurs monthly and is recognized as revenue monthly. 

Other Contracted Revenue - Managed services and certain other data customers include advanced fiber-delivered communications and managed information technology solutions to mainly business customers, as well as high-capacity last-mile data connectivity services to wireless and wireline carriers. Services are primarily offered on a subscription basis with a contractually specified and non-cancelable service period. The non-cancelable contract terms for these customers generally range from three to ten years. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized ratably over the contract period as the subscription services are delivered. These services are billed as monthly recurring charges to customers. 

Other – We also generate revenue from the sales, service and installation of CPE and other services. Sales and service of CPE are billed and recognized into revenue once the sale or service is complete or delivered. These sales and services are generally short-term in nature and are completed within one month. Other revenues are immaterial to our total revenues.

Subsidy and Other Revenue outside the Scope of ASC 606 – We receive subsidies from governmental entities to operate and expand our advanced fiber networks. In addition, we have revenue from leasing arrangements. Both revenue streams are outside of the scope of ASC 606. 

Interstate access rates are established by a nationwide pooling of companies known as NECA. The FCC established NECA in 1983 to develop and administer interstate access service rates, terms and conditions. Revenues are pooled and redistributed based on a company's actual or average costs. There has been a change in the composition of interstate access charges in recent years, shifting more of the charges to the end user and reducing the amount of access charges paid by the IXC’s. We believe this trend will continue.

Intrastate access rates are filed with state regulatory commissions in Minnesota and Iowa.

The Company currently receives funding based on the A-CAM as described below, except for Scott-Rice, which receives funding from the FUSF. Scott-Rice’s settlements from the pools are based on nationwide average schedules, which includes the pooling and redistribution of revenues based on a company’s actual or average costs as described below. 

A-CAM

As described above, except Scott-Rice, the remainder of our companies receive funding from A-CAM.

Per the FCC Public Notice DA 19-115, the Company receives A-CAM support and has corresponding service deployment obligations under that program. The Company annually receives (i) $596,084 for its Iowa operations and (ii) $8,354,481 for its Minnesota operations. The Company will receive the A-CAM support for a period of 10 years, which started in 2019. The Company uses the funding that it receives through the A-CAM program to meet its defined broadband build-out obligations, which the Company is currently completing.

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On September 29, 2023, Nuvera announced that it had notified the FCC that the Company had decided to remain on the current A-CAM funding, rather than moving to the E-ACAM program that the FCC introduced earlier in 2023. A-CAM and E-ACAM are FCC administered programs to subsidize the deployment of broadband to rural areas. E-ACAM is a successor to this program which requires participating carriers to offer broadband and voice services at speeds of 100/20 Mbps or faster to all E-ACAM required locations within its study area. Broadband providers were required to choose one of the two funding options and notify the FCC by September 29, 2023.

Accounts Receivable, Contract Assets and Contract Liabilities

The following table provides information about our receivables, contracts assets and contract liabilities from revenue contracts with our customers:

	Year Ended December 31,
	2023		2022		2021
Accounts receivable, net	$	1,966,012	$	1,477,692	$	1,512,369
Contract assets		1,458,631		794,193		662,437
Contract liabilities		551,995		626,306		602,007

Accounts Receivable

A receivable is recognized in the period the Company provides goods and services when the Company’s right to consideration is unconditional. Payment terms on invoiced amounts are generally 30-60 days.

Contract Assets

Contract assets include costs that are incremental to the acquisition of a contract. Incremental costs are those that result directly from obtaining a contract or costs that would not have been incurred if the contract had not been obtained, which primarily relates to sales commissions. We defer and amortize these costs over the expected customer life as the contract obligations are satisfied. We determined that the expected customer life is the expected period of benefit as the commission on the renewal contact is commensurate with the commission on the initial contract. During the years ended December 31, 2023, and 2022, the Company recognized expenses of $493,987 and $300,614, respectively, related to deferred contract acquisition costs. Short-term contract assets are included in current assets under prepaid expenses and other current assets. Long-term contract assets are included in investments and other assets under other assets.

Contract Liabilities

Contract liabilities include deferred revenues related to advanced payments for services and nonrefundable, upfront service activation and set-up fees, which are generally deferred. In addition, contact liabilities include customer deposits that are not recognized as revenue, but are instead returned to the customer after a holding period. Short-term contract liabilities include deferred revenues for advanced payments for managed services and other long-term contracts. This includes the current portion of the deferred revenues that will be recognized monthly within one year. Short-term contact liabilities are included in current liabilities under other accrued liabilities. Long-term contract liabilities include deferred revenues for advanced payments for managed services and other long-term contracts. This includes the portion longer than one year and the corresponding deferred revenues are recognized into revenue on a monthly basis based on the term of the contract. Long-term contact liabilities are included in noncurrent liabilities under other accrued liabilities.

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During the years ended December 31, 2023, and 2022 the Company recognized revenues of $364,644 and $349,109, respectively, related to deferred revenues.

Performance Obligations

ASC 606, Revenue from Contracts with Customers, requires that the Company disclose the aggregate amount of the transaction price that is allocated to remaining performance obligations that are unsatisfied as of December 31, 2023. The guidance provides certain practical expedients that limit this requirement. The service revenue contracts of the Company meet the following practical expedients provided by ASC 606:

1.  The performance obligation is part of a contract that has an original expected duration of one year or less.

2.  Revenue is recognized from the satisfaction of the performance obligations in the amount billable to the customer in accordance with ASC 606-10-55-18.

The Company has elected these practical expedients. Performance obligations related to our service revenue contracts are generally satisfied over time. For services transferred over time, revenue is recognized based on amounts invoiced to the customer as the Company has concluded that the invoice amount directly corresponds with the value of services provided to the customer. Management considers this a faithful depiction of the transfer of control as services are substantially the same and have the same pattern of transfer over the life of the contract. As such, revenue related to unsatisfied performance obligations that will be billed in future periods has not been disclosed.

NOTE 3 – LEASES

Under FASB’s ASU 2016-02, “Leases,” which, together with its related clarifying ASUs, provided revised guidance for lease accounting and related disclosure requirements and established a right-to-use (ROU) model that requires lessees to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. The ASU also requires disclosures to allow financial statement users to better understand the amount, timing and uncertainty of cash flows arising from leases. These disclosures include qualitative requirements, providing additional information about the amounts recorded in the financial statements.    

The following tables include the ROU assets and operating lease liabilities as of December 31, 2023, and 2022. Short-term operating lease liabilities are included in current liabilities in other accrued liabilities. Long-term operating lease liabilities are included in noncurrent liabilities in other accrued liabilities.

Right of Use Assets	Balance  December 31, 2023		Balance  December 31, 2022
Operating Lease Right-Of-Use Assets	$	1,348,290	$	1,341,029

Operating Lease Liabilities	Balance December 31, 2023		Balance December 31, 2022
Short-Term Operating Lease Liabilities	$	352,969	$	356,400
Long-Term Operating Lease Liabilities		1,029,910		1,026,978
Total	$	1,382,879	$	1,383,378

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Maturity analysis under these lease agreements are as follows:

Maturity Analysis	Balance December 31, 2023
2024	$	429,410
2025		241,574
2026		198,377
2027		149,229
2028		151,424
Thereafter		554,492
Total		1,724,506
Less Imputed interest		(341,627)
Present Value of Operating Leases	$	1,382,879

The following summarizes other information related to leases for the year ended December 31, 2023, as follows:

Weighted Average Remaining Lease Term (Years)	6.75
Weighted Average Discount Rate	6.27%

We amortize our leases over the shorter of the term of the lease or the useful life of the asset. Lease expenses for the years ended December 31, 2023, and 2022 was $506,138 and $357,303, respectively.

NOTE 4 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of December 31, 2023, and 2022, include the following:

	2023		2022
Communications Plant:
Land	$	707,648	$	712,503
Buildings		11,007,636		10,918,490
Other Support Assets		24,419,429		22,980,859
Central Office and Circuit Equipment		63,323,590		61,046,604
Cable and Wire Facilities		154,273,968		118,171,835
Other Plant and Equipment		404,883		404,883
Plant Under Construction		23,220,217		5,655,876
		277,357,371		219,891,050
Other Property		32,433,191		29,836,775
Video Plant		18,848,612		16,096,032
Total Property, Plant and Equipment	$	328,639,174	$	265,823,857

Depreciation is computed using the straight-line method based on the estimated service or remaining useful lives of the various classes of depreciable assets. Depreciation expense was $13,565,831 and $12,155,871 in 2023 and 2022. The composite depreciation rates on communications plant and equipment for the two years ended December 31, 2023, and 2022, respectively, were 4.4% and 4.7%. Other property and video plant is depreciated over estimated useful lives of three to twenty-five years.

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NOTE 5 - GOODWILL AND INTANGIBLES

We account for goodwill and other intangible assets under GAAP. Under GAAP, goodwill and intangible assets with indefinite useful lives are not amortized but are instead tested for impairment (i) on at least an annual basis and (ii) when changes in circumstances indicate that the fair value of goodwill may be below its carrying value. These circumstances include but are not limited to (i) a significant adverse change in the business climate, (ii) unanticipated competition or (iii) an adverse action or assessment by a regulator. Determining impairment involves estimating the fair value of a reporting unit using a combination of (i) the income or discounted cash flow approach and (ii) the market approach that utilizes comparable companies’ data. If the carrying amount of a reporting unit exceeds its fair value, the amount of the impairment loss must be measured. The impairment loss is calculated by comparing the implied fair value of the reporting unit’s goodwill to its carrying amount. In calculating the implied fair value of the reporting unit’s goodwill, the fair value of the reporting unit is allocated to all the assets and liabilities of the reporting unit. The excess of the fair value of a reporting unit over the amount assigned to its other assets and liabilities is the implied value of goodwill. We recognize impairment loss when the carrying amount of goodwill exceeds its implied fair value. Our goodwill totaled $40,603,029 as of December 31, 2023, and $49,903,029 as of December 31, 2022. The reduction in goodwill in 2023 was the result of the HTC impairment recognized in 2023.

In 2023 and 2022, we engaged an independent valuation firm to aid in the completion of an annual impairment test for existing goodwill acquired. For 2023 and 2022, the testing resulted in no impairment to goodwill for Scott-Rice and SETC and no impairment to goodwill for HTC for 2022 as the determined fair value was sufficient to pass the impairment test. For 2023, the testing resulted in an impairment to goodwill for HTC of $9.3 million as the determined fair value was not sufficient to pass the impairment test.

Our intangible assets subject to amortization consist of acquired customer relationships, regulatory rights and trade names. We amortize intangible assets with finite lives over their respective estimated useful lives. Identifiable intangible assets that are subject to amortization are evaluated for impairment. In addition, we periodically reassess the carrying value, useful lives and classifications of our identifiable intangible assets.

The components of our identified intangible assets are as follows:

		December 31, 2023				December 31, 2022
	Useful Lives		Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Definite-Lived Intangible Assets
Customers Relationships	14-15 yrs	$	42,878,445	$	32,053,361	$	42,878,445	$	30,429,708
Regulatory Rights	15 yrs		4,000,000		4,000,000		4,000,000		4,000,000
Video Franchise			3,000,000		214,290		-		-
Trade Name	3-5 yrs		310,106		310,106		310,106		273,465
Indefinitely-Lived Intangible Assets
Video Franchise			-		-		3,000,000		-
Spectrum			877,814		-		877,814		-
Total		$	51,066,365	$	36,577,757	$	51,066,365	$	34,703,173
Net Identified Intangible Assets				$	14,488,608			$	16,363,192

Amortization expense related to the definite-lived assets was $1,874,584 for 2023 and $1,952,375 for 2022. Amortization expense for the next five years is estimated to be:

2024	$	2,052,234
2025	$	2,047,312
2026	$	2,042,389
2027	$	1,335,247
2028	$	1,335,247

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NOTE 6 - LONG-TERM DEBT

On July 15, 2022, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and secured a new credit facility in the aggregate principal amount of $130.0 million.

Under the Agreements, among other things, (i) the Company received a $50.0 million term loan to replace existing debt, (ii) a $50.0 million delayed draw term loan, (iii) the Company’s revolving loan was increased from $20.0 million to $30.0 million, (iv) the maturity date of the term loans were set at July 15, 2029, and the maturity day of the revolving loan was set at July 15, 2027, and (v) the Company’s operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on July 20, 2022, for further details regarding the new credit agreements with CoBank.

On December 21, 2023, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and increased the Company’s existing credit facility from an aggregate principal amount of $130.0 million to $140.0 million. Under the Agreements, among other things, (i) the Company’s revolving loan was increased from $30.0 million to $40.0 million and (ii) the Company operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on December 21, 2023, for further details regarding the new credit agreements with CoBank.

Under the new credit agreement, the Company and its respective subsidiaries have entered into security agreements under which substantially all the assets of Nuvera and its respective subsidiaries have been pledged to CoBank as collateral. In addition, Nuvera and its respective subsidiaries have guaranteed all the obligations under the credit facility. The credit agreement contains certain customary events of default, which include failure to make payments when due, the material inaccuracy of representations or warranties, failure to observe or perform certain covenants, cross-defaults, bankruptcy and insolvency-related events, certain judgments, certain ERISA-related events, or a change in control (as defined in the credit agreement).

Secured Credit Facility:

New Credit Agreement

● TERM A-1 LOAN - $50,000,000 term note with interest payable quarterly. Final maturity date of this note is July 15, 2029. Twelve quarterly principal payments of $625,000 are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of $937,500 commencing on December 31, 2028, through maturity date. A final balloon payment of $39,687,500 is due at maturity of this note on July 15, 2029. We have currently drawn $50,000,000 on this Term Loan as of December 31, 2023.

● DELAYED DRAW TERM LOAN - $50,000,000 Delayed Draw Term Loan with interest on any outstanding amounts payable quarterly. Final maturity date of this loan is July 15, 2029. Twelve quarterly principal payments of 1.25% of the outstanding loan balance are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of 1.875% of the outstanding loan balance commencing on December 31, 2028, through maturity date. A final balloon payment of the balance of the Delayed Draw Term Loan is due at maturity of this note on July 15, 2029. We currently have drawn $50,000,000 on this Delayed Draw Term Loan as of December 31, 2023.

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●

REVOLVING LOAN - $40,000,000 revolving loan with interest payable quarterly. Final maturity date of this note is July 15, 2027. We currently have drawn $24,166,273 on this revolving note as of December 31, 2023.

The term loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 2.15% above the applicable base rate. The margin for base rate loans for term loans increases as our “Leverage Ratio” increases. The revolving loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 1.90% above the applicable base rate. The margin for base rate loans for revolving loans increases as our “Leverage Ratio” increases.

We generally use variable-rate debt to finance our operations, capital expenditures and acquisitions. These variable-rate debt obligations expose us to variability in interest payments due to changes in interest rates. The terms of our credit facility with CoBank require that we enter into interest rate agreements designed to protect us against fluctuations in interest rates, in an aggregate principal amount and for a duration determined under the credit facility.

Under the new credit facility, Nuvera can enter into IRSAs in connection with amounts borrowed from CoBank. In connection with the closing of the new credit facility, the Company “rolled over” its two exiting IRSAs. 

As described in Note 7 – “Interest Rate Swaps,” on August 1, 2018 we entered into an IRSA with CoBank covering 25 percent of our then existing debt balance or $16,137,500 of our aggregate indebtedness to CoBank on August 1, 2018. As of December 31, 2023, our IRSA covered $9,798,200, with a weighted average interest rate of 6.11%.

As described in Note 7 – “Interest Rate Swaps,” on August 29, 2019 we entered into a second IRSA with CoBank covering an additional $42,000,000 of our then aggregate indebtedness to CoBank on August 29, 2019. As of December 31, 2023, our IRSA covered $27,462,606, with a weighted average interest rate of 4.44%.

Our remaining outstanding debt of $86.9 million remains subject to variable interest rates at an effective weighted average interest rate of 8.55%, as of December 31, 2023.

As of December 31, 2023, our unused revolving credit facility of $15.8 million is subject to an unused commitment fee of 0.25% annually, until drawn. Once drawn, this debt would be subject to an effective weighted average interest rate based on a current rate of interest in effect at the time.

Our loan agreements include restrictions on our ability to pay cash dividends to our stockholders. However, we are allowed to pay dividends in an amount up to $3,000,000 in any year as long as no default or event of default has occurred. Our current Total Leverage Ratio as of December 31, 2023, was 5.03, which exceeded our maximum total leverage ratio of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.   

Our credit facility requires us to comply with specified financial ratios and tests. These financial ratios include total leverage ratio, debt service coverage ratio and equity to total assets ratio. On December 31, 2023, other than our total leverage ratio, we were in compliance with all the stipulated financial ratios in our loan agreements.

There are security and loan agreements underlying our current CoBank credit facility that contain restrictions on our distributions to stockholders and investment in, or loans, to others. Also, our credit facility contains restrictions that, among other things, limits or restricts our ability to enter into guarantees and contingent liabilities, incur additional debt, issue stock, transact asset sales, transfers or dispositions, and engage in mergers and acquisitions, without CoBank approval.  

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Long-term debt is as follows:	2023		2022
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of $625,000 (beginning on December 31, 2025) and    quarterly installments of $937,500 (beginning on December 31, 2028),    plus a notional variable rate of interest through July 15, 2029.	$	50,000,000	$	50,000,000
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of 1.25% of loan balance (beginning on    December 31, 2025) and quarterly installments of 1.875% of loan balance    beginning on December 31, 2028), plus a notional variable rate of    interest through July 15, 2029.		50,000,000		10,000,000
Secured five-year revolving credit facility of up to $40,000,000 to    CoBank, ACB, plus a notional variable rate of interest through    July 15, 2027.		24,166,273		19,885,082
Less:  Unamortized Loan Fees		(1,274,635)		(1,332,885)
		122,891,638		78,552,197
Less:  Amount due within one year		-		-
Net of Current Portion of Unamortized Loan Fees		-		-
Total Long Term Debt	$	122,891,638	$	78,552,197

Required principal payments for the next five years are as follows:

2024	$	-
2025	$	1,250,000
2026	$	4,922,845
2027	$	28,970,229
2028	$	5,272,117

NOTE 7 – INTEREST RATE SWAPS 

We assess interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely affect expected future cash flows and by evaluating hedging opportunities.

We generally use variable-rate debt to finance our operations, capital expenditures and acquisitions. These variable-rate debt obligations expose us to variability in interest payments due to changes in interest rates. The terms of our credit facility with CoBank required that we enter into interest rate agreements designed to protect us against fluctuations in interest rates, in an aggregate principal amount and for a duration determined under the credit facility.

Under the new credit facility, Nuvera can enter into IRSAs in connection with amounts borrowed from CoBank. In connection with the closing of the new credit facility, the Company “rolled over” its two exiting IRSAs. 

To meet this objective, we have entered into an IRSA with CoBank covering 25 percent of our then existing outstanding debt balance or $16,137,500 of our aggregate indebtedness to CoBank at August 1, 2018. The swap effectively locked in the interest rate on 25 percent of our variable-rate debt through July 2025. Under this IRSA, we have changed the variable-rate cash flow exposure on the debt obligations to fixed cash flows. Under the terms of the IRSA, we pay a fixed contractual interest rate and (i) make an additional payment if the SOFR variable rate payment is below a contractual rate or (ii) receive a payment if the SOFR variable rate payment is above the contractual rate.

On August 29, 2019, we entered into a second IRSA with CoBank covering an additional $42,000,000 of our then aggregate indebtedness to CoBank on August 29, 2019. The swap effectively locked in a significant portion of our variable-rate debt through July 2025. Under this IRSA, we have changed the variable rate cash flow exposure on the debt obligations to fixed cash flows. Under the terms of the IRSA, we pay a fixed contractual interest rate and (i) make an additional payment if the SOFR variable rate payment is below a contractual rate or (ii) receive a payment if the SOFR variable rate payment is above the contractual rate.

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Each month, we make interest payments to CoBank under its loan agreements based on the current applicable SOFR plus the contractual SOFR margin then in effect with respect to the loan, without reflecting our IRSAs. At the end of each calendar month, CoBank adjusts our aggregate interest payments based on the difference, if any, between the amounts paid by us during the month and the current effective interest rate. Net interest payments are reported in our consolidated income statement as interest expense.

As of December 31, 2023 we had the following IRSAs in effect.

Loan #	Maturity Date	Notional Amount		Current Effective Interest Rate (1)
TERM A-1 LN	7/31/2029	$	9,798,200	6.11% (SOFR Base Rate of 2.96% plus 3.15% Base Rate Margin)
TERM A-1 LN	7/31/2029	$	27,462,606	4.44% (SOFR Base Rate of 1.29% plus 3.15% Base Rate Margin)

(1) As described in Note 6 – “Long-Term Debt,” the notes above initially bears interest at a SOFR rate determined by the maturity of the note, plus a “Base Rate Margin” rate equal to a maximum of 2.90% according to the individual secured credit facility. The Base Rate Margin increases as the borrower’s “Leverage Ratio” increases. The “Current Effective Interest Rate” in the table reflects the rate we pay giving effect to the swaps.

Our IRSAs under our credit facilities both qualify as cash flow hedges for accounting purposes under GAAP. We reflect the effect of these hedging transactions in the financial statements. The unrealized gain/loss is reported in other comprehensive income. If we terminate our IRSAs, the cumulative change in fair value at the date of termination would be reclassified from accumulated other comprehensive gain (loss), which is classified in stockholders’ equity, into earnings on the consolidated statements of income.

The fair value of the Company’s IRSAs were determined based on valuations received from CoBank and were based on the present value of expected future cash flows using discount rates appropriate with the terms of the IRSAs. The fair value indicates an estimated amount we would be required to pay if the contracts were canceled or transferred to other parties. On December 31, 2023, the fair value asset of these swaps was $1,342,628, which has been recorded net of deferred tax expense of $383,186, resulting in the $959,442 in accumulated other comprehensive income gain. As of December 31, 2022, the fair value asset of these swaps was $2,214,462, which has been recorded net of deferred tax expense of $632,007, resulting in the $1,582,455 in accumulated other comprehensive income gain.

NOTE 8 - INCOME TAXES

Income taxes recorded in our consolidated statements of income consists of the following:

	2023		2022
Taxes currently payable
Federal	$	-	$	(50,330)
State		1,795,530		380,082
Deferred Income Taxes		520,126		2,368,911
Total Income Tax Expense	$	2,315,656	$	2,698,663

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. As required by GAAP, we recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. 

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As of December 31, 2022, we had $19,787 of unrecognized tax benefits that if recognized would affect the tax rate. As of December 31, 2023, the uncertain tax position was reduced to $0 due to a lapse in stature of limitations for the year the position originated.

A reconciliation of the beginning and ending amount of total unrecognized benefits for the years ended December 31, 2023, and 2022 are as follows:

	2023		2022
Balance, beginning of year	$	19,787	$	38,673
Increases related to prior year tax positions		-		-
Decreases related to prior year tax positions		-		(18,886)
Increases related to current year tax positions		-		-
Decreases due to lapse of statute of limitations		(19,787)		-
Settlements		-		-
Balance, end of year	$	-	$	19,787

We are primarily subject to United States, Minnesota, Iowa, Nebraska, North Dakota and Wisconsin income taxes. Tax years subsequent to 2019 remain open to examination by federal and state tax authorities. Our policy is to recognize interest and penalties related to income tax matters as income tax expense. As of December 31, 2023, and 2022 we had $0 and $3,518 of interest or penalties accrued that related to income tax matters.

The differences between the statutory federal tax rate and the effective tax rate were as follows:

	2023		2022
Statutory Tax Rate	21.00	%	21.00	%
Effect of:
State Income Taxes Net of Federal Tax Benefit	(65.32)		8.17
Non deductible goodwill impairment	(217.23)		-
Permanent Differences and Other, Net	3.98		(1.90)
Effective tax rate	(257.57)	%	27.27	%

The Company’s income tax provision was computed based on the federal statutory rate and the average state statutory rates, net of the related federal benefit. The Company’s effective rate for the year ended December 31, 2023 was significantly impacted by a nondeductible goodwill impairment charge. Absent the impairment charge, the Company’s effective tax rate would have been 27.56%.

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Deferred income taxes and unrecognized tax benefits reflected in our consolidated balance sheets are summarized as follows:

	2023		2022
Deferred Tax Assets
Accrued Expenses	$	(200,541)	$	(382,546)
Deferred Compensation		(86,319)		(118,265)
Other		(219,058)		(106,371)
State NOL		(27,367)		(19,668)
Federal NOL		(4,643,453)		(3,472,536)
Sec. 163(j) business interest limitation		(2,823,686)		-
Leases		(394,736)		(394,878)
Total Deferred Tax Assets		(8,395,160)		(4,494,264)
Deferred Tax Liabilities
Fixed Assets		26,429,560		21,076,220
Intangible Assets		3,089,966		3,591,783
Investments		723,264		1,322,296
Unrealized Gain on SWAP		383,247		632,007
Contract Assets		416,359		226,698
Leases		384,863		382,790
Total Deferred Tax Liabilities:		31,427,259		27,231,794
Total Net Deferred Taxes	$	23,032,099	$	22,737,530

As of December 31, 2023, the Company has net operating loss carryforwards of approximately $22.1 million for tax purposes, which will be available to offset future taxable income. The losses may be carried forward indefinitely.

NOTE 9 – INCENTIVE AND RETIREMENT PLANS

In 2006, we implemented an EIP for employees other than executive officers and a MIP for executive officers (collectively the 2006 Plan). In 2015, our BOD adopted, and our shareholders approved our 2015 Employee Stock Plan (2015 ESP), which permits the issuance of up to 200,000 shares of our Common Stock in stock awards for performance under the 2006 Plan. Each qualified employee of the Company may elect to receive up to 50% of their incentive compensation in Company Common Stock in lieu of cash. Each Company executive officer is required to receive 50% of their incentive compensation earned in Company Common Stock in lieu of cash. As of March 15, 2024, 149,747 shares remain available to be issued under the 2015 ESP.

We have a 401(k)-employee savings plan in effect for employees who meet age and service requirements. Our contributions to our 401(k)-employee savings plan were $435,317 and $402,398 in 2023 and 2022.

NOTE 10 – COMMITMENTS AND CONTINGENCIES

On December 15, 2021, the Company announced plans for a fiber network initiative. The Company has made commitments to purchase materials and entered into contracts with various parties to successfully build this next-generation fiber network. As of December 31, 2023, the Company had outstanding contract amounts of approximately $17.7 million, with estimate completions of approximately $11.5 million in 2024 and $6.2 million in 2025.

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We are involved in certain contractual disputes in the ordinary course of business. We do not believe the ultimate resolution of any of these existing matters will have a material adverse effect on our financial position, results of operations or cash flows. 

Our capital budget for 2024 is approximately $41.1 million and will be financed through internally generated funds and our credit facility with CoBank debt financing.    

NOTE 11 - NONCASH ACTIVITIES

Noncash investing activities included $11,020,966 and $5,279,044 during the years ended December 31, 2023 and 2022. These activities related to plant and equipment additions placed in service and are recorded in our accounts payable at year-end.

Noncash financing activities include $0 and $1,501,850 during the years ended December 31, 2023, and 2022. The activities related to broadband grants awarded and are recorded in our AR at year-end.

NOTE 12 – OTHER INVESTMENTS

We are a co-investor with other communication companies in several partnerships and limited liability companies. These joint ventures make it possible to offer services to customers, including digital video services and fiber transport services that we would have difficulty offering on our own. These joint ventures also make it possible to invest in new technologies with a lower level of financial risk. We recognize income and losses from these investments on the equity method of accounting. For a listing of our investments, see Note 16 – “Segment Information.”  

Nuvera recognized a gain of $4,060,775, net of escrow true ups, after the sale, in book value in connection with the sale of the FiberComm investment. 

The FASB requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. As of December 31, 2023, the Company had recorded losses on our investments of $90,279. As of December 31, 2022, the Company has recorded a gain on one of our investments of $217,876.  

NOTE 13 - GUARANTEES

On March 31, 2023, Nuvera and the other owners of FiberComm sold 100% of their investment in FiberComm to ImOn Communications, LLC. FiberComm has been providing high quality Internet and voice services to businesses in the Sioux City, Iowa market for over 20 years. Nuvera owned a 20% interest in FiberComm through its wholly owned subsidiary PTC. Nuvera announced the execution of the FiberComm sale agreement in January 2023.

Prior to the sale of Nuvera’s equity investment in FiberComm, Nuvera had guaranteed a portion of a ten-year loan owed by FiberComm, set to mature on April 30, 2026. On March 31, 2023, upon closing of the sale, the loan was paid and Nuvera was released from their guarantee of loan.

NOTE 14 – DEFERRED COMPENSATION

As of December 31, 2023, and 2022, we have recorded other deferred compensation relating to executive compensation payable to certain former executives of the Company and certain former executives of past acquisitions.  

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NOTE 15 – STOCK BASED COMPENSATION

The Company’s 2017 OSP was adopted by the Company’s BOD on February 24, 2017, and approved by the Company’s shareholders at the May 25, 2017, Annual Meeting of Shareholders. The 2017 OSP enables the Company to grant stock incentive awards to current and new employees, including officers, and to Board members and service providers. The 2017 OSP permits stock incentive awards in the form of Options (incentive and non-qualified), stock appreciation rights, restricted stock, RSUs, performance stock, performance units, and other awards in stock or cash. The 2017 OSP permits the issuance of up to 625,000 shares of our Common Stock in any of the above stock awards. As of March 15, 2024, 199,051 shares remain available for future grants under the 2017 OSP.

Starting in 2017, our BOD and Compensation Committee granted RSU awards to the Company’s executive officers under the 2017 OSP. We recognize share-based compensation expense for these RSUs over the vesting period of the RSUs, which is determined by our BOD. Forfeitures of RSUs are accounted for as they occur. Each executive officer was eligible to receive time-based RSUs and performance based RSUs. The time-based RSUs are computed as a percentage of the executive officer’s base salary based on the closing price of Company common stock on a date set by the BOD, and vest over a three-year period, subject to the executive officer being employed by the Company on the vesting date. The performance based RSUs are also computed as a percentage of the executive officer’s base salary based on the closing price of Company common stock on a date set by the BOD and vest over a three-year period based on the Company attaining an average Return on Invested Capital (ROIC) over that three-year period. The ROIC target is set by the BOD. Executive officers may earn more or fewer performance based RSUs based on if the actual ROIC achieved over the time period is more or less than target. Upon vesting of either time-based or performance based RSUs, the executive officers are issued Common Stock in exchange for the RSUs.

RSUs currently issued, exercised or forfeited are as follows:

	Time-Based RSUs	Targeted Performance-Based RSUs	Closing Stock Price		Vesting Date
Balance at December 31, 2021	9,440	13,270
Forfeited	(1,685)	(4,325)
Exercised	(4,391)	(4,244)	$	17.18	12/31/2022
Balance at December 31, 2022	3,364	4,701
Forfeited	(516)	(923)
Exercised	(2,848)	(3,778)	$	10.48	12/31/2023
Balance at December 31, 2023	0	0

Option Awards

In 2022, after considerable study, discussion and interaction with our consultants, the Compensation Committee decided to replace RSUs with Options. The Compensation Committee believes that grants of Options more directly align management long-term equity compensation with increased shareholder value creation at a time when the Company is engaged in significant investment and transformation as part of its long-term strategy. The Compensation Committee also determined to extend the grant of Options include Named Executive Officers, senior employee directors and other employee directors as key members of the Company leadership team and contributors to overall success.

As previously disclosed, the number of Options awarded was computed as a percentage of the employee’s base salary using a Black-Scholes formula using an exercise price equal to the closing price of Company common stock of $14.70 on March 31, 2023, and $21.20 on April 11, 2022. The 2023 Options will vest one-third each on March 31, 2024, 2025 and 2026. The 2022 Options will vest one-third each on April 11, 2023, 2024 and 2025.

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	Options		Closing Stock Price	Vesting Date
Balance at December 31, 2021	-
Issued	40,577	$	21.20	4/11/2023
Issued	40,583	$	21.20	4/11/2024
Issued	40,583	$	21.20	4/11/2025
Balance at December 31, 2022	121,743
Issued	51,431	$	14.70	3/31/2024
Issued	51,431	$	14.70	3/31/2025
Issued	51,432	$	14.70	3/31/2026
Balance at December 31, 2023	276,037

The grant date fair value of employee stock Option awards is determined using the Black Scholes Option-pricing model. The following assumptions were used during the following periods:

	2023 Grants		2022 Grants
Exercise Price	$	14.70	$	21.20
Risk-Free Rate of Interest		2.957%		1.515%
Expected Term (Years)		10		10
Expected Stock Price Volatility		20.7%		18.1%
Dividend Yield		2.83%		2.44%

The following table summarizes the Company’s employee stock Option activity under the 2017 OSP, which was approved by the Company’s shareholders, for the following periods:

		Weighted Average Exercise Price		Weighted Average Remaining Term (Years)	Aggregate Intrinsic Value (in Thousands)
	Number of Shares
Outstanding as of December 31, 2021	-	$	-	-	$	-
Granted	121,743		21.20	8.28		-
Forfeited	-		-	-		-
Outstanding as of December 31, 2022	121,743	$	21.20	8.28	$	-
Granted	154,294		14.70	9.25	$	-
Forfeited	-		-	-		-
Outstanding as of December 31, 2023	276,037	$	17.57	8.82	$	-

The Options had no intrinsic value as of December 31, 2023.

The weighted average grant date fair value per share for employee stock and non-employee Option grants issued on March 31, 2023, was $2.90. The weighted average grant date fair value per share for employee stock and non-employee Option grants issued on April 11, 2022, was $3.24. As of December 31, 2023, the total unrecognized compensation related to unvested employee and non-employee stock Option awards granted was $503,254, which the Company expects to recognize over a weighted-average period of approximately 1.93 years. As of December 31, 2022, the total unrecognized compensation related to unvested employee and non-employee stock Option awards granted was $299,434, which the Company expects to recognize over a weighted-average period of approximately 2.28 years.

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On March 13, 2023, the Company Board adopted changes to the Nuvera Communications, Inc. 2017 OSP. Most of the changes eliminate language specific to the requirements and limitations on grants under Internal Revenue Code Section162 (m), which has been repealed by Congress. This includes provisions related to “Performance-Based Exception” in several sections of the 2017 OSP. The Board also increased the limit on annual grants from 50,000 to 100,000 shares per participant and eliminated separate provisions on new-hire stock grants and cash-based grants. The Board also made minor changes to other sections of the 2017 OSP. The Board did not increase the number of shares authorized for issuance under the 2017 OSP or change the terms of eligibility for participants under the 2017 OSP. The foregoing description of the changes to the 2017 OSP does not purport to be complete and is qualified in its entirety by reference to the full text of the 2017 OSP, as amended, which is filed as Exhibit 10.12 to the 2022 Annual Report on Form 10-K and is incorporated by reference.

NOTE 16 – SEGMENT INFORMATION 

We operate in the Communications Segment and have no other significant business segments. The Communications Segment consists of voice, data and video communication services delivered to the customer over our advanced fiber communications network. No single customer accounted for a material portion of our consolidated revenues in any of the last two years.

The Communications Segment operates the following communications companies and has investment ownership interests as follows:

Communications Segment

● Communications Companies:

• Nuvera Communications, Inc., the parent Company;

• Hutchinson Telephone Company, a wholly owned subsidiary of Nuvera;

• Peoples Telephone Company, a wholly owned subsidiary of Nuvera;

• Scott-Rice Telephone Co., a wholly owned subsidiary of Nuvera;

• Sleepy Eye Telephone Company, a wholly owned subsidiary of Nuvera;

• Western Telephone Company, a wholly owned subsidiary of Nuvera; and

• Hutchinson Telecommunications, Inc., a wholly owned subsidiary of HTC, located in Litchfield and Glencoe, Minnesota;

● Our investments and interests in the following entities include some management responsibilities:

• Broadband Visions, LLC – 24.30% subsidiary equity ownership interest. BBV provides video headend and Internet services;

• Independent Emergency Services, LLC – 14.29% subsidiary equity ownership interest. IES is a provider of E-911 services to the State of Minnesota as well as a number of counties located in Minnesota; and

• Fiber Minnesota, LLC – 7.54% subsidiary equity ownership interest. FM is a Minnesota state-wide network that provides connectivity for regional businesses.

NOTE 17 – BROADBAND GRANTS

In 2023, the Company was awarded a grant from Redwood County under the Community Development Block Grant administered by the Southwest Minnesota Housing Partnership. The grant was to be used to build broadband fiber to residential customers in areas that qualify as low to moderate income. The Company was awarded $1,559,643 to complete this project. The Company has not received any funds for this project as of December 31, 2023.

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On December 8, 2022, the Company was awarded four broadband grants from the DEED. The grants will provide up to 45.0% to 50.0% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities and businesses in the Company’s service area. The Company is eligible to receive $8,594,688 of approximately $18,139,749 total project costs. The Company will provide the remaining 50.0% to 55.0% matching funds. Construction and expenditures for these projects will begin in the spring of 2023. We have not received any funds for these projects as of December 31, 2023.

In 2022, the Company was awarded two separate county grants from Nicollet County and Goodhue County to cover costs of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities. The Company was eligible to receive up to $2,139,562 to complete these projects. We have received $639,562 on these projects as of December 31, 2023.

On January 29, 2021, the Company was awarded five broadband grants from the DEED. The grant will provide up to 35.4% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved or underserved communities and businesses in the Company’s service area. The Company is eligible to receive $1,918,037 of approximately $5,419,617 total project costs. The Company will provide the remaining 64.6% of the matching funds. Construction and expenditures for these projects began in the spring of 2021. We have received $1,918,037 for these projects as of December 31, 2023.

Note 18 – Transactions with equity method investments

We receive and provide services to various partnerships and limited liability companies where we are an investor. Services received include digital video, special access and communications circuits. Services provided include BOD meeting attendance, labor, Internet help desk services and management services. Cost of services we receive from affiliated parties may not be the same as the costs of such services had they been obtained from different parties.

Total revenues from transactions with affiliates were $459,438 and $501,187 for 2023 and 2022. Total expenses from transactions with affiliates were $397,671 and $496,028 for 2023 and 2022.

NOTE 19 -- SUBSEQUENT EVENTS

On March 5, 2024, the Company was awarded a grant from the DEED. This Low-Density Broadband grant will provide up to 75% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities in the Company’s service area. The Company is eligible to receive $1,884,429 of approximately $2,512,572 total project costs. The Company will provide the remaining 25% of the matching funds.

We have evaluated and disclosed subsequent events through the filing date of this Annual Report on Form 10-K.

Item 9.   Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our principal executive officer and principal financial officer evaluated the effectiveness of our disclosure controls and procedures, as defined in Exchange Act Rule 13a-15(e) or Rule 15d-15(e), as of the end of the period subject to this Report. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective.

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Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting refers to the process designed by, or under the supervision of, our CEO and CFO, and effected by our BOD, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, and includes those policies and procedures that:

(1)	Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
(2)	Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorization of our management and directors; and
(3)	Provide reasonable assurance regarding prevention or timely detection or unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting cannot provide absolute assurance of preventing and detecting misstatements on a timely basis. It is possible to design into the process safeguards to reduce, though not eliminate, the risk that misstatements are not prevented or detected on a timely basis. Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company.

Our management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework set forth in the report entitled Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this assessment, management has concluded that, as of December 31, 2023, our internal control over financial reporting was effective.

Changes in Internal Control over Financial Reporting

Based upon the evaluation performed by our management, which was conducted with the participation of our CEO and CFO, there has been no change in our internal control over financial reporting during the quarter ended December 31, 2023, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 

Item 9B. Other Information

On March 13, 2023, the Company Board adopted changes to the Nuvera Communications, Inc. 2017 OSP. Most of the changes eliminate language specific to the requirements and limitations on grants under Internal Revenue Code Section162 (m), which has been repealed by Congress. This includes provisions related to “Performance-Based Exception” in several sections of the 2017 Plan. The Board also increased the limit on annual grants from 50,000 to 100,000 shares per participant and eliminated separate provisions on new-hire stock grants and cash-based grants. The Board also made minor changes to other sections of the 2017 Plan. The Board did not increase the number of shares authorized for issuance under the 2017 Plan or change the terms of eligibility for participants under the 2017 Plan. The foregoing description of the changes to the 2017 Plan does not purport to be complete and is qualified in its entirety by reference to the full text of the 2017 Plan, as amended, which is filed as Exhibit 10.12 to this Annual Report on Form 10-K and is incorporated by reference.

Item 9C. Disclosures Regarding Foreign Jurisdictions That Prevent Inspection

Not Applicable.

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PART III

Information Incorporated By Reference

In response to Part III, Items 10, 11, 12, 13 and 14, portions of the Company’s Proxy Statement for its 2024 Annual Meeting of Shareholders to be held on May 25, 2024, are incorporated by reference into this Form 10-K. The 2024 Proxy Statement will be filed pursuant to Regulation 14A within 120 days of December 31, 2023, the last day of the Company’s fiscal year.

Item 10.           Directors, Executive Officers and Corporate Governance

The information required by Item 401 of Regulation S-K relating to directors and nominees of the Company is contained under “Proposal 1 – Election of Directors” in the 2024 Proxy Statement and is incorporated by reference. Pursuant to General Instructions G(3) information required under Item 401 about executive officers is included in Part I, Item 1 of this Annual Report on Form 10-K under “Executive Officers of the Registrant.” 

The information required by Item 406 of Regulation S-K, Code of Ethics is contained in the section entitled “Corporate Governance – Code of Business Conduct” in the 2024 Proxy Statement and is incorporated by reference.

The information required by Item 407(d)(4) and (d)(5), under “Audit Committee,” and “Audit Committee financial expert” contained under Corporate Governance – Audit Committee” in the 2024 Proxy Statement and is incorporated by reference. There is no disclosure required under Item 407(c)(3) regarding material changes in shareholder director nominating procedures.

Item 11.           Executive Compensation

The information required by Item 402 of Regulation S-K is contained under “Executive Compensation” in the 2024 Proxy Statement and is incorporated by reference.

The information required by Regulation S-K Item 407(e)(4), “Compensation Committee Interlocks and Insider Participation,” and Item 407(e)(5), “Compensation Committee Report,” is not required because the Company is a smaller reporting company.

Item 12. Security Ownership of Beneficial Owners and Management, and Related Stockholder Matters

The information required by Item 201(d) of Regulation S-K; “Securities Authorized for Issuance under Equity Compensation Plans” is contained under Note 15 – Stock Based Compensation in notes to Audited Financial Statements in Item 8 of this Form 10-K.

The information required by Item 403 of Regulation S-K relating to security ownership of certain beneficial owners and management is contained under “Security Ownership of Certain Beneficial Owners and Management" in our 2024 Proxy Statement and is incorporated by reference.

Item 13.           Certain Relationships and Related Transactions, and Director Independence

The information required by Item 404(b) and Item 407(a) of Regulation S-K is contained under “Certain Relationships and Related Transactions” and “Corporate Governance,” respectively in the 2024 Proxy Statement and is incorporated by reference.

Item 14.           Principal Accountant Fees and Services

The information relating to principal accounting fees and services required by Item 9(e) of Schedule 14A is set forth under “Proposal 2- Ratification of Independent Registered Public Accounting Firm” in the 2024 Proxy Statement and incorporated by reference.

83

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: March 15, 2024	NUVERA COMMUNICATIONS, INC. (Registrant)
	By	/s/ Glenn H. Zerbe
		Glenn H. Zerbe, Chief Executive Officer
		(Principal Executive Officer)
	By	/s/ Curtis O. Kawlewski
		Curtis O. Kawlewski, Chief Financial Officer
		(Principal Financial Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, the following persons on behalf of the registrant and in the capacities and on the dates indicated have signed this report.

/s/ Perry L. Meyer	March 15, 2024
Perry Meyer, Chairman of the Board
/s/ Glenn H. Zerbe	March 15, 2024
Glenn H. Zerbe, President and Chief Executive Officer (Principal Executive Officer
/s/ Curtis O. Kawlewski	March 15, 2024
Curtis O. Kawlewski, Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/ Dennis E. Miller	March 15, 2024
Dennis Miller, Director
/s/ Bill D. Otis	March 15, 2024
Bill D. Otis, Director
/s/ Wesley E. Schultz	March 15, 2024
Wesley E. Schultz, Director
/s/ James J. Seifert	March 15, 2024
James J. Seifert, Director
/s/ Colleen R. Skillings	March 15, 2024
Colleen R. Skillings, Director
/s/ Suzanne M. Spellacy	March 15, 2024
Suzanne M. Spellacy, Director

84

PART IV

Item 15.            Exhibits and Financial Statement Schedules

(a) 1.	Consolidated Financial Statements
	Included in Part II, Item 8, of this report:
		Pages
	Report of Independent Registered Public Accounting Firm	48-50
	Consolidated Statements of Operations for the Years Ended December 31, 2023 and 2022	51
	Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2023 and 2022	52
	Consolidated Balance Sheets as of December 31, 2023 and 2022	53-54
	Consolidated Statements of Cash Flows for the Years Ended December 31, 2023 and 2022	55
	Consolidated Statements of Stockholders’ Equity for the Years Ended Ended December 31, 2023 and 2022	56
	Notes to Consolidated Financial Statements	57-81
(a) 2.	Consolidated Financial Statement Schedules:
	Other schedules are omitted because they are not required or are not applicable, or the required information is shown in the financial statements or notes thereto.
(a) 3.	Exhibits Required
	See “Index to Exhibits”	86-87

85

EXHIBIT INDEX

3.1	Second Amended and Restated Articles of Incorporation of Nuvera Communications, Inc., as of May 25, 2023, incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K dated May 25, 2023
3.2	Bylaws of Nuvera Communications, Inc., as amended as of December 21, 2023, incorporated by reference to Exhibit 3.2 of the Company’s Form 8-K dated December 21, 2023
4.1	Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934, incorporated by reference to Exhibit 4.1 of the Company’s Form 10-K for the year ended December 31, 2021
10.1+	August 27, 2019, Offer Letter to Glenn Zerbe, incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated August 27, 2019
10.2+	Change in Control Agreement with Glenn Zerbe incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated August 27, 2019
10.3+	Employment Agreement dated as of July 1, 2006, between Nuvera Communications, Inc. and Barbara A.J. Bornhoft, incorporated by reference to Exhibit 10.1 to the Company’s Form 10-Q for the quarter ended March 31, 2007
10.3.1+	Amendment dated March 21, 2012, to Employment Agreement dated as of July 1, 2006, between Nuvera Communications, Inc. and Barbara A.J. Bornhoft, incorporated by reference to Exhibit 10.2.1 to the Company’s 2011 Form 10-K
10.4+	Employment Agreement dated as of March 11, 2012, between Nuvera Communications, Inc. and Curtis Kawlewski, incorporated by reference to Exhibit 10.2.1 to the Company’s 2011 Form 10-K
10.4.1+	Amendment dated July 24, 2017, to Employment Agreement dated as of March 31, 2012, between Nuvera Communications, Inc. and Curtis Kawlewski, incorporated by reference to Exhibit 10.3 to the Company’s 2011 Form 10-K
10.5+	Nuvera Communications, Inc. Amended Management Incentive Plan, incorporated by reference to Exhibit 10.4.1 to the Company’s Form 10-Q for the quarter ended March 31, 2013
10.6+	Nuvera Communications, Inc. 2015 Employee Stock Plan, incorporated by reference to Appendix A to the definitive proxy statement dated April 15, 2015, for the Annual Meeting of Shareholders held on May 28, 2015
10.7+	Nuvera Communications, Inc. 2017 Omnibus Stock Plan, as amended March 13, 2023, incorporated by reference to Exhibit 10.12 to the Company’s Form 10-K for the year ended December 31, 2022
10.8+	Nuvera Communications, Inc. Non-Incentive Stock Option Agreement, incorporated by reference to Exhibit 10.8 to the Company’s Form 10-K for the year ended December 31, 2022
10.9+	Nuvera Communications, Inc. Employee Restricted Stock Unit Award Agreement (time-based/performance based), incorporated by reference to Exhibit 10.9 to the Company’s Form 10-K for the year ended December 31, 2022
10.10	Credit Agreement dated as of July 15, 2022, between Nuvera Communications, Inc., Nuvera subsidiaries as Guarantors and CoBank, ACB as Lender and as Administrative Agent, incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K dated July 20, 2022
10.11	Pledge and Security Agreement dated as of July 15, 2022, between Nuvera Communications Inc., Nuvera subsidiaries as Guarantors and CoBank, ACB as Lender and as administrative agent, incorporated by reference to Exhibit 10.2 to the Company’s 8-K dated July 20, 2022
10.12*	First Amendment dated as of August 12, 2022, by and among Nuvera Communications, Inc. as Borrower, Nuvera subsidiaries as Guarantors, CoBank, in its capacity as administrative agent and swing line lender and each other lender (including the Voting Participants)
10.13	Second Amendment to Credit Agreement and Waiver dated as of November 10, 2023, amending Existing Credit Agreement by and among Nuvera Communications, Inc.as Borrower, Nuvera Subsidiaries as Guarantors, and CoBank, ACB, as Lender and as Administrative Agent and each other Lender and Voting Participant party to the Amended Credit Agreement, incorporated by reference to Exhibit 10.1 of the Company’s Form 10-Q for the quarter ended September 30, 2023
10.14	Third Amendment dated December 21, 2023, by and among Nuvera Communications, Inc., Nuvera subsidiaries as Guarantors, CoBank ACB in its capacity as administrative agent, as Swing Line Lender, as sole Issuing Lender and as a Lender, and each other Lender and Voting Participant party to the Existing Credit Agreement, incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated December 21, 2023

86

19.1*	Nuvera Communications, Inc. Insider Trading Policy (as amended, February 29, 2024)
21*	Subsidiaries of Nuvera Communications, Inc.
23.1*	Consent of Independent Registered Public Accounting Firm
31.1*	Certification of Chief Executive Officer Under Rule 13a-14(a) Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Chief Financial Officer Under Rule 13a-14(a) adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1*	Nuvera Communications, Inc. Clawback and Forfeiture Policy (As Amended, February 2024)
101.INS	XBRL Instance File
101.SCH	XBRL Taxonomy Extension Schema File
101.CAL	XBRL Taxonomy Extension Calculation Linkbase File
101.DEF	XBRL Taxonomy Extension Definition Linkbase File
101.LAB	XBRL Taxonomy Extension Label Linkbase File
101.PRE	XBRL Taxonomy Extension Presentation Linkbase File

*Filed Herewith

+Management compensation plan or arrangement required to be filed as an exhibit

Item 16.            Form 10-K Summary

Not Applicable.

87

EX-10.12

Exhibit 10.12

FIRST AMENDMENT TO CREDIT AGREEMENT

This FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made and entered into as of August 12, 2022, by and among NUVERA COMMUNICATIONS, INC., a Minnesota corporation (the “Borrower”), the Guarantors party hereto, COBANK, ACB (“CoBank”), in its capacity as administrative agent under the Existing Credit Agreement (as defined below; CoBank, in such capacity, the “Administrative Agent”) and swing line lender (in such capacity, the “Swing Line Lender”), and the Lenders (including the Voting Participants) party hereto.

RECITALS

WHEREAS, the Borrower, the guarantors party thereto from time to time (collectively, the “Guarantors” and, together with the Borrower, the “Loan Parties”), the Lenders party thereto from time to time (the “Lenders”) and the Administrative Agent have entered into that certain Credit Agreement, dated as of July 15, 2022 (as the same may have been further amended, restated, or otherwise modified from time to time prior to the date hereof, the “Existing Credit Agreement”);

WHEREAS, the Borrower has requested that the Existing Credit Agreement be amended to establish a swing line facility with the Swing Line Lender;

WHEREAS, pursuant to Section 11.1 of the Existing Credit Agreement, the Borrower has requested that the Administrative Agent and each other Lender (including the Voting Participants) amend the Existing Credit Agreement as set forth herein; and

WHEREAS, the Administrative Agent, the Issuing Lender, the Swing Line Lender, the Lenders (including the Voting Participants) and the Loan Parties have hereby agreed to the following amendments and waiver to the Existing Credit Agreement on the terms and subject to the conditions set forth herein;

NOW, THEREFORE, in consideration of the premises set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.         Certain Definitions; Interpretation.

(a)        Defined terms used but not otherwise defined herein shall have the meanings when used herein as set forth in the Amended Credit Agreement (as defined below).

(b)        The rules of construction set forth in Sections 1.2 through 1.7 of the Amended Credit Agreement shall apply to this Amendment.

2.         Amendments to Existing Credit Agreement.

(a)        Subject to the satisfaction (or waiver) of the conditions set forth in Section 4 hereof, the Existing Credit Agreement is hereby amended by deleting the stricken text (indicated textually in the same manner as the following example:) and adding the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in Exhibit A hereto (the Existing Credit Agreement, as amended by this Amendment, the “Amended Credit Agreement”).

(b)        The Exhibits to the Existing Credit Agreement is hereby amended by adding a new Exhibit F-5 in the form of Exhibit B attached hereto.

3.         Representations and Warranties of the Loan Parties. Each Loan Party represents and warrants to the Administrative Agent, the Issuing Lender, the Swing Line Lender and the Lenders that, as of the Effective Date: (a) the representations and warranties of the Loan Parties set forth in Article V of the Amended Credit Agreement and in the other Loan Documents are true and correct, except such representations and warranties that are not qualified by reference to materiality or a Material Adverse Change are true and correct in all material respects, before and after giving effect to this Amendment, as though made on and as of the date hereof (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty shall remain true and correct in all material respects as of such earlier date); (b) each Loan Party has taken all necessary limited liability company, corporate and other action to authorize the execution, delivery and performance of this Amendment and each of the other Loan Documents to which it is a party; (c) this Amendment is the legally valid and binding obligation of each Loan Party hereto, enforceable against such Person in accordance with its terms, and (d) no event has occurred and is continuing, or would result from the transactions contemplated by this Amendment, that constitutes a Default or an Event of Default.

4.         Conditions to Effectiveness. The effectiveness of this Amendment and the amendments and waiver set forth herein are subject to the satisfaction of the following conditions (the date upon which such conditions are satisfied, the “Effective Date”):

(a)        Deliveries. The Administrative Agent shall have received each of the following in form and substance satisfactory to the Administrative Agent and, if applicable, its counsel:

(i)         counterparts to this Amendment, duly executed by an Authorized Officer of each Loan Party, the Administrative Agent, the Issuing Lender, the Swing Line Lender and the Lenders (including the Voting Participants); and

(ii)        such other documents in connection with such transactions as the Administrative Agent or its counsel may reasonably request.

(b)        Representations and Warranties. The representations and warranties of the Loan Parties set forth in Section 3 of this Amendment, in Article V of the Amended Credit Agreement and in the other Loan Documents shall be true and correct, except such representations and warranties that are not qualified by reference to materiality or a Material Adverse Change shall be true and correct in all material respects, before and after giving effect to this Amendment, as though made on and as of the date hereof (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty shall remain true and correct in all material respects as of such earlier date).

(c)        Defaults and Events of Default. No event shall have occurred and shall be continuing or would result from the transactions contemplated by this Amendment, that constitutes a Default or an Event of Default.

(d)       Payment of Fees. The Borrower shall have paid all fees and expenses related to this Amendment and the other Loan Documents payable on or before the Effective Date as required by this Amendment or any other Loan Document.

5.         Reaffirmation of Security Interest. Each of the Borrower and each Guarantor hereby acknowledges its receipt of a copy of this Amendment and its review of the terms and conditions hereof and consents to the terms and conditions of this Amendment and the transactions contemplated thereby. Each of the Borrower and each Guarantor, as applicable, (a) affirms and confirms its guarantees, pledges, grants and other undertakings under the Amended Credit Agreement and the other Loan Documents to which it is a party and (b) agrees that (i) each Loan Document, as modified by this Amendment, to which it is a party shall continue to be in full force and effect and (ii) all guarantees, pledges, grants and other undertakings thereunder, as modified by this Amendment, shall continue to be in full force and effect and shall accrue to the benefit of the Secured Parties, including the Administrative Agent.

6.         Release. Although each of the Administrative Agent and the Lenders regards its conduct as proper and does not believe that any of the Loan Parties have any claim, right, cause of action, offset or defense against the Administrative Agent, any Lender, or any of their respective affiliates or participants in connection with the execution, delivery, performance and administration of, or the transactions contemplated by, the Existing Credit Agreement, the other Loan Documents or this Amendment, the Administrative Agent, the Lenders and the Loan Parties, as an inducement to enter into this Amendment and as consideration therefor, agree to eliminate any possibility that any past conduct, conditions, acts, omissions, events, circumstances or matters of any kind whatsoever could impair or otherwise affect any rights, interests, contracts or remedies of the Administrative Agent, any Lender, any of their respective affiliates or any participant. Therefore, each Loan Party unconditionally, freely, voluntarily and, after consultation with counsel and becoming fully and adequately informed as to the relevant facts, circumstances and consequences, jointly and severally releases, waives and forever discharges the Administrative Agent, each Lender, and each of their respective affiliates and participants from and against (a) any and all liabilities, indebtedness and obligations, of any kind whatsoever, (b) any legal, equitable or other obligations of any kind whatsoever and (c) all other claims, rights, causes of action, counterclaims or defenses of any kind whatsoever, in contract or in tort, at Law or in equity, whether known or unknown, direct or derivative, which each Loan Party, or any predecessor, successor or assign thereof might otherwise have against the Administrative Agent, any Lender, or any of their respective affiliates or participants on account of any conduct, condition, act, omission, event, contract, liability, obligation, demand, covenant, promise, indebtedness, claim, right, cause of action, suit, damage, defense, circumstance or matter of any kind whatsoever which, in the case of clauses (a) through (c), arise from or relate to any actions which any such Person has or may have taken or omitted to take in connection with, or otherwise arise from, relate to or are in connection with, the Existing Credit Agreement or the other Loan Documents, that existed, arose or occurred at any time prior to the effectiveness of this Amendment; provided, that, the foregoing releases and waivers shall not apply to any claims arising from the gross negligence or willful misconduct of the Administrative Agent, such Lender or any such affiliate or participants.

7.         Expenses; Indemnity; Damage Waiver. Section 11.3 of the Amended Credit Agreement is hereby incorporated, mutatis mutandis, by reference as if such section was set forth in full herein.

8.         Miscellaneous.

(a)        Counterparts; Integrations; Effectiveness.

(i)         This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment, the Amended Credit Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 5, this Amendment shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Amendment by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Amendment.

(ii)        The words “execution,” “signed,” “signature,” and words of like import in this Amendment shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, or any similar state laws based on the Uniform Electronic Transactions Act. This Amendment and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.

(b)        Successors and Assigns. The provisions of this Amendment shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns permitted by the Amended Credit Agreement, except that neither the Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except as permitted under the Amended Credit Agreement.

(c)        Governing Law. This Amendment and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Amendment and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the law of the State of New York. Section 11.10 of the Amended Credit Agreement regarding governing law, submission to jurisdiction, waiver of venue, service of process and waiver of jury trial is hereby incorporated, mutatis mutandis, by reference as if such section was set forth in full herein.

(d)       Severability. The provisions of this Amendment are intended to be severable. If any provision of this Amendment shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.

(e)        Headings. The headings of this Amendment are included for convenience and shall not affect the interpretation of this Amendment.

(f)        Effect on the Existing Credit Agreement and other Loan Documents. Except as specifically modified by this Amendment, the Existing Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed and this Amendment shall not be considered a novation. Other than as specifically set forth in Section 3, the execution, delivery and performance of this Amendment shall not constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of the Administrative Agent or any Lender under, the Existing Credit Agreement or any of the other Loan Documents.

[Remainder of page intentionally left blank.]

IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment to be executed by such party, or to be executed by a duly authorized officer of such party, as of the date first above written.

BORROWER:

NUVERA COMMUNICATIONS, INC., as Borrower

By: /s/Glenn H. Zerbe
Name:  Glenn H. Zerbe
Title:    Chief Executive Officer and President

GUARANTORS:

PEOPLES TELEPHONE COMPANY
WESTERN TELEPHONE COMPANY
HUTCHINSON TELEPHONE COMPANY
HUTCHINSON TELECOMMUNICATIONS, INC.
HUTCHINSON CELLULAR, INC.
TECH TRENDS, INC.
SLEEPY EYE TELEPHONE COMPANY
SCOTT-RICE TELEPHONE CO., each as Guarantor

By: /s/ Glenn H. Zerbe
Name:  Glenn H. Zerbe
Title:    Chief Executive Officer and President

COBANK, ACB, as a Lender, the Administrative Agent and the Swing Line Lender

By: /s/ Lennie Blakeslee            
Lennie Blakeslee
Managing Director

GREENSTONE FARM CREDIT SERVICES, FCLA, AS A Voting Participant pursuant to the provisions of Section 11.7 of the Existing Credit Agreement

By:/s/ Shane Prichard________
Name: Shane Prichard
Title: Vice President- Capital Markets Lending

FEDERAL AGRICULTURAL MORTGAGE CORPORATION, as a Voting Participant pursuant to the provisions of Section 11.7 of the Existing Credit Agreement

By: /s/ Eric Estey                                 

Name: Eric Estey

Title: Director

AGCOUNTRY FARM CREDIT SERVICES, FLCA, as a Voting Participant pursuant to the provisions of Section 11.7 of the Existing Credit

By:/s/ Warren Shoen_________________
Name: Warren Shoen
Title: Senior Vice President

EXHIBIT A
AMENDED CREDIT AGREEMENT

[See attached.]

CREDIT AGREEMENT

by and among

NUVERA COMMUNICATIONS, INC.,

THE GUARANTORS PARTY HERETO,

THE LENDERS PARTY HERETO

and

COBANK, ACB, as Administrative Agent and Swing Line Lender

Dated as of July 15, 2022

TABLE OF CONTENTS

			Page
I.	CERTAIN DEFINITIONS		1
	1.1	Certain Definitions	1
	1.2	Construction	40
	1.3	Accounting Principles	40
	1.4	Rounding	41
	1.5	Covenant Compliance Generally	41
	1.6	Holidays	41
	1.7	Divisions	41
II.	CREDIT FACILITIES		42
	2.1	Term Loans	42
	2.2	Revolving Loans	46
	2.3	Delayed Draw Term Loans	46
	2.4	Swing Line Loans	48
	2.5	Interest Rate Provisions	50
	2.6	Interest Periods	51
	2.7	Making of Loans	52
	2.8	Fees	53
	2.9	Notes	54
	2.10	Payments	54
	2.11	Interest Payment Dates	54
	2.12	Voluntary Prepayments and Reduction of Commitments	55
	2.13	Mandatory Prepayments	57
	2.14	Sharing of Payments by Lenders	58
	2.15	Defaulting Lenders	59
III.	INCREASED COSTS; TAXES; ILLEGALITY; INDEMNITY		61
	3.1	Increased Costs	61
	3.2	Taxes	62
	3.3	Illegality	65
	3.4	Inability to Determine Rate; Cost; Interest After Default	66
	3.5	Indemnity	68
	3.6	Mitigation Obligations; Replacement of Lenders	68
	3.7	Benchmark Replacement Setting	69
	3.8	Survival	70
IV.	CONDITIONS OF LENDING		70
	4.1	First Loans	70
	4.2	Each Loan	73
V.	REPRESENTATIONS AND WARRANTIES		73
	5.1	Organization and Qualification	73
	5.2	Compliance With Laws	74
	5.3	Title to Properties	74
	5.4	Investment Company Act	74
	5.5	Event of Default	74
	5.6	Subsidiaries and Owners	74

TABLE OF CONTENTS

(cont’d)

			Page
	5.7	Power and Authority; Validity and Binding Effect	74
	5.8	No Conflict; Material Agreements; Consents	75
	5.9	Litigation	75
	5.10	Financial Statements	76
	5.11	Margin Stock	76
	5.12	Full Disclosure	77
	5.13	Taxes	77
	5.14	Intellectual Property; Other Rights	77
	5.15	Liens in the Collateral	77
	5.16	Insurance	78
	5.17	Employee Benefits Compliance	78
	5.18	Environmental Matters	78
	5.19	Communications Regulatory Matters	79
	5.20	Solvency	80
	5.21	Qualified ECP Guarantor	80
	5.22	Transactions with Affiliates	81
	5.23	Labor Matters	81
	5.24	Anti-Corruption; Anti-Terrorism and Sanctions	81
	5.25	Borrower’s Status as a Holding Company	82
VI.	AFFIRMATIVE COVENANTS		82
	6.1	Reporting Requirements	82
	6.2	Preservation of Existence, Etc	84
	6.3	Preservation of Licenses	84
	6.4	Payment of Liabilities, Including Taxes, Etc	84
	6.5	Maintenance of Insurance	85
	6.6	Maintenance of Properties and Leases	86
	6.7	Visitation Rights	86
	6.8	Keeping of Records and Books of Account	86
	6.9	Compliance with Laws	86
	6.10	Further Assurances	87
	6.11	CoBank Equity and Securities	88
	6.12	Use of Proceeds	89
	6.13	Updates to Schedules and Annexes	90
	6.14	Material Agreements	90
	6.15	Benefit Plan Compliance	90
	6.16	Interest Rate Protection	90
	6.17	Post-Closing	90
VII.	NEGATIVE COVENANTS		92
	7.1	Indebtedness	92
	7.2	Liens	92
	7.3	Affiliate Transactions	92
	7.4	Contingent Obligations	93
	7.5	Loans and Investments	93

ii

TABLE OF CONTENTS

(cont’d)

			Page
	7.6	Dividends and Related Distributions	94
	7.7	Liquidations, Mergers, Consolidations, Acquisitions	95
	7.8	Dispositions of Assets or Subsidiaries	95
	7.9	Use of Proceeds	96
	7.10	Subsidiaries, Partnerships and Joint Ventures	96
	7.11	Continuation of or Change in Business	96
	7.12	Fiscal Year	96
	7.13	Issuance of Equity Interests	96
	7.14	Changes in Organizational Documents	97
	7.15	Negative Pledges; Other Inconsistent Agreements	97
	7.16	Material Agreements	97
	7.17	Employee Plans	97
	7.18	Management Fees	97
	7.19	Capital Expenditures	98
	7.20	Anti-Corruption; Anti-Terrorism; Sanctions	98
	7.21	Independence of Covenants	98
VIII.	FINANCIAL COVENANTS		98
	8.1	Maximum Leverage Ratio	98
	8.2	Minimum Equity to Assets Ratio	98
	8.3	Minimum Debt Service Coverage Ratio	98
IX.	EVENTS OF DEFAULT		99
	9.1	Events of Default	99
	9.2	Consequences of Event of Default	101
X.	THE ADMINISTRATIVE AGENT		103
	10.1	Appointment and Authority	103
	10.2	Rights as a Lender	104
	10.3	No Fiduciary Duty	104
	10.4	Exculpation	105
	10.5	Reliance by the Administrative Agent	105
	10.6	Delegation of Duties	105
	10.7	Filing Proofs of Claim	106
	10.8	Resignation of the Administrative Agent	106
	10.9	Non-Reliance on the Administrative Agent and Other Lenders	107
	10.10	Enforcement	107
	10.11	No Other Duties, etc	108
	10.12	Authorization to Release Collateral and Loan Parties	108
	10.13	Compliance with Flood Laws	108
	10.14	No Reliance on the Administrative Agent’s Customer Identification Program	109
	10.15	Affiliates as Secured Parties	109
	10.16	Certain ERISA Matters	109
	10.17	Rate Disclaimer	110
	10.18	Resignation of Swing Line Lender	111

iii

TABLE OF CONTENTS

(cont’d)

XI.	MISCELLANEOUS		112
	11.1	Modifications, Amendments or Waivers	112
	11.2	No Implied Waivers; Cumulative Remedies	113
	11.3	Expenses; Indemnity; Damage Waiver	114
	11.4	Notices; Effectiveness; Electronic Communication	116
	11.5	Severability	117
	11.6	Duration; Survival	117
	11.7	Successors and Assigns	118
	11.8	Confidentiality	122
	11.9	Counterparts; Integration; Effectiveness	123
	11.10	Choice of Law; Submission to Jurisdiction; Waiver of Venue; Service of Process; Waiver of Jury Trial	124
	11.11	USA Patriot Act Notice	125
	11.12	Payments Set Aside	125
	11.13	Secured Bank Products and Secured Hedge Agreements	126
	11.14	Interest Rate Limitation	126
	11.15	FCC and PUC Compliance	126
	11.16	Keepwell	127
	11.17	No Advisory or Fiduciary Responsibility	127
	11.18	Recovery of Erroneous Payments	128
XII.	GUARANTY		128
	12.1	Guaranty	128
	12.2	Payment	128
	12.3	Absolute Rights and Obligations	129
	12.4	Maximum Liability	131
	12.5	Contribution Agreement	133
	12.6	Currency and Funds of Payment	133
	12.7	Subordination	133
	12.8	Enforcement	134
	12.9	Set-Off and Waiver	134
	12.10	Waiver of Notice; Subrogation	134
	12.11	No Stay	135
	12.12	Additional Guarantors	136
	12.13	Reliance	136
	12.14	Receipt of Credit Agreement, Other Loan Documents, Benefits	136
	12.15	Joinder	137

iv

LIST OF SCHEDULES AND EXHIBITS

SCHEDULES

SCHEDULE 1.1(B)    —        COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES

SCHEDULE 1.1(C)    —        PRICING

SCHEDULE 1.1(P)    —        EXISTING LIENS

SCHEDULE 5.1         —        QUALIFICATIONS TO DO BUSINESS AND JURISDICTION OF ORGANIZATION

SCHEDULE 5.6         —        SUBSIDIARIES

SCHEDULE 5.19       —        LICENSES

SCHEDULE 7.1         —        EXISTING INDEBTEDNESS

SCHEDULE 7.4(f)     —        EXISTING GUARANTEES

SCHEDULE 7.5(i)     —        EXISTING INVESTMENTS

SCHEDULE 11.7       —        VOTING PARTICIPANTS

EXHIBITS

EXHIBIT A    —        ASSIGNMENT AND ASSUMPTION

EXHIBIT B    —        COMPLIANCE CERTIFICATE

EXHIBIT C    —        GUARANTOR JOINDER

EXHIBIT D    —        LOAN REQUEST

EXHIBIT F-1 —        REVOLVING NOTE

EXHIBIT F-2 —        TERM LOAN NOTE

EXHIBIT F-3 —        DDTL NOTE

EXHIBIT F-4 —        INCREMENTAL TERM LOAN NOTE

EXHIBIT F-5 —        SWING LINE NOTE

EXHIBIT G    —        SOLVENCY CERTIFICATE

EXHIBIT H    —        TAX COMPLIANCE CERTIFICATES

EXHIBIT I     —        CONVERSION OR CONTINUATION NOTICE

EXHIBIT J     —        NOTICE OF INCREMENTAL TERM LOAN BORROWING

EXHIBIT K    —        PERMITTED ACQUISITION QUESTIONNAIRE

EXHIBIT L    —        PERMITTED ACQUISITION CERTIFICATE

CREDIT AGREEMENT

THIS CREDIT AGREEMENT (this “Agreement”) is dated as of July 15, 2022 and is made by and among Nuvera Communications, Inc., a Minnesota corporation, as BORROWER (as hereinafter defined), each of the GUARANTORS (as hereinafter defined), the LENDERS (as hereinafter defined), and COBANK, ACB, in its capacity as Administrative Agent for the Secured Parties and as the Swing Line Lender (each as hereinafter defined).

RECITALS

WHEREAS, the Borrower has requested that the Lenders provide to the Borrower (a) commitments to fund a revolving credit facility in an aggregate principal amount at any time outstanding not to exceed $30,000,000, (b) an initial term loan facility in an aggregate principal amount not to exceed $50,000,000, as such aggregate principal amount may be increased from time to time in accordance herewith and (c) commitments to fund a multiple draw delayed draw term loan facility in an aggregate principal amount not to exceed $50,000,000, all as more particularly set forth in, and subject to the terms and conditions of, this Agreement. In consideration of their mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, the parties hereto covenant and agree as follows:

I.CERTAIN DEFINITIONS

1.1    Certain Definitions. In addition to words and terms defined elsewhere in this Agreement, the following words and terms shall have the following meanings, respectively, unless the context hereof clearly requires otherwise:

“Acquired Business” means any Person or all or substantially all the assets of, or any line of business or division or business unit of, any other Person acquired in an Acquisition.

“Acquisition” means any acquisition, in a single transaction or in a series of related transactions, of all or any substantial portion of the assets of, or any line of business, division or business unit of, another Person, or at least a majority of the equity interests of another Person, in each case whether involving a merger or consolidation with such other Person and whether for cash, property, services, assumption of Indebtedness, securities or otherwise.

“Acquisition Agreement” means each stock purchase agreement, asset purchase agreement, merger agreement or similar document executed and delivered in connection with an Acquisition.

“Additional Incremental Term Lender” has the meaning set forth in Section 2.1(e).

“Adjusted Term SOFR Rate” means, for purposes of any calculation, the rate per annum equal to (a) the Term SOFR Rate for such calculation plus (b) the Term SOFR Adjustment; provided that if the Adjusted Term SOFR Rate as so determined shall ever be less than the Floor, then the Adjusted Term SOFR Rate shall be deemed to be the Floor.

“Administrative Agent” means CoBank, in its capacity as administrative agent and collateral agent under the Loan Documents.

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“Administrative Questionnaire” means an administrative questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to any specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by or is under common Control with the Person specified.

“Agent Parties” has the meaning set forth in Section 11.4(d)(ii).

“Alternate Base Rate” means a rate per annum determined by the Administrative Agent on the first Business Day of each week, which shall be the highest of (a) the Prime Rate, (b) the Federal Funds Effective Rate plus one half of one percent (0.50%) per annum, and (c) the Adjusted Term SOFR Rate for a one-month tenor in effect on such day plus one percent (1.00%) per annum; provided that, in no event shall the Alternate Base Rate be less than one percent (1.00% per annum). Any change in the Alternate Base Rate due to a change in the calculation thereof shall be effective at the opening of business on the first Business Day of each week or, if determined more frequently, at the opening of business on the first Business Day immediately following the date of such determination and without necessity of notice being provided to the Borrower or any other Person.

“Anti-Corruption Laws” means any Laws of any Governmental Authority concerning or relating to bribery or corruption.

“Anti-Terrorism Laws” means any Laws of any Governmental Authority concerning or relating to financing terrorism, “know your customer” or money laundering.

“Applicable Margin” means, as applicable:

(a)        the percentage spread to be added to the Alternate Base Rate applicable to Base Rate Loans based on the Leverage Ratio then in effect according to the Pricing Grid below the heading “Applicable Margin for Base Rate Loans (Revolving Credit Facility)” or “Applicable Margin for Base Rate Loans (Term Loans)”, or

(b)        the percentage spread to be added to the Adjusted Term SOFR Rate applicable to Term SOFR Rate Loans based on the Leverage Ratio then in effect according to the Pricing Grid below the heading “Applicable Margin for Term SOFR Rate Loans (Revolving Credit Facility)” or “Applicable Margin for Term SOFR Rate Loans (Term Loans)”.

Notwithstanding the foregoing, the Applicable Margin for any Incremental Term Loan shall be the interest rate margin per annum governing such Tranche of Incremental Term Loan as set forth in the related Incremental Term Loan Funding Agreement, subject to Section 2.1 hereof.

“Applicable Unused Commitment Fee Rate” means (a) the Applicable Unused DDTL Commitment Fee Rate and (b) the Applicable Unused Revolving Commitment Fee Rate, as applicable.

“Applicable Unused DDTL Commitment Fee Rate” has the meaning set forth in Part 1 of Schedule 1.1(C) hereto.

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“Applicable Unused Revolving Commitment Fee Rate” means the percentage rate per annum based on the Leverage Ratio then in effect according to the Pricing Grid below the heading “Applicable Unused Commitment Fee Rate.”

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” means CoBank, in its capacity as lead arranger and bookrunner.

“Assignment and Assumption” means an assignment and assumption agreement entered into by a Lender and an assignee permitted under Section 11.7, in substantially the form of Exhibit A or any other form approved by the Administrative Agent.

“Authorized Officer” means, with respect to any Loan Party, the Chief Executive Officer, President, Chief Financial Officer, Chief Operating Officer, Secretary, Treasurer or Assistant Treasurer (or in the case of a Loan Party that is a limited liability company without officers, a manager or member authorized under such Loan Party’s Organizational Documents) of such Loan Party or such other individuals, designated by written notice to the Administrative Agent from the Borrower, authorized to execute notices, reports and other documents on behalf of the Loan Parties required hereunder. The Borrower may amend such list of individuals from time to time by giving written notice of such amendment to the Administrative Agent.

“Available Revolving Commitment” means, with respect to any Revolving Lender, an amount equal to such Lender’s Revolving Commitment minus the outstanding principal amount of its Revolving Loans, minus such Lender’s Pro Rata Share of the aggregate outstanding amount of Swing Line Loans, if any.

“Available Tenor” means, as of any date of determination and with respect to the applicable then- current Benchmark, as applicable, (a) if the applicable then-current Benchmark is a term rate, any tenor for such Benchmark that is or may be used for determining the length of an Interest Period or (b) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, pursuant to this Agreement as of such date.

“Avoidance Provisions” has the meaning specified in Section 12.4(a)(i)(C).

“Bankruptcy Code” means title 11 of the United States Code.

“Base Rate Loan” means a Loan bearing interest calculated in accordance with the Base Rate Option. A Base Rate Loan is a Loan not subject to an Interest Period.

”Base Rate Option” means the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 2.5(a)(i).

“Benchmark” means, initially, the Term SOFR Rate; provided that if a Benchmark Transition Event has occurred with respect to the Term SOFR Rate or any then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 3.7(a). Any reference to a “Benchmark” shall include, as applicable, the published component used in the calculation thereof.

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“Benchmark Replacement” means, for any Available Tenor:

(a)        for the Adjusted Term SOFR Rate, the first alternative set forth below that can be determined by the Administrative Agent:

(i)         the sum of (x) Daily Simple SOFR Rate and (y) the Term SOFR Adjustment for a three-month Interest Period, or

(ii)        the sum of (x) the alternate benchmark rate and (y) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time; and

(b)        for all other Benchmarks, the sum of (i) the alternate benchmark rate and (ii) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time;

provided that, if the Benchmark Replacement as determined pursuant to clause (a) or (b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents; provided, further, that, if the Benchmark Replacement is calculated using the Daily Simple SOFR Rate, all interest payments will be payable on a quarterly basis.

“Benchmark Replacement Conforming Changes” means, with respect to either the use or administration of any initial Benchmark or adjusted initial Benchmark or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period” or any similar or analogous definition (or the addition of a concept of “interest period”), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of Section 3.5 and other technical, administrative or operational matters) that the Administrative Agent, in consultation with the Borrower, decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Administrative Agent, in consultation with the Borrower, decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

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“Benchmark Transition Event” means, with respect to any then-current Benchmark, the occurrence of a public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor for the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark, a resolution authority with jurisdiction over the administrator for such Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark, announcing or stating that (a) such administrator has ceased or will cease on a specified date to provide all Available Tenors of such Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark or (b) all Available Tenors of such Benchmark are or will not be representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.

“Board” means the Board of Governors of the Federal Reserve System of the United States of America.

“Borrower” means Nuvera Communications, Inc., a Minnesota corporation.

“Borrowing” means as of any date of determination (a) with respect to Term SOFR Rate Loans outstanding as of such date, a borrowing consisting of Loans of the same Class and having the same Interest Period and (b) with respect to Base Rate Loans, all Base Rate Loans outstanding as of such date regardless of Class.

“Borrowing Date” means, with respect to any Loan, the date for the making thereof or the renewal or conversion thereof at or to the same or a different Interest Rate Option, which shall be a Business Day.

“Budget” means, for the Borrower and its Subsidiaries on a Consolidated basis, forecasted: (a) balance sheets, (b) profit and loss statements, (c) cash flow statements, (d) operating budget, and (e) capital budget, all prepared on a consistent basis with the Borrower’s and the Subsidiaries’ historical financial statements. The Budget represents and will represent as of the date thereof the good faith estimate of the Borrower and its senior management concerning the probable course of its and its Subsidiaries’ business.

5

“Business Day” means any day that is not a Saturday, Sunday or other day that is a legal holiday under the laws of the State of New York or Colorado or is a day on which banking institutions in such state are authorized or required by Law to close.

“Capital Expenditures” means, with respect to any Person, the aggregate costs incurred by such Person during any measuring period for the acquisition of any fixed assets or improvements or replacements of, substitutions for or additions to any existing fixed asset resulting in a future economic benefit to such Person, and that are required to be capitalized in accordance with GAAP, excluding, in each case, to the extent otherwise included:

(1)        Net Cash Proceeds from Dispositions of capital assets to the extent reinvested in other capital assets,

(2)        all cash insurance proceeds and condemnation awards received on account of any Casualty Event in respect of capital assets to the extent any such amounts are actually applied to replace, repair or reconstruct the damaged capital assets affected by the condemnation or taking in connection with such Casualty Event,

(3)        any such expenditures financed with cash proceeds of indemnity payments or third party reimbursements received by a Loan Party, and

(4)        the trade-in amount of existing equipment solely to the extent that the gross amount of the purchase price of equipment acquired substantially contemporaneously therewith is reduced by such trade-in amount.

“Capital Lease” means any lease of real or personal property that is required to be capitalized under GAAP or that is treated as an operating lease under regulations applicable to the Borrower and its Subsidiaries but that otherwise would be required to be capitalized under GAAP

“Cash Collateralize” means with respect to Other Liabilities, to pledge and deposit with or deliver to the Administrative Agent, for the benefit of each Lender (or its Affiliate) that is the provider of a Secured Bank Product or Secured Hedge, as the case may be, as collateral for the Other Liabilities, cash or deposit account balances, or, if the Administrative Agent and such Lender (or its Affiliate) shall agree in their respective sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to the Administrative Agent and each applicable Lender (or its Affiliate). “Cash Collateral” shall have meanings analogous to the foregoing and shall include the proceeds of such cash collateral and other credit support.

“Cash Equivalents” means:

(a)        direct obligations of the United States of America or any agency or instrumentality thereof or obligations backed by the full faith and credit of the United States of America maturing in twelve (12) months or less from the date of acquisition;

(b)        commercial paper maturing in 180 days or less rated not lower than A-1, by Standard & Poor’s or P-1 by Moody’s on the date of acquisition;

6

i.    demand deposits, time deposits or certificates of deposit maturing within one year in commercial banks that are organized under the laws of the United States or any state thereof or that is a foreign bank or branch or agency thereof acceptable to the Administrative Agent and, in any case, having combined capital, surplus and undivided profits in an amount equal to at least $1,000,000,000; and

ii.   money market or mutual funds whose investments are limited to those types of investments described in clauses (a) through (b) above.

“Casualty Event” means, with respect to any property of any Person, any loss of or damage to, or any condemnation or other taking of, such property for which such Person or any of its Subsidiaries receives insurance proceeds or proceeds of a condemnation award or other compensation.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any Law, (b) any change in any Law or in the administration, interpretation, implementation or application thereof by any Official Body or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of Law) by any Official Body; provided that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, regulations, guidelines, interpretations or directives thereunder or issued in connection therewith (whether or not having the force of Law) and (ii) all requests, rules, regulations, guidelines, interpretations or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities (whether or not having the force of Law), in each case pursuant to Basel III, shall in each case be deemed to be a Change in Law regardless of the date enacted, adopted, issued, promulgated or implemented.

“Change of Control” means: (a) a majority of the board of directors of the Borrower shall cease to consist of either Continuing Directors or individuals whose initial nomination for, or assumption of office as, a member of that board or equivalent governing body occurs as a result of an actual or threatened solicitation of proxies or consents for the election or removal of one or more directors by any person or group; (b) the occurrence of any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of the Borrower; (c) the occurrence of any consolidation or merger of the Borrower in which the Borrower is not the continuing or surviving corporation or pursuant to which common shares of the Borrower will be converted into cash, securities or other property, or (d) other than pursuant to a transaction permitted by this Agreement, the Borrower shall cease to control, hold or own, directly or indirectly, the voting power or beneficial ownership (within the meaning of Rule 13d-3 of the SEC under the Securities Exchange Act of 1934) of all Voting Interests of any of the other Loan Parties (or other securities convertible into such Voting Interests).

“Class” means, when used in reference to any Loan, whether such Loan is a Revolving Loan, Swing Line Loan, Term Loan, Delayed Draw Term Loan or Incremental Term Loan and, when used in reference to any Commitment, whether such Commitment is a Revolving Commitment, a Term Loan Commitment, a DDTL Commitment or an Incremental Term Loan Commitment.

7

“Closing Date” means the Business Day on which each of the conditions precedent in Section 4.1 has been satisfied or waived by the Required Lenders.

“CoBank” means CoBank, ACB, a federally chartered instrumentality of the United States.

“CoBank Cash Management Agreement” means any Master Agreement for Cash Management and Transaction Services between CoBank and the Borrower, including all exhibits, schedules and annexes thereto and including all related forms delivered by the Borrower to CoBank in connection therewith; provide that, the Borrower shall have elected pursuant to its rule set instructions or similar document to have its accounts that are subject to the CoBank Cash Management Agreement settle against the Swing Line Loan and such election shall not have been modified.

“CoBank Equities” means any of the Borrower’s stock, patronage refunds issued in the form of stock or otherwise constituting allocated units, patronage surplus (including any such surplus accrued by CoBank for the account of the Borrower) and other equities in CoBank acquired in connection with, or because of the existence of, the Borrower’s patronage loan from CoBank (or its affiliate), and the proceeds of any of the foregoing.

“Code” means the Internal Revenue Code of 1986.

“Collateral” means the collateral subject to any of the Collateral Documents or any other real or personal property of the Loan Parties, in each case pledged to the Administrative Agent for the benefit of the Secured Parties as security for the Secured Obligations.

“Collateral Assignment” means any collateral assignment of a Material Agreement, in form and substance reasonably satisfactory to the Administrative Agent, executed by the applicable Loan Party or Loan Parties and the counterparty to such Material Agreement in favor of the Administrative Agent, for the benefit of itself and the other Secured Parties.

“Collateral Documents” means the Security Agreement, any Collateral Assignment, the Mortgages, any account control agreements and any other document pursuant to which the Borrower or any other Loan Party has granted a Lien to the Administrative Agent for the benefit of the Secured Parties to secure all or a portion of the Secured Obligations.

“Commitment” means as to any Lender the aggregate of its Revolving Commitment (including any Swing Line Commitment or a Swing Line Lender), Term A-1 Loan Commitment, DDTL Commitment and any other Incremental Term Loan Commitment or Commitments, as applicable, and “Commitments” means the aggregate of the Revolving Commitments (including any Swing Line Commitment of a Swing Line Lender), Term A-1 Loan Commitments, DDTL Commitments and other Incremental Term Loan Commitments of all of the Lenders.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.).

8

“Communications” has the meaning specified in Section 11.4.

“Communications Act” means the Communications Act of 1934, as amended, the rules and regulations of the FCC thereunder and codified in Title 47 of the Code of Federal Regulations, and the effective orders, decisions, rulings, published policies, and public notices of the FCC.

“Communications Systems” means a system, network or business (a) providing (or capable of providing) voice, data, Internet access or video transport, connection, monitoring services, answering services or other communications and/or information or entertainment services (including cable television), through any means or medium, (b) providing (or capable of providing) facilities, marketing, management, technical and financial (including call rating) or other services to companies providing such transport, connection, monitoring service or other communications and/or information services, or (c) that is (or that is capable of) constructing, creating, developing or marketing communications-related networks, network equipment, software and other devices for use in any system or business described above.

“Compliance Certificate” means a certificate of the Borrower, signed by a Compliance Officer of the Borrower, substantially in the form of Exhibit B hereto.

“Compliance Officer” means the Chief Executive Officer, President or Chief Financial Officer (or in the case of a Loan Party that is a limited liability company without officers, a manager or member authorized under such Loan Party’s Organizational Documents) of the Borrower or any other Loan Party, as the case may be.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Consolidated” means, when used with reference to financial statements or financial statement items of any Person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP.

“Consolidated EBITDA” means for any period of determination: the sum of (i) Consolidated Net Income, plus (ii) the following items, to the extent deducted in determining Consolidated Net Income: (a) total interest expense (including non-cash interest), (b) provision of income taxes or benefits, as the case may be, (c) depreciation and amortization expenses, (d) unrealized losses on financial derivatives recognized in accordance with SFAS No. 133, (e) extraordinary executive compensation, (f) transaction costs and expenses incurred in connection with any Permitted Acquisition or other Investment permitted hereunder, whether or not such Permitted Acquisition or other Investment is consummated, (g) pro forma “run rate” costs savings, operating expense reductions, operating improvements and synergies from operational changes and operational initiatives (including, related to a Permitted Acquisition to the extent reasonably identifiable), in each case, projected in good faith to result from actions taken or to be taken within the first eighteen (18) months (or such longer period as the Administrative Agent may agree in its sole discretion) following the consummation of a Specified Transaction or the implementation of an operational change or initiative, 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 income, dividends and patronage income, and (z) income from unconsolidated subsidiaries, partnerships and joint ventures. Consolidated 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. For the purposes of calculating Consolidated EBITDA for any relevant four fiscal quarter period, notwithstanding the foregoing, amounts added back in the calculation of Consolidated EBITDA for any applicable measurement period pursuant to clauses (f) and (g) of this definition shall not, in the aggregate, exceed $500,000 for such period (calculated prior to giving effect to such addbacks for such period in the calculation of Consolidated EBITDA).

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“Consolidated Net Income” means, for any period, the net income (or loss) of the Borrower and its Subsidiaries for such period, determined on a Consolidated basis, without duplication, in accordance with GAAP; provided, that in calculating Consolidated Net Income of the Borrower and its Subsidiaries for any period, there shall be excluded (a) the net income (or loss) of any Person (other than a Subsidiary which shall be subject to clause (c) below), in which the Borrower or any of its Subsidiaries has a joint interest with a third party, except to the extent such net income is actually paid in cash to the Borrower or any of its Subsidiaries by dividend or other distribution during such period, (b) the net income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of the Borrower or any of its Subsidiaries or is merged into or consolidated with the Borrower or any of its Subsidiaries or that Person’s assets are acquired by the Borrower or any of its Subsidiaries except to the extent included pursuant to the foregoing clause (a), and (c) the net income (if positive), of any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary to the Borrower or any of its Subsidiaries of such net income (i) is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Subsidiary or (ii) would be subject to any taxes payable on such dividends or distributions, but in each case only to the extent of such prohibition or taxes.

“Contingent Obligations” means, as applied to any Person, any direct or indirect liability of that Person: (a) with respect to any indebtedness, lease, dividend or other obligation of another Person if the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid, performed or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto; (b) with respect to any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; or (c) under any foreign exchange contract, currency swap agreement, interest rate swap agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates. Contingent Obligations should also include (i) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligations of another (ii) obligations to make take-or-pay or similar payments if required regardless of the nonperformance by any other party or parties to any agreement to purchase, repurchase or otherwise acquire such obligation or any property constituting security therefor, to provide funds for the payment or discharge of such obligation or to maintain the solvency, financial condition or any balance sheet item or level of income of another and (iii) obligations under any revenue sharing agreement with vendors. Except to the extent expressly stated elsewhere in this Agreement, the amount of any Contingent Obligation shall be equal at all times to the amount of the obligations so guaranteed or otherwise supported or, if not a fixed and determined amount, the maximum amount so guaranteed.

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“Continuing Directors” means the directors of the Borrower on the Closing Date and each other director if, in each case, such other director’s nomination for election to the board of directors of the Borrower is recommended by at least a majority of the then Continuing Directors.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. Without limiting the generality of the foregoing, a Person shall be deemed to be “controlled by” a Person if such Person holds, directly or indirectly, power to vote 5% or more of the securities having ordinary voting power for the election of directors of such other Person. “Controlling” and “Controlled” have meanings analogous thereto.

”Conversion or Continuation Notice” has the meaning specified in Section 2.6.

“Credit Extension” means the making, conversion or continuation of any Borrowing, Loan or Swing Line Loan.

“Daily Simple SOFR Rate” means, for any day (a “Daily Simple SOFR Rate Day”), a rate per annum equal to the greater of (a) SOFR for the day (such day, a “Daily Simple SOFR Determination Date”) that is five U.S. Government Securities Business Days prior to (i) if such Daily Simple SOFR Rate Day is a U.S. Government Securities Business Day, such Daily Simple SOFR Rate Day or (ii) if such Daily Simple SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such Daily Simple SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website, and (b) the Floor. If by 3:00 p.m. on the second U.S. Government Securities Business Day immediately following any Daily Simple SOFR Determination Date, SOFR in respect of such Daily Simple SOFR Determination Date has not been published on the SOFR Administrator’s Website and a Benchmark Transition Event with respect to the Daily Simple SOFR Rate has not occurred, then the SOFR for such Daily Simple SOFR Determination Date will be the SOFR as published in respect of the first preceding U.S. Government Securities Business Day for which such SOFR was published on the SOFR Administrator’s Website; provided that any SOFR determined pursuant to this sentence shall be utilized for purposes of the calculation of the Daily Simple SOFR Rate for no more than three consecutive Daily Simple SOFR Rate Days. Any change in the Daily Simple SOFR Rate due to a change in SOFR shall be effective from and including the effective date of such change in SOFR without notice to the Borrower or any other Person.

”DDTL Commitment” with respect to each Lender, its obligation to make delayed draw term loans pursuant to Section 2.3 in an aggregate principal amount at any time outstanding set forth opposite such Lender’s name on Schedule 1.1(B) or in the Assignment and Assumption pursuant to which such Lender becomes party hereto, as such commitment (a) shall be reduced from time to time by each Credit Extension made pursuant to the DDTL Commitment and (b) may be reduced from time to time in accordance with Section 2.12(b)(ii). As of the Closing Date, the aggregate amount of the DDTL Commitments of all Lenders is $50,000,000.

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”DDTL Expiration Date” means the earliest of (x) July 15, 2025, (y) the date on which the Borrower elects in its sole discretion by written notice pursuant to Section 2.12(b)(iii) to terminate the DDTL Commitments and (z) the earlier of (i) the funding date of the fifth (5^th) advance of the Delayed Draw Term Loans and (ii) the date on which the DDTL Commitments are fully drawn.

“DDTL Facility” means the delayed draw credit facility established on the Closing Date by the DDTL Lenders pursuant to Section 2.3(a).

“DDTL Lender” means each Lender having a DDTL Commitment or who has funded or purchased all or a portion of a Delayed Draw Term Loan in accordance with the terms hereof.

“DDTL Note” means any promissory note of the Borrower substantially in the form of Exhibit F-3 hereto evidencing any Delayed Draw Term Loans.

”DDTL Overadvance” has the meaning specified in Section 2.13(a)(ii).

“Debt Incurrence” means the incurrence or issuance by the Borrower or any of its Subsidiaries on or after the Closing Date of any Indebtedness other than the Obligations.

“Debt Service” means the sum of: (a) all principal payments scheduled (and excluding any mandatory or voluntary prepayments with respect to the Secured Obligations) 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 (b) cash interest expense, each for the then most recently completed four fiscal quarters.

“Debt Service Coverage Ratio” means the ratio derived by dividing (a) the result of (i) Consolidated EBITDA plus (ii) cash interest, dividends and patronage income minus (iii) cash income taxes, dividends and distributions by (b) Debt Service, in each case, for the then most recently completed four fiscal quarters.

“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to time in effect.

“Default” means any event or condition that with notice or passage of time, or both, would constitute an Event of Default.

“Default Rate” means, as of any date of determination, the following: (a) for Base Rate Loans, the rate determined in accordance with the Base Rate Option as of such date plus an additional margin of 2.00% per annum, (b) for Term SOFR Rate Loans, the rate determined in accordance with the Term SOFR Rate Option as of such date plus an additional margin of 2.00% per annum, and (c) for all other Obligations, the rate determined in accordance with the Base Rate Option as of such date plus an additional margin of 2.00% per annum.

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”Defaulting Lender” means, subject to Section 2.15(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the Swing Line Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Swing Line Loans) within two (2) Business Days of the date when due, (b) has notified the Borrower or the Administrative Agent or Swing Line Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (x) become the subject of a proceeding under any Debtor Relief Law, or (y) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority or other Governmental Authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above shall be conclusive and binding absent manifest error, and, subject to any cure rights expressly provided above, such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.15) upon delivery of written notice of such determination to the Borrower, the Swing Line Lender and each Lender.

“Delayed Draw Term Loan” has the meaning specified in Section 2.3 and “Delayed Draw Loans” means collectively all of the Delayed Draw Term Loans.

“Diligence Threshold” means consideration with respect to an Acquisition in an amount equal to $500,000.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property or asset by any Person.

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“Division” means, in reference to any Person which is an entity, the division of such Person into two (2) or more separate Persons with the dividing Person either continuing or terminating its existence as part of the division including as contemplated under Section 18-217 of the Delaware Limited Liability Act for limited liability companies formed under Delaware Law or any analogous action taken pursuant to any applicable Law with respect to any corporation, limited liability company, partnership or other entity. The word “Divide”, when capitalized shall have analogous meaning.

“Dollar,” “Dollars,” “U.S. Dollars” and the symbol “$” means lawful money of the United States of America.

“Domestic Subsidiary” means any Subsidiary that is organized and existing under the Laws of the United States of America or any state, commonwealth or territory thereof or under the Laws of the District of Columbia.

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Sections 11.7(b)(iii), 11.7(b)(v) and 11.7(b)(vi) (subject to such consents, if any, as may be required under Section 11.7(b)(iii)).

“Environmental Laws” means any and all applicable current and future federal, state, local and foreign Laws and any consent decrees, concessions, permits, grants, franchises, licenses, agreements or other restrictions of a Governmental Authority or common Law causes of action relating to: (a) protection of the environment or natural resources from, or emissions, discharges, releases or threatened releases of, any materials, including Hazardous Materials, in the environment including ambient air, surface, water, ground water or land, (b) the generation, handling, use, labeling, disposal, transportation, reclamation and remediation of Hazardous Materials; (c) human health or safety; (d) the protection of endangered or threatened species; and (e) the protection of environmentally sensitive areas.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of any Loan Party or any Subsidiary of any Loan Party resulting from or based upon (a) violation of any Environmental Law; (b) the generation, use, handling, transportation, storage, treatment, disposal or permitting or arranging for the disposal of any Hazardous Materials; (c) exposure to any Hazardous Materials; (d) the release or threatened release of any Hazardous Materials; or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Equity Interests” has the meaning specified in the Security Agreement.

“Equity Issuance” means (a) any issuance or sale by the Borrower or any of its Subsidiaries of any Equity Interests, or (b) any equity contribution or capital contribution in respect of any Equity Interests of the Borrower or any of its Subsidiaries, in each case at any time after the Closing Date.

“Equity to Assets Ratio” means, as of the end of any date of determination, the ratio derived by dividing (i) the result of (a) total assets of the Borrower and its Subsidiaries determined on a Consolidated basis minus (b) total liabilities of the Borrower and its Subsidiaries determined on a Consolidated basis by (ii) total assets of the Borrower and its Subsidiaries determined on a Consolidated basis, each as of the date of calculation.

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“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means, at any time, any trade or business (whether or not incorporated) under common control with any Loan Party such that such trade or business, together with such Loan Party and all other ERISA Affiliates, are treated as a single employer under Section 414(b), (c), (m), or (o) of the Code or Section 4001(b)(1) of ERISA.

“ERISA Event” means (a) a “reportable event” (under Section 4043 of ERISA and regulations thereunder) with respect to a Pension Plan; (b) a withdrawal by a Loan Party or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by a Loan Party or any ERISA Affiliate from a Multiemployer Plan; (d) the filing of a notice of intent to terminate, the treatment of an amendment to a Pension Plan or a Multiemployer Plan as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition that constitutes grounds or that could reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (f) an event or condition that results or could reasonably expected to result in any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, to a Loan Party or any ERISA Affiliate; (g) with respect to any Pension Plan or Multiemployer Plan, the failure to satisfy the minimum funding standards under the Plan Funding Rules (whether or not waived); (h) with respect to any Pension Plan, the occurrence of any event that would result in the imposition of any limitation under Section 436 of the Code or Section 206(g) of ERISA, determined without regard to any contribution made or the provision of security under Section 436 of the Code or Section 206(g) of ERISA to avoid the imposition of the limitation; (i) the determination that any Pension Plan or Multiemployer Plan is considered an at-risk plan or a plan in endangered or critical status within the meaning of the Plan Funding Rules; (j) the occurrence of an aggregate Unfunded Liability for all Plans exceeding the Threshold Amount; (k) any transaction that could subject any Loan Party or any ERISA Affiliate to liability under Section 4069 or 4212 of ERISA; and (l) a prohibited transaction with respect to a Plan within the meaning of Section 4975 of the Code or Section 406 of ERISA or a violation of the fiduciary responsibility rules of Section 404 of ERISA.

“Event of Default” means any of the events described in Section 9.1 and referred to therein as an “Event of Default.”

“Excluded Swap Obligation” means, with respect to any Loan Party providing a Guaranty of or granting a security interest to secure any Swap Obligation of another Loan Party, if, and to the extent that, all or a portion of the Guaranty of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason not to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 11.16 and any other “keepwell, support or other agreements” for the benefit of such Guarantor) at the time the Guaranty of, or the grant of such security interest by, such Loan Party becomes effective with respect to such related Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or grant of security interest is or becomes illegal.

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“Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (x) such Lender acquires such interest in such Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 3.6) or (y) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 3.2, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.2 and (d) any U.S. federal withholding Taxes imposed under FATCA.

“Existing Loan Documents” means the “Loan Documents” as defined in the Prior Credit Agreement.

“Facilities” means, collectively, the Revolving Credit Facility, the Term Loan Facility, the DDTL Loan Facility, the Swing Line Facility and any Incremental Term Loan Facility. “Facility” means any one of such Facilities.

“Farm Credit Lender” means a federally-chartered Farm Credit System lending institution organized under the Farm Credit Act of 1971.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities entered into in connection with the implementation of the foregoing.

“FCC” means the Federal Communications Commission or any Governmental Authority succeeding to any of its principal functions.

“Federal Funds Effective Rate” means, for any day, the greater of (a) the rate of interest per annum (rounded upward, if necessary, to the nearest whole multiple of 1/100th of 1%) equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York on such date, or if no such rate is so published on such day, on the most recent day preceding such day on which such rate is so published and (b) 0%.

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“Fee Letter” means that certain fee letter dated as of May 4, 2022 between the Borrower and the Administrative Agent, together with any other fee letters entered into between the Borrower and the Administrative Agent from time to time in connection with any Tranche of Incremental Term Loans.

“First Amendment Effective Date” means August 12, 2022.

“Flood Laws” means, collectively, (a) the National Flood Insurance Act of 1968, (b) the Flood Disaster Protection Act of 1973, (c) the National Flood Insurance Reform Act of 1994 and (d) the Flood Insurance Reform Act of 2004, and all other applicable Laws related thereto.

“Floor” means a rate of interest equal to 0.00%.

“Foreign Lender” means (a) if the Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that is resident or organized under the Laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to the Swing Line Lender, such Defaulting Lender’s Pro Rata Share of outstanding Swing Line Loans made by the Swing Line Lender other than Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders.

“Fund” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“Funding Agency” means the Universal Service Administrative Company (USAC), National Telecommunications and Information Administration (NTIA), the Rural Utilities Service (RUS), any comparable state or municipal funding agent, or any successor agency or organization of any of the foregoing.

“Funding Program” means any federal, state, or local loan, grant/loan combinations, support program or similar program or arrangement entered into with a Governmental Authority and/or Funding Agency and any Loan Party or Subsidiary of a Loan Party.

“GAAP” means generally accepted accounting principles as are in effect from time to time, subject to the provisions of Section 1.3, and applied on a consistent basis both as to classification of items and amounts.

“Governmental Authority” means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank), including the FCC and any applicable PUC.

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“Guaranteed Liabilities” means (a) all Secured Obligations and all other amounts pursuant to the terms of this Agreement, the Notes, and all other Loan Documents heretofore, now or at any time or times hereafter owing, arising, due or payable from the Borrower or any other Loan Party to any one or more of the Secured Parties, including principal, interest, premiums and fees (including all reasonable fees and expenses of counsel); (b) each and every agreement, undertaking, covenant and provision to be performed, observed or discharged by the Borrower and each other Loan Party under this Agreement, the Notes and all other Loan Documents to which it is a party; and (c) all obligations and liabilities now or hereafter arising with respect to any Secured Bank Product or Secured Hedge. Notwithstanding the foregoing, the “Guaranteed Liabilities”, with respect to any Loan Party providing a Guaranty, shall not include the Excluded Swap Obligations.

“Guarantor” means each of the parties to this Agreement that is designated as a “Guarantor” on the signature page hereof and each other Person that joins this Agreement as a Guarantor after the date hereof pursuant to a Guarantor Joinder.

“Guarantor Joinder” means a joinder agreement joining a Person as a Guarantor under the Loan Documents in the form of Exhibit C.

“Guarantors’ Obligations” means the obligations of the Guarantors to the Secured Parties under Article XII.

“Guaranty” or “Guarantee” means, with respect to any Person, without duplication, any obligation, contingent or otherwise, of such Person pursuant to which such Person has directly or indirectly guaranteed or had the economic effect of guaranteeing any Indebtedness or other obligation or liability of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or liability (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise), (b) to purchase or lease property or services for the purpose of assuring another Person’s payment or performance of any Indebtedness or other obligations or liabilities, (c) to maintain the working capital of such Person to permit such Person to pay such Indebtedness or other obligations or liabilities or (d) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness or other obligation or liability of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, that the term Guaranty/Guarantee shall not include endorsements for collection or deposit in the ordinary course of business. Unless otherwise specified, the amount of any Guaranty shall be deemed to be the lesser of the principal amount of the Indebtedness or other obligations or liabilities guaranteed and still outstanding and the maximum amount for which the guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guaranty.

“Hazardous Materials” means (a) any explosive or radioactive substances, materials or wastes, (b) any hazardous or toxic substances, materials or wastes, defined or regulated as such in or under, or that could reasonably be expected to give rise to liability under, any applicable Environmental Law, including, asbestos or asbestos containing materials, infectious or medical waste, polychlorinated biphenyls, radon gas, urea-formaldehyde insulation, gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products and (c) all other substances, materials or wastes of any nature regulated under or with respect to which liability or standards of conduct are imposed pursuant to any Environmental Law.

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“Hedge Agreement” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement.

“Hedge Bank” means any Person that, at the time it enters into a Hedge Agreement with a Loan Party for an Interest Rate Hedge with respect to interest on the Obligations, is a Lender, an Affiliate of a Lender, the Administrative Agent or an Affiliate of the Administrative Agent.

“Hedge Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).

“Incremental Term Lender” means each Lender having an Incremental Term Loan Commitment with respect to any Tranche of the Incremental Term Loan Facility or who has funded or purchased all or a portion of any Incremental Term Loan with respect to any Tranche of the Incremental Term Loan Facility in accordance with the terms hereof.

“Incremental Term Loan” has the meaning specified in Section 2.1(e); and “Incremental Term Loans” means collectively all of the Incremental Term Loans.

“Incremental Term Loan Commitment” means, as to any Lender at any time, the amount initially set forth opposite its name in any Incremental Term Loan Funding Agreement with respect to any Tranche of the Incremental Term Loan Facility, as such Commitment is thereafter assigned or modified and “Incremental Term Loan Commitments” means the aggregate Incremental Term Loan Commitments of all of the Lenders with respect to all Tranches of the Incremental Term Loan Facility.

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“Incremental Term Loan Facility” means the incremental term loan facility established pursuant to Section 2.1(e).

“Incremental Term Loan Funding Agreement” has the meaning assigned to such term in Section 2.1(e)(v).

“Incremental Term Loan Notes” means the promissory notes of the Borrower substantially in the form of Exhibit F-4 hereto evidencing any Tranche of Incremental Term Loans.

“Indebtedness” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a)       all obligations of such Person for borrowed money (including the principal amount of any outstanding Loans) and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b)       all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

(c)       all net obligations of such Person under each Hedge Agreement to which it is a party (provided, that the amount of any net obligation under any Hedge Agreement on any date shall be deemed to be the Hedge Termination Value thereof as of such date);

(d)       all obligations of such Person to pay the deferred purchase price of property or services to the extent required to be recognized under GAAP (other than trade accounts payable in the ordinary course of business and, in each case, not past due for more than 90 days after the date on which such trade account payable was created unless contested in good faith);

(e)       obligations (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such obligations shall have been assumed by such Person or is limited in recourse;

(f)       all obligations of such Person under Capital Leases and all its Synthetic Lease Obligations;

(g)       all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends;

(h)       the net present value of future extraordinary executive compensation; and

(i)       all fixed payment obligations of any Person under any Guarantee of such Person in respect of any of the foregoing.

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“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Borrower or any other Loan Party under any Loan Document and (b) to the extent not otherwise described in the preceding clause (a), Other Taxes.

“Indemnitee” has the meaning specified in Section 11.3.

“Information” has the meaning specified in Section 11.8.

“Initial Interest Period” means the initial Interest Period following the Closing Date which shall be for a period commencing on the Closing Date and ending on August 15, 2022.

“Insolvency Proceeding” means, with respect to any Person, (a) a case, action or proceeding with respect to such Person (i) before any court or any other Governmental Authority under any Debtor Relief Law or other similar law now or hereafter in effect, or (ii) for the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar official) of any Loan Party or otherwise relating to the liquidation, dissolution, winding-up or relief of such Person, or (b) any general assignment for the benefit of creditors, composition, marshaling of assets for creditors, or other, similar arrangement in respect of such Person’s creditors generally or any substantial portion of its creditors; undertaken under any Law.

“Intellectual Property” means all Copyrights, Domain Names, Patents, Trademarks and IP Licenses, in each case as defined in the Security Agreement.

“Interest Payment Date” means the first day of each calendar quarter after the date hereof and the Maturity Date.

“Interest Period” means the period of time selected by the Borrower in connection with (and to apply to) any election permitted hereunder by the Borrower to have Loans bear interest under the Term SOFR Rate Option. Subject to the last sentence of this definition, at the Borrower’s election, such period shall be one, three and six months or, to the extent applicable, a period equal to the Initial Interest Period. Such Interest Period shall commence on the effective date of such Term SOFR Rate Loan, which shall be (a) the Borrowing Date if the Borrower is requesting new Loans, or (b) the date of renewal of or conversion to a Term SOFR Rate Loan if the Borrower is renewing or converting an existing Loan. Notwithstanding the second sentence hereof: (i) any Interest Period that would otherwise end on a date that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) the Borrower shall not select, convert to or renew an Interest Period for any portion of the Loans that would end after the applicable Maturity Date and (iii) if any Interest Period begins on the last Business Day of a month or on a day of a month for which there is no numerically corresponding day in the month in which such Interest Period is to end, such Interest Period shall be deemed to end on the last Business Day of the final month of such Interest Period.

“Interest Rate Hedge” means a Hedge Agreement entered into by the Loan Parties or their Subsidiaries in order to provide protection to, or minimize the impact upon, the Borrower, the Guarantor and/or their Subsidiaries of increasing floating rates of interest applicable to Indebtedness.

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“Interest Rate Option” means any (a) Base Rate Option or (b) Term SOFR Rate Option. “Investment” means, with respect to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“IRS” means the United States Internal Revenue Service.

“Joint Venture” means a corporation, partnership, limited liability company or other entity in which any Person other than the Loan Parties and their Subsidiaries holds, directly or indirectly, an equity interest.

“Law” means any law (including common law), constitution, statute, code, treaty, regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ, decree, bond, judgment, authorization or approval, or award by or settlement agreement with any Governmental Authority applicable to any Person or the properties of any Person, including the Licenses, and, including the Communications Act, any applicable PUC Laws and all Environmental Laws.

“Lenders” means each of the financial institutions from time to time party hereto as a lender (including the Swing Line Lender and any Additional Incremental Term Lender) and their respective successors and assigns as permitted hereunder, each of which is referred to herein as a Lender. For the sole purpose of any Loan Document that provides for the granting of a security interest or other Lien to the Lenders or to the Administrative Agent for the benefit of the Lenders as security for the Obligations, “Lenders” shall include any Affiliate of a Lender to the extent such Affiliate is a Secured Party.

“Leverage Ratio” means, as of the end of any date of determination, the ratio of (a) all Indebtedness of the Borrower and its Subsidiaries determined on a Consolidated basis as of such date to (b) Consolidated EBITDA for the consecutive four fiscal quarters ending as of such date or most recently ended.

“Licenses” means any cable television franchise or any wireline telephone, cellular telephone, microwave, personal communications, commercial mobile radio service, broadband, undersea cable or other telecommunications or similar license, authorization, registration, certificate, certificate of compliance, waiver, franchise (including cable television and telecommunications franchise), approval, ordinance, right of way, material filing, exemption, order, or permit, or any renewal or extension of any of the foregoing, whether for the acquisition, construction or operation of any Communications System, including the lease of any spectrum (and attendant rights and obligations), or to otherwise provide the services related to any Communications System, granted or issued by the FCC or any applicable PUC or other Governmental Authority.

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“Lien” means any mortgage, deed of trust, pledge, hypothecation, collateral assignment, lien (statutory or otherwise), security interest, charge or other encumbrance or security arrangement of any nature whatsoever, whether voluntarily or involuntarily given, including any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing).

“Loan Documents” means this Agreement, the Fee Letter, the Collateral Documents, the Solvency Certificates, the Perfection and Diligence Certificate, the Notices of Incremental Term Loan Borrowing (if any), the Incremental Term Loan Funding Agreements (if any), the Notes, any Guarantor Joinder and any other instruments, certificates or documents delivered in connection herewith or therewith, all as amended, restated, reaffirmed, reconfirmed, replaced, substituted or otherwise modified from time to time.

“Loan Parties” means the Borrower and the other Guarantors.

”Loan Request” means a request for any of a Term Loan, a Delayed Draw Term Loan, an Incremental Term Loan, Revolving Loan or Swing Line Loan, in each case substantially in the form of Exhibit D hereto.

“Loans” means collectively all Revolving Loans, Swing Line Loans, Term Loans, Delayed Draw Term Loans and Incremental Term Loans or any Revolving Loan, Swing Line Loan, Term Loan, Delayed Draw Term Loan or Incremental Term Loan, and “Loan” means the reference to any of the foregoing.

“Material Account” means all deposit, securities or other investment accounts in the name of any Loan Party to the extent the average daily balance of any such account determined after giving effect to any daily sweeps thereof (or market value of such account), for the most recently completed six calendar months, individually, exceeds $250,000 or, in the aggregate, exceeds $500,000, and excluding any such accounts exclusively used for payroll, payroll taxes or employee benefits.

“Material Adverse Change” means any circumstance or event, or series of circumstances or events, that has or could reasonably be expected to have any material adverse effect whatsoever upon (a) the business, properties, assets, condition (financial or otherwise), or operations of the Loan Parties, taken as a whole, (b) the legality, binding effect, validity or enforceability of this Agreement or any other Loan Document, (c) the ability of the Loan Parties, taken as a whole, to duly and punctually pay or perform any of the Secured Obligations, or (d) the ability of the Administrative Agent or any other Secured Party to enforce their legal remedies pursuant to this Agreement or any other Loan Document.

“Material Agreement” means any (a) agreement, contract, note, bond, debenture or other instrument evidencing Material Indebtedness, or (b) any agreement, contract or other instrument to which any Loan Party or any Subsidiary of any Loan Party is a party or that is binding upon any Loan Party or any Subsidiary of any Loan Party or its respective property the revocation, suspension or termination (prior to the stated termination date therefor) of which could reasonably be expected to result in a Material Adverse Change; provided, however, that any agreement, contract or other instrument which is terminable by a party without cause or liability upon notice of ninety (90) days or less shall not constitute a Material Agreement.

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“Material Indebtedness” means Indebtedness (other than the Obligations) in an aggregate principal amount exceeding $500,000.

“Material Owned Property” means any real property owned by any Loan Party in fee simple that has a book value in excess of $350,000.

“Maturity Date” means (a) with respect to the Revolving Credit Facility and the Swing Line Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) July 15, 2027, (b) with respect to the Term A-1 Loan Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) July 15, 2029, (c) with respect to the DDTL Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) July 15, 2029, and (d) with respect to any Incremental Term Loan Facility, the earlier of (i) the date of acceleration of the Obligations in accordance with Section 9.2 and (ii) the date set forth in the corresponding Incremental Term Loan Funding Agreement.

“Maximum Aggregate Increase Amount” means an aggregate principal amount for all Tranches of Incremental Term Loans made pursuant to Section 2.1(e) not to exceed $30,000,000;

“Maximum Guarantor Liability” has the meaning specified in Section 12.4. “Maximum Rate” has the meaning specified in Section 11.14.

“Moody’s” means Moody’s Investors Service, Inc., or any successor or assignee thereof in the business of rating securities and debt.

“Mortgage” means each mortgage or deed of trust (as applicable) in a form acceptable to the Administrative Agent in its reasonable discretion executed and delivered by a Loan Party to the Administrative Agent for the benefit of the Lenders with respect to certain of the real estate owned by such Loan Party.

“Multiemployer Plan” means any employee benefit plan that is a “multiemployer plan” within the meaning of Section 3(37) of the Code or Section 4001(a)(3) of ERISA and to which any Loan Party or any ERISA Affiliate is then making or accruing an obligation to make contributions or, within the preceding five (5) plan years of such Multiemployer Plan, has made or had an obligation to make such contributions or with respect to which otherwise has any obligation or liability (including a contingent liability).

“Net Cash Proceeds” means:

(a)        in the case of any Debt Incurrence, an amount equal to: (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries in respect of such Debt Incurrence, minus (ii) customary, bona fide, out-of-pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with such issuance;

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(b)        in the case of any Equity Issuance, an amount equal to: (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries in respect of such Equity Issuance, minus (ii) customary, bona fide, out-of-pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with such issuance;

(c)        in the case of any Casualty Event, an amount equal to: (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries from such Casualty Event in excess of $500,000 in any fiscal year, minus (ii) the sum of all customary, bona fide, out-of- pocket direct costs incurred by such Loan Party and its Subsidiaries in connection with collecting such cash payments; and

(d)       in the case of any Disposition, an amount equal to: (i) the aggregate amount of all cash and Cash Equivalents received by any Loan Party or any of its Subsidiaries from such Disposition (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or return of funds held in escrow or otherwise, but only as and when received) in excess of $500,000 in any fiscal year, minus (ii) the sum of (x) all income taxes and other taxes assessed by a Governmental Authority as a result of such transaction, (y) all customary, bona fide, out-of-pocket direct transaction costs incurred by such Loan Party and its Subsidiaries in connection with such Disposition, and (z) amounts applied to repayment of permitted Indebtedness (other than the Obligations) secured by a Permitted Lien on the asset or property disposed of having priority over the Lien of the Administrative Agent on the Collateral;

provided that, so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, Net Cash Proceeds shall not include any amounts (1) with respect to clause (c) above to the extent that such amounts are used for repairs to or replacements of the property subject to such Casualty Event; or reinvested in productive assets (other than inventory unless such Net Cash Proceeds result from a Casualty Event with respect to inventory) of a kind then used or usable in the business of such Loan Party, within one year after the receipt thereof or (2) with respect to clause (d) above to the extent that such amounts are reinvested in productive assets (other than inventory) of a kind then used or usable in the business of such Loan Party, within one year after the receipt thereof. To the extent reinvestment is permitted, such Net Cash Proceeds must be deposited and held in a deposit account of which the Administrative Agent has “control” (as defined in Article 9 of the UCC) until reinvested and must be reinvested in assets subject to the Lien of the Administrative Agent under the Collateral Documents, subject only to Permitted Liens.

“Non-Consenting Lender” has the meaning specified in Section 11.1.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Notes” means, collectively, the Revolving Notes, the Term Loan Notes, the Swing Line Notes, the Incremental Term Loan Notes, and the DDTL Notes.

“Notice of Incremental Term Loan Borrowing” means a notice of a Tranche of Incremental Term Loans meeting the requirements of Section 2.1(e) and substantially in the form of Exhibit J hereto.

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“Obligation” means any obligation or liability of any of the Loan Parties (other than Excluded Swap Obligations), howsoever created, arising or evidenced, whether direct or indirect, joint or several, absolute or contingent, for payment or performance, now or hereafter existing (and including obligations or liabilities arising or accruing after the commencement of any Insolvency Proceeding with respect to any Loan Party or which would have arisen or accrued but for the commencement of such Insolvency Proceeding, even if the claim for such obligation or liability is not enforceable or allowable in such proceeding), or due or to become due, under or in connection with this Agreement, the Notes, the Fee Letter or any other Loan Document (regardless of whether any Credit Extension is in excess of the amount committed under or contemplated by the Loan Documents or are made in circumstances in which any condition to any Credit Extension is not satisfied) whether to the Administrative Agent, any of the Lenders or their Affiliates or other persons provided for under such Loan Documents.

“Official Body” means (a) any Governmental Authority and (b) any group or body charged with setting financial accounting or regulatory capital rules or standards (including the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).

“Organizational Documents” means the certificate or articles of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation, limited liability company agreement or other organizational documents of any Person.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Information” has the meaning specified in Section 12.13.

“Other Liabilities” means any obligation of any Loan Party arising under any document or agreement relating to or on account of (a) any Secured Bank Product and/or (b) any Secured Hedge (other than any Excluded Swap Obligations).

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.6).

“Overadvance” means any Revolving Overadvance or any DDTL Overadvance.

“Participant” has the meaning specified in Section 11.7(d).

“Participant Register” has the meaning specified in Section 11.7(d).

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“Payment In Full” means (a) with respect to the Obligations, the payment in full in cash of the Loans and other Obligations (other than contingent indemnification obligations as to which no claim has been made) hereunder, the termination of the Commitments and the expiration, and (b) with respect to the Other Liabilities, the payment in full in cash of such Other Liabilities (or any such other treatment of such Other Liabilities as the holder thereof shall agree in its sole discretion).

“PBGC” means the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA.

“Pension Plan” means any “employee pension benefit plan” (as defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code, and that any Loan Party or any ERISA Affiliate sponsors, maintains, or contributes to or is required to contribute to or with respect to which any Loan Party or any ERISA Affiliate otherwise has any obligation or liability (including any contingent liability).

“Perfection and Diligence Certificate” means a certificate in form satisfactory to the Administrative Agent, executed and delivered by an Authorized Officer of each Loan Party to the Administrative Agent on the Closing Date.

“Permitted Acquisition” means any Acquisition by any Loan Party of all or substantially all the assets of, or any line of business or division or business unit of, any other Person, or all of the Equity Interests of any Person (or such lesser percentage as may be agreed to by the Administrative Agent in writing in its sole discretion); provided that:

(i)         (A) at least fifteen (15) Business Days (or such shorter time period as the Administrative Agent may agree in its sole discretion) prior to the proposed closing date of such Acquisition, the Administrative Agent shall have received a completed Permitted Acquisition Questionnaire and (B) prior to or concurrently with the consummation of such Acquisition, the Administrative Agent shall have a received a duly executed Permitted Acquisition Certificate;

(ii)        all assets acquired (other than immaterial assets) are usable in, and any Acquired Business (including any of the Acquired Business’s Subsidiaries) is primarily engaged in, a line of business permitted under Section 7.11;

(iii)       the Administrative Agent shall have received in accordance with the requirements of Section 6.10 all documents reasonably required by Administrative Agent to have a first- priority perfected security interest (subject to Permitted Liens other than with respect to any Equity Interests required to be pledged under the Security Agreement) in the Acquired Business acquired or created in such Acquisition, together with all opinions of counsel, certificates, resolutions, proof of insurance and other documents required by Section 6.10, in form and substance reasonably acceptable to the Administrative Agent;

(iv)       [reserved];

(v)        the aggregate amount of the consideration (including, in the case of consideration consisting of assets, the fair market value of the assets) paid or incurred by the Loan Parties and their Subsidiaries in connection with all such Acquisitions shall not exceed $500,000, individually, and $1,500,000 in the aggregate for all such Acquisitions during the term of this Agreement;

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(vi)       unless otherwise agreed to by the Administrative Agent in writing in its sole discretion, any Acquired Business (including any of its Subsidiaries) will be a direct or indirect, wholly-owned Domestic Subsidiary of the Borrower immediately after such Acquisition and the assets being acquired (other than a de minimis amount of assets) are located within the United States;

(vii)      such Acquisition shall not be hostile and shall have been approved by all necessary corporate or limited liability company action of the Acquired Business;

(viii)     to the extent the Acquisition exceeds the Diligence Threshold, the Borrower shall have provided to the Administrative Agent and the Lenders not later than ten (10) Business Days prior to the anticipated closing date of such Acquisition (or such shorter period as the Administrative Agent may agree in its sole discretion) with any requested due diligence materials regarding the Acquired Business and such other information as the Administrative Agent may reasonably request, which may include, without limitation, the total amount of such Acquisition and other terms and conditions of the Acquisition, the full name and jurisdiction of organization of any new Subsidiary created or acquired for the purpose of effecting such Acquisition, copies of historical and projected financial statements of the Acquired Business, a detailed description of assets to be acquired, copies of material agreements of the Acquired Business and copies of any agreements (including, for the avoidance of doubt, any Acquisition Agreement and related material documents), schedules or due diligence delivered in connection with the consummation of such Acquisition;

(ix)       before and after giving effect to such Acquisition, no Default or Event of Default shall have occurred and be continuing or would reasonably be expected to result therefrom;

(x)        before and after giving pro forma effect to such Acquisition, (A) the Loan Parties shall have a Leverage Ratio at least 0.50:1.00 less than the applicable Leverage Ratio required pursuant to Section 8.1 and (B) the Loan Parties shall otherwise be in compliance with the financial covenants set forth in Article VIII; provided that, the Borrower shall provide to Administrative Agent a certificate of a Compliance Officer of the Borrower (supported by reasonably detailed calculations) certifying (A) as to the foregoing and (B) based upon projections made in good faith by the management of the Borrower, the Loan Parties are projected to remain in compliance with the financial covenants set forth in Article VIII for at least the next following four fiscal quarters ending after consummation of such Acquisition;

(xi)       if such Acquisition constitutes the extension of Indebtedness by a Loan Party to any Person who is not a Loan Party, such Investment shall have been permitted under the terms of Sections 7.1 and 7.5 and shall be evidenced by a written promissory note in form and substance acceptable to the Administrative Agent; provided that, such promissory note shall be collaterally assigned and delivered to the Administrative Agent as security for the Secured Obligations if and to the extent the aggregate amount of all such unassigned and undelivered promissory notes together with the other instruments described in Section 4.5 of the Security Agreement exceeds the threshold described therein;

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(xii)      at least five (5) Business Days prior to the closing date of such Acquisition, the Administrative Agent shall have received (A) all documentation and other information requested by (or on behalf of) any Lender in order to comply with requirements of Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions and (B) if the Borrower or any other Loan Party qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification; and

(xiii)     within five (5) Business Days (or such longer period as the Administrative Agent may agree in its sole discretion) following the closing date of such Acquisition, the Borrower shall deliver to the Administrative Agent (i) copies of the fully executed Acquisition Agreement for such Acquisition, together with all schedules, exhibits, attachments, amendments and other modifications thereto, (ii) any historical or pro forma financial statements or projections related to such Acquisition and (iii)         such other documents and information as the Administrative Agent may request in its reasonable discretion.

“Permitted Acquisition Certificate” means a certificate of the Borrower with respect to a Permitted Acquisition, substantially in the form of Exhibit L hereto.

“Permitted Acquisition Questionnaire” means the questionnaire for preliminary information regarding a proposed Permitted Acquisition and substantially in the form of Exhibit K hereto.

“Permitted Liens” means:

(a)        Liens for taxes, assessments, or similar charges and levies of any Governmental Authority not yet due or which are being diligently contested in good faith by appropriate and lawful proceedings that suspend enforcement of such Liens and for which adequate reserves or other appropriate provisions in accordance with GAAP have been set aside on such Loan Party’s books;

(b)        pledges or deposits made in the ordinary course of business to secure payment of worker’s compensation, or to participate in any fund in connection with worker’s compensation, unemployment insurance, old-age pensions or other social security programs, other than any Lien imposed by ERISA;

(c)        Liens of mechanics, repairmen, materialmen, warehousemen, carriers, suppliers, landlords or other like Liens that are incurred in the ordinary course of business and either (i) secure obligations that are not overdue by more than thirty (30) days or (ii) are being diligently contested in good faith by appropriate and lawful proceedings that suspend enforcement of such Liens and for which adequate reserves or other appropriate provisions in accordance with GAAP have been set aside on such Loan Party’s books;

(d)       good-faith pledges or deposits made in the ordinary course of business to secure performance of bids, tenders, trade contracts (other than Indebtedness) or leases, not in excess of the aggregate amount due thereunder, or to secure statutory obligations, or surety, appeal, performance or other similar bonds required in the ordinary course of business;

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(e)        encumbrances consisting of zoning restrictions, easements, right-of-way or other encumbrances, title defects and restrictions on the use of real property that in the aggregate are not substantial in amount and none of which materially impairs the use of such property or the value thereof, none of which is violated in any material respect by existing or proposed structures or land use and which do not interfere with the ordinary conduct of the business of the applicable Loan Party;

(f)        Liens, security interests and mortgages in favor of the Administrative Agent for the benefit of the Secured Parties;

(g)        any Lien existing on the date of this Agreement and described on Schedule 1.1(P), provided that (a) the principal amount secured thereby is not hereafter increased, (b) no additional assets become subject to such Lien, (c) the direct or contingent obligor with respect thereto is not changed and (d) any renewal or extension of the Obligations secured or benefitted thereby is permitted by Section 7.1(b);

(h)        CoBank’s Lien (including the right of setoff) in the CoBank Equities and in any cash patronage;

(i)         Liens resulting from judgments or orders not constituting an Event of Default under Section 9.1(f);

(j)         Liens securing Indebtedness permitted under Section 7.1(c), provided, that (i) such Liens do not at any time encumber any property other than the property purchased, leased or otherwise acquired with the proceeds of such Indebtedness and (ii) the Indebtedness secured thereby does not exceed the cost or fair market value, whichever is lower, of the property being so purchased, leased or otherwise acquired on the date of its purchase, lease or other acquisition;

(k)        Liens in favor of Rural Telephone Finance Cooperative (“RTFC”), provided such Liens only encumber patronage capital of Hutchinson Telephone Company in RTFC;

(l)         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; and

(m)       Liens solely on any cash earnest money deposits made by any Loan Party or any of its Subsidiaries in connection with any letter of intent or Acquisition Agreement with respect to any Permitted Acquisition to the extent otherwise permitted by this Agreement.

“Person” means any natural person, corporation, company, partnership, limited liability company, association, joint-stock company, trust, unincorporated organization, joint venture, Official Body, or any other entity.

“Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including any Pension Plan) that any Loan Party or any ERISA Affiliate sponsors, maintains, or contributes to or is required to contribute to or with respect to which any Loan Party or any ERISA Affiliate otherwise has any obligation or liability.

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“Plan Funding Rules” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and Multiemployer Plans and set forth in, Sections 412, 430, 431, 432 and 436 of the Code and Sections 206, 302, 303, 304 and 305 of ERISA.

“Plan Qualification Event” means with respect to any Plan that is intended to be a qualified plan under Section 401(a) of the Code, or exempt from tax under Section 501(a) or 501(c)(9) of the Code, any occurrence or event that results or could reasonably be expected to result in the loss of the Plan’s qualified or tax-exempt status or for which the cost of correction under or related to the IRS employee plans compliance resolution system or any successor program (including the cost of computing the correction, making a submission to the IRS, making any payment to the IRS, the Plan or participants and any other related cost of correction) could reasonably be expected to exceed the Threshold Amount.

“Platform” has the meaning specified in Section 11.4.

“Pricing Grid” means the table and text set forth in Part 2 of Schedule 1.1(C).

“Prime Rate” means the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Federal Reserve Board (as determined by the Administrative Agent). Any change in the Prime Rate shall take effect at the opening of business on the day such change is publicly announced or quoted as being effective without the necessity of notice provided to the Borrower or any other Person.

“Principal Office” means the main banking office of the Administrative Agent in Greenwood Village, Colorado, or such other banking office as may be designated by the Administrative Agent from time to time.

“Prior Credit Agreement” means that certain Second Amended and Restated Master Loan Agreement, dated as of July 31, 2018, by and between the Borrower and CoBank as supplemented by that certain Fourth Supplement to the Second Amended and Restated Master Loan Agreement, dated as of July 31, 2018, by and between the Borrower and CoBank and that certain Fifth Supplement to the Second Amended and Restated Master Loan Agreement, dated as of July 31, 2018, by and between the Borrower and CoBank, as each has been modified, amended, or restated from time to time.

“Prior Security Interest” means a valid and enforceable perfected first-priority security interest in and to the Collateral (to the extent required to be perfected under the Collateral Documents) that is subject only to Permitted Liens which have first-priority by operation of applicable Law.

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“Pro Rata Share” means (a) with respect to the Revolving Credit Facility as of any date of determination, the proportion that a Revolving Lender’s Revolving Commitment as of such date bears to the aggregate amount of Revolving Commitments of all of the Revolving Lenders as of such date, provided, that if the Revolving Commitments have been terminated or have expired, Pro Rata Share under the Revolving Credit Facility shall be determined based upon the Revolving Commitments most recently in effect, giving effect to any assignment, (b) with respect to the Term Loan Facility as of any date of determination, (i) if any Term Loan Commitments remain in effect, the proportion that a Term Lender’s unused Term Loan Commitments bears to the aggregate amount of Term Loan Commitments of all of the Term Lenders as of such date, or (ii) if the Term Loan Commitments have been terminated or have expired, the proportion that the outstanding principal amount of a Term Lender’s Term Loans as of such date bears to the aggregate principal amount of all outstanding Term Loans as of such date, (c) with respect to each Tranche of the Incremental Term Loan Facility as of any date of determination, (i) if any Incremental Term Loan Commitments remain in effect with respect to such Tranche, the proportion that an Incremental Term Lender’s unused Incremental Term Loan Commitments with respect to such Tranche bears to the aggregate amount of the Incremental Term Loan Commitments of all of the Incremental Term Lenders for such Tranche as of such date, or (ii) if the Incremental Term Loan Commitments have been terminated or have expired with respect to such Tranche, the proportion that the outstanding principal amount of an Incremental Term Lender’s Incremental Term Loans with respect to such Tranche as of such date bears to the aggregate principal amount of all outstanding Incremental Term Loans for such Tranche as of such date, and (d) and (c) with respect to any Delayed Draw Term Loans as of any date of determination, (i) if any DDTL Commitments remain in effect, (x) the proportion that a DDTL Lender’s DDTL Commitments and outstanding Delayed Draw Term Loans (if any) bears to the aggregate amount of DDTL Commitments and outstanding Delayed Draw Term Loans (if any) of all of the DDTL Lenders as of such date, or (ii) if the DDTL Commitments have been terminated or used or have expired, the proportion that the outstanding principal amount of a DDTL Lender’s Delayed Draw Term Loans as of such date bears to the aggregate principal amount of all outstanding Delayed Draw Term Loans as of such date.

“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.

“PUC” means any state, provincial or other local public utility commission, franchising authority, public right of way licensor or similar regulatory agency or body that exercises jurisdiction over the rates, terms or services or the ownership, construction or operation of any Communications System (and its related facilities and access to any public right of way) or over Persons who own, construct or operate a Communications System, in each case by reason of the nature or type of the services, operations or business subject to regulation and not pursuant to laws and regulations of general applicability to Persons conducting business in any such jurisdiction.

“PUC Laws” means all relevant rules, regulations, and published policies of, and all Laws administered by, any PUC asserting jurisdiction over any Loan Party or its Subsidiaries.

“Purchase Money Security Interest” means Liens upon tangible personal property securing loans to any Loan Party or Subsidiary of a Loan Party or deferred payments by such Loan Party or Subsidiary for the purchase of such tangible personal property.

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“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Guaranty or grant of security interest becomes effective with respect to such Swap Obligation or such other Person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another Person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Recipient” means (a) the Administrative Agent or (b) any Lender, as applicable.

“Register” has the meaning specified in Section 11.7(c).

“Regulation D” means Regulation D of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.

“Related Agreements” has the meaning specified in Section 12.3(a).

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Relevant Governmental Body” means the Federal Reserve Board or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board or the Federal Reserve Bank of New York, or any successor thereto.

“Required Lenders” means, at any time, Lenders (other than Defaulting Lenders and including Voting Participants) having Total Credit Exposures representing more than 50% of the Total Credit Exposures of all Lenders. The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to the Borrower’s stockholders, partners or members (or the equivalent Person thereof).

“Revolving Commitment” means, as to any Revolving Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter assigned or modified and “Revolving Commitments” means the aggregate Revolving Commitments of all of the Revolving Lenders. As of the Closing Date, the aggregate amount of the Revolving Commitments of all Revolving Lenders is $30,000,000.

“Revolving Credit Exposure” means, as to any Revolving Lender at any time, the aggregate principal amount at such time of its outstanding Revolving Loans and such Revolving Lender’s participation in Swing Line Loans at such time.

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“Revolving Credit Facility” means the Revolving Credit Facility established pursuant to Section 2.2.

“Revolving Credit Facility Usage” means at any time the sum of the outstanding Revolving Loans, the outstanding Swing Line Loans, and the Letter of Credit Obligations. 

“Revolving Lender” means each Lender having a Revolving Commitment or who has funded or purchased all or a portion of a Revolving Loan in accordance with the terms hereof.

“Revolving Loans” means collectively and “Revolving Loan” means separately all Revolving Loans or any Revolving Loan made by the Lenders or one of the Lenders to the Borrower pursuant to Section 2.2.

“Revolving Note” means the promissory notes of the Borrower substantially in the form of Exhibit F-1 hereto evidencing the Revolving Loans.

”Revolving Overadvance” has the meaning specified in Section 2.13(a)(i).

“Sanctioned Country” means, at any time, a country, territory or sector that is, or whose government is, the subject or target of any Sanctions or that is, or whose government is, the subject of any list-based or territorial or sectorial Sanctions.

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by any Governmental Authority, (b) any Person operating, organized or resident in a Sanctioned Country, (c) any Person that is otherwise subject to any Sanctions, or (d) any Person, directly or indirectly, 50% or more in the aggregate owned by, otherwise controlled by, or acting for the benefit or on behalf of, any Person or Persons described in clause (a), (b) or (c) of this definition.

“Sanctions” means any economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by any Governmental Authority.

“Secured Bank Product” means agreements or other arrangements entered into by a Lender or its Affiliate, on the one hand, and any Loan Party, on the other hand at the time such Lender is a party to this Agreement, under which any Lender or Affiliate of a Lender provides any of the following products or services to any of the Loan Parties: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) purchase cards, (e) ACH transactions, (f) cash management, including controlled disbursement, accounts or services, or (g) foreign currency exchange, and shall include the CoBank Cash Management Agreement; provided that the foregoing shall not constitute a Secured Bank Product if at any time the applicable provider of such bank products or services is not a Lender or an Affiliate of a Lender.

“Secured Hedge” means an Interest Rate Hedge permitted under this Agreement (a) that is entered into by a Hedge Bank at the time that such Hedge Bank or its Affiliate is a Lender hereunder and (b) with respect to which such Hedge Bank has provided evidence satisfactory to the Administrative Agent that (i) such Interest Rate Hedge is documented in a standard International Swaps and Derivatives Association, Inc. Master Agreement, and (ii) such Interest Rate Hedge provides for the method of calculating the reimbursable amount of the provider’s credit exposure in a reasonable and customary manner; provided that the foregoing shall not constitute a Secured Hedge if at any time the applicable provider of such Interest Rate Hedge is not a Lender or an Affiliate of a Lender.

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“Secured Obligations” means all Obligations, all Guaranteed Liabilities and all Other Liabilities, but excluding all Excluded Swap Obligations.

“Secured Parties” means, collectively, the Administrative Agent, the Lenders, each Lender (or its Affiliate) that provides any Secured Hedge for so long as such Lender remains a Lender hereunder, each Lender (or its Affiliate) that provides any Secured Bank Product for so long as such Lender remains a Lender hereunder, each Related Party or co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Section 10.6, and, in each case, their respective successors and permitted assigns.

“Security Agreement” means the Pledge and Security Agreement, dated as of the date hereof, by each of the Loan Parties in favor of the Administrative Agent.

“SOFR” means a rate per annum equal to the secured overnight financing rate as administered by the SOFR Administrator.

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

“SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“Solvency Certificate” means the certificate of the Loan Parties in the form of Exhibit G hereto. “Solvent” means, with respect to any Person on any date of determination, taking into account any and all rights of reimbursement, contribution or similar right available to such Person from other Persons, that on such date (a) the fair value of the assets of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its assets and pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, considering all financing alternatives and potential asset sales reasonably available to such Person, (d) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature, and (e) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s assets would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed at the amount that, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

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“Standard & Poor’s” means Standard & Poor’s Ratings Services LLC, a subsidiary of The McGraw-Hill Companies, Inc., or any successor or assignee of the business of such division in the business of rating securities and debt.

“Subsidiary” of any Person at any time means any corporation, trust, partnership, any limited liability company or other business entity (a) of which more than 50% of the outstanding voting securities or other interests normally entitled to vote for the election of one or more directors or trustees (regardless of any contingency that does or may suspend or dilute the voting rights) is at such time owned, or the management of which is controlled, directly or indirectly through one or more intermediaries, or both, by such Person or one or more of such Person’s Subsidiaries, or (b) that is directly or indirectly controlled by such Person or one or more of such Person’s Subsidiaries.

“Subsidiary Equity Interests” has the meaning specified in Section 5.6.

“Swap Obligation” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

“Swing Line Commitment” means, as to the Swing Line Lender at any time, the amount initially set forth opposite its name on Schedule 1.1(B), as such Commitment is thereafter assigned or modified. As of the First Amendment Effective Date, the Swing Line Commitment of the Swing Line Lender is $3,000,000.

“Swing Line Facility” means the swing line facility established pursuant to Section 2.4.

“Swing Line Lender” means CoBank, in its individual capacity as the provider of the Swing Line Commitment.

“Swing Line Loans” means collectively, and “Swing Line Loan” means separately all Swing Line Loans, or any Swing Line Loan made by the Swing Line Lender to the Borrower pursuant to Section 2.4 hereof.

“Swing Line Note” means the promissory note of the Borrower substantially in the form of Exhibit F-5 hereto evidencing the Swing Line Loans.

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, for tax purposes or otherwise upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

“Tax Compliance Certificate” means tax certificates substantially in the form of Exhibit H hereto, prepared and delivered in accordance with Section 3.2(g).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

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“Term A-1 Loan” means any term loan funded pursuant to the Term A-1 Loan Commitment.

“Term A-1 Loan Commitment” with respect to each Lender, its obligation to make term loans pursuant to Section 2.1 on the Closing Date in an aggregate principal amount at any time outstanding set forth opposite such Lender’s name on Schedule 1.1(B) or in the Assignment and Assumption pursuant to which such Lender becomes party hereto. As of the Closing Date, the aggregate amount of the Term A-1 Loan Commitments of the Lenders is $50,000,000.

“Term A-1 Loan Facility” means the term loan facility established pursuant to Section 2.1.

“Term Lender” means each Lender (including any Incremental Term Lender) having a Term Loan Commitment with respect to any Tranche of Term Loans or who has funded or purchased all or a portion of any Tranche of Term Loans in accordance with the terms hereof.

“Term Loan” means the Term A-1 Loans together with all Incremental Term Loans, if any.

“Term Loan Commitment” means the Term A-1 Loan Commitment together with all Incremental Term Loan Commitments, if any.

“Term Loan Facility” means the Term A-1 Loan Facility together with all Incremental Term Loan Facilities, if any.

“Term Loan Notes” means the promissory notes of the Borrower substantially in the form of Exhibit F-3 hereto evidencing the Term Loans.

“Term SOFR Adjustment” means a percentage per annum equal to 0.10%.

“Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Administrative Agent in its reasonable discretion).

“Term SOFR Rate” means,

(a)        for any calculation with respect to a Term SOFR Rate Loan, the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, (i) that if as of 3:00 p.m. on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Transition Event with respect to the Term SOFR Reference Rate has not occurred, then the Term SOFR Rate will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day; and (ii) the Term SOFR Rate for the Initial Interest Period (if applicable) shall be the Term SOFR Reference Rate for a tenor of one month on the Periodic Term SOFR Determination Day that is two U.S. Government Securities Business Days prior to the Closing Date;

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(b)        for any calculation with respect to a Base Rate Loan on any day, the Term SOFR Reference Rate for a tenor of one month on the day (such day, the “Base Rate Term SOFR Determination Day”) that is two U.S. Government Securities Business Days prior to such day, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 3:00 p.m. on any Base Rate Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Transition Event with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR Rate will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three U.S. Government Securities Business Days prior to such Base Rate Term SOFR Determination Day;

provided, further, that if the Term SOFR Rate determined as provided above (including pursuant to the proviso under clause (a) or clause (b) above) shall ever be less than the Floor, then Term SOFR Rate shall be deemed to be the Floor.

“Term SOFR Rate Loan” means a Loan bearing interest at the Term SOFR Rate Option, other than pursuant to clause (c) of the definition of “Alternate Base Rate”. A Term SOFR Rate Loan is a Loan subject to an Interest Period.

”Term SOFR Rate Option” means the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 2.5(a)(ii).

“Term SOFR Reference Rate” means the forward-looking term rate based on SOFR.

“Termination Date” means the date as of which all of the following shall have occurred: (a) all Commitments under this Agreement have terminated, and (b) all Obligations have been paid in full (other than (i) contingent indemnification obligations as to which not claim has been made and (ii) obligations and liabilities with respect to any Secured Bank Product or Secured Hedge as to which arrangements reasonably satisfactory to the applicable Lender (or its Affiliate) or Hedge Bank have been made).

“Threshold Amount” means $2,000,000.

“Total Credit Exposure” means, as to any Lender at any time, the unused Commitments, Revolving Credit Exposure, outstanding Term Loans, outstanding Delayed Draw Term Loans and the outstanding Incremental Term Loans of such Lender at such time.

“Tranche” means, with respect to each Class of Loans (other than Revolving Loans), (a) (i) all Term A-1 Loans and (ii) all Incremental Term Loans made on the same date pursuant to the terms of the same Notice of Incremental Term Loan Borrowing and Incremental Term Loan Funding Agreement and (b) all Delayed Draw Term Loans under the DDTL Facility.

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“U.S. Borrower” means any Borrower that is a U.S. Person.

“U.S. Government Securities Business Day” means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.

“UCC” has the meaning set forth in the Security Agreement, subject to the rules of construction set forth in Section 1.2 of the Security Agreement.

“Unfunded Liability” means, (a) for a Pension Plan other than a Multiemployer Plan, any excess of the Pension Plan’s funding target under Section 430(d) of the Code or Section 303(d) of ERISA over the value of the Pension Plan’s assets, determined in accordance with Section 430(d)(2)(A) of the Code or Section 303(d)(2)(A) of ERISA for the applicable plan year, (b) for a Multiemployer Plan, any excess of the Multiemployer Plan’s current liability under Section 431(c)(6) of the Code or Section 304(c)(6) of ERISA over the value of the Multiemployer Plan’s assets determined in accordance with Section 431(c)(2) of the Code or Section 304(c)(2) of ERISA, and (c) for a Welfare Benefit Plan, the present value (determined using actuarial and other assumptions that are reasonable with respect to the benefits provided and the employees participating) of the liability of each Loan Party and each ERISA Affiliate for post- retirement benefits other than pensions, net of all assets under all such Welfare Benefit Plans allocable to such benefits, determined in accordance with Financial Accounting Standard 106 (as amended).

“Unused Commitment Fees” means (a) the Unused DDTL Commitment Fee, or (b) the Unused Revolving Commitment Fee.

”Unused DDTL Commitment Fee” has the meaning specified in Section 2.8(a)(ii).

“Unused Revolving Commitment Fee” has the meaning specified in Section 2.8(a)(i).

“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.

“Voting Interests” means shares of capital stock issued by a corporation, or equivalent equity interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency.

“Voting Participant” has the meaning specified in Section 11.7(d).

“Voting Participant Notice” has the meaning specified in Section 11.7(d).

“Welfare Benefit Plan” means a Plan which is an “employee welfare benefit plan” within the meaning of Section 3(1) of ERISA.

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“Withholding Agent” means (a) the Borrower or any other Loan Party and (b) the Administrative Agent.

1.2   Construction. Unless the context of this Agreement otherwise clearly requires, the following rules of construction shall apply to this Agreement and each of the other Loan Documents: (a) references to the plural include the singular, the plural, the part and the whole; (b) the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; (c) the words “hereof,” “herein,” “hereunder,” “hereto” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document as a whole; (d) article, section, subsection, clause, schedule and exhibit references are to this Agreement or other Loan Document, as the case may be, unless otherwise specified; (e) reference to any Person includes such Person’s successors and assigns; (f) reference to any agreement, including this Agreement and any other Loan Document together with the schedules and exhibits hereto or thereto, document or instrument means such agreement, document or instrument as amended, extended, modified, supplemented, replaced, substituted for, superseded, renewed, refinanced, refunded, reaffirmed or restated at any time and from time to time; (g) relative to the determination of any period of time, “from” means “from and including,” “to” means “to but excluding,” and “through” means “through and including”; (h) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights; (i) section headings herein and in each other Loan Document are included for convenience and shall not affect the interpretation of this Agreement or such Loan Document; (j) any pronoun shall include the corresponding masculine, feminine and neuter terms; (k) reference to any Law shall refer to such Law as amended, modified, supplemented, renewed, or extended from time to time and to any successor or replacement Law promulgated thereunder or substantially related thereto and to any rules and regulations related thereto; (l) reference to any Governmental Authority includes any similar or successor Governmental Authority; (m) the word “will” shall be construed to have the same meaning and effect as the word “shall”; (n) unless otherwise specified, all references herein to times of day shall be references to Denver, Colorado time; (o) the word “or” is not exclusive; and (p) the word “year” shall refer to, (i) in the case of a leap year, to a year of three hundred sixty-six (366) days and, (ii) otherwise, a year of three hundred sixty-five (365) days.

1.3   Accounting Principles. Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters (including financial ratios and other financial covenants) and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principles of consolidation where appropriate), applied on a consistent basis and, except as expressly provided herein, in a manner consistent with that used in preparing audited financial statements in accordance with Section 6.1(b) and all accounting or financial terms have the meanings ascribed to such terms by GAAP; provided, however, that all accounting terms used in any financial ratio or financial covenant (and any definitions used in any financial ratio or financial covenant) have the meaning given to such terms (and defined terms) under GAAP as in effect on the Closing Date applied on a basis consistent with those used in preparing the financial statements referred to in Section 5.10. In the event of any change after the Closing Date in GAAP, and if such change would affect the computation of any financial ratio or financial covenant set forth herein, then the parties hereto agree to endeavor, in good faith, to agree upon an amendment to this Agreement that would adjust such financial ratio or financial covenants in a manner that would preserve the original intent thereof, but would allow compliance therewith to be determined in accordance with the financial statements of the Loan Parties at that time, provided that until so amended such financial ratio or financial covenant shall continue to be computed in accordance with GAAP prior to such change therein. Notwithstanding the foregoing, for purposes of determining compliance with any ratio or covenant (including the computation of any financial ratio, financial covenant or component thereof) contained herein, Indebtedness of any Loan Party and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded. Without limiting the foregoing, any operating lease properly classified as an operating lease as of the Closing Date shall be classified and accounted for as an operating lease during the term of this Agreement for all purposes of this Agreement, notwithstanding any changes in GAAP relating thereto.

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1.4   Rounding. Any financial ratios required to be maintained pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio or percentage is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

1.5   Covenant Compliance Generally. For purposes of determining compliance under Article VIII, any amount in a currency other than Dollars will be converted to Dollars in a manner consistent with that used in calculating Consolidated Net Income in the most recent annual financial statements of any Loan Party and its Subsidiaries delivered pursuant to Section 6.1(b). Notwithstanding the foregoing, for purposes of determining compliance with Article VII, with respect to any covenant with respect to the amount of Indebtedness or investment in a currency other than Dollars, no breach of any basket contained therein shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such Indebtedness or investment is incurred; provided, that for the avoidance of doubt, the result of any changes in rates of exchange occurring after the time such Indebtedness or investment is incurred shall otherwise apply in all other cases, including determining whether any additional Indebtedness or investment may be incurred at any time in accordance with Article VII and for purposes of calculating financial ratios in accordance with Article VIII.

1.6   Holidays. Whenever payment of a Loan to be made or taken hereunder shall be due on a day that is not a Business Day such payment shall be due on the next Business Day (except as provided in Section 2.6) and such extension of time shall be included in computing interest and fees, except that the Loans shall be due on the Business Day preceding the Maturity Date if the Maturity Date is not a Business Day. Whenever any payment or action to be made or taken hereunder (other than payment of the Loans) shall be stated to be due on a day that is not a Business Day, such payment or action shall be made or taken on the next following Business Day, and such extension of time shall not be included in computing interest or fees, if any, in connection with such payment or action.

1.7   Divisions. For all purposes under the Loan Documents, in connection with any Division or plan of Division: (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its Equity Interests at such time. Any reference in Section 7.7 or in Section 7.8 to a combination, merger, consolidation, Disposition, dissolution, liquidation, transfer or similar term shall be deemed to apply to a Division, or an allocation of assets to a series of limited liability companies (or the unwinding of such a Division or allocation) as if it were a combination, merger, consolidation, Disposition, dissolution, transfer or similar term, as applicable, to of or with a separate Person.

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II.CREDIT FACILITIES

2.1    Term Loans.

(a)Term A-1 Loan Commitments. Subject to the terms and conditions hereof, and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each Term A-1 Lender severally agrees to make the Term A-1 Loan to the Borrower on the Closing Date in such principal amount as the Borrower shall request up to, but not exceeding the lesser of (i) such Term A-1 Lender’s Term A-1 Loan Commitment or (ii) such Term A-1 Lender’s Pro Rata Share of the aggregate principal amount of Term A-1 Loans to be funded on the Closing Date. The request by the Borrower for the Term A-1 Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with Article IV both before and after giving effect to the requested Term A-1 Loan.

(b)Term A-1 Loan Request. The Borrower shall request the Term A-1 Lenders to make the Term A-1 Loans by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) U.S. Government Securities Business Days prior to the Closing Date with respect to Term SOFR Rate Loans (or such shorter period of time as the Administrative Agent may agree in its sole discretion); and (ii) one (1) Business Day prior to the Closing Date with respect to Base Rate Loans (or such shorter period of time as the Administrative Agent may agree in its sole discretion), a duly completed Loan Request. The Loan Request with respect to the Term A-1 Loan shall be subject to the occurrence of the Closing Date but otherwise shall be irrevocable and shall specify the aggregate amount of the proposed Term A-1 Loans comprising each Borrowing, and, if applicable, the Interest Period, which amounts shall be in (x) integral multiples of $500,000 and not less than $1,000,000 for each Borrowing under the Term SOFR Rate Option and (y) integral multiples of $500,000 and not less than $1,000,000 for each Borrowing under the Base Rate Option.

(c)Nature of Lenders’ Obligations with Respect to Term Loans. The failure of any Term A-1 Lender to make a Term Loan shall not relieve any other Term A-1 Lender of its obligations to make a Term A-1 Loan nor shall it impose any additional liability on any other Lender hereunder. The Term A-1 Lenders shall have no obligation to make the Term A-1 Loans after the Closing Date. The Term A-1 Loan Commitments are not revolving commitments, and the Borrower shall not have the right to repay and reborrow under Section 2.1.

(d)Repayment of Term Loans. In addition to any prepayments or repayments made pursuant to Sections 2.12 and 2.13, commencing with the fiscal quarter ending December 31, 2025, the Borrower shall repay the aggregate outstanding principal balance of the Term A-1 Loan in quarterly principal payments on the last Business Day of each fiscal quarter for the periods and in the amounts set forth in the following table:

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Quarterly Payment Dates	Quarterly Repayments
December 31, 2025 – September 30, 2028	$625,000
December 31, 2028 through Maturity Date	$937,500
Maturity Date	Outstanding principal balance of the Term A-1 Loans

Notwithstanding anything herein to the contrary, the entire outstanding principal balance of the Term A-1 Loans shall be due and payable in full in cash on the Maturity Date with respect to the Term A-1 Loan Facility.

(e)Incremental Term Loans.

(i)Following the Closing Date, the Borrower may from time to time prior to the Maturity Date with respect to the Term Loan Facility, request that additional Tranches of Term Loans be made to it in accordance with this Section 2.1(e) (each, an “Incremental Term Loan”) by delivering a Notice of Incremental Term Loan Borrowing to the Administrative Agent, specifying (subject to the restrictions set forth in Section 2.1(e)(ii)) therein (v) the amount of the Tranche of Incremental Term Loans requested (which Tranche shall be in a minimum principal amount of $5,000,000 and integral multiples of $5,000,000 in excess thereof), (w) the requested advance date of the proposed Incremental Term Loans comprising such Tranche (which shall be not less than thirty (30) days from the date of delivery of the Notice of Incremental Term Loan Borrowing (or such shorter period of time as to which the Administrative Agent may agree in its sole discretion)), (x) the Interest Rate Option(s) and the Applicable Margin(s) to be applicable to all Incremental Term Loans in such Tranche, (y) the amortization for all Incremental Term Loans in such Tranche, and (z) the amount of any upfront or closing fees to be paid by the Borrower to the Lenders funding the Tranche of Incremental Term Loans requested. Subject to the last sentence in Section 2.1(e)(iv), each Notice of Incremental Term Loan Borrowing delivered by the Borrower shall be irrevocable and shall be binding upon all Loan Parties. At the time of delivery of each Notice of Incremental Term Loan Borrowing, the Borrower shall also deliver to the Administrative Agent a certificate of an Authorized Officer of the Borrower certifying (1) that, both before and after giving effect to a Borrowing of such Tranche of Incremental Term Loans, the Borrower shall be in pro forma compliance with the covenants set forth in Article VIII as of the most recent period for which financial statements have been delivered (and showing the calculations thereof), and (2) that no Default or Event of Default then exists or would be caused thereby. There shall be no more than seven (7) Tranches of Incremental Term Loans.

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(ii)The aggregate principal amount of all Incremental Term Loan Commitments of all Tranches of Incremental Term Loans made pursuant to this Section 2.1(e) shall not exceed the Maximum Aggregate Increase Amount. Repayments of the principal of any Incremental Term Loans may not be reborrowed. Each Tranche of Incremental Term Loans shall bear interest at the Alternate Base Rate or the Benchmarks plus such Applicable Margin as is set forth in the Notice of Incremental Term Loan Borrowing related to such Tranche, and shall be subject to the amortization set forth in the applicable Notice of Incremental Term Loan Borrowing relating to such Tranche, provided, however, to the extent that the Applicable Margin for the Alternate Base Rate or any Benchmark under any Tranche of Incremental Term Loans exceed by more than 0.50% the Applicable Margin for the Alternate Base Rate or for such Benchmark for the existing Term Loan Facility, determined as of the effective date of the Incremental Term Loan Commitment of such Tranche of Incremental Term Loans, the Applicable Margin for the Alternate Base Rate or such Benchmark for the existing Term Loan Facility, as applicable, shall be increased so that the Applicable Margin for the Alternate Base Rate or such Benchmark, as applicable, on such Tranche of Incremental Term Loans and the existing Term Loan Facility are equal, (ii) the final maturity date of any Tranche of Incremental Term Loans shall be no earlier than the Maturity Date with respect to the Term Loans. The weighted average life of any Tranche of Incremental Term Loans shall be equal to or greater than the remaining life of the Term Loan Facility, determined as of the effective date of the Incremental Term Loan Commitment for such Tranche of Incremental Term Loans. The original issue discount or the upfront fees applicable to any Tranche of Incremental Term Loans shall not be more than 0.50% of the aggregate principal amount of the Incremental Term Loans thereunder. Any representation, covenant or Event of Default applicable to any Tranche of Incremental Term Loans that is more restrictive than the equivalent representation, covenant or Event of Default set forth in this Agreement shall be deemed to be applicable to all Loans hereunder. All Incremental Term Loans shall for all purposes be Obligations hereunder and under the Loan Documents.

(iii)Upon receipt of a request for a Tranche of Incremental Term Loans from the Borrower, the Administrative Agent may, in its sole discretion, offer one or more Term Lenders, other Lenders or new lenders that are Eligible Assignees, and, with the consent of the Borrower, other new lenders that are not Eligible Assignees the opportunity, in such amounts as the Administrative Agent shall determine, to participate in the requested Tranche of Incremental Term Loans. The Administrative Agent shall have no obligation to offer any Lender or new lender the opportunity to participate in any such Tranche of Incremental Term Loans and nothing herein shall prohibit the Administrative Agent from retaining for its own account, as an Incremental Term Lender, all or substantially all of such Tranche of Incremental Term Loans. Each Term Lender, other Lender or new lender that fails to respond to such a notice in writing in a form acceptable to the Administrative Agent within the period of time provided therein shall be deemed to have elected not to participate in such Tranche of Incremental Term Loans. No Lender or new lender shall have any obligation to fund any Incremental Term Loan, and any decision by a Lender or new lender to fund any Incremental Term Loan shall be made in its sole discretion independently from any other Lender or new lender.

(iv)If in response to the offer to participate in such Tranche made by the Administrative Agent pursuant to clause (iii) above, the Administrative Agent receives commitments from Lenders and/or from any other Person that (x) qualifies as an Eligible Assignee and is reasonably acceptable to the Borrower and the Administrative Agent and (y) has agreed to become a Lender in respect of all or a portion of the Incremental Term Loan (an “Additional Incremental Term Lender”), in excess of the requested Incremental Term Loan, the Administrative Agent shall have the right, in its sole discretion but with the consent of the Borrower, to reduce and reallocate (within the minimum and maximum amounts specified by each such Lender or Additional Incremental Term Lender in its notice to the Administrative Agent) the shares of the Incremental Term Loan of the Lenders or Additional Incremental Term Lenders willing to fund (or commit to fund) such Incremental Term Loan so that the total committed Incremental Term Loan equals the requested Incremental Term Loan. If the Administrative Agent does not receive commitments from Lenders or Additional Incremental Term Lenders in an amount sufficient to fund the requested Incremental Term Loan, the Administrative Agent shall so notify Borrower and the request for such Incremental Term Loan shall be deemed automatically rescinded; provided, the Borrower may submit a replacement Notice of Incremental Term Loan Borrowing setting forth different terms for the requested Incremental Term Loan.

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(v)An agreement to fund Incremental Term Loans (an “Incremental Term Loan Funding Agreement”), pursuant to this Section 2.1(e) shall become effective upon the receipt by the Administrative Agent of an agreement in form and substance reasonably satisfactory to the Administrative Agent and the Borrower signed by each Loan Party, by each Additional Incremental Term Lender and by each existing Lender who has agreed to fund such Incremental Term Loans, setting forth the new Incremental Term Loans of such Lenders and setting forth the agreement of each Additional Incremental Term Lender to become a party to this Agreement as a Lender and to be bound by all the terms and provisions hereof, together with officer’s certificates and ratification agreements executed by each Loan Party and such evidence of satisfaction of all conditions set forth in Section 4.2, appropriate corporate authorization on the part of each Loan Party with respect to the requested Incremental Term Loan, amendments to any other Loan Documents reasonably requested by the Administrative Agent in relation to the requested Incremental Term Loan (which amendments to the Loan Documents (other than this Agreement) the Administrative Agent is hereby authorized to execute on behalf of the Lenders), updates or endorsements to policies of title insurance, flood hazard determination certificates (and, if applicable, evidence of flood insurance) with respect to each parcel of property subject to a Mortgage, the results of lien searches from applicable jurisdictions, and such opinions of counsel for the Loan Parties with respect to the requested Incremental Term Loan and other assurances as the Administrative Agent may reasonably request.

(vi)In addition to any prepayments or repayments made pursuant to Sections 2.12 and 2.13, the principal of the Incremental Term Loans of each Tranche shall be repaid on such dates and in such amounts as may be set forth in the Notice of Incremental Term Loan Borrowing for such Tranche, to be applied to the unpaid principal amount of the Incremental Term Loans for such Tranche for which such payment relates. Notwithstanding anything herein to the contrary, the entire outstanding principal balance of the Incremental Term Loans shall be due and payable in full in cash on the applicable Maturity Date.

(vii)The Administrative Agent shall record relevant information regarding each Tranche of Incremental Term Loans (including information with respect to Additional Incremental Term Lenders) in the Register in accordance with Section 11.7(c); provided, however, that failure to make any such recordation, or any error in such recordation, shall not affect the Borrower’s obligations in respect of any Incremental Term Loan Commitment or Incremental Term Loan.

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2.2   Revolving Loans.

(a)Revolving Loan Commitments. Subject to the terms and conditions hereof and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each Revolving Lender severally agrees to make Revolving Loans to the Borrower at any time or from time to time on or after the Closing Date to, but not including, the Maturity Date with respect to the Revolving Credit Facility, provided, that after giving effect to each such Revolving Loan (i) the aggregate principal amount of such Revolving Lender’s Revolving Loans shall not exceed its Available Revolving Commitment and (ii) the aggregate outstanding principal amount of all Revolving Loans shall not exceed the Revolving Commitments. Each request by the Borrower for a Revolving Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with the proviso at the end of the preceding sentence and with Article IV after giving effect to the requested Revolving Loan. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.2.

(b)Revolving Loan Requests. Except as otherwise provided herein, the Borrower may from time to time prior to the Maturity Date request the Revolving Lenders to make Revolving Loans by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) U.S. Government Securities Business Days prior to the proposed Borrowing Date with respect to Term SOFR Rate Loans; and (ii) one (1) Business Day prior to the proposed Borrowing Date with respect to Base Rate Loans, a duly completed Loan Request. Each such Loan Request shall be irrevocable and shall specify the aggregate amount of the proposed Revolving Loans comprising each Borrowing, and, if applicable, the Interest Period, which amounts shall be in (x) integral multiples of $250,000 and not less than $500,000 for each Borrowing under the Term SOFR Rate Option and (y) integral multiples of $250,000 and not less than $500,000 for each Borrowing under the Base Rate Option.

(c)Nature of Lenders’ Obligations with Respect to Revolving Loans.   Each Revolving Lender shall be obligated to participate in each request for Revolving Loans pursuant to this Section 2.2 in accordance with its Pro Rata Share. The obligations of each Revolving Lender hereunder are several. The failure of any Revolving Lender to perform its obligations hereunder shall not affect the Obligations of the Borrower to any other party nor shall any other party be liable for the failure of such Revolving Lender to perform its obligations hereunder. Other than Revolving Loans in repayment of Swing Line Loans in accordance with Section 2.4(e), the Revolving Lenders shall have no obligation to make Revolving Loans hereunder on or after the Maturity Date with respect to the Revolving Credit Facility.

(d)Repayment of Revolving Loans. Notwithstanding anything herein or in any other Loan Document to the contrary, the Borrower shall repay the entire outstanding principal amount of Revolving Loans, together with all outstanding interest thereon and unpaid fees with respect thereto, on the Maturity Date with respect to the Revolving Credit Facility.

2.3    Delayed Draw Term Loans.

(a)DDTL Commitments. Subject to the terms and conditions hereof and relying upon the representations and warranties of the Loan Parties set forth herein and in the other Loan Documents, each DDTL Lender severally agrees to make Delayed Draw Term Loans to the Borrower during the period from the Closing Date through the DDTL Expiration Date with respect to the DDTL Facility in such principal amount as the Borrower shall request up to, but not exceeding, the lesser of (i) such DDTL Lender’s DDTL Commitment or (ii) such DDTL Lender’s Pro Rata Share of the aggregate principal amount of the Delayed Draw Term Loans to be funded on the applicable Borrowing Date. Each request by the Borrower for a Delayed Draw Term Loan shall be deemed to be a representation by the Borrower that it shall be in compliance with Article IV after giving effect to the requested Delayed Draw Term Loan.

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(b)Delayed Draw Term Loan Requests. Except as otherwise provided herein, the Borrower may from time to time prior to the DDTL Expiration Date request the DDTL Lenders to make Delayed Draw Term Loans by delivering to the Administrative Agent, not later than 11:00 a.m. five (5) Business Days prior to the proposed Borrowing Date (or such shorter period of time as agreed to by the Administrative Agent in its sole discretion), a duly completed Loan Request. Each such Loan Request shall be irrevocable and shall specify the aggregate amount of the proposed Delayed Draw Loans comprising each Borrowing, and, if applicable, the Interest Period, which amounts shall be in (x) integral multiples of $500,000 and not less than $1,000,000 for each Borrowing under the Term SOFR Rate Option and

(c)integral multiples of $500,000 and not less than $1,000,000 for each Borrowing under the Base Rate Option or, if less than such minimum principal amount or integral multiple, the remaining balance of the DDTL Commitment. In no event shall the Borrower make more than five (5) Loan Requests under the DDTL Facility.

(d)Nature of Lenders’ Obligations with Respect to Delayed Draw Term Loans. Each DDTL Lender shall be obligated to participate in each request for Delayed Draw Term Loans pursuant to this Section 2.3 in accordance with its Pro Rata Share. The obligations of each DDTL Lender hereunder are several. The failure of any DDTL Lender to perform its obligations hereunder shall not affect the Obligations of the Borrower to any other party nor shall any other party be liable for the failure of such DDTL Lender to perform its obligations hereunder. The DDTL Lenders shall have no obligation to make any Delayed Draw Term Loan hereunder after the DDTL Expiration Date. The DDTL Commitments are not revolving commitments, and the Borrower shall not have the right to repay and reborrow under Section 2.3.

(e)Repayment of Delayed Draw Term Loans. In addition to any prepayments or repayments made pursuant to Sections 2.12 and 2.13, commencing on the last Business Day of the fiscal quarter ending December 31, 2025 and on the last Business Day of each fiscal quarter thereafter, the Borrower shall repay the aggregate outstanding principal balance of the Delayed Draw Term Loans as of the DDTL Expiration Date in quarterly principal payments on the dates and in the percentages set forth in the table below:

Quarterly Payment Dates	Quarterly Repayments
December 31, 2025 – September 30, 2028	1.25%
December 31, 2028 through Maturity Date	1.875%
Maturity Date	Outstanding principal balance of the Delayed Draw Term Loans

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Notwithstanding anything herein or in any other Loan Document to the contrary, the Borrower shall repay the entire outstanding principal amount of Delayed Draw Term Loans, together with all outstanding interest thereon and unpaid fees with respect thereto, on the Maturity Date with respect to the DDTL Facility.

2.4 Swing Line Loans.

(a)Swing Line Commitments. Subject to the terms and conditions hereof and relying upon the agreements of the Revolving Lenders set forth  in this Section 2.4, the Swing Line Lender shall make Swing Line Loans to the Borrower at any time or from time to time after the Closing Date to, but not including, the Maturity Date with respect to the Revolving Credit Facility provided, that after giving effect to any such Swing Line Loan, (i) the aggregate amount of Swing Line Loans shall not exceed the Swing Line Commitment, and (ii) the Revolving Credit Facility Usage shall not exceed the Revolving Commitments. Each request by the Borrower for a Swing Line Loan shall be deemed to be a representation by the Borrower that it is in compliance with the proviso at the end of the preceding sentence and with Article IV after giving effect to the requested Swing Line Loan. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow Swing Line Loans in accordance with this Section 2.4. The Borrower shall not use the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan. If at any time the aggregate principal balance of the Swing Line Loans then outstanding exceeds the Swing Line Commitment, the Borrower shall be deemed to have requested the Revolving Lenders to make Revolving Loans in the amount of the difference in the manner and pursuant to the terms of Section 2.2(b).

(b)Cash Management Arrangements. The Borrower and the Swing Line Lender may enter into a cash management agreement (including the CoBank Cash Management Agreement) providing for the automatic advance by the Swing Line Lender of Swing Line Loans under the conditions set forth in such agreement, which conditions shall be in addition to the conditions set forth herein and which shall be in form and substance reasonably acceptable to the Administrative Agent.

(c)Swing Line Loan Requests. Except as otherwise provided herein, the Borrower may from time to time prior to the Maturity Date with respect to the Revolving Credit Facility request that the Swing Line Lender make Swing Line Loans by delivery to the Swing Line Lender (with a copy to the Administrative Agent) not later than 12:00 noon (or such later time as the applicable cash management agreement, if any, may permit or otherwise as the Swing Line Lender in its sole discretion may agree) on the proposed Borrowing Date of a duly completed and executed Loan Request, by telephonic request promptly followed by a duly completed and executed Loan Request, or by such other method of request as may be provided for in any such applicable cash management agreement. Each such request shall be irrevocable and shall specify the proposed Borrowing Date and the principal amount of such Swing Line Loan. Minimum borrowing amounts shall not apply to Swing Line Loans, except as provided for in any applicable cash management agreement. Promptly after receipt of any such request for a Swing Line Loan, the Swing Line Lender will confirm with the Administrative Agent that the Administrative Agent received a copy of the same, and, if not, the Administrative Agent with information regarding the requested Swing Line Loan.

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(d)Making Swing Line Loans. So long as the Swing Line Lender has not received timely telephonic or written notice from the Administrative Agent that one or more conditions precedent to the making of a Credit Extension under Section 4.2, have not been satisfied, the Swing Line Lender, after receipt by it of a Loan Request in accordance with Section 2.4(c), shall fund such Swing Line Loan to the Borrower in Dollars and immediately available funds at the Principal Office prior to 2:00 p.m., or as otherwise agreed in any applicable cash management agreement on the Borrowing Date; provided, that at any time that the CoBank Cash Management Agreement is in effect, the Swing Line Lender may waive, in its sole discretion, any one or more of the conditions precedent in Section 4.2 with respect to the making of any Swing Line Loan.

(e)Borrowings to Repay Swing Line Loans. The Swing Line Lender may, at its option, exercisable at any time for any reason whatsoever, request that the Administrative Agent demand repayment of the Swing Line Loans. Upon such request, the Administrative Agent shall demand repayment of the Swing Line Loans, and each Revolving Lender shall make a Revolving Loan in an amount equal to such Lender’s Pro Rata Share of the aggregate principal amount of the outstanding Swing Line Loans, plus, if the Swing Line Lender has so requested, accrued interest thereon, provided, that no Revolving Lender shall be obligated in any event to make Revolving Loans in excess of its Available Revolving Commitment. Revolving Loans made pursuant to the preceding sentence shall bear interest at the Base Rate Option and shall be deemed to have been properly requested in accordance with Section 2.2(b) without regard to any of the requirements of that provision. Each Revolving Lender acknowledges and agrees that its obligation to fund Swing Line Loans pursuant to this Section 2.4(e) and /or to acquire participants pursuant to Section 2.4(f) in respect of Swing Line Loans are absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or an Event of Default or any failure by the Borrower to satisfy any of the conditions set forth in Section 4.2. The Administrative Agent shall provide notice to the Revolving Lenders that such Revolving Loans are to be made under this Section 2.4 and of the apportionment among the Revolving Lenders, and the Revolving Lenders shall be unconditionally obligated to fund such Revolving Loans (whether or not the conditions specified in Section 2.2(b) are then satisfied) by the time requested by the Swing Line Lender and designated in such notice from the Administrative Agent, which shall not be earlier than 2:00 p.m. on the Business Day next after the date the Revolving Lenders receive such notice from the Administrative Agent.

(f)Risk Participations in Swing Line Loans. Immediately upon the making of each Swing Line Loan, each Revolving Lender shall be deemed tom and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender, without recourse or warranty, an undivided interest and participation in such Swing Line Loan in an amount equal to such Revolving Lender’s Pro Rata Share of the principal amount of such Swing Line Loan, and such interest and participation may be recovered from such Revolving Lender together with interest thereon at the Alternate Base Rate for each day during the period commencing on the date of demand and ending on the date such amount is received (subject to the limitation in clause (e) above that no Revolving Lender shall be obligated in any event to make Revolving Loans in excess of its Available Revolving Commitment).

(g)Repayment of Swing Line Loans. On the Maturity Date with respect to the Revolving Credit Facility, if not sooner demanded, the Borrower shall repay in full the outstanding principal amount of the Swing Line Loans, together with all accrued and unpaid interest and any applicable fees.

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2.5 Interest Rate Provisions. The Borrower shall pay interest in respect of the outstanding unpaid principal amount of the Loans, it being understood that, subject to the provisions of this Agreement, the Borrower may select different Interest Rate Options and different Interest Periods to apply to different Borrowings at any time outstanding and may convert to or renew one or more Interest Rate Options with respect to all or any portion of any Borrowing (subject to minimum amounts set forth in Sections 2.1(b), 2.2(b), 2.3(b), and 2.4(b)); provided that there shall not be at any one time outstanding more than five (5) Borrowings of Term SOFR Rate Loans; provided, further, that if a Default or an Event of Default or Default has occurred and is continuing, (x) the Borrower may not request, convert to, or renew any Term SOFR Rate Loans, and (y), immediately upon the occurrence and during the continuation of an Event of Default under clause (a) or (l) of Section 9.1 or immediately after written demand by the Administrative Agent (or by the Required Lenders to the Administrative Agent) after the occurrence and during the continuation of any other Event of Default, any Term SOFR Rate Loans will convert to Base Rate Loans. If at any time the designated rate applicable to any Loan made by any Lender exceeds the Maximum Rate, the rate of interest on such Lender’s Loan shall be limited to such Lender’s Maximum Rate.

(a)Interest Rate Options. Swing Line Loans and all other Obligations not constituting Loans shall bear interest calculated based upon the Base Rate Option. Subject to the limitations set forth in Section 3.4, the Borrower shall have the right to select from the following Interest Rate Options applicable to the Loans:

(i)Base Rate Option: An option to pay interest at a fluctuating rate per annum equal to the Alternate Base Rate in effect as of any date of determination plus the Applicable Margin as of such date; or

(ii)Term SOFR Rate Option: An option to pay interest at a fluctuating rate per annum equal to the Adjusted Term SOFR Rate with respect to the applicable Interest Period and as in effect as of any date of determination plus the Applicable Margin as of such date.

(b)Day Count Basis. Interest and fees shall be calculated on the basis of a 360-day year for the actual number of days elapsed (which results in more interest or fees, as the case may be, being paid than if calculated on the basis of a 365-day year); provided that interest with respect to Base Rate Loans incurring interest based on the Prime Rate shall be calculated on the basis of a 365/366-day year. The date of funding or conversion of a Term SOFR Rate Loan to a Base Rate Loan and the first day of an Interest Period shall be included in the calculation of interest. The date of payment of any Loan and the last day of an Interest Period shall be excluded from the calculation of interest; provided, if a Loan is repaid on the same day that it is made, one (1) day’s interest shall be charged.

(c)SOFR. In connection with the use or administration of the Term SOFR Rate and the Adjusted Term SOFR Rate and clause (c) of the definition of Alternate Base Rate, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document. The Administrative Agent will promptly notify the Borrower and the Lenders of the effectiveness of any Benchmark Replacement Conforming Changes in connection with the use or administration of the Term SOFR Rate, and the Adjusted Term SOFR Rate or clause (c) of the definition of the Alternate Base Rate.

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         2.6       Interest Periods. In order to convert a Base Rate Loan (other than Swing Line Loans) or Term SOFR Rate Loan or continue a Term SOFR Rate Loan, the Borrower shall deliver to the Administrative Agent a duly completed, written request therefor substantially in the form of Exhibit I (each, a “Conversion or Continuation Notice”) not later than 11:00 a.m. (i) with respect to a conversion to or continuation of a Term SOFR Rate Loan, at least three (3) U.S. Government Securities Business Days prior to the proposed effective date of such conversion or continuation and (ii) with respect to a conversion to a Base Rate Loan, at least one (1) Business Day prior to the proposed effective date of such conversion. The Conversion or Continuation Notice shall specify (i) which Borrowings (including the principal amount thereof) are subject to such request, and, in the case of any Term SOFR Rate Loan to be converted or continued, the last day of the current Interest Period therefor, (ii) the proposed effective date of such conversion or continuation (which shall be a Business Day), (iii) whether the Borrower is requesting a continuation of Term SOFR Rate Loans or a conversion of Borrowings from one interest rate option to another interest rate option, and (iv) if a continuation of or conversion to Term SOFR Rate Loans is requested, the requested Interest Period with respect thereto. In addition, the following provisions shall apply to any continuation of or conversion of any Borrowings:

(a)Amount of Loans. After giving effect to such conversion or continuation, each Borrowing of Term A-1 Loans, Revolving Loans, Delayed Draw Term Loans, and Incremental Term Loans shall be in an amount no less than the applicable minimum amount for Term A-1 Loans as set forth in Section 2.1(a), Revolving Loans as set forth in Section 2.2(b), for Delayed Draw Term Loans as set forth in Section 2.3(b), or in the applicable Incremental Term Loan Funding Agreement.

(b)Commencement of Interest Period. In the case of any borrowing of, conversion to or continuation of any Term SOFR Rate Loan, the Interest Period shall commence on the date of advance or continuation of, or conversion to, any Term SOFR Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires. Upon a conversion from a Term SOFR Rate Loan to a Base Rate Loan, interest at the Base Rate Option shall commence on the last day of the existing Interest Period.

(c)Selection of Interest Rate Options. If the Borrower elects to continue a Term SOFR Rate Loan but fails to select a new Interest Period to apply thereto, then a one month Interest Period automatically shall apply. If the Borrower fails to duly request the continuation of any Borrowing consisting of Term SOFR Rate Loans on or before the date specified and otherwise in accordance with the provisions of this Section 2.6, then such Term SOFR Rate Loan automatically shall be converted to a Base Rate Loan, interest at the Base Rate Option shall commence on the last day of the existing Interest Period.

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2.7       Making Loans.

(a)Notifications and Payments.   The Administrative Agent shall, promptly after receipt by it of a Loan Request, notify the applicable Lenders of such Class of Loan of its receipt of such Loan Request specifying the information provided by the Borrower and the apportionment among the Lenders of the requested Loan as determined by the Administrative Agent in accordance with Section 2.1, Section 2.2, Section 2.3, or Section 2.4, as applicable. Each applicable Lender shall remit the principal amount of their Pro Rata Share of the Loan to the Administrative Agent such that the Administrative Agent is able to, and the Administrative Agent shall, to the extent the Lenders have made funds available to it for such purpose and subject to the terms and conditions of Section 2.1, Section 2.2, Section 2.3, or Section 2.4, as applicable, fund such Loan to the Borrower in Dollars and immediately available funds to the Borrower’s account specified in the Loan Request prior to 2:00 p.m. on the proposed Borrowing Date.

(b)Pro Rata Treatment of Lenders. The borrowing of any Tranche or any Class of Loan, as applicable, shall be allocated to each Lender of such Tranche or such Class of Loan, as applicable, according to its Pro Rata Share thereof, and each selection of, conversion to or renewal of any Interest Rate Option and each payment or prepayment by the Borrower with respect to principal and interest due from the Borrower hereunder to the Lenders with respect to the applicable Tranche or Class of Commitments and Loan, as applicable, shall (except as otherwise may be provided with respect to a Defaulting Lender and except as provided in Section 3.1 or Section 3.6) be payable ratably among the Lenders of such Tranche or Class of Loan, as applicable, entitled to such payment in accordance with the amount of principal and interest then due or payable to such Lenders as set forth in this Agreement.

(c)Presumptions by the Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed Borrowing Date that such Lender will not make available to the Administrative Agent such Lender’s share of any Loan, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.1, Section 2.2, Section 2.3, or Section 2.4, as the case may be, and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of such Loan available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate then applicable to Base Rate Loans. If such Lender pays its share of the applicable Loan to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent. If the Borrower and such Lender pay such interest for the same period, the Administrative Agent promptly shall remit to the Borrower the amount of interest paid by Borrower for such overlapping period. Nothing in this Section 2.7(c) or elsewhere in this Agreement or the other Loan Documents, including the provisions of Section 2.14, shall be deemed to require the Administrative Agent (or any other Lender) to advance funds on behalf of any Lender or to relieve any Lender from its obligation to fulfill its commitments hereunder or to prejudice any rights that the Administrative Agent or the Borrower may have against any Lender as a result of any default by such Lender hereunder.

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2.8       Fees.

(a)Unused Commitment Fees.

(i)Accruing from the Closing Date through the Maturity Date with respect to the Revolving Credit Facility, the Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender according to its Pro Rata Share of the Revolving Credit Facility, a nonrefundable unused commitment fee (each an “Unused Revolving Commitment Fee”) equal to (x) the Applicable Unused Revolving Commitment Fee Rate (computed on the basis of a year of 360 days, as the case may be, and actual days elapsed) multiplied by (y) the average daily result of (A) the Revolving Commitments minus (B) the sum of the Revolving Loans; provided however, with  respect to the Unused Commitment Fee for the account of the Swing Line Lender, such fee shall be equal to the Applicable Unused Revolving Commitment Fee Rate (computed on the basis of a year of 360 days, as the case may be, and actual days elapsed) multiplied by the average daily difference between the Revolving Commitment and the Revolving Credit Facility Usage; provided further that any Unused Revolving Commitment Fee accrued with respect to the Revolving Commitment of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall not be payable by the Borrower so long as such Lender shall be a Defaulting Lender except to the extent that such Unused Revolving Commitment Fee shall otherwise have been due and payable by the Borrower prior to such time; provided further that no Unused Revolving Commitment Fee shall accrue with respect to the Revolving Commitment of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. Subject to the provisos in the directly preceding sentence, all Unused Revolving Commitment Fees shall be payable in arrears on each Interest Payment Date.

(ii)Accruing from the Closing Date through the DDTL Expiration Date, the Borrower agrees to pay to the Administrative Agent for the account of each DDTL Lender according to its Pro Rata Share of the DDTL Facility, a nonrefundable unused commitment fee (each an “Unused DDTL Commitment Fee”) equal to (x) the Applicable DDTL Unused Commitment Fee Rate (computed on the basis of a year of 360 days, as the case may be, and actual days elapsed) multiplied by (y) the average daily amount of the outstanding unfunded DDTL Commitments with respect to the DDTL Facility; provided, however, that any Unused DDTL Commitment Fee accrued with respect to the DDTL Commitment with respect to the DDTL Facility of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall not be payable by the Borrower so long as such Lender shall be a Defaulting Lender except to the extent that such Unused DDTL Commitment Fee shall otherwise have been due and payable by the Borrower prior to such time; provided further that no Unused DDTL Commitment Fee shall accrue with respect to the DDTL Commitment with respect to the DDTL Facility of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. Subject to the provisos in the directly preceding sentence, all Unused DDTL Commitment Fees shall be payable in arrears on each Interest Payment Date.

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(b)Other Fees. The Borrower agrees to pay to the Administrative Agent such other fees as agreed in the Fee Letter.

2.9       Notes. The obligation of the Borrower to repay the aggregate unpaid principal amount of the Revolving Loans, Swing Line Loans, Term Loans, Delayed Draw Term Loans and Incremental Term Loans made to it by each Lender, together with interest thereon, shall, at the request of the applicable Lender, be evidenced by a Revolving Note, a Swing Line Note, Term Loan Note and/or an Incremental Term Loan Note or DDTL Note, as the case may be, dated the Closing Date, the effective date, or the date of such request, as applicable, payable to such Lender in a face amount equal to the Revolving Commitment, Swing Line Commitment, Term Loan Commitment, Incremental Term Loan Commitment, or DDTL Commitment, as applicable, of such Lender. The Borrower hereby unconditionally promises to pay, to each of the Lenders, Administrative Agent and Swing Line Lender, as applicable, the Loans and other Obligations as provided in this Agreement and the other Loan Documents.

2.10     Payments.

(a)Payments Generally. All payments and prepayments to be made in respect of principal, interest, Unused Commitment Fees, other fees referred to in Section 2.8 or other fees or amounts due from the Borrower hereunder shall be payable prior to 11:00 a.m. on the date when due without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by the Borrower, and without set-off, counterclaim or other deduction of any nature, and an action therefor shall immediately accrue. Such payments shall be made to the Administrative Agent at the Principal Office for the account of the Lenders to which they are owed, in each case in Dollars and in immediately available funds. The Administrative Agent shall promptly distribute such amounts to the Swing Line Lender and/or applicable Lenders in immediately available funds. The Administrative Agent’s and each Lender’s statement of account, ledger or other relevant record shall, in the absence of manifest error, be conclusive as the statement of the amount of principal of and interest on the Loans and other amounts owing under this Agreement and shall be deemed an “account stated.”

(b)Payments by the Borrower; Presumptions by the Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

2.11     Interest Payment Dates. Interest on Base Rate Loans shall be due and payable in arrears on each applicable Interest Payment Date. Interest on Term SOFR Rate Loans shall be due and payable on the last day of each Interest Period for those Loans and, if such Interest Period is longer than three (3) months, also on the date that is the three-month anniversary of the first day of such Interest Period. Interest on mandatory prepayments of principal under Section 2.13 shall be due on the date such mandatory prepayment is due. Interest on the principal amount of each Loan not constituting a Base Rate Loan or Term SOFR Rate Loan or on other monetary Obligation shall be due and payable on demand after such principal amount or other monetary Obligation becomes due and payable (whether on the stated Maturity Date, upon an accelerated Maturity Date or otherwise).

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2.12     Voluntary Prepayments and Reduction of Commitments.

(a)Right to Prepay. The Borrower shall have the right at its option from time to time to prepay the Loans in whole or part without premium or penalty (except as provided in Sections 11.3, 3.1 and 3.5). Whenever the Borrower desires to prepay any part of the Loans, it shall provide a prepayment notice to the Administrative Agent by 11:00 a.m. at least (A) three (3) U.S. Government Securities Business Days prior to the date of prepayment of Term SOFR Rate Loans, (B) one (1) Business Day prior to the date of prepayment of Base Rate Loans or (C) no later than 1:00 p.m. on the date of prepayment of Swing Line Loans, in each case, setting forth the following information:

(i)prepayment is to be made; the date, which shall be a Business Day, on which the proposed

(ii)a statement indicating the application of the prepayment among Classes and Tranches of Loans and Borrowings, as applicable; and

(iii)the total principal amount of such prepayment, which shall not be less than the lesser of the following with respect to any Class of Loan: (A) the then outstanding principal amount of such Class of Loan, or (B) $1,000,000 (provided, that the amount of any prepayment to which this Section 2.12(a)(iii)(B) applies shall be in integral multiples of $1,000,000).

Except as otherwise expressly provided herein with respect to refinancings, all prepayment notices shall be irrevocable. The principal amount of the Loans for which a prepayment notice is given, together with interest on such principal amount, shall be due and payable on the date specified in such prepayment notice as the date on which the proposed prepayment is to be made. So long as no Event of Default has occurred and is continuing, voluntary prepayments shall be applied to any outstanding Term Loans, Revolving Loans and Delayed Draw Term Loans as the Borrower may direct; provided that all prepayments with respect to Term Loans permitted pursuant to this Section 2.12 shall be applied pro rata among all Tranches of Term Loans and, in each case, to the remaining scheduled installments of principal in direct order of maturity (meaning that the earliest maturity will be repaid first). If the Borrower prepays a Loan but the Borrower fails to specify the applicable Class and/or Borrowing that the Borrower intends to prepay or if an Event of Default has occurred and is continuing, then such prepayment shall be applied first, ratably to all outstanding Revolving Loans that are Base Rate Loans, second, ratably to all outstanding Revolving Loans that are Term SOFR Rate Loans, third, ratably to all outstanding Term Loans and Delayed Draw Term Loans that are Base Rate Loans, fourth, ratably to all outstanding Term Loans and Delayed Draw Term Loans that are Term SOFR Rate Loans. Any prepayment hereunder shall include all interest and fees due and payable with respect to the Loan being prepaid and shall be subject to the Borrower’s Obligation to indemnify the Lenders under Section 3.5. Notwithstanding the foregoing, any prepayment notice delivered in connection with any proposed refinancing of all of the Facilities may be, if expressly so stated in the applicable prepayment notice, contingent upon the consummation of such refinancing and (a) the prepayment date therefore may be amended from time to time by notice from the Borrower to the Administrative Agent and/or (y) such prepayment notice may be revoked by the Borrower in the event such refinancing is not consummated (provided, that the failure of such contingency shall not relieve the Borrower from its obligations in respect thereof under Section 3.5).

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(b)Reduction of Revolving Commitment and DDTL Commitment.

(i)In addition to the commitment reductions pursuant to Section 2.12(b)(iii) and 2.13(f), the Revolving Commitment shall be permanently reduced and terminated in full on the Maturity Date with respect to the Revolving Credit Facility. Any outstanding principal balance of the Revolving Loans not sooner due and payable will become due and payable on such Maturity Date and shall be accompanied by accrued interest on the amount repaid, any applicable fees pursuant to Section 3.5 and any other fees required hereunder.

(ii)In addition to the commitment reductions pursuant to Section 2.12(b)(iii) and 2.13(f), any unused portion of the DDTL Commitments with respect to any Tranche of Delayed Draw Term Loans shall be permanently reduced and terminated in full on the applicable DDTL Expiration Date for such Tranche. Any outstanding principal balance of the applicable Tranche of Delayed Draw Term Loans not sooner due and payable will become due and payable on the Maturity Date for such Tranche and shall be accompanied by accrued interest on the amount repaid, any applicable fees pursuant to Section 3.5 and any other fees required hereunder.

(iii)The Borrower shall have the right at any time after the Closing Date upon five (5) days’ prior written notice to the Administrative Agent to permanently reduce (ratably among the Revolving Lenders or the DDTL Lenders, as applicable, in proportion to their Pro Rata Shares) the Revolving Commitments and/or the DDTL Commitments with respect to any Tranche of Delayed Draw Term Loans, in a minimum amount of $1,000,000 and whole multiples of $1,000,000, or to terminate completely the Revolving Commitments and/or the applicable DDTL Commitments, without penalty or premium except as hereinafter set forth; provided that, with respect to any Revolving Commitments, any such reduction or termination shall be accompanied by prepayment of the Revolving Loans, together with outstanding Unused Revolving Commitment Fees, and the full amount of interest accrued on the principal sum to be prepaid (and all amounts referred to in Section 3.5 hereof) to the extent necessary to cause the aggregate outstanding principal amount of all Revolving Loans after giving effect to such prepayments to be equal to or less than the Revolving Commitments as so reduced or terminated; provided further that, with respect to any DDTL Commitments, any such reduction or termination shall be accompanied by the payment of any outstanding Unused Commitment Fee applicable to such DDTL Commitment. Any notice to reduce the Revolving Commitments or the DDTL Commitments under this Section 2.12(b)(iii) shall be irrevocable.

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2.13     Mandatory Prepayments.

(a)Over advance.

(i)If the outstanding principal amount of the Revolving Loans at any time exceeds the Revolving Commitments (each, a “Revolving Overadvance”), the Borrower shall prepay the Revolving Loans and Swing Line Loans in such amounts as shall be necessary so that the outstanding principal amount of the Revolving Loans does not exceed the Revolving Commitments.

(ii)If the aggregate amount of the Delayed Draw Term Loans at any time exceeds the DDTL Commitments (each, a “DDTL Overadvance”), the Borrower shall prepay the Delayed Draw Term Loans in such amounts as shall be necessary so that the Delayed Draw Term Loans do not exceed the DDTL Commitment.

(b)Disposition of Assets. Promptly upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds from any Disposition not expressly permitted by Section 7.8, the Borrower shall prepay, or cause such other Loan Party or Subsidiary to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Disposition. All such proceeds shall be paid and applied in accordance with Sections 2.13(f) and (g). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of the Disposition giving rise to such prepayment obligation.

(c)Casualty Events. Promptly upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds of any Casualty Event or series of related Casualty Events affecting any property of any Loan Party, the Borrower shall prepay, or cause such other Loan Party or Subsidiary thereof to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Casualty Event(s). All such proceeds shall be paid and applied in accordance with Sections 2.13(f) and (g). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of such Casualty Event(s) giving rise to such prepayment obligation.

(d)Equity Issuances. Promptly upon receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds from any Equity Issuance, other than Equity Issuances expressly permitted under Section 7.13(a), the Borrower shall prepay, or cause such other Loan Party or Subsidiary to prepay, Obligations in an aggregate amount equal to 100% of the Net Cash Proceeds of such Equity Issuance. All such proceeds shall be paid and applied in accordance with Sections 2.13(f) and (g). Notwithstanding anything herein to the contrary, no such mandatory prepayment shall constitute or be deemed to constitute a cure of any Default or Event of Default arising as a result of such Equity Issuance giving rise to such prepayment obligation.

(e)Debt Incurrence. Promptly upon the receipt by any Loan Party or Subsidiary thereof of the Net Cash Proceeds of any Debt Incurrence, other than a Debt Incurrence permitted under Section 7.1, the Borrower shall prepay, or cause such other Loan Party or Subsidiary thereof to prepay, Obligations in an amount equal to 100% of the amount of such Net Cash Proceeds. All such proceeds shall be paid and applied in accordance with Sections 2.13(f) and (g). Notwithstanding anything herein to the contrary, any such prepayment shall not constitute or be deemed to be a cure of any Default or Event of Default arising as a result of such Debt Incurrence.

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(f)Application Among Obligations.        All prepayments pursuant to this Section 2.13 shall be applied, first to prepay any Overadvances that may be outstanding, pro rata, second to prepay the Term Loans, the Delayed Draw Term Loans and Incremental Term Loans, pro rata (to be applied to installments of the Term Loans, the Delayed Draw Term Loans and Incremental Term Loans in inverse order of scheduled maturities) and third to prepay the Revolving Loans (including Swing Line Loans) with a corresponding reduction in the Revolving Commitments.

(g)Interest Payments; Application Among Interest Rate Options. All prepayments pursuant to this Section 2.13 shall be accompanied by accrued and unpaid interest upon the principal amount of each such prepayment. Subject to Section 2.13(f), all prepayments required pursuant to this Section 2.13 shall first be applied to Base Rate Loans and then to Term SOFR Rate Loans. In accordance with Section 3.5, the Borrower shall indemnify the Lenders for any loss or expense, including loss of margin, incurred with respect to any such prepayments applied against Term SOFR Rate Loans on any day other than the last day of the applicable Interest Period.

2.14     Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff, counterclaim or banker’s lien, by receipt of voluntary payment, by realization upon security, or by any other non-pro rata source or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or other obligations hereunder resulting in such Lender receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other such obligations greater than its pro-rata share of the amount such Lender is entitled hereunder, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other Obligations owing them, provided that:

(a)if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest other than interest or other amounts, if any, required by Law (including court order) to be paid by the Lender or the holder making such purchase; and

(b)the provisions of this Section 2.14 shall not be construed to apply to (x) any payment (including the application of funds arising from the existence of a Defaulting Lender) made by the Loan Parties pursuant to and in accordance with the express terms of the Loan Documents or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant, other than to the Borrower or any Subsidiary thereof (as to which the provisions of this Section 2.14 shall apply).

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Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against each Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Loan Party in the amount of such participation. This Section 2.14 shall not apply to any action taken by CoBank with respect to any CoBank Equities held by the Borrower or any cash patronage, whether on account of foreclosure of any Lien thereon, retirement and cancellation of the same, exercise of setoff rights or otherwise.

            2.15     Defaulting Lenders.

(a)Defaulting Lender Adjustments.        Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

(i)Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders.

(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article IX or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 9.2(c) shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Swing Line Lender hereunder; third, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fourth, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; fifth, to the payment of any amounts owing to the Lenders or the Swing Line Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender or the Swing Line Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; sixth, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and seventh, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made at a time when the conditions set forth in Section 4.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans and Swing Line Loans are held by the Lenders pro rata in accordance with the Commitments under the applicable Facility without giving effect to Section 2.15(a)(iv) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

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(iii)Certain Fees.

(A)No Defaulting Lender shall be entitled to receive any Unused Commitment Fee for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(B)With respect to any Unused Commitment Fee not required to be paid to any Defaulting Lender pursuant to clause (A) above, the Borrower shall (x) pay to each Non- Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in Swing Line Loans that have been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to the Swing Line Lender the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to the Swing Line Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

(iv)Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s participation in Swing Line Loans shall be reallocated among the Non- Defaulting Lenders in accordance with their respective Pro Rata Shares (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that (x) the conditions set forth in Section 4.2 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time), and (y) such reallocation does not cause any Non-Defaulting Lender’s Pro Rata Share of the Revolving Credit Facility Usage to exceed such Non-Defaulting Lender’s Revolving Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

(b)Defaulting Lender Cure. If the Borrower, Administrative Agent and the Seeing Line Lender agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein, that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and unfunded participations in Swing Line Loans to be held pro rata by the Lenders in accordance with the Commitments under the applicable Facility (without giving effect to Section 2.15(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

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(c)New Swing Line Loans. So long as any Lender is a Defaulting Lender, the Swing Line Lender shall not be required to fund any Swing Line Loans unless it is satisfied that it will have no Fronting Exposure after giving effect to such Swing Line Loan.

III.INCREASED COSTS; TAXES; ILLEGALITY; INDEMNITY

3.1   Increased Costs

(a)Increased Costs Generally. If any Change in Law shall:

(i)impose, modify or deem applicable any reserve (including pursuant to regulations issued from time to time by the Federal Reserve Board for determining the maximum reserve requirement (including any emergency, special, supplemental or other marginal reserve requirement) with respect to eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D)), special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender;

(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii)impose on any Lender any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or participation therein; and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any Loan or of maintaining its obligation to make any such Loan, or to increase the cost to such Lender or such other Recipient to reduce the amount of any sum received or receivable by such Lender or other Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or other Recipient, the Borrower will pay to such Lender or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.

(b)Capital Requirements. If any Lender determines that any Change in Law affecting such Lender or any lending office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made, or participations in Swing Line Loans held by, such Lender, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender, as the case may be, such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

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(c)Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in this Section 3.1 and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d)Delay in Requests.      Failure or delay on the part of any Lender to demand compensation pursuant to this Section 3.1 shall not constitute a waiver of such Lender’s right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender pursuant to this Section 3.1 for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that such Lender, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) month period referred to above shall be extended to include the period of retroactive effect thereof).

3.2   Taxes

(a)Payments Free of Taxes.         Any and all payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear of and without deduction or withholding for any Taxes, except as required by applicable Law. If any applicable Law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 3.2) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(b)Payment of Other Taxes by the Borrower. The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable Law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(c)Indemnification by the Borrower. The Loan Parties shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.2) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. Each of the Loan Parties shall, and does hereby agree to, jointly and severally indemnify the Administrative Agent, and shall make payment in respect thereof within ten (10) days after demand therefor, for any amount which a Lender for any reason fails to pay indefeasibly to the Administrative Agent as required pursuant to Section 3.2(e) below.

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(d)Indemnification by the Lenders.         Each Lender shall severally indemnify the Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the applicable Loan Party has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.7 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this clause (e).

(e)Evidence of Payments. As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 3.2, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(f)Status of Lenders.

(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 3.2(f)(ii)(A), (f)(ii)(B) and (f)(ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii)Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Borrower:

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(A)any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding Tax;

(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

(1)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(2)executed originals of IRS Form W-8ECI;

(3)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a Tax Compliance Certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, or (C) a “controlled foreign corporation” related to the Borrower as described in Section 881(c)(3)(C) of the Code and (y) executed copies of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable; or

(4)to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, a Tax Compliance Certificate, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a Tax Compliance Certificate on behalf of each such direct and indirect partner;

(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

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(D)if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(g)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.2 (including by the payment of additional amounts pursuant to this Section 3.2), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 3.2 with respect to the Taxes giving rise to such refund), net of all out- of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this clause (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this clause (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this clause (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This clause (g) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

           3.3    Illegality . If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable lending office to make, maintain or fund any Loans (other than Base Rate Loans) or to determine or charge interest based upon any Benchmark, then, upon notice thereof by such Lender to the Borrower (through the Administrative Agent), (a) any obligation of the Lenders to make such Loans, and any right of the Borrower to continue such Loans or to convert Base Rate Loans to such Loans, shall be suspended, and (b), if necessary to avoid such illegality, the interest rate on the Base Rate Loans shall be determined by the Administrative Agent without reference to clause (c) of the definition of “Alternate Base Rate”, in each case until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice,

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(i)the Borrower shall, if necessary to avoid such illegality, upon demand from any Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all such Loans to Base Rate Loans (if necessary to avoid such illegality, the interest rate on the Base Rate Loans of such Lender shall be determined by the Administrative Agent without reference to clause (c) of the definition of “Alternate Base Rate”),

(A)if such Loans are not subject to an Interest Period, immediately, or

(B)if such Loans are subject to an Interest Period, on the last day of the Interest Period therefor, if all affected Lenders may lawfully continue to maintain such Loans to such day, or immediately, if any Lender may not lawfully continue to maintain such Loans to such day, and

(ii)if necessary to avoid such illegality, the Administrative Agent shall during the period of such suspension compute the Alternate Base Rate without reference to clause (c) of the definition of “Alternate Base Rate,”

in each case until the Administrative Agent is advised in writing by each affected Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon such Benchmark. Upon any such prepayment or conversion, the Borrower shall also pay accrued and unpaid interest on the amount so prepaid or converted, together with any additional amounts required pursuant to Section 3.5.

3.4   Inability to Determine Rate; Cost; Interest After Default

(a)Inability to Determine Rate; Cost. Subject to Section 3.7, if, on or prior to the commencement of any Interest Period (or, in the case of any Benchmark that is not subject to an Interest Period, on any Business Day):

(i)the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that for any reason (other than a Benchmark Transition Event) any Benchmark cannot be determined pursuant to the definition thereof;

(ii)the Required Lenders determine that for any reason in connection with any request for a Loan that is subject to an Interest Period or a conversion thereto or a continuation thereof that the Benchmark for any requested Interest Period with respect to a proposed Loan does not adequately and fairly reflect the cost to such Lenders of making and maintaining such Loan, and the Required Lenders have provided notice of such determination to the Administrative Agent; or

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(iii)the Required Lenders determine that for any reason in connection with any request for a Loan that is not subject to an Interest Period (other than a Base Rate Loan) or a conversion thereto or a continuation thereof or the maintaining thereof that the Benchmark with respect to a proposed Loan or outstanding Loan does not adequately and fairly reflect the cost to such Lenders of making and maintaining such Loan, and the Required Lenders have provided notice of such determination to the Administrative Agent, then the Administrative Agent shall give notice thereof to the Borrower and the Lenders.

Upon notice thereof by the Administrative Agent to the Borrower:

(1) any obligation of the Lenders to make such Loans that are subject to an Interest Period, and any right of the Borrower to continue such Loans or to convert to such Loans, shall be suspended (to the extent of the affected Loans or affected Interest Periods) until the Administrative Agent (with respect to clause (ii), at the instruction of the Required Lenders) revokes such notice;

(2) any obligation of the Lenders to make or maintain such Loans that are not subject to an Interest Period (other than Base Rate Loans), and any right of the Borrower to continue such Loans or to convert to such Loans (other than Base Rate Loans), shall be suspended (to the extent of the affected Loans) until the Administrative Agent (with respect to clause (iii), at the instruction of the Required Lenders) revokes such notice;

(3) the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of such Loans (to the extent of the affected Loans or affected Interest Periods) or, failing that, the Borrower will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Loans in the amount specified therein;

(4) any outstanding affected Loans will be deemed to have been converted into Base Rate Loans at the end of the applicable Interest Period (or if such Loans are not subject to an Interest Period, immediately) and, upon any such conversion, the Borrower shall also pay accrued interest on the amount so converted, together with any additional amounts required pursuant to Section 3.5; and

(5) in the case of any such notice under Section 3.4(a)(i) regarding any Benchmark used as a component of the Alternate Base Rate, such component will not be used in any determination of Base Rate Loans until such notice is revoked.

(b)Default Rate. To the extent permitted by Law, immediately upon the occurrence and during the continuation of an Event of Default under clauses (a) or (l) of Section 9.1, or immediately after demand by the Required Lenders to the Administrative Agent upon the occurrence and during the continuation of any other Event of Default, then the principal amount of all Obligations shall bear interest at the Default Rate. The Borrower acknowledges and agrees that the increase in rates referred to in this Section 3.4(b) reflects, among other things, the fact that such Loans or other amounts have become a substantially greater risk given their default status and that the Lenders are entitled to additional compensation for such risk; and all such interest shall be payable by the Borrower upon demand by the Administrative Agent.

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3.5   Indemnity. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense attributable to or incurred by it as a result of:

(a)any continuation, conversion, payment or prepayment of any Loan that is subject to an Interest Period on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b)any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan subject to an Interest Period on the date or in the amount notified by the Borrower; or

(c)any assignment of a Loan subject to an Interest Period on a day other than the last day of the Interest Period therefor as a result of a request by the Borrower pursuant to Section 3.6; including any loss of anticipated profits and any loss, cost or expenses arising from the liquidation or reemployment of funds or from any fees payable. The Borrower shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

3.6   Mitigation Obligations; Replacement of Lenders.

(a)Designation of a Different Lending Office. If any Lender requests compensation under Section 3.1, or requires any Loan Party to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.2, then such Lender shall (at the request of the Borrower) use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.1 or Section 3.2, as the case may be, in the future, and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)Replacement of Lenders. If any Lender requests compensation under Section 3.1, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.2 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 3.6(a) above or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.7), all of its interests, rights (other than its existing rights to payments pursuant to Section 3.1 or 3.2) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

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(i)the Borrower shall have paid to the Administrative Agent the assignment fee (if any) specified in Section 11.7;

(ii)such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.5) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);

(iii)in the case of any such assignment resulting from a claim for compensation under Section 3.1 or payments required to be made pursuant to Section 3.2, such assignment will result in a reduction in such compensation or payments thereafter;

(iv)such assignment does not conflict with applicable Law;

(v)in the case of any assignment resulting from a Lender becoming a Non- Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent; and

(vi)a Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

3.7   Benchmark Replacement Setting.

Notwithstanding anything to the contrary herein or in any other Loan Document (and, for the avoidance of doubt, any Secured Bank Product or Hedge Agreement shall be deemed not to be a “Loan Document” for purposes of this Section 3.7).

(a)Replacing Benchmarks. Upon a date and time determined by the Administrative Agent as to any Benchmark which date shall be no later than the occurrence of a Benchmark Transition Event with respect to such Benchmark, the applicable Benchmark Replacement will replace the applicable then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any setting of such Benchmark at or after 3:00 p.m. on the fifth Business Day after the date notice of such Benchmark Replacement is provided to the affected Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from the Required Lenders. At any time that the administrator of the applicable then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such Benchmark has been announced by the regulatory supervisor for the administrator of such Benchmark pursuant to public statement or publication of information to be not representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored, the Borrower may revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that would bear interest by reference to such Benchmark until the Borrower’s receipt of notice from the Administrative Agent that a Benchmark Replacement has replaced such Benchmark, and, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to Base Rate Loans. During the period referenced in the foregoing sentence, the component of the Alternate Base Rate based upon such Benchmark (if any) will not be used in any determination of the Alternate Base Rate.

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(b)Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

(c)Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower and the Lenders of (i) the implementation of any Benchmark Replacement, and (ii) the effectiveness of any Benchmark Replacement Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. The Administrative Agent will notify the Borrower of the removal or reinstatement of any tenor of a Benchmark pursuant to Section 3.7(d). Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 3.7, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non- occurrence of an event, circumstance or date and any decision to take or refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party hereto or any other Loan Document, except, in each case, as expressly required pursuant to this Section 3.7.

(d)Unavailability of Tenor of Benchmark. At any time (including in connection with the implementation of a Benchmark Replacement), (i) if the applicable then-current Benchmark is a term rate (including the Term SOFR Rate), then the Administrative Agent may remove any tenor of such Benchmark that is unavailable or non-representative for Benchmark (including Benchmark Replacement) settings and (ii) the Administrative Agent may reinstate any such previously removed tenor for such Benchmark (including any applicable Benchmark Replacement) settings.

3.8   Survival. Each party’s obligations under this Article III shall survive the resignation of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

IV.CONDITIONS OF LENDING

The obligation of each Lender to make Loans hereunder is subject to the performance by each of the Loan Parties of its Obligations to be performed hereunder at or prior to the making of any such Loans and to the satisfaction of the following further conditions:

4.1   First Loans . The obligation of each Lender to make the Term A-1 Loan and any other Loans requested by the Borrower on the Closing Date are subject to the satisfaction of the following conditions on or before the Closing Date:

(a)Deliveries. The Administrative Agent shall have received each of the following in form and substance satisfactory to the Administrative Agent and, if applicable, its counsel:

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(i)a certificate of the Borrower signed by a Compliance Officer of the Borrower, dated as of the Closing Date stating that (a) all representations and warranties of the Loan Parties set forth in this Agreement or the other Loan Documents are true and correct in all material respects, except that such representations and warranties that are qualified in this Agreement or such other Loan Document by reference to materiality or a Material Adverse Change shall be true and correct in all respects, as of the Closing Date (or, if such representation or warranty makes reference to an earlier date, as of such earlier date), (b) the Loan Parties are in compliance with each of the covenants and conditions hereunder and the other Loan Documents, (c) no Event of Default or Default exists, (d) there has occurred no Material Adverse Change either (y) in the business, properties, assets, or condition (financial or otherwise) of the Loan Parties, taken as a whole or (z) in the facts and information regarding the Loan Parties as represented to the Administrative Agent and the Lenders up to the Closing Date, taken as a whole, (e) each of the Loan Parties has satisfied each of the closing conditions required to be satisfied by it hereunder and (f) a calculation, calculated on a pro forma basis, of the Leverage Ratio as of the last day of the fiscal quarter of the Borrower most recently ended prior to the Closing Date;

(ii)a certificate dated as of the Closing Date and signed by the Secretary or an Assistant Secretary of each of the Loan Parties, certifying as appropriate as to: (a) all action taken by each Loan Party in connection with this Agreement and the other Loan Documents; (b) the names of the Authorized Officers authorized to sign the Loan Documents and their true signatures; and (c) copies of its Organizational Documents as in effect on the Closing Date certified by the appropriate state official where such documents are filed in a state office (if so filed or required to be so filed) together with certificates from the appropriate state officials as to the continued existence and good standing or existence (as applicable) of each Loan Party in each state where organized or qualified to do business;

(iii)evidence that there is no action, suit, proceeding or investigation pending against, or threatened in writing against, any Loan Party or any of their respective properties, including the Licenses, in any court or before any arbitrator of any kind or before or by any other Governmental Authority (including the FCC and any applicable PUC) that would reasonably be expected to result in a Material Adverse Change;

(iv)this Agreement and each of the other Loan Documents signed by an Authorized Officer and all appropriate financing statements and appropriate stock powers and certificates evidencing the pledged Collateral and all other original items required to be delivered pursuant to any of the Collateral Documents;

(v)customary written opinions of counsel for the Loan Parties, duly executed (including any local, FCC or PUC counsel, if required by the Administrative Agent), dated as of the Closing Date;

(vi)evidence that adequate insurance required to be maintained under this Agreement is in full force and effect, with additional insured, mortgagee and lender loss payable special endorsements attached thereto naming the Administrative Agent as additional insured, mortgagee and lender loss payee, as applicable;

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(vii)a duly completed, executed Loan Request for Credit Extension for each Loan requested to be made on the Closing Date, including notice of election as to Interest Periods (if applicable);

(viii)a duly completed, executed Perfection and Diligence Certificate signed by an Authorized Officer of each of the Loan Parties;

(ix)a duly completed, executed Solvency Certificate signed by an Authorized Officer of the Borrower on behalf of itself and the Loan Parties;

(x)evidence that all material governmental and third-party consents, subordinations or waivers, as applicable, required to effectuate the transactions contemplated hereby have been obtained and are in full force and effect, including any required material permits and authorizations of all applicable Governmental Authorities, including the FCC and all applicable PUCs;

(xi)evidence that the Prior Credit Agreement, has been terminated, and all outstanding obligations thereunder have been paid in full and all Liens securing such obligations have been released or assigned to the Administrative Agent, as applicable;

(xii)a Lien search with respect to the Borrower and each other Loan Party, in scope satisfactory to the Administrative Agent and with results showing no Liens other than Permitted Liens and otherwise satisfactory to the Administrative Agent;

(xiii)to the extent requested by the Administrative Agent, true, correct and complete copies of all Material Agreements not already delivered pursuant to another clause of this Section 4.1;

(xiv)Collateral.

(A)evidence that the Loan Parties have effectively and validly pledged and perfected the Collateral contemplated by the Collateral Documents;

(B)evidence that all filings and recordings (including all fixture filings and transmitting utility filings) that are necessary to perfect the Prior Security Interest of the Administrative Agent, for the benefit of the Secured Parties, in the Collateral described in the Collateral Documents have been filed or recorded or will be filed for recording concurrently with the Loans to be made on the Closing Date, in each case, in all appropriate locations;

(xv)an executed letter from the Borrower with respect to any proceeds of the Loans being disbursed to third parties authorizing the Administrative Agent to distribute such proceeds on behalf of the Loan Parties in accordance with the instructions set forth in such letter;

(xvi)the audited, consolidated financial statements of the Borrower and its Subsidiaries for the fiscal year ending December 31, 2021 and such other financial statements, budgets, forecasts and other financial information as to the Loan Parties as the Administrative Agent or any other Lender may have required prior to the Closing Date;

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(xvii)at least five (5) Business Days prior to the Closing Date, (A) all documentation and other information reasonably requested by (or on behalf of) any Lender in order to comply with requirements of Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions and (B) if the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification;

(xviii)and

(xix)such other documents in connection with such transactions as the Administrative Agent or its counsel may reasonably request.

(b)Payment of Fees. The Borrower shall have paid all fees and expenses related to the Facilities and this Agreement and the other Loan Documents payable on or before the Closing Date as required by this Agreement, the Fee Letter or any other Loan Document.

4.2    Each Loan . At the time of any Credit Extension and after giving effect to the proposed Credit Extension: (a) (i) the representations and warranties of the Loan Parties set forth in Article V of this Agreement and in the other Loan Documents shall then be true and correct, except such representations and warranties that are not qualified by reference to materiality or a Material Adverse Change shall then be true and correct in all material respects as of such date (except for any such representation and warranty that by its terms is made only as of an earlier date, which representation and warranty shall remain true and correct in all material respects as of such earlier date), (ii) no Event of Default or Default shall have occurred and be continuing, and (iii) the Borrower shall have delivered a duly executed and completed Loan Request to the Administrative Agent for each Loan requested to be made pursuant to Sections 2.1(b), 2.1(e), 2.2(b), 2.3(b) and 2.4(b), as the case may be and (b) with respect to any Credit Extension consisting of Incremental Term Loans, the Borrower shall have complied with all conditions set forth in the applicable Incremental Term Loan Funding Agreement.

V.REPRESENTATIONS AND WARRANTIES

The Loan Parties, jointly and severally, represent and warrant to the Administrative Agent and each of the Lenders as follows:

5.1   Organization and Qualification. Each Loan Party and each Subsidiary of each Loan Party (a) is a corporation, partnership or limited liability company or other entity as identified on Schedule 5.1, in each case duly organized, validly existing and in good standing under the laws of its jurisdiction of organization specified on Schedule 5.1, (b) has the lawful power to own or lease its properties and to engage in the business it presently conducts or proposes to conduct, and (c) is duly licensed or qualified and in good standing in each jurisdiction listed on Schedule 5.1 and in all other jurisdictions where the property owned or leased by it or the nature of the business transacted by it or both makes such licensing or qualification necessary except where the failure to be so duly licensed or qualified could not reasonably be expected to result in a Material Adverse Change.

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5.2   Compliance With Laws.

(a)Each Loan Party and each Subsidiary of each Loan Party is in compliance with all applicable Laws in all jurisdictions in which any Loan Party or Subsidiary of any Loan Party is presently or currently foresees that it will be doing business except where the failure to do so could not reasonably be expected to result in a Material Adverse Change.

(b)No Credit Extension, or use of any proceeds thereof, or entry into or performance by any Loan Party of the Loan Documents to which it is a party contravenes any Law applicable to such Loan Party or any Subsidiary of any Loan Party or any of the Lenders.

5.3   Title to Properties. Each Loan Party and each Subsidiary of each Loan Party (a) has good and marketable title to or valid leasehold interest in all material properties, assets and other rights that it purports to own or lease or that are reflected as owned or leased on its books and records, and (b) owns or leases all of its properties free and clear of all Liens except Permitted Liens.

5.4   Investment Company Act. None of the Loan Parties or Subsidiaries of any Loan Party is an “investment company” registered or required to be registered under the Investment Company Act of 1940 or under the “control” of an “investment company” as such terms are defined in the Investment Company Act of 1940 and shall not become such an “investment company” or under such “control.”

5.5   Event of Default. No Event of Default or Default exists or is continuing.

5.6   Subsidiaries and Owners.

Schedule 5.6 states, (a) the name of each of the Borrower’s Subsidiaries, its jurisdiction of organization and the amount, percentage and type of Equity Interests in such Subsidiary (the “Subsidiary Equity Interests”), (b) the name of each holder of an Equity Interest in the Borrower, the amount, percentage and type of such Equity Interest (the “Borrower Equity Interests”), and (c) any options, warrants or other rights outstanding to purchase any such Equity Interests referred to in clause (a) or (b). The Borrower and each Subsidiary of the Borrower has good and marketable title to all of the Subsidiary Equity Interests it purports to own, free and clear in each case of any Lien and all such Subsidiary Equity Interests have been validly issued, fully paid and nonassessable (or, in the case of a partnership, limited liability company or similar Equity Interest, not subject to any capital call or other additional capital requirement). All of the Borrower’s Subsidiaries are Guarantors as of the Closing Date.

5.7   Power and Authority; Validity and Binding Effect.

(a)Each Loan Party has the full power to enter into, execute, deliver and carry out this Agreement and the other Loan Documents to which it is a party, to incur the Indebtedness contemplated by the Loan Documents and to perform its Obligations under the Loan Documents to which it is a party, and all such actions have been duly authorized by all necessary proceedings on its part.

(b)This Agreement and each of the other Loan Documents (i) has been duly and validly executed and delivered by each Loan Party, and (ii) constitutes, or will constitute, legal, valid and binding obligations of each Loan Party that is or will be a party thereto, enforceable against such Loan Party in accordance with its terms, subject only to limitations on enforceability imposed by (y) applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, and (z) general equitable principles.

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5.8   No Conflict; Material Agreements; Consents.

(a)Neither the execution and delivery of this Agreement or the other Loan Documents by any Loan Party nor the consummation of the transactions herein or therein contemplated or compliance with the terms and provisions hereof or thereof by any of them will conflict with, constitute a default under or result in any breach of (i) the terms and conditions of the Organizational Documents of any Loan Party, (ii) any Material Agreement to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or to which it is subject, or (iii) any applicable Law or any order, writ, judgment, injunction or decree to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries or any of its respective property is bound or to which it is subject, or result in the creation or enforcement of any Lien, charge or encumbrance whatsoever upon any property (now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other than Liens granted under the Loan Documents). There is no default by any Loan Party under any Material Agreement or order, writ, judgment, injunction or decree to which any Loan Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or to which it is subject. None of the Loan Parties or their Subsidiaries or their respective property is bound by any contractual obligation (including pursuant to any Material Agreement), or subject to any restriction in any of its Organizational Documents, or any requirement of Law that could reasonably be expected to result in a Material Adverse Change.

(b)No consent, approval, exemption, order or authorization of, registration or filing with, or notice to, any Governmental Authority or any other Person is required by any Law or any agreement (including any Material Agreement) in connection with (i) the execution, delivery and carrying out of this Agreement, the other Loan Documents, (ii) the grant by any Loan Party of the Liens granted by it pursuant to the Collateral Documents, (iii) the perfection of the Prior Security Interest of the Administrative Agent and the Secured Parties created under the Collateral Documents (other than the filing of UCC financing statements (including any transmitting utility financing statements), recording of the Mortgages, and filings with the United States Patent and Trademark Office or the United States Copyright Office), or (iv) the exercise by the Administrative Agent or any Lender of its rights under the Loan Documents or the remedies of any Secured Party in respect of the Collateral pursuant to the Collateral Documents (except approvals of the FCC or any applicable PUC with respect to any assignment or transfer of control of a License or Communications System), in each case except those which have been duly obtained on or before the Closing Date, taken, given or made and are in full force and effect. Each of the Loan Parties’ Material Agreements is in full force and effect, and no Loan Party has received any written notice of termination, revocation or other cancellation (before any scheduled date of termination) in respect thereof.

5.9   Litigation. There are no actions, suits, proceedings or investigations pending or threatened in writing against any Loan Party or any Subsidiary of any Loan Party or any of their respective properties, including the Licenses, at law or in equity before any Governmental Authority that individually or in the aggregate (i) could reasonably be expected to result in a Material Adverse Change or (ii) purports to affect the legality, validity or enforceability of any Loan Document. None of the Loan Parties or any Subsidiaries of any Loan Party is subject to or in violation of any order, judgement, writ, injunction or any decree of any Governmental Authority that could reasonably be expected to result in a Material Adverse Change.

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5.10   Financial Statements.

(a)Audited Financial Statements. The audited financial statements delivered on or before the Closing Date in accordance with Section 4.1(a) and thereafter most recently delivered in accordance with Section 6.1(b) (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present in all material respects the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all Material Indebtedness and other liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.

(b)Unaudited Financial Statements. The unaudited financial statements delivered on or before the Closing Date in accordance with Section 4.1(a) and thereafter most recently delivered by the Borrower in accordance with Section 6.1(a) (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present in all material respects the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments.

(c)Accuracy of Financial Statements.     Neither the Borrower nor any of its Subsidiaries has any liabilities, contingent or otherwise, or forward or long-term commitments that are not disclosed in the financial statements referred to in clauses (a) and (b) of this Section 5.10 or in the notes thereto, and except as disclosed therein there are no unrealized or anticipated losses from any commitments of the Borrower or any Subsidiary of the Borrower that could reasonably be expected to result in a Material Adverse Change.

(d)Material Adverse Change. Since December 31, 2021 no Material Adverse Change has occurred.

5.11   Margin Stock. None of the Loan Parties nor any Subsidiaries of any Loan Party engages or intends to engage principally, or as one of its important activities, in the business of extending credit for the purpose, immediately, incidentally or ultimately, of purchasing or carrying margin stock (within the meaning of Regulation U, T or X as promulgated by the Board). No part of the proceeds of any Loan has been or will be used, immediately, incidentally or ultimately, to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock or that is inconsistent with the provisions of the regulations of the Board. None of the Loan Parties nor any Subsidiary of any Loan Party holds or intends to hold margin stock in such amounts that more than 25% of the reasonable value of the assets of any Loan Party or Subsidiary of any Loan Party are or will be represented by margin stock.

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5.12   Full Disclosure.

(a)Neither this Agreement nor any other Loan Document, nor any certificate, statement, agreement or other documents furnished to the Administrative Agent or any Lender in connection herewith or therewith (other than projections and budgets), contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein and therein, in light of the circumstances under which they were made, not misleading. Any projections or budgets provided by or on behalf of the Loan Parties have been prepared by management in good faith and based on assumptions believed by management to be reasonable at the time the projections or budgets were prepared, it being understood that the projections or budgets as to future events are not to be viewed as fact and that actual results during the period or periods covered by the projections or budgets may differ materially from such projected results. There is no fact known to any Loan Party that materially and adversely affects the business, property, assets, financial condition or results of operations of the Loan Parties, taken as a whole, that has not been set forth in this Agreement or in the certificates, statements, agreements or other documents furnished in writing to the Administrative Agent and the Lenders prior to or at the date hereof in connection with the transactions contemplated hereby.

(b)As of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.

5.13   Taxes. All federal, state, and material local or other tax returns required to have been filed with respect to each Loan Party and each Subsidiary of each Loan Party have been filed, and payment or adequate provision has been made for the payment of all taxes, fees, assessments and other governmental charges that have or may become due pursuant to said returns or to assessments received, except for (i) any such taxes, assessments, charges and levies in an amount of less than $500,000 in the aggregate; and (ii) to the extent that such taxes, fees, assessments and other charges are being contested in good faith by appropriate proceedings diligently conducted and for which such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made.

5.14   Intellectual Property; Other Rights. Each Loan Party and each Subsidiary of each Loan Party owns or possesses all the material Intellectual Property and all service marks, trade names, domain names, licenses, registrations, franchises, permits and other rights necessary to own and operate its properties and to carry on its business as presently conducted and planned to be conducted by such Loan Party or Subsidiary, without known possible, alleged or actual conflict with the rights of others.

5.15   Liens in the Collateral. The Liens in the Collateral granted to the Administrative Agent for the benefit of the Secured Parties pursuant to the Collateral Documents constitute and will continue to constitute Prior Security Interests in and to the Collateral. All filing fees and other expenses in connection with the perfection of such Liens have been or will be paid by the Borrower.

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5.16    Insurance.

(a)The properties of each Loan Party and each of its Subsidiaries are insured pursuant to policies and other bonds that are valid and in full force and effect and that provide coverage satisfying or surpassing the requirements set forth in Section 6.5(a).

(b)Each Loan Party, to the extent required under the Flood Laws, has obtained flood insurance for such structures and contents constituting Collateral located in a flood hazard zone pursuant to policies that are valid and in full force and effect and which provide coverage meeting the requirements of Section 6.5(b).

5.17   Employee Benefits Compliance.

(a)Each Plan is in compliance with its terms and with the applicable provisions of ERISA, the Code and other federal or state Laws in all material respects. Each Plan that is intended to qualify under Section 401(a) of the Code has (i) received the most recently available favorable determination letter from the IRS, or (ii) an application for such a letter currently being processed by the IRS with respect thereto, or (iii) been adopted by means of a pre-approved plan document that has received the most recently available opinion letter from the IRS on which the plan sponsor is entitled to rely and, nothing has occurred that would prevent, or cause the loss of, such qualification. The Loan Parties and each ERISA Affiliate have satisfied all of their obligations and liabilities with respect to each Plan, and have made all required contributions to each Plan on or before the applicable due date, including contributions to any Pension Plan and any Multiemployer Plan that are required by the Plan Funding Rules or the collective bargaining agreement, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Pension Plan or Multiemployer Plan.

(b)There are no pending or, to the best knowledge of any Loan Party, threatened claims, actions or lawsuits, or action by any Governmental Authority, including any audit, investigation or enforcement action, with respect to any Plan. There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan except as could not reasonably be expected to result in liability to any Loan Party or an ERISA Affiliate in excess of the Threshold Amount.

(c)(i) Except as could not reasonably be expected to result in liability to any Loan Party or an ERISA Affiliate in excess of the Threshold Amount, no ERISA Event has occurred or is reasonably expected to occur; and (ii) no Unfunded Liability exists in excess of the Threshold Amount, taking into account only Pension Plans with positive Unfunded Liability.

(d)The Unfunded Liability of each Plan is reflected on the financial statements referenced in Section 5.10.

5.18   Environmental Matters.

(a)The facilities and properties currently owned or operated, or, to the knowledge of any Loan Party formerly owned leased or operated by any Loan Party or any Subsidiary of any Loan Party (the “Properties”) do not contain any Hazardous Materials attributable to the such Loan Party’s or Subsidiary’s ownership, lease or operation of the Properties in amounts or concentrations or stored or utilized which (i) constitute or constituted a violation of Environmental Laws, and (ii) could reasonably be expected to give rise to any Environmental Liability in excess of the Threshold Amount;

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(b)No Loan Party or Subsidiary of a Loan Party has received any written notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters or compliance with Environmental Laws (and no related claim, complaint, proceeding, investigation or inquiry is pending or, to the knowledge of any Loan Party or any Subsidiary of any Loan Party, is threatened or contemplated) with regard to their activities at any of the Properties or the business operated by the Loan Parties (the “Business”), or any prior Business for which any Loan Party or any Subsidiary of any Loan Party has retained liability under any Environmental Law in excess of the Threshold Amount;

(c)Hazardous Materials have not been transported or disposed of from the Properties in violation of, or in a manner or to a location which could reasonably be expected to give rise to any Environmental Liability in excess of the Threshold Amount for any Loan Parties or any Subsidiary of any Loan Party, nor have any Hazardous Materials been generated, treated, stored or disposed of by or on behalf of any Loan Party or any Subsidiary of any Loan Party at, on or under any of the Properties in violation of Environmental Laws that could reasonably be expected to result in a Material Adverse Change, or in a manner that could reasonably be expected to give rise to, Environmental Liability in excess of the Threshold Amount;

(d)No Loan Party or Subsidiary of any Loan Party knows of any basis for any permit, license or other approval required under any Environmental Law with regard to their activities at any of the Properties or the Business to be revoked, canceled, limited, terminated, modified, appealed or otherwise challenged and that could reasonably be expected to result in a Material Adverse Change; and

(e)No Loan Party or Subsidiary of a Loan Party knows or any facts, events or circumstances that could give rise to any basis for any Environmental Liability in excess of the Threshold Amount of any Loan Party or any Subsidiary of any Loan Party.

5.19   Communications Regulatory Matters.

(a)As of the Closing Date, Schedule 5.19 sets forth a true and complete list of the following information for each License issued to or utilized by the Loan Parties or their respective Subsidiaries: the granting authority, the name of the licensee, the type of service, the expiration date and the geographic area covered by such License. Other than as set forth in Schedule 5.19, each License is held by a Loan Party or a wholly-owned, Domestic Subsidiary of a Loan Party whose Equity Interests are subject to a Prior Security Interest in favor of the Administrative Agent, on behalf of itself and the other Secured Parties, pursuant to the Security Agreement.

(b)The Licenses are valid and in full force and effect without adverse conditions, except for such conditions as are generally applicable to holders of such Licenses. Each Loan Party or Subsidiary of a Loan Party has all requisite power and authority required under the Communications Act and PUC Laws to hold the Licenses and to own and operate the Communications Systems. The Licenses constitute in all material respects all of the Licenses necessary for the operation of the Communications Systems in the same manner as it is presently conducted. No event has occurred and is continuing which could reasonably be expected to (i) result in the suspension, revocation, or termination of any such License or (ii) materially and adversely affect any rights of the Loan Parties or their respective Subsidiaries thereunder. Neither the Loan Parties nor any of their Subsidiaries have actual knowledge that any License will not be renewed in the ordinary course. Neither the Loan Parties nor any of their respective Subsidiaries are a party to any investigation, notice of apparent liability, notice of violation, order or complaint issued by or before the FCC, PUC or any applicable Governmental Authority with respect to a License, and there are no proceedings pending by or before the FCC, PUC or any applicable Governmental Authority which would reasonably be expected to adversely affect the validity of any License.

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(c)All of the material properties, equipment and systems owned, leased, subleased or managed by the Loan Parties or their respective Subsidiaries are, and (to the best knowledge of the Loan Parties and their Subsidiaries) all such property, equipment and systems to be acquired or added in connection with any contemplated system expansion or construction will be, in good repair, working order and condition (reasonable wear and tear excepted) and are and will be in compliance in all material respects with all terms and conditions of the Licenses, all Laws and all standards or rules imposed by any Governmental Authority or as imposed under any agreements with telecommunications companies and customers.

(d)Each of the Loan Parties and their respective Subsidiaries has made all material filings which are required to be filed by it, paid all material franchise, license, regulatory assessments or other fees and charges related to the Licenses or which are required to be paid or have become due pursuant to any authorization, consent, approval or license of, or registration or filing with, any Governmental Authority in respect of its business or which is otherwise required for the construction and operation of any Communication System and has made appropriate provision as is required by GAAP for any such fees and charges which have accrued. All such filings are complete and accurate in all material respects.

(e)Each of the Loan Parties and their respective Subsidiaries has complied in all material respects with all requirements, rules, restrictions, and other terms and conditions required to be complied with respect to any Funding Program or associated with the receipt and use of funding from any Funding Agency. To each Loan Party’s knowledge, there are no pending audits or investigations by any Governmental Authority or Funding Agency threatened in writing regarding the Loan Parties’ use of, or entitlement to, any funding received from any Funding Program.

5.20   Solvency.  Before and after giving effect to any Credit Extension hereunder, each of the Loan Parties, taken as a whole, are Solvent.

5.21   Qualified ECP Guarantor.

Each Loan Party is a Qualified ECP Guarantor.

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5.22   Transactions with Affiliates.

No Affiliate and no officer or director of any Loan Party or any of its Subsidiaries owns any beneficial interest, is a party to any agreement, contract, commitment or transaction with Loan Parties or has any material interest in any material property used by Loan Parties, except as permitted by Section 7.3.

5.23   Labor Matters.

There are no strikes, lockouts or slowdowns against any Loan Party or any Subsidiary of any Loan Party pending or, to the knowledge of any Loan Party, threatened except as could not reasonably be expected to result in a Material Adverse Change. The hours worked by and payments made to employees of the Loan Parties and their respective Subsidiaries within the past five (5) years have not been in violation of the Fair Labor Standards Act or any other applicable Federal, state, local or foreign law dealing with such matters, except as could not reasonably be expected to result in a Material Adverse Change. The execution, delivery and performance of the Loan Documents will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Loan Party or any Subsidiary of any Loan Party is bound.

5.24   Anti-Corruption; Anti-Terrorism and Sanctions.

(a)Each of the Loan Parties and their respective Subsidiaries, Affiliates, and to the knowledge of Borrower, their officers, directors, employees and agents are in compliance, in all respects, with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions.

(b)The Borrower has implemented and maintains in effect policies and procedures designed to ensure compliance by the Loan Parties and their respective Subsidiaries, Affiliates, officers, directors, employees and agents with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions.

(c)None of the Loan Parties or their respective Subsidiaries, Affiliates, and to the knowledge of Borrower, their officers, directors, employees or agents are Sanctioned Persons or have engaged in, or are now engaged in, or will engage in, any dealings or transactions with any Sanctioned Person.

(d)No Credit Extension, use of proceeds or other transaction contemplated by this Agreement will violate any applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws or (iii) Sanctions.

(e)The Loan Parties have provided to the Administrative Agent and the Lenders all information requested by the Administrative Agent and the Lenders regarding the Loan Parties and their respective Subsidiaries, Affiliates, officers, directors, employees and agents that is necessary for the Administrative Agent and the Lenders to collect to comply with applicable Anti-Corruption Laws, Anti- Terrorism Laws, Sanctions and other Laws.

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5.25   Borrower’s Status as a Holding Company.

Borrower does not own any assets other than the Equity Interests in the Loan Parties and does not conduct, transact or engage in any business or operations other than those incidental to its direct ownership of the Loan Parties.

VI.AFFIRMATIVE COVENANTS

The Loan Parties, jointly and severally, covenant and agree that until Payment In Full of the Secured Obligations, the Loan Parties shall comply at all times with the following covenants:

6.1   Reporting Requirements. The Loan Parties will furnish or cause to be furnished to the Administrative Agent and each of the Lenders:

(a)Quarterly Financial Statements. As soon as available and in any event within sixty (60) calendar days after the end of each of the first three fiscal quarters in each fiscal year, financial statements of the Borrower, consisting of a consolidated balance sheet as of the end of such fiscal quarter and related consolidated statements of income, stockholders or members equity and cash flows for the fiscal quarter then ended and the fiscal year through that date, all in reasonable detail and certified by a Compliance Officer of the Borrower as having been prepared in accordance with GAAP (subject to normal year-end audit adjustments), consistently applied, and setting forth in comparative form the respective financial statements for the corresponding date and period in the previous fiscal year.

(b)Annual Financial Statements. As soon as available and in any event within one hundred twenty (120) days after the end of each fiscal year of the Borrower, audited financial statements of the Borrower consisting of a consolidated balance sheet as of the end of such fiscal year, and related consolidated statements of income, stockholders’ equity and cash flows for the fiscal year then ended, all in reasonable detail and setting forth in comparative form the financial statements as of the end of and for the preceding fiscal year, including a comparison of actual performance to the Budget for such fiscal year and year-to-date delivered to the Administrative Agent pursuant to Section 6.1(d)(i), and certified by independent certified public accountants of nationally recognized standing satisfactory to the Administrative Agent. The certificate or report of accountants shall be free of qualifications (other than any consistency qualification that may result from a change in the method used to prepare the financial statements as to which such accountants concur).

(c)Compliance Certificate. Concurrently with the financial statements of the Borrower furnished to the Administrative Agent and to the Lenders pursuant to Sections 6.1(a) and (b), a Compliance Certificate duly executed by a Compliance Officer of the Borrower.

(d)Other Reports.

(i)Annual Budget. The annual consolidated Budget, to be supplied not later than sixty (60) days after the first day of each fiscal year of the Borrower;

(ii)Accountants’ Reports. Promptly upon their becoming available to the Borrower, any reports, including management letters submitted, to the Borrower by independent accountants in connection with any annual, interim or special audit;

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(iii)[Reserved].

(iv)Benefit Plan Documentation. Promptly upon request by any Lender, each Loan Party will deliver to the Lender (A) all reports, forms and other documents required to be or otherwise prepared or filed in respect of any Plan pursuant to the Code, ERISA and other applicable Law; (B) all actuarial reports prepared in respect of any Pension Plan or Multiemployer Plan that are available to the Loan Party or that may be made available to the Loan Party upon request; and (C) any documentation regarding withdrawal liability under or the funding status with respect to any Multiemployer Plan.

(e)Notices.

(i)Default. Promptly after any officer of any Loan Party has learned of the occurrence of an Event of Default or Default, a certificate signed by an Authorized Officer setting forth the details of such Event of Default or Default and the action that such Loan Party proposes to take with respect thereto.

(ii)Regulatory and Other Notices. Promptly after filing, receiving or becoming aware thereof, the Loan Parties will deliver or cause to be delivered copies of any filings or communications sent to, or notices and other communications received by, any Loan Party or any of its respective Subsidiaries from any Governmental Authority, including the FCC and any PUC, relating to any noncompliance by any Loan Party or any of its Subsidiaries with any applicable Law, including the Communications Act and any applicable PUC Law, or with respect to any matter or proceeding, in each case, the effect of which could reasonably be expected to result in a Material Adverse Change.

(iii)Litigation. Promptly after the commencement thereof, notice of all actions, suits, proceedings or investigations before or by any Governmental Authority or any other Person against any Loan Party or Subsidiary of any Loan Party that relate to the Collateral or that could reasonably be expected to result in a Material Adverse Change.

(iv)Organizational Documents.    Within the time limits set forth in Section 7.14, any amendment to the Organizational Documents of any Loan Party or any Subsidiary of any Loan Party which is material or otherwise adverse to the interests of the Lenders.

(v)Material Agreements. Promptly after becoming aware thereof, notice of any material amendment, supplement, waiver or other modification to any of the Material Agreements, or any notice of default or of termination, cancellation or revocation (in each case, prior to any scheduled date of termination) delivered thereunder.

(vi)Erroneous Financial Information. Notice, promptly in the event that the Borrower or its accountants conclude or advise that any previously issued financial statement, audit report or interim review should no longer be relied upon or that disclosure should be made or action should be taken to prevent future reliance.

(vii)ERISA Event. Promptly upon the occurrence of any ERISA Event or Plan Qualification Event or any event reasonably expected to result in an ERISA Event or Plan Qualification Event, notice of such occurrence or event.

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(viii)Material Adverse Change. Promptly after becoming aware thereof, the Borrower will give notice of any change in events or changes in facts or circumstances affecting any Loan Party or any of their respective Subsidiaries which individually or in the aggregate have resulted in or could reasonably be expected to result in a Material Adverse Change.

(ix)Environmental Notices. Promptly after becoming aware of any material violation by any Loan Party or any of its respective Subsidiaries of Environmental Laws or promptly upon receipt of any notice that a Governmental Authority or other Person has asserted that any Loan Party or any of its respective Subsidiaries is not in compliance with Environmental Laws or that its compliance is being investigated, and, in either case, the same would reasonably be expected to result in a Material Adverse Change, the Borrower will give notice thereof and provide such other information as may be reasonably available to any Loan Party or any of its respective Subsidiaries to enable the Administrative Agent and the Lenders to reasonably evaluate such matter.

(x)SEC Reports; Shareholder Communications. Reports, including Forms 10-K, 10-Q and 8-K, registration statements and prospectuses and other shareholder communications, filed by the Borrower with the Securities and Exchange Commission.

(f)Beneficial Ownership Certificate. Promptly after the occurrence thereof, a notice of any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in such certification.

(g)Other Information.      Such other reports and information as the Administrative Agent may from time to time reasonably request.

6.2   Preservation of Existence, Etc.  Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain (a) its legal existence as a corporation, limited partnership or limited liability company or other entity, as the case may be as of the Closing Date or the date of formation or acquisition thereof and its license or qualification and good standing in each jurisdiction in which its ownership or lease of property or the nature of its business makes such license or qualification necessary, except as otherwise expressly permitted in Section 7.7, and (b) all licenses, franchises, permits and other authorizations (including all Licenses) and Intellectual Property, the loss, revocation, termination, suspension or adverse modification of which could reasonably be expected to result in a Material Adverse Change.

6.3   Preservation of Licenses. Each Loan Party shall, and shall cause each of its Subsidiaries to, at all times preserve, renew and keep in full force and effect all Licenses, except for immaterial Licenses and Licenses which are no longer required in the conduct of such Loan Party’s or Subsidiary’s business and which cannot be sold or which have de minimis fair market value.

6.4   Payment of Liabilities, Including Taxes, Etc. Each Loan Party shall, and shall cause each of its Subsidiaries to, duly pay and discharge all material indebtedness and other liabilities (including all lawful claims that, if unpaid, would by Law become a Lien on the assets of any Loan Party) to which it is subject or that are asserted against it, promptly as and when the same shall become due and payable, including all taxes, assessments and governmental charges upon it or any of its properties, assets, income or profits, prior to the date on which penalties attach thereto, except to the extent that such liabilities, including taxes, assessments or governmental charges, are being contested in good faith and by appropriate and lawful proceedings diligently conducted and for which such reserve or other appropriate provisions, if any, as shall be required by GAAP shall have been made.

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6.5   Maintenance of Insurance.

(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, insure its properties and assets against loss or damage by fire and such other insurable hazards as such assets are commonly insured (including fire, extended coverage, property damage, workers’ compensation, public liability and business interruption insurance) and against other risks (including errors and omissions) in such amounts as similar properties and assets are insured by prudent companies in similar circumstances carrying on similar businesses, and with reputable and financially sound insurers, including self-insurance to the extent customary, all as reasonably determined by the Administrative Agent. Such insurance policies (other than workers’ compensation and business interruption insurance) shall contain additional insured, mortgagee and lender loss payable special endorsements in form and substance satisfactory to the Administrative Agent naming the Administrative Agent as additional insured, mortgagee and lender loss payee, as applicable, and providing the Administrative Agent with notice of cancellation acceptable to the Administrative Agent.

(b)Each Loan Party shall, to the extent required under the Flood Laws, obtain and maintain flood insurance for such structures and contents constituting Collateral located in a flood hazard zone, in such amounts as similar structures and contents are insured by prudent companies in similar circumstances carrying on similar businesses and otherwise satisfactory to the Administrative Agent (but, in any event, providing all flood insurance required by applicable Law).

(c)Each Loan Party shall deliver evidence of the insurance policies and endorsements described above to the Administrative Agent on or prior to the Closing Date. Not less than fifteen (15) days (or such later date as the Administrative Agent shall agree to in its reasonable discretion) prior to the expiration date of the insurance policies required to be maintained by any Loan Party or its Subsidiaries pursuant to the terms hereof, the Borrower will deliver to the Administrative Agent one or more certificates of insurance and endorsements evidencing renewal of the insurance coverage required hereunder plus such other evidence of payment of premiums therefor as Administrative Agent may reasonably request.

(d)If any Loan Party fails to, or fails to cause any of its Subsidiaries to, obtain and maintain any of the policies of insurance required to be maintained pursuant to the provisions of this Section 6.5 or to pay any premium in whole or in part, the Administrative Agent may, without waiving or releasing any obligation or Default or Event of Default, at the Loan Parties’ expense, but without any obligation to do so, procure such policies or pay such premiums. All sums so disbursed by the Administrative Agent, including any reasonable and documented out-of-pocket expenses incurred by the Administrative Agent and reasonable fees, charges and disbursements of counsel for the Administrative Agent, shall be payable by the Loan Parties to the Administrative Agent on demand and shall be additional Obligations hereunder and under the other Loan Documents, secured by the Collateral.

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6.6   Maintenance of Properties and Leases . Each Loan Party shall, and shall cause each of its Subsidiaries to (a) maintain, preserve and protect all of its properties and equipment necessary in the operation of its business in good working order and condition except to the extent the failure to do so could not reasonably be expected to have a material adverse impact on the operations or business of any Loan Party, ordinary wear and tear and casualty and condemnation excepted; (b) make all necessary repairs thereto and renewals and replacements thereof; and (c) use the standard of care typical in the industry in the operation and maintenance of its facilities.

6.7   Visitation Rights . Each Loan Party shall, and shall cause each of its Subsidiaries to, at permit any of the officers or authorized employees or representatives of the Administrative Agent or any of the Lenders to visit and inspect during normal business hours any of its properties and to examine and make excerpts from its books and records (other than books and records that are protected by attorney- client privilege or the disclosure of which would violate applicable laws) and discuss its business affairs, finances and accounts with its officers and to conduct reviews of each Loan Party’s Collateral (such reviews to occur not more frequently than annually, absent an Event of Default), all in such detail and at such times and as often as the Required Lenders or the Administrative Agent may reasonably request, all at the Borrower’s expense, provided that prior to the occurrence of an Event of Default the Administrative Agent shall provide the Borrower with reasonable notice prior to any visit or inspection. Prior to occurrence of an Event of Default, the Administrative Agent shall not, without cause, as determined by the Administrative Agent in its reasonable judgment, request reimbursement from the Borrower for more than one (1) such visitation/inspection and Collateral audit in any calendar year.

6.8   Keeping of Records and Books of Account . The Loan Parties shall, and shall cause each Subsidiary of the Borrower to, maintain and keep proper books of record and account that enable the Borrower and its Subsidiaries to issue financial statements in accordance with GAAP and as otherwise required by applicable Laws of any Governmental Authority having jurisdiction over the Borrower or any Subsidiary of the Borrower, and in which full, true and correct entries shall be made in all material respects of all its dealings and business and financial affairs.

6.9   Compliance with Laws.

(a)Each Loan Party shall, and shall cause each of its Subsidiaries to, comply with all other applicable Laws, except where failure to comply with any applicable Law would not result in fines, penalties, remediation costs, other similar liabilities or injunctive relief that, in the aggregate, could reasonably be expected to result in a Material Adverse Change.

(b)Each of the Loan Parties shall, and shall cause each of its Subsidiaries, officers, directors, and employees to, comply with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions. The Borrower shall implement and maintain in effect policies and procedures designed to ensure compliance by the Loan Parties and their respective Subsidiaries, Affiliates, officers, directors, employees and agents with all applicable (i) Anti-Corruption Laws, (ii) Anti-Terrorism Laws and (iii) Sanctions.

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(c)Each of the Loan Parties shall, and shall cause each of its Subsidiaries (i) conduct its operations and keep and maintain its real property in compliance in all material respects with all Environmental Laws and environmental permits; (ii) obtain and renew all material environmental permits necessary for its operations and properties; and (iii) implement any and all investigation, remediation, removal and response actions that are necessary to maintain the value and marketability of the real property or to otherwise comply in all material respects with Environmental Laws pertaining to any of its real property (provided, however, that neither a Loan Party nor any of its Subsidiaries shall be required to undertake any such investigation, remediation, removal, response or other action to the extent that its obligation to do so is being contested in good faith and by proper proceedings and adequate reserves have been set aside and are being maintained by the Loan Parties with respect to such circumstances in accordance with GAAP).

6.10   Further Assurances.

(a)Generally. Each Loan Party shall, from time to time, at its expense, preserve and protect the Administrative Agent’s Lien on and Prior Security Interest in the Collateral and all other real and personal property of the Loan Parties whether now owned or hereafter acquired as a continuing Prior Security Interest therein, and shall do or make, or cause each of its Subsidiaries to do or make, such other acts, deliveries and things as the Administrative Agent in its reasonable discretion may deem necessary or advisable from time to time in order to consummate the transactions contemplated hereby, preserve, perfect and protect the Liens granted or purported to be granted under the Loan Documents and to exercise and enforce its rights and remedies thereunder with respect to the Collateral.

(b)Additional Subsidiaries. In furtherance, and not in limitation, of Section 6.10(a), promptly upon (and in any event within thirty (30) days after (or such later date as the Administrative Agent shall agree to in its sole discretion)) the creation or acquisition of any direct or indirect wholly-owned Subsidiary by any Loan Party, each such new wholly-owned Subsidiary and the Loan Parties will execute and deliver to the Administrative Agent a duly executed Guarantor Joinder in accordance with Section 12.12, pursuant to which (i) such new wholly-owned Subsidiary (unless it is not a Domestic Subsidiary) shall become a party hereto as a Guarantor and shall become a party to the Security Agreement as a Grantor (as defined therein), and (ii) the Equity Interests of such new wholly-owned Subsidiary shall be pledged by the applicable Loan Party to the extent provided in the Collateral Documents. Upon the creation or acquisition of any direct or indirect Subsidiary by any Loan Party that is not a wholly-owned Subsidiary, the Equity Interests of such new Subsidiary shall be pledged by the applicable Loan Party to the extent provided in the Collateral Documents. As promptly as reasonably possible, the Loan Parties and their respective Subsidiaries will deliver all certificates evidencing such Equity Interests, together with undated, executed transfer powers, and such other Collateral Documents and such other documents, certificates and opinions (including opinions of local counsel in the jurisdiction of organization of each such new Subsidiary) regarding such new Subsidiary, in form, content and scope reasonably satisfactory to the Administrative Agent, as the Administrative Agent may reasonably request in connection therewith and will take such other action as the Administrative Agent may reasonably request to create in favor of the Administrative Agent a Prior Security Interest in the Collateral, to the extent provided in the Collateral Documents, for the Secured Obligations.

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(c)Real Property. In furtherance, and not in limitation, of Sections 6.10(a) and 6.10(b), the Loan Parties shall (i) within ten (10) days after the acquisition of any Material Owned Property by any Loan Party that is not subject to an existing mortgage or deed of trust in favor of the Administrative Agent, for the benefit of the Secured Parties, notify the Administrative Agent and (ii) if requested by the Administrative Agent, within sixty (60) days of such acquisition (as such time period may be extended by the Administrative Agent, in its sole discretion), deliver such Mortgages, title insurance, flood and other insurance, environmental reports and other documents, instruments or agreements requested by the Administrative Agent in connection with granting and perfecting a Prior Security Interest, on such real property in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, all in form and substance acceptable to the Administrative Agent.

(d)Other Property. Pursuant to the terms of this Section 6.10 and of the Security Agreement, the Loan Parties will (i) promptly (and in any event on or before the earlier of (x) if applicable, the time required by Section 6.10(b) or (y) the Borrower’s next submission of a Compliance Certificate) notify the Administrative Agent of (A) any Equity Interest, (B) any federally registered Copyrights, Patents, and Trademarks (each as defined in the Security Agreement) which are material to the continued operation of any Loan Party’s business, (C) any commercial tort claim known to any Loan Party (such that an officer of any Loan Party has actual knowledge of the existence of a tort cause of action and not merely of the existence of the facts giving rise to such cause of action) that such Loan Party knows to involve an amount in controversy in the aggregate with any other known commercial tort claim of any Loan Party (in excess of the Threshold Amount), (D) any Material Agreements, and (E) any Material Account, in each case, owned, acquired, leased or opened by any Loan Party or any of its Subsidiaries, in each case, of which notice has not previously been given to the Administrative Agent, and (ii) on or before the earlier of (x) if applicable, the time required by Section 6.10(b) or (y) the Borrower’s next submission of a Compliance Certificate in connection with the financial statements required to be delivered pursuant to Section 6.1(b), deliver updated Annexes to the Security Agreement.

The Administrative Agent may elect not to request any documents, instruments, filings or opinions as contemplated by this Section 6.10 or the Security Agreement and the other Loan Documents if it determines in its sole discretion that the costs to the Loan Parties of perfecting a security interest or Lien in such property exceed the relative benefit of such security interest to the Secured Parties.

6.11   CoBank Equity and Securities.

(a)So long as CoBank (or its affiliates) is a Lender hereunder, the Borrower shall maintain its status as an entity eligible to borrow from CoBank (or its affiliates) and (b) acquire equity in CoBank in such amounts and at such times as CoBank may require in accordance with CoBank’s Bylaws and Capital Plan (as each may be amended from time to time), except that the maximum amount of equity that the Borrower may be required to purchase in CoBank in connection with the Loans made by CoBank (or its affiliates) may not exceed the maximum amount permitted by the Bylaws and the Capital Plan at the time this Agreement is entered into. The Borrower acknowledges receipt of a copy of (i) CoBank’s most recent annual report, and if more recent, CoBank’s latest quarterly report, (ii) CoBank’s Notice to Prospective Stockholders and (iii) CoBank’s Bylaws and Capital Plan, which describe the nature of all of the CoBank Equities as well as capitalization requirements, and agrees to be bound by the terms thereof.

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(b)Each party hereto acknowledges that CoBank’s Bylaws and Capital Plan (as each may be amended from time to time) shall govern (i) the rights and obligations of the parties with respect to the CoBank Equities and any patronage refunds or other distributions made on account thereof or on account of the Borrower’s patronage with CoBank, (ii) the Borrower’s eligibility for patronage distributions from CoBank (in the form of CoBank Equities and cash) and (iii) patronage distributions, if any, in the event of a sale of a participation interest. CoBank reserves the right to assign or sell participations in all or any part of its (or its affiliate’s) Commitments or outstanding Loans hereunder on a non-patronage basis.

(c)Notwithstanding anything herein or in any other Loan Document to the contrary, each party hereto acknowledges that: (i) CoBank has a statutory first Lien pursuant to the Farm Credit Act of 1971 (as amended from time to time) on all CoBank Equities that the Borrower may now own or hereafter acquire, which statutory Lien shall be for CoBank’s (or its affiliate’s) sole and exclusive benefit; (i) during the existence of any Event of Default, CoBank may at its sole discretion, but shall not be required to, foreclose on its statutory first Lien on the CoBank Equities and/or set off the value thereof or of any cash patronage against the Secured Obligations; (iii) during the existence of any Event of Default, CoBank may at its sole discretion, but shall not be required to, without notice except as required by applicable Law, retire and cancel all or part of the CoBank Equities owned by or allocated to the Borrower in accordance with the Farm Credit Act of 1971 (as amended from time to time) and any regulations promulgated pursuant thereto in total or partial liquidation of the Secured Obligations for such value as may be required pursuant applicable Law and CoBank’s Bylaws and Capital Plan (as each may be amended from time to time); (iv) the CoBank Equities shall not constitute security for the Secured Obligations due to the Administrative Agent, any other Lender or any other Secured Party; (v) to the extent that any of the Loan Documents create a Lien on the CoBank Equities, such Lien shall be for CoBank’s (or its affiliate’s) sole and exclusive benefit and shall not be subject to pro rata sharing hereunder; (vi) any setoff effectuated pursuant to the preceding clauses (ii) or (iii) may be undertaken whether or not the Secured Obligations are currently due and payable; and (vii) CoBank shall have no obligation to retire the CoBank Equities upon any Event of Default, Default or any other default by the Borrower or any other Loan Party, or at any other time, either for application to the Obligations or otherwise. The Borrower acknowledges that any corresponding tax liability associated with CoBank’s application of the value of the CoBank Equities to any portion of the Obligations is the sole responsibility of the Borrower.

6.12   Use of Proceeds. The proceeds of (a) the Term A-1 Loans shall be used to refinance the existing credit facility under the Existing Loan Documents provided to the Borrower, (b) Revolving Loans and Swing Line Loans shall be used to fund Permitted Acquisitions (including the payment of certain fees and expenses incurred in connection therewith), to finance Capital Expenditures of the Borrower and its Subsidiaries and for general corporate purposes of the Borrower and its Subsidiaries not in contravention of any Laws, including the payment of certain fees and expenses incurred in connection with the this Agreement, (c) the Delayed Draw Term Loans shall be used finance Capital Expenditures of the Borrower and its Subsidiaries and for general corporate purposes of the Borrower and its Subsidiaries not in contravention of any Laws, and (d) any Tranche of Incremental Term Loans shall be used as specified in the applicable Incremental Term Loan Funding Agreement. The Loan Parties will use the proceeds of the Loans only in accordance with Sections 5.11 and 5.24 and as permitted by applicable Law.

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6.13   Updates to Schedules and Annexes . Should any of the information or disclosures provided on any of the Schedules referred to in this Agreement and attached hereto or any Annex to the Security Agreement become outdated or incorrect in any material respect, the Borrower shall promptly provide the Administrative Agent in writing with such revisions or updates to such Schedule or such Annex as may be necessary or appropriate to update or correct same. No such Schedule or Annex, whether delivered pursuant to this Section 6.13, Section 6.10 or otherwise shall be deemed to have been amended, modified or superseded by any such correction or update, nor shall any breach of warranty or representation resulting from the inaccuracy or incompleteness of any such Schedule or Annex be deemed to have been cured thereby, unless and until the Administrative Agent, in its sole discretion, or the Required Lenders shall have accepted in writing such revisions or updates to such Schedule or Annex; provided, however, that the Borrower may update Schedule 5.6 without any Administrative Agent or Required Lender approval in connection with any transaction not prohibited under Sections 7.7, 7.8 and 7.10.

6.14   Material Agreements. Each of the Loan Parties covenants and agrees that it shall comply in all material respects with each of its Material Agreements.

6.15   Benefit Plan Compliance.

Each Plan will be in compliance in all material respects with its terms and applicable Law, each of the Loan Parties and the ERISA Affiliates will satisfy their obligations and liabilities with respect to each Plan in all material respects and each of the Loan Parties and the ERISA Affiliates will make all contributions with respect to any Plan on or before the due date for such contribution.

6.16   Interest Rate Protection. No later than ninety (90) days after the Closing Date, the Borrower shall have entered into or obtained, and the Borrower will thereafter maintain in full force and effect, an Interest Rate Hedge in form and substance reasonably satisfactory to Administrative Agent, the effect of which Interest Rate Hedge shall be to fix or limit interest rates payable by the Borrower as to at least 35% of the aggregate principal balance of the then outstanding Term Loans for a period of two (2) years after the Closing Date. The Borrower will deliver to Administrative Agent, promptly upon receipt thereof, copies of such Interest Rate Hedges (and any supplements or amendments thereto), and promptly upon request therefor, any other information reasonably requested by Administrative Agent to evidence its compliance with the provisions of this Section 6.16.

6.17   Post-Closing. No later than ninety (90) days after the Closing Date, or such later date as the Administrative Agent may agree to in its sole discretion, the Loan Parties will deliver, or cause to be delivered, to the Administrative Agent, each of the following:

(a)Real Estate Deliverables.

(i)A Mortgage with respect to each Material Owned Property, signed by an Authorized Officer of the applicable Loan Party and evidence that each such Mortgage has been filed or recorded in all appropriate locations;

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(ii)a legal description of each parcel of real property subject to a Mortgage, compatible with the survey described below (if such survey is required) and sufficient for recording;

(iii)to the extent requested by the Administrative Agent in its sole discretion, an ALTA title insurance policy or policies insuring the Administrative Agent, for the benefit of the Secured Parties (including such endorsements as the Administrative Agent may reasonably require), insuring each Mortgage as a valid first priority Lien upon the property subject to such Mortgage subject only to Permitted Liens which have first priority by operation of law, and such other exceptions as are reasonably acceptable to the Administrative Agent;

(iv)to the extent requested by the Administrative Agent in its sole discretion, an “as-built” survey or surveys adequate to delete the standard survey exception from any title policy delivered to the Administrative Agent, such survey or surveys to be certified in favor of the Administrative Agent for the benefit of the Secured Parties as to each of the real properties constituting Collateral;

(v)to the extent requested by the Administrative Agent in its sole discretion, acceptable appraisals, field exams and other third party inspections, as applicable of the Loan Parties’ and their Subsidiaries’ assets, including the real property and improvements thereto constituting Collateral;

(vi)to the extent requested by the Administrative Agent in its sole discretion, acceptable Phase I environmental audits with respect to each of the real properties constituting Collateral, together with such other environmental information as the Administrative Agent may request, including, but not limited to, completed environmental questionnaires in the form provided by the Administrative Agent;

(vii)written opinions of counsel for the Loan Parties, duly executed, dated as of the date of delivery of each of the items required pursuant to this Section 6.17, and covering such matters with respect to the Mortgages as may be requested by the Administrative Agent;

(viii)evidence that the Loan Parties have taken all actions required under the Flood Laws and/or requested by the Administrative Agent to assist in ensuring that each Lender is in compliance with the Flood Laws applicable to the Collateral, including, but not limited to:

(A)providing the Administrative Agent with the address and/or GPS coordinates of each structure on any improved real property that will be subject to the Mortgage;

(B)obtaining or providing the following documents: (a) a completed standard “life-of-loan” flood hazard determination form, (b) if the improvement(s) to the improved real property is located in a special flood hazard area, a notification to the Borrower (“Borrower Notice”) and (if applicable) notification to the Borrower that flood insurance coverage under the National Flood Insurance Program (“NFIP”) is not available because the community does not participate in the NFIP, and (c) documentation evidencing the Borrower’s receipt of the Borrower Notice (e.g., countersigned Borrower Notice, return receipt of certified U.S. Mail, or overnight delivery),

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(ix)to the extent required under Section 6.5(b), obtaining flood insurance for such property, structures and contents prior to such property, structures and contents becoming Collateral, together with such endorsements in favor of the Administrative Agent as the Administrative Agent may request; and

(b)Control Agreements. A duly completed, executed account control agreement with respect to all Material Accounts signed by an Authorized Officer of the Borrower and the appropriate depository institutions or other entities holding such Material Accounts.

VII.NEGATIVE COVENANTS

7.1      Indebtedness. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries, to, at any time create, incur, assume or suffer to exist any Indebtedness, except:

(a)Indebtedness under this Agreement and the other Loan Documents;

(b)existing Indebtedness as set forth on Schedule 7.1;

(c)Indebtedness incurred with respect to Purchase Money Security Interests, Synthetic Lease Obligations and Capital Leases for fixed or capital assets not in excess of $1,000,000 in the aggregate outstanding at any time;

(d)unsecured Indebtedness of a Loan Party to another Loan Party;

(e)Indebtedness (contingent or otherwise) of any Loan Party arising under (i) any Secured Hedge or (ii) Indebtedness under any Secured Bank Product entered into in the ordinary course of business; provided however, that (i) no Loan Party shall enter into or incur any Secured Hedge that constitutes a Swap Obligation if at the time it enters into or incurs such Swap Obligation it does not constitute an “eligible contract participant” as defined in the Commodity Exchange Act, and (ii) the Loan Parties and their Subsidiaries shall enter into a Secured Hedge only for hedging (rather than speculative) purposes;

(f)Guarantees and other Contingent Obligations permitted by Section 7.4; and

(g)other Indebtedness in an aggregate amount not to exceed $1,000,000.

7.2      Liens. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, at any time create, incur, assume or suffer to exist any Lien on any of its property or assets, tangible or intangible, now owned or hereafter acquired, or agree or become liable to do so, except Permitted Liens.

7.3      Affiliate Transactions. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, enter into or carry out any transaction with any Affiliate of any Loan Party (including purchasing property or services from or selling property or services to any Affiliate of any Loan Party or other Person) unless such transaction (a) is not otherwise prohibited by this Agreement, (b) is in accordance with all applicable Law and (c) (i) is among the Loan Parties, (ii) is entered into in the ordinary course of business upon fair and reasonable arm’s-length terms and conditions, (iii) relates to the 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, or (iv) is a Restricted Payment permitted by Section 7.6 or an advance permitted by Section 7.5(b).

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7.4   Contingent Obligations. No Loan Party shall, nor shall it permit any of its Subsidiaries to, at any time, directly or indirectly, create or become or be liable with respect to any Contingent Obligation except for those:

(a)course of business; resulting from endorsement of negotiable instruments for collection in the ordinary

(b)arising in the ordinary course of business with respect to customary indemnification obligations incurred in the ordinary course of business;

(c)incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds and other similar obligations;

(d)constituting Investments permitted pursuant to Section 7.5;

(e)Guarantees by any Loan Party of Indebtedness permitted hereunder (other than Excluded Swap Obligations); hereto;

(f)Guarantees existing as of the Closing Date and described on Schedule 7.4(f)

(g)unsecured Guarantees of Indebtedness of FiberComm, LC related to the purchase and renovation of 713 Nebraska Street, Sioux City, Iowa in an amount not to exceed $400,000 at any one time;

(h)arising in connection with the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of a Loan Party’s or a Loan Party’s Subsidiary’s business; and

(i)Guarantees of other Indebtedness, the aggregate principal amount of which shall not exceed $1,000,000 in the aggregate at any one time.

7.5   Loans and Investments. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, at any time make or suffer to remain outstanding any Investment or agree, become or remain liable to make any Investment, except:

(a)trade credit extended on usual and customary terms in the ordinary course of business;

(b)advances to employees of the Loan Parties to meet expenses incurred by such employees in the ordinary course of business;

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(c)Investments in the form of cash and Cash Equivalents;

(d)loans and advances to, and other Investments in, other wholly-owned Loan Parties;

(e)notes payable to, or equity interests issued by, account debtors to any Loan Party in good faith settlement of delinquent obligations and pursuant to any plan of reorganization or similar proceedings upon the bankruptcy or insolvency of any such account debtor;

(f)the CoBank Equities and any other stock or securities of, or Investments in, CoBank or its investment services or programs;

(g)Guaranties and other Contingent Obligations permitted by Section 7.4;

(h)any Secured Hedge permitted under Section 7.1;

(i)Investments existing as of the Closing Date and set forth on Schedule 7.5(i) hereto, which Investments may be increased by an amount not to exceed $500,000 in the aggregate (based upon original purchase price or principal amount);

(j)Permitted Acquisitions; and

(k)other Investments not exceeding $1,000,000 in the aggregate at any time (based upon original purchase price or principal amount).

7.6   Dividends and Related Distributions. No Loan Party shall declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, except that:

(a)each Subsidiary of any Loan Party may make Restricted Payments to any Loan Party and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made;

(b)the Borrower and each Subsidiary of any Loan Party may declare and make dividend payments or other distributions payable solely in the common stock or other common Equity Interests of such Person;

(c)the Borrower and each Subsidiary of any Loan Party may purchase, redeem or otherwise acquire Equity Interests issued by it with the proceeds received from the substantially concurrent issue of new shares of its common stock or other common Equity Interests; and

(d)so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, Borrower may (i) declare or pay cash dividends to its stockholders and (ii) purchase, redeem or otherwise acquire for cash Equity Interests issued by it, in an aggregate amount for clauses (i) and (ii) not to exceed $3,000,000 in any fiscal year of the Borrower.

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7.7  Liquidations, Mergers, Consolidations, Acquisitions. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, (i) dissolve, liquidate or wind-up its affairs, (ii) become a party to any merger or consolidation, or (iii) acquire by purchase, lease or otherwise all or substantially all of the assets or capital stock of any other Person or group of related Persons; provided that:

(a)any Subsidiary may merge with (i) the Borrower, provided that the Borrower shall be the continuing or surviving Person, or (ii) any one or more other Subsidiaries, provided that when any Guarantor is merging with another Subsidiary, the Guarantor shall be the continuing or surviving Person;

(b)any Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to the Borrower or to another Guarantor; provided that if the transferor in such a transaction is a Guarantor, then the transferee must either be the Borrower or a Guarantor; and

(c)the Loan Parties may consummate Permitted Acquisitions.

provided that, (x) no Loan Party or Subsidiary of Loan Party shall engage in, allow or be party to any Division without the written prior consent of the Administrative Agent in its sole discretion and (y) after giving effect to such merger or Disposition, the representations and warranties of the Loan Parties set forth in Article V and the other Loan Documents shall be true and correct in all material respects, except that such representations and warranties that are qualified in this Agreement or such other Loan Document by reference to materiality or a Material Adverse Change shall be true and correct in all respects.

7.8   Dispositions of Assets or Subsidiaries. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, Dispose of (including pursuant to any sale and leaseback transaction), voluntarily or involuntarily, any of its properties or assets, tangible or intangible (including sale, assignment, discount or other disposition of accounts, contract rights, chattel paper, equipment or general intangibles with or without recourse or of capital stock, shares of beneficial interest, partnership interests or limited liability company interests or other equity interests of a Subsidiary of such Loan Party), except:

(a)any Disposition of assets in the ordinary course of business that are replaced by substitute assets acquired or leased as permitted in this Agreement, so long as such substitute assets are subject to the Administrative Agent’s Prior Security Interest therein;

(b)transactions involving the sale of inventory to customers in the ordinary course of business;

(c)any Disposition of obsolete or worn-out assets in the ordinary course of business that are no longer necessary or required in the conduct of such Loan Party’s or such Subsidiary’s business;

(d)any Disposition of assets by any Loan Party to another Loan Party, so long as such sold or transferred assets are subject to the Administrative Agent’s Prior Security Interest therein or, if any such asset is expressly excluded from the Collateral pursuant to Section 2.3 of the Security Agreement or otherwise, such asset is sold or transferred to a Loan Party all of whose Equity Interest is subject to the Administrative Agent’s Prior Security Interest;

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(e)any Disposition permitted by Section 7.5;

(f)any Disposition of cash and Cash Equivalents; and

(g)Dispositions by the Borrower and its Subsidiaries not otherwise permitted under this Section 7.8; provided that (i) at the time of such Disposition, no Default or Event of Default shall exist or would result from such Disposition and (ii) the aggregate book value of all property Disposed of in reliance on clause (i) in any fiscal year shall not exceed $1,000,000 in any fiscal year of the Borrower. provided, however, that any Disposition pursuant to clause (a) shall be for substantially equivalent value and any Disposition pursuant to clauses (b) through (g) shall be for fair market value; provided, further, that, no Loan Party or Subsidiary of any Loan Party shall engage in, allow or be party to any Division without the written prior consent of the Administrative Agent in its sole discretion.

7.9   Use of Proceeds. No Loan Party shall (a) use the proceeds of any Loan or other Credit Extension hereunder, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the Board) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose or (b) request any Credit Extension or use (or permit the use by any of its Subsidiaries or its or their respective Affiliates, directors, officers, employees or agents) the proceeds of any Credit Extension, whether directly or indirectly, in violation of Anti-Corruption Laws, Anti-Terrorism Laws, Sanctions or other applicable Law.

7.10   Subsidiaries, Partnerships and Joint Ventures. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, own or create directly or indirectly any Subsidiaries other than (i) any Subsidiary that has joined this Agreement as Guarantor on the Closing Date; and (ii) any Subsidiary formed or acquired after the Closing Date that joins this Agreement as a Guarantor by delivering to the Administrative Agent (A) an executed Guarantor Joinder; (B) documents in the forms described in Section 4.1 modified as appropriate; and (C) documents necessary to grant and perfect Prior Security Interests to the Administrative Agent for the benefit of the Secured Parties in the Equity Interests of, and Collateral held by, such Subsidiary.

7.11   Continuation of or Change in Business. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, engage in any line of business other than those lines of business conducted by the Loan Parties on the date hereof, substantially as conducted and operated by such Loan Party or Subsidiary during the present fiscal year, or other lines of business necessary or ancillary to the foregoing or consistent with advances in the industry of the Loan Parties.

7.12   Fiscal Year. The Borrower shall not, and shall not permit any Subsidiary of the Borrower to, change its fiscal year from the twelve-month period beginning January 1 and ending December 31.

7.13   Issuance of Equity Interests. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, commence or consummate any Equity Issuance, except for (a) any such Equity Issuances by any Loan Party (other than the Borrower) to and for the benefit of a Loan Party and that are subject to the Administrative Agent’s Prior Security Interest therein and otherwise comply with the Security Agreement and (b) any Equity Issuance permitted pursuant to Section 7.6(b) or (c).

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7.14   Changes in Organizational Documents. No Loan Party shall, nor shall any Loan Party permit any of its Subsidiaries to, amend in any material respect its Organizational Documents without providing at least thirty (30) calendar days’ prior written notice (or such shorter notice as to which the Administrative Agent may agree in its sole discretion) to the Administrative Agent and the Lenders and, in the event such change would be adverse to the Lenders as determined by the Administrative Agent in its sole discretion, obtaining the prior written consent of the Required Lenders.

7.15   Negative Pledges; Other Inconsistent Agreements. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to, enter into any Material Agreement containing any provision which would (a) be breached by any Borrowing by the Borrower hereunder or by the performance by the Loan Parties or their respective Subsidiaries of any of their obligations hereunder or under any other Loan Document, (b) limit the ability of any Loan Party or any Subsidiary of any Loan Party to create, incur, assume or suffer to exist Liens on property of such Person; (c) create or permit to exist or become effective any encumbrance or restriction on the ability of any Loan Party or Subsidiary of any Loan Party to (i) make Restricted Payments to any Loan Party, or pay any Indebtedness owed to any Loan Party, (ii) make loans or advances to any Loan Party, (iii) transfer any of its assets or properties to any Loan Party, or (iv) Guarantee the Indebtedness of any Loan Party, provided, however, that this clause (c) shall not prohibit any negative pledge incurred or provided in favor of any holder of Indebtedness permitted under Section 7.1(c) solely to the extent any such negative pledge relates to the property financed by or the subject of such Indebtedness; or (d) require the grant of a Lien to secure an obligation of such Person if a Lien is granted to secure another obligation of such Person; provided, however, that the foregoing shall not apply to restrictions and conditions imposed by applicable Law or by this Agreement.

7.16   Material Agreements. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to (i) amend, restate, supplement, waive or otherwise modify, or terminate, cancel or revoke (prior to any scheduled date of termination) any Material Agreement if such modification, termination, cancellation or revocation could reasonably be expected to result in a Material Adverse Change, Default or Event of Default or (ii) make any optional prepayments of Indebtedness arising under any Material Indebtedness, except for optional prepayments of Indebtedness between the Loan Parties, if any.

7.17   Employee Plans. No Loan Party or ERISA Affiliate will acquire liability (by adopting a new plan, acquisition of another entity, participating in an asset transfer or plan merger, or otherwise) under any Pension Plan or Multiemployer Plan under which the Loan Party or ERISA Affiliate has no liability as of the date of this Agreement.

7.18   Management Fees. Each of the Loan Parties covenants and agrees that it shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, pay any management 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 a Loan Party’s business.

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7.19   Capital Expenditures. The Loan Parties shall not make any Capital Expenditure other than maintenance Capital Expenditures if an Event of Default has occurred and is continuing or will result therefrom.

7.20   Anti-Corruption; Anti-Terrorism; Sanctions.

(a)None of the Loan Parties or their respective Subsidiaries, Affiliates, officers, directors, employees or agents will engage in any dealings or transactions with any Sanctioned Person or in violation of any applicable Anti-Corruption Laws, Anti-Terrorism Laws or Sanctions.

(b)No Loan Party will fund all or any part of any payment under this Agreement or any other Loan Document out of proceeds derived from transactions that violate Sanctions, or with any Sanctioned Person, or with or connected to any Sanctioned Country.

7.21   Independence of Covenants. All covenants contained in Articles VI, VII and VIII of this Agreement shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that such action or condition would be permitted by another covenant shall not avoid the occurrence of a Default or Event of Default if such action is taken or condition exists.

VIII.FINANCIAL COVENANTS

8.1   Maximum Leverage Ratio. The Loan Parties shall maintain at all times, measured as of the last day of each fiscal quarter, a Leverage Ratio of the Borrower of not more than the ratios set forth below for the periods specified below:

PERIOD	RATIO
Each fiscal quarter end from the Closing Date through December 31, 2027	4.25:1.00
Each fiscal quarter end from January 1, 2028 and thereafter	3.25:1.00

8.2   Minimum Equity to Assets Ratio. The Loan Parties shall maintain at all times, measured as of the last day of each fiscal quarter, an Equity to Assets Ratio of the Borrower of not less than 35%.

8.3   Minimum Debt Service Coverage Ratio. The Loan Parties shall maintain at all times, measured as of the last day of each fiscal quarter, a Debt Service Coverage Ratio of the Borrower of not less than 2.00 to 1.0.

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IX.EVENTS OF DEFAULT

9.1   Events of Default. An Event of Default means the occurrence or existence of any one or more of the following events or conditions (whatever the reason therefor and whether voluntary, involuntary or effected by operation of Law):

(a)Payments Under Loan Documents. Failure by the Borrower or any other Loan Party to pay, on the date on which such payment becomes due in accordance with the terms of this Agreement or any other applicable Loan Document, (i) any principal of any Loan (including scheduled installments, mandatory prepayments or the payment due at maturity), or within three Business Days after such amount is due any interest on any Loan, or (ii) within three Business Days after such amount is due any other amount owing hereunder or under the other Loan Documents, or any other Secured Obligation;

(b)Breach of Warranty. Any representation, warranty, certification or statement of fact made or deemed made at any time by any of the Loan Parties herein or in any other Loan Document, or in any certificate, other instrument or statement furnished pursuant to the provisions hereof or thereof, shall have been false or misleading as of the time it was made or furnished (i) as stated if such representation or warranty contains an express materiality qualification or (ii) in any material respect if such representation or warranty does not contain such qualification;

(c)Breach of Certain Covenants. Any of the Loan Parties shall default in the observance or performance of any covenant contained in Section 6.1, Section 6.2, Section 6.3, Section 6.5, Section 6.7, Section 6.10, Section 6.11, Section 6.12, Section 6.16, Section 6.17, Article VII, or Article VIII.

(d)Breach of Other Covenants.   Any of the Loan Parties shall default in the observance or performance of any other covenant, condition or provision hereof or of any other Loan Document, and such default shall continue unremedied for the expressly specified cure period with respect thereto or, if no such cure period is specified, for a period of thirty (30) days after the earlier of (i) the Administrative Agent’s delivery of written notice thereof to the Borrower and (ii) an Authorized Officer or any other executive officer of any Loan Party obtaining knowledge thereof;

(e)Defaults in Other Agreements or Indebtedness. A default or event of default with respect to any Loan Party or any Subsidiary of any Loan Party shall occur at any time under the terms of any other agreement with respect to Indebtedness or any other credit extension in an aggregate principal amount (including undrawn committed or available amounts) in excess of the Threshold Amount, or with respect to any Hedge Agreement, the Hedge Termination Value of which is equal to or in excess of the Threshold Amount and such breach, default or event of default (i) arises from the failure to pay (beyond any period of grace permitted with respect thereto, whether waived or not) any related Indebtedness or other credit extensions when due (whether at stated maturity, by acceleration or otherwise) or (ii) the effect of which is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice and/or lapse of time, if required, the acceleration of any related Indebtedness or other credit extensions (whether or not such right shall have been waived) or the termination of any commitment to lend;

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(f)Final Judgments or Orders. Any final judgments or orders for the payment of money in excess of the Threshold Amount in the aggregate shall be entered against any Loan Party by a court having jurisdiction in the premises, which judgment is not discharged, satisfied, vacated, bonded or stayed pending appeal within a period of sixty (60) days from the date of entry;

(g)Loan Document Unenforceable. Any of the Loan Documents shall cease to be legal, valid and binding agreements enforceable against the party executing the same or such party’s successors and assigns (as permitted under the Loan Documents) in accordance with the respective terms thereof or shall in any way be terminated (except in accordance with its terms) or become or be declared ineffective or inoperative or shall in any way be challenged or contested by any party thereto (other than the Administrative Agent or any Lender) or cease to give or provide the respective Liens, security interests, rights, titles, interests, remedies, powers or privileges intended to be created thereby (other than as a result of the Administrative Agent or any Lenders action or inaction with respect thereto);

(h)Security Interests Unenforceable. Any Lien purported to be created under any Collateral Document shall cease to be, or shall be asserted by any Loan Party not to be, a valid or perfected Lien on any portion of the Collateral, with the priority required by the applicable Collateral Document, except (i) as a result of a release pursuant to Section 11.1(f), (ii) as a result of the sale or other disposition of the applicable Collateral or the release of the applicable Loan Party in a transaction permitted under the Loan Documents, or (iii) as a result of the Administrative Agent or any Lenders action or inaction with respect thereto;

(i)Uninsured Losses; Proceedings Against Assets. There shall occur any uninsured damage to or loss, theft or destruction of any portion of the Collateral with a fair market value in excess of the Threshold Amount or the Collateral or any other of the Loan Parties’ or any of their Subsidiaries’ assets with a fair market value in excess of the Threshold Amount are attached, seized, levied upon or subjected to a writ or distress warrant; or such come within the possession of any receiver, trustee, custodian or assignee for the benefit of creditors and the same is not cured within sixty (60) days thereafter;

(j)Events Relating to Employee Benefit Plans. (i) An ERISA Event or Plan Qualification Event occurs that has resulted or could reasonably be expected to result in liability of any Loan Party or any ERISA Affiliate in an aggregate amount in excess of the Threshold Amount, or (ii) any Loan Party or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any contribution required to be made with respect to any Pension Plan or Multiemployer Plan in an aggregate amount in excess of the Threshold Amount, including any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan;

(k)Change of Control. A Change of Control shall have occurred;

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(l)Insolvency Proceedings. (i) An Insolvency Proceeding shall have been instituted against any Loan Party or Subsidiary of a Loan Party and such Insolvency Proceeding shall remain undismissed or unstayed and in effect for a period of sixty (60) consecutive days or such court shall enter a decree or order granting any of the relief sought in such Insolvency Proceeding, (ii) any Loan Party or Subsidiary of a Loan Party institutes, or takes any action in furtherance of, an Insolvency Proceeding, (iii) an order granting the relief requested in any Insolvency Proceeding (including, but not limited to, an order for relief under federal bankruptcy laws) shall be entered, (iv) any Loan Party or Subsidiary thereof shall commence a voluntary case under, file a petition seeking to take advantage of, any bankruptcy, insolvency, reorganization or other similar law, domestic or foreign, (v) any Loan Party or Subsidiary thereof shall consent to or fail to contest in a timely and appropriate manner any petition filed against it in any Insolvency Proceeding, (vi) any Loan Party or Subsidiary thereof shall apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign, (vii) any Loan Party or Subsidiary thereof shall take any action to approve or authorize any of the foregoing, or (viii) any Loan Party or any Subsidiary of a Loan Party ceases to be Solvent or admits in writing its inability to pay its debts as they mature;

(m)Material Agreements. If any Loan Party shall default, past any applicable grace and cure period, under any Material Agreement not otherwise described in this Section 9.1 and such default would reasonably be expected to result in a Material Adverse Change; or

(n)FCC and PUC Matters. Any License (except for Licenses which are no longer required in the conduct of such Loan Party’s or Subsidiary’s business and which cannot be sold or which have de minimis fair market value) shall be cancelled, expired, revoked, terminated, rescinded, annulled, suspended or modified or shall no longer be in full force and effect, the effect of which has resulted in, or would reasonably be expected to result in, a Material Adverse Change.

9.2   Consequences of Event of Default.

(a)Events of Default Other Than Bankruptcy, Insolvency or Reorganization Proceedings. If an Event of Default specified under Section 9.1 (other than Section 9.1(l)) shall occur and be continuing, the Lenders and the Administrative Agent shall be under no further obligation to make Loans and the Administrative Agent may, and upon the request of the Required Lenders, shall by written notice to the Borrower, declare the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to the Lenders hereunder and thereunder to be forthwith due and payable, and the same shall thereupon become and be immediately due and payable to the Administrative Agent for the benefit of each Lender without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, and the Borrower hereby pledges to the Administrative Agent and the Lenders, and grants to the Administrative Agent and the Lenders a security interest in, all such cash as security for such Secured Obligations; and

(b)Bankruptcy, Insolvency or Reorganization Proceedings. If an Event of Default specified under Section 9.1(l) shall occur, the Lenders shall be under no further obligations to make Loans hereunder and the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to the Lenders hereunder and thereunder automatically shall be immediately due and payable without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived; and

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(c)Set-off. If an Event of Default shall have occurred and be continuing, each Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held, and other obligations (in whatever currency) at any time owing, by such Lender or any such Affiliate, to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or their respective Affiliates, irrespective of whether or not such Lender or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch, office or Affiliate of such Lender different from the branch, office or Affiliate holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.15 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender or their respective Affiliates may have. Each Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.

(d)Application of Proceeds. After the exercise of remedies provided for in Section 9.2 (or after the Loans have automatically become immediately due and payable as set forth in the proviso to Section 9.2), any amounts received on account of the Secured Obligations shall be applied by the Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of counsel to the Administrative Agent) payable to the Administrative Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting indemnities, expenses, and other amounts (other than principal, interest and fees) payable to the Lenders (including fees, charges and disbursements of counsel to the respective Lenders and amounts payable under Article X), ratably among them in proportion to the amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans, and other Obligations, and fees (including Unused Commitment Fees), ratably among the Lenders in proportion to the respective amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans, ratably among the Lenders in proportion to the respective amounts described in this clause Fourth held by them; fifth, to payment of all other Obligations, ratably among the Secured Parties in proportion to the respective amounts described in this clause Sixth held by them;

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Sixth, to payment or Cash Collateralization (if agreed by the applicable Loan Parties and any a provider of any Secured Bank Product or Secured Hedge, as applicable) of that portion of Other Liabilities then outstanding, ratably among the Secured Parties providing the Secured Bank Products and Secured Hedges giving rise to such Other Liabilities in proportion to the respective amounts described in this clause Seventh held by them; and

Last, the balance, if any, after Payment In Full of all of the Secured Obligations, to the Loan Parties or as otherwise required by Law.

Amounts used to Cash Collateralize Secured Obligations pursuant to clause Sixth above shall be applied to pay such Other Liabilities as they come due, as the case may be. If any amount remains on deposit as Cash Collateral after Payment In Full of the Other Liabilities, such remaining amount shall be applied to the other Secured Obligations, if any, and/or to the Loan Parties or as otherwise required by Law, in the order set forth above.

Amounts distributed with respect to any Secured Obligations attributable to Other Liabilities shall be equal to the lesser of (a) the applicable amount of such Other Liabilities last reported to the Administrative Agent or (b) the actual amount of such Other Liabilities as calculated by the methodology reported to the Administrative Agent for determining the amount due. The Administrative Agent shall have no obligation to calculate the amount to be distributed with respect to any such Other Liabilities, but may rely upon written notice of the amount (setting forth a reasonably detailed calculation) from the applicable Lender or its Affiliate providing such Secured Bank Products or Secured Hedge. In the absence of such notice, the Administrative Agent may assume the amount to be distributed is the amount of such obligations last reported to it.

If and to the extent the Administrative Agent has received notice or other evidence that any amount claimed as a Secured Obligation is or could reasonably be determined to be an Excluded Swap Obligation with respect to any Loan Party, amounts received from such Loan Party or its assets shall not be applied to such Excluded Swap Obligations with respect to such Loan Party, and adjustments shall be made with respect to amounts received from other Loan Parties and their assets as the Administrative Agent may determine, in consultation with or at the direction of, the Lenders to be equitable (which may include the purchase and sale of participation interests) so that, to the maximum extent practical, the benefit of all amounts received from the Loan Parties and their assets are shared in accordance with the allocation of recoveries set forth above that would apply if the applicable Swap Obligations were not Excluded Swap Obligations. Each Loan Party acknowledges and consents to the foregoing.

X.THE ADMINISTRATIVE AGENT

10.1   Appointment and Authority. Each of the Lenders (on behalf of itself and each of its Affiliates) hereby irrevocably appoints CoBank to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article X are solely for the benefit of the Administrative Agent, the Lenders, the Affiliates of the Lenders who are Secured Parties, and neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

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10.2   Rights as a Lender. The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

10.3   No Fiduciary Duty. The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:

(a)shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or Event of Default has occurred and is continuing;

(b)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c)shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

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10.4   Exculpation.

(a)The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 11.1 and 9.2) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and non- appealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default unless and until notice describing such Default or Event of Default is given to the Administrative Agent by the Borrower or a Lender.

(b)The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

10.5   Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

10.6   Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article X shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the Facilities as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub agents.

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10.7   Filing Proofs of Claim. In case of the pendency of any proceedings under any Debtor Relief Law or any other judicial proceeding relating to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand therefor) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

(a)to file and prove a claim for the whole amount of the owing and unpaid principal and interest in respect to the Secured Obligations and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Sections 2.8, 2.10(b), 3.5 and 11.3) allowed in such proceeding;

(b)to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same; and

(c)any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.8, 2.10(b), 3.5 and 11.3.

10.8   Resignation of the Administrative Agent. The Administrative Agent may at any time give notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor Administrative Agent. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation (or such earlier date as the Required Lenders may approve), then the retiring Administrative Agent may (but shall not be obligated to) on behalf of the Lenders, appoint a successor Administrative Agent; provided, that if the Administrative Agent shall notify the Borrower and the Lenders that no Person has accepted such appointment, then the Administrative Agent’s resignation shall nonetheless become effective in accordance with such notice and (i) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on behalf of the Lenders under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (ii) except for any indemnity payments owed to the retiring Administrative Agent, all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section 10.8. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent (other than any rights to indemnity payments owed to the retiring Administrative Agent), and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article X and Section 11.3 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.

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Any resignation by CoBank as Administrative Agent pursuant to this Section shall also automatically constitute its resignation as the Swing Line Lender, with replacement of the Administrative Agent as Swing Line Lender conducted in accordance with Section 10.18 below.

10.9   Non-Reliance on the Administrative Agent and Other Lenders. Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent, the arranger or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder. Each Lender represents and warrants that (a) the Loan Documents set forth the terms of a commercial lending facility and (b) it is engaged in making, acquiring or holding commercial loans in the ordinary course and is entering into this Agreement as a Lender for the purpose of making, acquiring or holding commercial loans set forth herein as may be applicable to such Lender, and not for the purpose of purchasing, acquiring or holding any other type of financial instrument, and each Lender agrees not to assert a claim in contravention of the foregoing. Each Lender represents and warrants that it is sophisticated with respect to decisions to make, acquire or hold commercial loans, as may be applicable to such Lender, and either it, or the Person exercising discretion in making its decision to make, acquire or hold such commercial loans, is experienced in making, acquiring or holding such commercial loans.

10.10   Enforcement. By its acceptance of the benefits of this Agreement and the other Loan Documents, each Secured Party agrees that (a) the Loan Documents may be enforced only by the Administrative Agent, subject to Section 11.2, (b) no Secured Party shall have any right individually to enforce or seek to enforce this Agreement or the other Loan Documents or to realize upon any Collateral or other security given to secure the payment and performance of the Obligations and (c) no Secured Party has any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents.

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10.11   No Other Duties, etc. Anything herein to the contrary notwithstanding, the Administrative Agent shall not have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent or a Lender hereunder.

10.12   Authorization to Release Collateral and Loan Parties

(a)The Secured Parties irrevocably authorize the Administrative Agent, at its option and in its discretion,

(i)to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (x) upon termination of all Commitments and Payment In Full of all Secured Obligations (other than contingent indemnification obligations as to which no claim has been made) (other than Other Liabilities then due and payable as to which other arrangements satisfactory to the Administrative Agent and the applicable Lender on behalf of itself or its Affiliates shall have been made), (y) that is Disposed of or to be Disposed of as part of or in connection with any sale or other disposition permitted under the Loan Documents, or (z) subject to Section 11.1, if approved, authorized or ratified in writing by the Required Lenders;

(ii)to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 7.1(c); and

(iii)to release any Guarantor from its obligations under the Loan Documents if such Person ceases to be a Subsidiary as a result of a transaction permitted under the Loan Documents.

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under the Loan Documents pursuant to this Section 10.12.

(b)The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agent’s Lien thereon, or any certificate prepared by any Loan Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

10.13   Compliance with Flood Laws. CoBank has adopted internal policies and procedures that address requirements placed on federally regulated lenders under the Flood Laws. CoBank, as administrative agent or collateral agent on a syndicated facility, will post on the applicable electronic platform (or otherwise distribute to each lender in the syndicate) documents that it receives in connection with the Flood Laws. However, CoBank reminds each lender and participant in the facility that, pursuant to the Flood Laws, each federally regulated lender (whether acting as a lender or participant in the facility) is responsible for assuring its own compliance with the flood insurance requirements.

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10.14   No Reliance on the Administrative Agent’s Customer Identification Program. Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on the Administrative Agent to carry out such Lender’s, Affiliate’s, participant’s or assignee’s customer identification program, or other obligations required or imposed under or pursuant to the USA Patriot Act or the regulations thereunder, including the regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the “CIP Regulations”), or any other Anti-Terrorism Law, Anti- Corruption Law or Sanctions, including any programs involving any of the following items relating to or in connection with any of the Loan Parties, their Affiliates or their agents, the Loan Documents or the transactions hereunder or contemplated hereby: (a) any identity verification procedures, (b) any recordkeeping, (c) comparisons with government lists, (d) customer notices or (e) other procedures required under the CIP Regulations or such other Laws.

10.15   Affiliates as Secured Parties. To the extent any Affiliate of a Lender is a party to a Secured Hedge or a Secured Bank Product and thereby becomes a beneficiary of the Liens pursuant to any Collateral Document for so long as such Lender remains a Lender, such Affiliate of a Lender shall be a Secured Party and shall be deemed to appoint the Administrative Agent its nominee and agent to act for and on behalf of such Affiliate in connection with such Collateral Document and to be bound by the terms of this Article X and the other provisions of this Agreement.

10.16.   Certain ERISA Matters.

(a)Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, and its respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:

(i)such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit Plans with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments or this Agreement,

(ii)the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement,

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(iii)(A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement, or

(iv)such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.

(v)In addition, unless either (1) Section 10.16(a)(i) is true with respect to a Lender or (2) a Lender has provided another representation, warranty and covenant as provided in Section 10.16(a)(iv), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, and its Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that the Administrative Agent and its Affiliates, are not a fiduciary with respect to the assets of such Lender involved in such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).

10.17   Rate Disclaimer. The Administrative Agent does not warrant or accept responsibility for, and each of the parties to this Agreement hereby acknowledge and agree (for the benefit of the Administrative Agent) that the Administrative Agent shall not have any liability with respect to (a) the continuation of, administration of, submission of, calculation of or any other matter related to the Alternate Base Rate, any Benchmark, or any component definition thereof or rates referred to in the definition thereof, or any alternative, successor or replacement rate thereto (including any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement) will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, Alternate Base Rate, any initial Benchmark or any other Benchmark or Benchmark Replacement prior to its discontinuance or unavailability, or (b) the effect, implementation or composition of any Benchmark Replacement Conforming Changes. The Administrative Agent and its affiliates or other related entities may engage in transactions that affect the calculation of the Alternate Base Rate, or any Benchmark, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain the Alternate Base Rate, any initial Benchmark or any other Benchmark or Benchmark Replacement, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other Person for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.

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10.18   Resignation of Swing Line Lender. The Swing Line Lender may at any time give notice of its resignation to Lenders, the Administrative Agent and the Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with approval from the Borrower (so long as no Event of Default has occurred and is continuing) to appoint a successor Swing Line Lender, such approval not to be unreasonable withheld or delayed. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Swing Line Lender gives notice of its resignation, then the Administrative Agent may on behalf of the Lenders, appoint a successor Swing Line Lender; provided that if the Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and the retiring Swing Line Lender shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the retiring Swing Line Lender on behalf of the Lenders or the Swing Line Lender under any of the Loan Documents, the retiring Swing Line Lender shall continue to hold such collateral security until such time as a successor Swing Line Lender is appointed). Upon the acceptance of a successor’s appointment as a Swing Line Lender hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Swing Line Lender, and the retiring Swing Line Lender shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Swing Line Lender shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Swing Line Lender’s resignation hereunder and under the other Loan Documents as a Swing Line Lender, the provisions of Section 11.3 (and Article X if the Administrative Agent is the resigning Swing Line Lender) shall continue in effect for the benefit of such retiring Swing Line Lender, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Swing Line Lender was acting as the Swing Line Lender.

In addition to the foregoing requirements, upon the acceptance of a successor’s appointment as Issuing Lender hereunder, the successor Issuing Lender shall issue letters of credit in substitution for the Letters of Credit issued by the retiring Issuing Lender, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring Issuing Lender to effectively assume the obligations of the retiring Issuing Lender with respect to such Letters of Credit.

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XI.MISCELLANEOUS

11.1   Modifications, Amendments or Waivers. With the written consent of the Required Lenders, the Administrative Agent, acting on behalf of all the Lenders, and the Borrower, on behalf of the Loan Parties, may from time to time enter into written agreements amending or changing any provision of this Agreement or any other Loan Document or the rights of the Lenders or the Loan Parties hereunder or thereunder, or may grant written waivers or consents hereunder or thereunder. Any such agreement, waiver or consent made with such written consent shall be effective to bind all the Lenders and the Loan Parties; provided, that no such agreement, waiver or consent may be made that will:

(a)extend or increase the Commitment of any Lender (or reinstate any obligation to make Loans terminated pursuant to Section 9.2) without the written consent of such Lender whose Commitment is being extended or increased (it being understood and agreed that a waiver of any condition precedent set forth in Section 4.2 or of any Default, Event of Default, mandatory prepayment or a mandatory reduction in Commitments is not considered an extension or increase in Commitments of any Lender);

(b)postpone any date fixed by this Agreement or any other Loan Document for any payment (including mandatory prepayment of Overadvances but excluding other mandatory prepayments of principal, interest, fees or other amounts due to the Lenders (or any of them) or any scheduled or mandatory reduction of the Commitments hereunder or under any other Loan Document without the written consent of each Lender entitled to receive such payment or whose Commitments are to be reduced, it being understood that the waiver of any mandatory prepayment of Loans (or any definition relating thereto), other than a mandatory prepayment of Overadvances, shall not constitute a postponement of any date scheduled for the payment of principal or interest);

(c)reduce the principal of, or the rate of interest specified herein on, any Loan or any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial ratio (including the applicable defined terms) used in determining the Applicable Margin in a manner that would result in a reduction of any interest rate on any Loan or any fee payable hereunder without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary (i) to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest at the Default Rate or (ii) to amend any financial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce the rate of interest on any Loan or to reduce any fee payable hereunder;

(d)change Section 2.14 or Section 9.2(c) in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender directly affected thereby;

(e)change any provision of this Section 11.1 or the definition of “Required Lenders” without the written consent of each Lender directly affected thereby;

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(f)except in connection with a transaction permitted under Section 7.7 or 7.8, release all or substantially all of the Collateral without the written consent of each Lender whose Obligations are secured by such Collateral; or

(g)release the Borrower without the consent of each Lender, or, except in connection with a transaction permitted under Section 7.7 or 7.8, all or substantially all of the value of the Guaranty provided pursuant to Article XII of this Agreement without the written consent of each Lender whose Secured Obligations are guaranteed thereby, except to the extent such release is permitted pursuant to Section 10.12 (in which case such release may be made by the Administrative Agent acting alone); provided that (i) no agreement, waiver or consent that would modify the interests, rights or obligations of the Administrative Agent or the Swing Line Lender may be made without the written consent of such Administrative Agent or Swing Line Lender, as applicable, (ii) only the consent of the Administrative Agent shall be required for any amendment to the Fee Letter, and (iii) the Schedules to this Agreement and the Annexes to the Security Agreement may be modified as provided in and subject to the terms described in Section 6.10 and 6.13 may be amended, modified, or terminate or any provision thereof waived in accordance with the terms set forth therein; and provided, further that, if in connection with any proposed waiver, amendment or modification referred to in Sections 11.1(a) through 11.1 (g) above, the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained (each a “Non-Consenting Lender”), then the Borrower shall have the right to replace any such Non-Consenting Lender with one or more replacement Lenders pursuant to Section 3.6.

No Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of such Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects such Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

Notwithstanding anything to the contrary contained herein, if following the Closing Date, if the Administrative Agent and the Borrower shall have jointly identified an obvious error or any error or omission of a technical or immaterial nature, in each case, in any provision of this Agreement or any other Loan Document, then the Administrative Agent and the Borrower shall be permitted to amend such provision and such amendment shall become effective without any further action or consent of any other party to this Agreement or any other Loan Document if the same is not objected to in writing by the Required Lenders within five (5) Business Days following receipt of notice thereof. It is understood that posting such amendment electronically on SyndTrak or another relevant website with notice of such posting by the Administrative Agent to the Required Lenders shall be deemed adequate receipt of notice of such amendment.

11.2   No Implied Waivers; Cumulative Remedies. No course of dealing and no delay or failure of the Administrative Agent or any Lender in exercising any right, power, remedy or privilege under this Agreement or any other Loan Document shall affect any other or future exercise thereof or operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any further exercise thereof or of any other right, power, remedy or privilege. The rights and remedies of the Administrative Agent and the Lenders under this Agreement and any other Loan Documents are cumulative and not exclusive of any rights or remedies that they would otherwise have.

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Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent for the benefit of the Secured Parties; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) any Lender from exercising setoff rights in accordance with Section 9.2 (subject to the terms of Section 2.14), (c) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party in any Insolvency Proceedings, or (d) the Swing Line Lender from exercising the rights and remedies that insure to its benefit (solely in its capacity as Swing Line Lender, as the case may be) hereunder and under the other Loan Documents.

11.3   Expenses; Indemnity; Damage Waiver.

(a)Costs and Expenses. The Borrower shall pay (i) all reasonable out of pocket expenses incurred by the Administrative Agent and its Affiliates (including the reasonable out of pocket fees, charges and disbursements of outside counsel for the Administrative Agent) in connection with the syndication of the Facilities, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents, or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), and (ii) all reasonable out of pocket expenses incurred by the Administrative Agent (including the fees, charges and disbursements of a single counsel for the Administrative Agent and the Lenders), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made hereunder, including all such out of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b)Indemnification by the Borrower.  The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the reasonable fees, charges and disbursements of a single counsel for the Indemnitee) incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Borrower or any other Loan Party and the expense of investigation) other than such Indemnitee and its Related Parties arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the Borrower or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if the Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction. This Section 11.3(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages and other similar amounts arising from any non-Tax claim.

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(c)Reimbursement by Lenders. To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under clause (a) or (b) of this Section 11.3 to be paid by it to the Administrative Agent (or any sub-agent thereof), the Swing Line Lender or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the Swing Line Lender or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s Pro Rata Share at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender); provided, that with respect to such unpaid amounts owed to the Swing Line Lender solely in its capacity as such, only the Revolving Lenders shall be required to pay such unpaid amounts, such payment to be made severally among them based on such Revolving Lenders’ Pro Rata Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought); and provided, further that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent) or Swing Line Lender in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent) or Swing Line Lender in connection with such capacity.

(d)Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable Law, none of the Loan Parties shall assert, and each hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof. No Indemnitee referred to in Section 11.3 shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and non-appealable judgment of a court of competent jurisdiction.

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(e)Payments. All amounts due under this Section shall be payable not later than ten (10) days after demand therefor.

(f)Survival. Each party’s obligations under this Section 11.3 shall survive the resignation of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

11.4   Notices; Effectiveness; Electronic Communication

(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in clause (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile (i) if to a Lender, at its address (or facsimile number) set forth in its Administrative Questionnaire or (ii) if to any other Person, to it at its address (or facsimile number) set forth on Schedule 1.1(B). Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices delivered through electronic communications, to the extent provided in clause (b) below, shall be effective as provided in said clause (b).

(b)Electronic Communications. Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

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(c)Change of Address, etc. Any party hereto may change its address, facsimile number or e-mail address, if applicable, for notices and other communications hereunder by notice to the other parties hereto.

(d)Platform.

(i)Each Loan Party agrees that the Administrative Agent may, but shall not be obligated to, make the Communications (as defined below) available to the Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system (the “Platform”).

(ii)The Platform is provided “as is” and “as available.” The Agent Parties (as defined below) do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the Platform. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower or the other Loan Parties, any Lender or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or the Administrative Agent’s transmission of communications through the Platform. “Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein which is distributed to the Administrative Agent or any Lender by means of electronic communications pursuant to this Section, including through the Platform.

11.5   Severability. The provisions of this Agreement are intended to be severable. If any provision of this Agreement shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.

11.6   Duration; Survival. All representations and warranties of the Loan Parties contained herein or made in connection herewith shall survive the execution and delivery of this Agreement, the completion of the transactions hereunder and Payment In Full. All covenants and agreements of the Borrower contained herein relating to the payment of principal, interest, premiums, additional compensation or expenses and indemnification, including those set forth in the Notes, Article II, Article III, Section 11.3 or any other provision of any Loan Document, the agreement of the Lenders set forth in Section 11.3(c), and the agreements of the Loan Parties set forth in Section 11.10 or any other provision of any Loan Documents shall survive Payment In Full and shall protect the Administrative Agent, the Lenders and any other Indemnitees against events arising after such termination as well as before. All other covenants and agreements of the Loan Parties shall continue in full force and effect from and after the date hereof and until Payment In Full.

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11.7   Successors and Assigns.

(a)Successors and Assigns Generally. The provisions of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of this Section, (ii) by way of participation in accordance with the provisions of this Section 11.7, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of this Section 11.7 (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in this Section 11.7 and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment, all participants in Swing Line Loans and the Loans at the time owing to it); provided that (in each case and with respect to any Facility) any such assignment shall be subject to the following conditions:

(i)Minimum Amounts.

(A)in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and/or the Loans at the time owing to it (in each case with respect to any Facility) or contemporaneous assignments to related Approved Funds that equal at least the amount specified in clause (B) below in the aggregate or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B)in any case not described in clause (i)(A) of this clause (b), the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, in the case of any assignment in respect of the Revolving Credit Facility, or $1,000,000, in the case of any assignment in respect of the DDTL Facility or any Term Loan Facility, or any Delayed Draw Term Loans or any Tranche of Term Loans, unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed).

(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loan or the Commitment assigned, except that this clause (ii) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separate Facilities on a non-pro rata basis.

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(iii)Required Consents.     No consent shall be required for any assignment except to the extent required by clause (b)(i)(B) of this Section 11.7 and in addition:

(A)the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice thereof and provided, further, that the Borrower’s consent shall not be required during the primary syndication of the Facilities; and

(B)the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of (i) the Revolving Credit Facility or any unfunded Commitments with respect to the DDTL Facility or any Term Loan Facility if such assignment is to a Person that is not a Lender with a Commitment in respect of such Facility or Tranche of such Facility, an Affiliate of such Lender or an Approved Fund with respect to such Lender, or (ii) any Delayed Draw Term Loans or Term Loans to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund; and

(C)the consent of the Swing Line Lender shall be required for any assignment in respect of the Revolving Credit Facility.

(iv)Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

(v)No Assignment to Certain Persons. No such assignment shall be made to (i) the Borrower or any of the Borrower’s Affiliates or Subsidiaries or (ii) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (v).

(vi)No Assignment to Natural Persons. No such assignment shall be made to a natural Person (or a holding company, investment vehicle or trust for, or owned or operated for the primary benefit of, a natural Person).

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(vii)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to(x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent, the Swing Line Lender and each other Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Swing Line Loans in accordance with its Pro Rata Share. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.1, 3.2, 3.5 and 11.3(b) with respect to facts and circumstances occurring prior to the effective date of such assignment; provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.7(d) below.

(c)Register. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in Greenwood Village, Colorado a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d)Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural Person or a holding company, investment vehicle or trust for, or owned or operated for the primary benefit of, a natural Person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 11.3(c) with respect to any payments made by such Lender to its Participant(s).

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Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in Sections 11.1(a) through (g) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.1, 3.2 (subject to the requirements and limitations therein, including the requirements under Section 3.2 (it being understood that the documentation required under Section 3.2 shall be delivered to the participating Lender)), 3.5 and 11.3 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (b) of this Section 11.7; provided that such Participant (A) agrees to be subject to the provisions of Section 3.6 as if it were an assignee under clause (b) of this Section 11.7; and (B) shall not be entitled to receive any greater payment under Section 3.1 or 3.2, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 3.6 with respect to any Participant. To the extent permitted by Law, each Participant also shall be entitled to the benefits of Section 9.2(c) as though it were a Lender; provided that such Participant agrees to be subject to Section 2.14 though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non- fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans, or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register. CoBank reserves the right to assign or sell participations in all or part of its Commitments or outstanding Loans hereunder on a non-patronage basis.

Notwithstanding the preceding paragraph, any Participant that is a Farm Credit Lender or the Federal Agricultural Mortgage Corporation that (i) has purchased a participation, (ii) has been designated as a voting Participant (a “Voting Participant”) in a notice (a “Voting Participant Notice”) sent by the relevant Lender (including any existing Voting Participant) to the Administrative Agent and (iii) receives, prior to becoming a Voting Participant, the consent of the Administrative Agent (such Administrative Agent consent to be required only to the extent and under the circumstances it would be required if such Voting Participant were to become a Lender pursuant to an assignment in accordance with Section 11.7(b) and such consent is not required for an assignment to an existing Voting Participant), shall be entitled to vote as if such Voting Participant were a Lender on all matters subject to a vote by Lenders, and the voting rights of the selling Lender (including any existing Voting Participant) shall be correspondingly reduced, on a dollar-for-dollar basis. Each Voting Participant Notice shall include, with respect to each Voting Participant, the information that would be included by a prospective Lender in an Assignment and Assumption. Notwithstanding the foregoing, each Farm Credit Lender designated as a Voting Participant in Schedule 11.7 and, if applicable, the Federal Agricultural Mortgage Corporation shall be a Voting Participant without delivery of a Voting Participant Notice and without the prior written consent of the Administrative Agent. The selling Lender (including any existing Voting Participant) and the purchasing Voting Participant shall notify the Administrative Agent within three (3) Business Days of any termination, reduction or increase of the amount of, such participation. The Administrative Agent shall be entitled to conclusively rely on information contained in Voting Participant Notices and all other notices delivered pursuant hereto. The voting rights of each Voting Participant are solely for the benefit of such Voting Participant and shall not inure to any assignee or participant of such Voting Participant that is not a Farm Credit Lender.

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(e)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

11.8   Confidentiality. Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners); (c) to the extent required by applicable Law or by any subpoena or similar legal process; (d) to any other party hereto; (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder; (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights and obligations under this Agreement, or (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder; (g) on a confidential basis to (i) any rating agency in connection with rating the Borrower or its Subsidiaries or the Facilities or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Facilities; (h) with the consent of the Borrower; or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section, or (y) becomes available to the Administrative Agent, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower.

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For purposes of this Section, “Information” means all information received from the Borrower or any of its Subsidiaries relating to the Borrower or any of its Subsidiaries or any of their respective businesses, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower or any of its Subsidiaries; provided that, in the case of information received from the Borrower or any of its Subsidiaries after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

In addition to the foregoing, the Administrative Agent may place advertisements in financial and other newspapers and periodicals, and on a home page or similar place for dissemination of information on the Internet or worldwide web, as it may choose, and may circulate similar promotional materials after the Closing Date in the form of a “tombstone” or otherwise describing the names of the Borrower and its affiliates (or any of them), and the amount, type and Closing Date, all at the Administrative Agent’s expense.

11.9   Counterparts; Integration; Effectiveness.

(a)This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Article IV, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Agreement.

(b)Electronic Execution of Loan Documents. The parties agree that the electronic signature of a party to this Agreement and any other Loan Document shall be as valid as an original signature of such party and shall be effective to bind such party to this Agreement or such other Loan Document. The parties agree that any electronically signed Loan Document (including this Agreement) shall be deemed (i) to be “written” or “in writing,” (ii) to have been signed and (iii) to constitute a record established and maintained in the ordinary course of business and an original written record when printed from electronic files. The parties presently intend to authenticate the Loan Documents to which they are a party by either signing such Loan Document or attaching thereto or logically associating therewith an electronic sound, symbol or process as their respective electronic signature. The words “execution,” “signed,” “signature,” and words of like import in this Agreement and any other Loan Document (including any Assignment and Assumption) shall be deemed to include electronic signatures or electronic records, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

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11.10   Choice of Law; Submission to Jurisdiction; Waiver of Venue; Service of Process; Waiver of Jury Trial.

(a)Governing Law. This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be governed by, and construed in accordance with, the law of the State of Colorado without regard to conflicts of law principles that require or permit application of the laws of any other state or jurisdiction.

(b)SUBMISSION TO JURISDICTION. EACH OF THE BORROWER AND OTHER LOAN PARTIES IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF COLORADO SITTING IN DENVER COUNTY AND OF THE UNITED STATES DISTRICT COURT OF COLORADO, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH COLORADO STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)WAIVER OF VENUE. EACH OF THE BORROWER AND OTHER LOAN PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN THIS SECTION 11.10. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT AND AGREES NOT TO ASSERT ANY SUCH DEFENSE.

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(d)SERVICE OF PROCESS.     EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.4. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

(e)WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, ADMINISTRATIVE AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

11.11   USA Patriot Act Notice. Each Lender that is subject to the USA Patriot Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies Loan Parties that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of Loan Parties and other information that will allow such Lender or Administrative Agent, as applicable, to identify the Loan Parties in accordance with the USA Patriot Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable Anti-Corruption Laws, Anti-Terrorism Laws and Sanctions, including the USA PATRIOT Act.

11.12   Payments Set Aside. To the extent any Loan Party makes a payment or payments to the Administrative Agent for the ratable benefit of the Lenders or Secured Parties or the Administrative Agent receives any payment or proceeds of the Collateral which payments or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any Insolvency Proceeding, other applicable Law or equitable cause, then, to the extent of such payment or proceeds repaid, the Secured Obligations or part thereof intended to be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had not been received by the Administrative Agent.

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11.13   Secured Bank Products and Secured Hedge Agreements. No Secured Party (other than the Administrative Agent) that obtains the benefit of the Guaranty set forth in Article XII or of any security interest in any of the Collateral shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document (including the release, impairment or modification of any Guarantors’ Obligations or security therefor) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. No Hedge Bank or provider of any Secured Bank Product shall have any voting rights hereunder or under any other Loan Document in its capacity as the provider of such Secured Hedge or Secured Bank Product. Notwithstanding any other provision of this Agreement to the contrary, the Administrative Agent shall only be required to verify the payment of, or that other reasonably satisfactory arrangements have been made with respect to, the Secured Obligations arising with respect to Secured Bank Products and Secured Hedges to the extent the Administrative Agent has received written notice of such Secured Obligations, together with such supporting documentation as it may request, from the applicable Lender (or its Affiliate) or Hedge Bank, as the case may be. Each Secured Party not a party to this Agreement that obtains the benefit of this Agreement or any other Loan Document shall be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of this Agreement, and acknowledges and agrees that the Administrative Agent is and shall be entitled to all the rights, benefits and immunities conferred under this Agreement with respect to each such Secured Party.

11.14   Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents, together with all fees, charges and other amounts treated as interest under applicable Laws (collectively, “Charges”) shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or any Lender shall receive interest and Charges in an amount that exceeds the Maximum Rate, the excess interest and Charges shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest and Charges contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

11.15   FCC and PUC Compliance. Notwithstanding anything to the contrary in this Agreement and the other Loan Documents, no party hereto or thereto shall take any action under this Agreement or the other Loan Documents that would constitute or result in an assignment of any License, or a change of control or action of any Loan Party or Subsidiary directly or indirectly holding a License or other action, to the extent that such assignment or change of control would require the prior approval by the FCC under the Communications Act and/or any applicable PUC under the PUC Laws without first obtaining such required approval.

Upon any action to commence the exercise of remedies hereunder or under the other Loan Documents, each Loan Party hereby undertakes and agrees on behalf of itself, the other Loan Parties and the Subsidiaries of any Loan Party, to cooperate and join with the Administrative Agent, and cause the other Loan Parties and the Subsidiaries of any Loan Party, to cooperate and join with the Administrative Agent, in any application to any Governmental Authority which may be required in order to permit the Administrative Agent to exercise its rights and remedies under the Loan Documents and to provide such assistance in connection therewith as the Administrative Agent may request, including the preparation of, consenting to or joining in of filings and appearances of officers and employees of any Loan Party or any Subsidiary of any Loan Party before such Governmental Authority, in each case in support of any such application made by the Administrative Agent; provided, however, nothing herein shall be construed to require any of the Loan Parties nor any of the Subsidiaries of any Loan Party to, directly or indirectly, violate any terms or conditions of any License. The obligation of the Loan Parties to make all payments required to be made under this Agreement or any other Loan Document shall be absolute and unconditional; provided, however, in the event any portion of the debt, is disallowed under applicable Law or by action of the FCC or any PUC, then such disallowance shall be limited to the specific Loan Parties and Loan amounts impacted by such FCC or PUC action or required by applicable Law.

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11.16   Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support to each other Loan Party as may be needed by such Loan Party from time to time to honor all of its obligations under this Agreement and the other Loan Documents to which it is a party with respect to Swap Obligations permitted under this Agreement that would, in the absence of the agreement in this Section 11.16, otherwise constitute Excluded Swap Obligations (but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECP Guarantors’ obligations and undertakings under this Section voidable under applicable Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations, undertakings and guaranty of the Qualified ECP Guarantors under this Section 11.16 shall remain in full force and effect until Payment In Full of the Obligations and termination of all the Commitments. The Borrower and the Qualified ECP Guarantors intend this Section 11.16 to constitute, and this Section 11.16 shall be deemed to constitute, a guarantee of the obligations of, and a “keepwell, support, or other agreement” for the benefit of, each Loan Party for all purposes of the Commodity Exchange Act.

11.17   No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (a) (i) no fiduciary, advisory or agency relationship between the Borrower and its Subsidiaries and the Arranger, the Administrative Agent or any Lender is intended to be or has been created in respect of the transactions contemplated hereby or by the other Loan Documents, irrespective of whether the Arranger, the Administrative Agent, or any Lender has advised or is advising the Borrower or any Subsidiary on other matters, (ii) the arranging and other services regarding this Agreement provided by the Arranger, the Administrative Agent and the Lenders are arm’s-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Arranger, the Administrative Agent and the Lenders, on the other hand, (iii) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent that it has deemed appropriate and (iv) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; and (b) (i) the Arranger, the Administrative Agent and the Lenders each is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any other Person; (ii) none of the Arranger, the Administrative Agent and the Lenders has any obligation to the Borrower or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Arranger, the Administrative Agent and the Lenders and their respective Affiliates may be engaged, for their own accounts or the accounts of customers, in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and none of the Arranger, the Administrative Agent and the Lenders has any obligation to disclose any of such interests to the Borrower or its Affiliates. To the fullest extent permitted by Law, the Borrower hereby waives and releases any claims that it may have against any of the Arranger, the Administrative Agent and the Lenders with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

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11.18   Recovery of Erroneous Payments. Without limitation of any other provision in this Agreement, if at any time the Administrative Agent makes a payment hereunder in error to any Lender (each, a “Lender Party”), whether or not in respect of an Obligation due and owing by the Borrower at such time (any such payment, an “Erroneous Payment”), then in any such event, each Lender Party receiving an Erroneous Payment severally agrees to repay to the Administrative Agent promptly upon demand the Erroneous Payment received by such Lender Party in immediately available funds (and in the currency so received), with interest thereon for each day from and including the date such Erroneous Payment is received by it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. Each Lender Party irrevocably waives any and all defenses, including any “discharge for value” (under which a creditor might otherwise claim a right to retain funds mistakenly paid by a third party in respect of a debt owed by another) or similar defense to its obligation to return any Erroneous Payment. The Administrative Agent shall inform each Lender Party promptly upon determining that any payment made to such Lender Party comprised, in whole or in part, an Erroneous Payment (and such determination shall be conclusive absent manifest error).

XII.GUARANTY

12.1   Guaranty. Each Guarantor hereby jointly and severally, unconditionally, absolutely, continually and irrevocably guarantees to the Administrative Agent for the benefit of the Secured Parties the prompt Payment in Full, and payment and performance in full, as and when due, of the Guaranteed Liabilities. For all purposes of this Article XII, notwithstanding the foregoing, the liability of each Guarantor individually with respect to its Guarantors’ Obligations shall be limited to an aggregate amount equal to the Maximum Guarantor Liability. Each Guarantor agrees that it is jointly and severally, directly and primarily liable (subject to the limitation in the immediately preceding sentence) for the Guaranteed Liabilities. The Guarantors’ Obligations are secured by various Collateral.

12.2   Payment. If the Borrower or any other Loan Party shall default in payment or performance of any of the Guaranteed Liabilities, whether principal, interest, premium, indemnification obligations, fees (including, but not limited to, attorney’s fees and expenses), expenses or otherwise, when and as the same shall become due, and after expiration of any applicable grace period, whether according to the terms of this Agreement, by acceleration, or otherwise, or upon the occurrence and during the continuance of any Event of Default, then any or all of the Guarantors will, upon demand thereof by the Administrative Agent, (i) fully pay to the Administrative Agent, for the benefit of the Secured Parties, an amount equal to all the Guaranteed Liabilities then due and owing or declared or deemed to be due and owing, including for this purpose, in the event of any Event of Default under Section 9.1(l) (and irrespective of the applicability of any restriction on acceleration or other action as against any other Loan Party in any Insolvency Proceeding), the entire outstanding or accrued amount of all Secured Obligations or (ii) perform such Guaranteed Liabilities, as applicable. For purposes of this Section 12.2, the Guarantors acknowledge and agree that “Guaranteed Liabilities” shall be deemed to include any amount (whether principal, interest, premium, fees, expenses, indemnification obligations and/or any other payment obligation of any kind or nature) which would have been accelerated in accordance with Section 9.2 but for the fact that such acceleration could be unenforceable or not allowable in any Insolvency Proceeding or otherwise under any applicable Law. Notwithstanding anything herein to the contrary, upon the occurrence and continuation of an Event of Default, then notwithstanding any Collateral or other direct or indirect security or credit support for the Guaranteed Liabilities, at the Administrative Agent’s election and without notice thereof or demand therefor, each of the Guaranteed Liabilities and the Guarantors’ Obligations shall immediately be and become due and payable.

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12.3   Absolute Rights and Obligations. This is a guaranty of payment and not of collection. The Guarantors’ Obligations under this Article XII shall be joint and several, absolute and unconditional irrespective of, and each Guarantor hereby expressly waives, to the extent not otherwise expressly prohibited by applicable Law, any defense to its obligations under this Article XII and all other Loan Documents to which it is a party by reason of:

(a)any lack of legality, validity or enforceability of this Agreement, or any of the Notes, or any other Loan Document, or of any other agreement or instrument creating, providing security for, or otherwise relating to any of the Guarantors’ Obligations, any of the Guaranteed Liabilities, or any other guaranty of any of the Guaranteed Liabilities (the Loan Documents, the documentation with respect to any Other Liabilities and all such other agreements and instruments being collectively referred to as the “Related Agreements”);

(b)any action taken under any of the Related Agreements, any exercise of any right or power therein conferred, any failure or omission to enforce any right conferred thereby, or any waiver of any covenant or condition therein provided;

(c)any acceleration of the maturity of any of the Guaranteed Liabilities, of the Guarantors’ Obligations of any other Guarantor, or of any other obligations or liabilities of any Person under any of the Related Agreements;

(d)any release, exchange, non-perfection, lapse in perfection, disposal, deterioration in value, or impairment of any security for any of the Guaranteed Liabilities, for any of the Guarantors’ Obligations of any Guarantor, or for any other obligations or liabilities of any Person under any of the Related Agreements;

(e)any change in the corporate or limited liability company existence, structure or ownership, including dissolution, of the Borrower, any Guarantor, any other Loan Party or any other party to a Related Agreement, or the combination or consolidation of the Borrower, any Guarantor, any other Loan Party or any other party to a Related Agreement into or with another entity or any transfer or disposition of any assets of the Borrower, any Guarantor or any other Loan Party or any other party to a Related Agreement;

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(f)any extension (including extensions of time for payment), renewal, amendment, restructuring or restatement of, any acceptance of late or partial payments under, or any change in the amount of any borrowings or any credit facilities available under, this Agreement, any of the Notes or any other Loan Document or any other Related Agreement, in whole or in part;

(g)the existence, addition, modification, termination, reduction or impairment of value, or release of any other guaranty (or security therefor) of the Guaranteed Liabilities (including the Guarantors’ Obligations of any other Guarantor and obligations arising under any other Guaranty or any other Loan Document now or hereafter in effect);

(h)any waiver of, forbearance or indulgence under, or other consent to any change in or departure from any term or provision contained in this Agreement, any other Loan Document or any other Related Agreement, including any term pertaining to the payment or performance of any of the Guaranteed Liabilities, any of the Guarantors’ Obligations of any other Guarantor, or any of the obligations or liabilities of any party to any other Related Agreement;

(i)any failure to assert any breach of or default under any Loan Document or with respect to the payment or performance of any of the Guaranteed Liabilities, any of the Guarantors’ Obligations of any Guarantor, or any of the obligations or liabilities of any party to any other Related Agreement; any extensions of credit in excess of the amount committed under or contemplated by the Loan Documents, or in circumstances in which any condition to such extensions of credit has not been satisfied; any other exercise or non-exercise, or any other failure, omission, breach, default, delay, or wrongful action in connection with any exercise or non-exercise, of any right or remedy against the Borrower, any other Loan Party or any other Person under or in connection with any Loan Document, any Related Agreement or any of the Guaranteed Liabilities or any Guarantors’ Obligation; any refusal of payment or performance of any of the Guaranteed Liabilities or any Guarantors’ Obligation, whether or not with any reservation of rights against any Guarantor; or any application of collections (including but not limited to collections resulting from realization upon any direct or indirect security for the Guaranteed Liabilities) to other obligations, if any, not entitled to the benefits of the Guaranty provided for in this Article XII, in preference to Guaranteed Liabilities or Guarantors’ Obligations entitled to the benefits of the Guaranty provided for in this Article XII, or if any collections are applied to the payment of Guaranteed Liabilities, any application to particular Guaranteed Liabilities;

(j)any taking, exchange, amendment, modification, waiver, supplement, termination, subordination, compromise, release, surrender, loss, or impairment of, or any failure to protect, perfect, or preserve the value of, or any enforcement of, realization upon, or exercise of rights, or remedies under or in connection with, or any failure, omission, breach, default, delay, or wrongful action by the Administrative Agent or the other Secured Parties, or any of them, or any other Person in connection with the enforcement of, realization upon, or exercise of rights or remedies under or in connection with, or, any other action or inaction by the Administrative Agent or the other Secured Parties, or any of them, or any other Person in respect of, any direct or indirect security for any of the Guaranteed Liabilities. As used in this Article XII, “direct or indirect security” for the Guaranteed Liabilities, and similar phrases, includes any collateral security, guaranty, suretyship, letter of credit, capital maintenance agreement, put option, subordination agreement, or other right or arrangement of any nature providing direct or indirect assurance of payment or performance of any of the Guaranteed Liabilities, made by or on behalf of any Person;

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(k)any merger, consolidation, liquidation, dissolution, winding-up, charter revocation, or forfeiture, or other change in, restructuring or termination of the corporate structure or existence of, the Borrower, any other Loan Party or any other Person; any bankruptcy, insolvency, reorganization or similar proceeding with respect to the Borrower, any other Loan Party or any other Person; or any action taken or election made by the Administrative Agent or the other Secured Parties, or any of them (including but not limited to any election under Section 1111(b)(2) of the Bankruptcy Code), the Borrower, any other Loan Party or any other Person in connection with any such proceeding;

(l)any defense, set-off, or counterclaim which may at any time be available to or be asserted by the Borrower, any other Loan Party or any other Person with respect to any Loan Document, any of the Guaranteed Liabilities, any Guarantors’ Obligation, or with respect to any Related Agreement; or any discharge by operation of law or release of the Borrower, any other Loan Party or any other Person from the performance or observance of any Loan Document or any of the Guaranteed Liabilities or Guarantors’ Obligations;

(m)any other circumstance whatsoever (with or without notice to or knowledge of any Guarantor or any other Loan Party) which might in any manner or to any extent vary the risks of such Loan Party, or might otherwise constitute a legal or equitable defense available to, or discharge of, a surety or a guarantor, including any right to require or claim that resort be had to the Borrower or any other Loan Party or to any Collateral or other security in respect of the Guaranteed Liabilities or Guarantors’ Obligations.

It is the express purpose and intent of the parties hereto that this Guaranty, the Guaranteed Liabilities and the Guarantors’ Obligations hereunder and under each Guarantor Joinder with respect hereto shall be absolute and unconditional under any and all circumstances and shall not be discharged except by payment and performance as herein provided.

12.4   Maximum Liability.

(a)Notwithstanding any provision to the contrary contained herein or in any other of the Loan Documents, to the extent any Guarantors’ Obligations shall be adjudicated to be invalid or unenforceable for any reason (including because of any applicable Law relating to fraudulent conveyances or transfers) then the obligations of each such Guarantor hereunder shall be limited to the maximum amount that is permissible under applicable Law (whether federal or state and including any Debtor Relief Law). Any analysis of the provisions hereof for purposes of laws relating to fraudulent conveyances or transfers shall take into account the contribution agreement established in Section 12.5.

(i)Each Guarantor’s maximum obligations hereunder (the “Maximum Guarantor Liability”) in any case or proceeding referred to below (but only in such a case or proceeding) shall not be in excess of:

(A)in a case or proceeding commenced by or against such Guarantor under the Bankruptcy Code on or within one year from the date on which any of the Guaranteed Liabilities are incurred, the maximum amount that would not otherwise cause the Guarantors’ Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations) to be avoidable or unenforceable against such Guarantor under (A) Section 548 of the Bankruptcy Code or (B) any state fraudulent transfer or fraudulent conveyance act or statute applied in such case or proceeding by virtue of Section 544 of the Bankruptcy Code; or

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(B)in a case or proceeding commenced by or against such Guarantor under the Bankruptcy Code subsequent to one year from the date on which any of the Guaranteed Liabilities or Guarantors’ Obligations of such Guarantor are incurred, the maximum amount that would not otherwise cause the Guarantors’ Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations) to be avoidable or unenforceable against such Guarantor under any state fraudulent transfer or fraudulent conveyance act or statute applied in any such case or proceeding by virtue of Section 544 of the Bankruptcy Code; or

(C)in a case or proceeding commenced by or against such Guarantor under any Debtor Relief Law other than the Bankruptcy Code, the maximum amount that would not otherwise cause the Guarantors’ Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations) to be avoidable or unenforceable against such Guarantor under such Debtor Relief Law, including any state fraudulent transfer or fraudulent conveyance act or statute applied in any such case or proceeding. (The substantive state or federal laws under which the possible avoidance or unenforceability of the Guarantors’ Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations) shall be determined in any such case or proceeding shall hereinafter be referred to as the “Avoidance Provisions”).

(ii)To the extent set forth above, but only to the extent that the Guarantors’ Obligations of such Guarantor or the transfers made by such Guarantor under the Collateral Documents to which it is a party, would otherwise be subject to avoidance under any Avoidance Provisions if such Guarantor is not deemed to have received valuable consideration, fair value, fair consideration or reasonably equivalent value for such transfers or obligations, or if such transfers or the Guarantors’ Obligations of such Guarantor would render such Guarantor insolvent, or leave such Guarantor with an unreasonably small capital or unreasonably small assets to conduct its business, or cause such Guarantor to have incurred debts (or to have intended to have incurred debts) beyond its ability to pay such debts as they mature, in each case as of the time any of such Guarantors’ Obligations are deemed to have been incurred and transfers made under such Avoidance Provisions, then such Guarantors’ Obligations shall be reduced to that amount which, after giving effect thereto, would not cause the Guarantors’ Obligations of such Guarantor (or any other obligations of such Guarantor to Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations), as so reduced, to be subject to avoidance under such Avoidance Provisions. This paragraph is intended solely to preserve the rights hereunder of Administrative Agent, Lenders and any other Person holding any of the Guaranteed Liabilities to the maximum extent that would not cause such Guarantors’ Obligations to be subject to avoidance under any Avoidance Provisions, and neither such Guarantor nor any other Person shall have any right, defense, offset, or claim under this paragraph as against Administrative Agent, Lenders or any other Person holding any of the Guaranteed Liabilities or the Guarantors’ Obligations that would not otherwise be available to such Person under the Avoidance Provisions.

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(b)Each Guarantor agrees that the Guarantors’ Obligations of such Guarantor may at any time and from time to time exceed the Maximum Guarantor Liability, without impairing the guaranty or any provision contained herein or affecting the rights and remedies of Administrative Agent hereunder.

12.5   Contribution Agreement. To the extent that any Guarantor shall be required hereunder to pay any portion of any Guaranteed Liability or Guarantors’ Obligation exceeding the greater of (i) the amount of the value actually received by such Guarantor and its Subsidiaries from the Loans and other Guaranteed Liabilities and Guarantors’ Obligations and (ii) the amount such Guarantor would otherwise have paid if such Guarantor had paid the aggregate amount of the Guaranteed Liabilities and Guarantors’ Obligations (excluding the amount thereof repaid by the Borrower) in the same proportion as such Guarantor’s net worth on the date enforcement is sought hereunder bears to the aggregate net worth of all the Guarantors on such date, then such Guarantor shall be reimbursed by such other Guarantors for the amount of such excess, pro rata, based on the respective net worth of such other Guarantors on such date of enforcement. The contribution agreement in this paragraph is intended only to define the relative rights of the Guarantors and nothing set forth in this paragraph is intended to or shall impair the obligations of the Guarantors, jointly and severally, to pay any amounts as and when the same shall become due and payable in accordance with the terms of this Agreement (up to the Maximum Guarantor Liability).

12.6   Currency and Funds of Payment. All Guarantors’ Obligations for payment will be paid in lawful currency of the United States of America and in immediately available funds, regardless of any law, regulation or decree now or hereafter in effect that might in any manner affect the Guaranteed Liabilities, or the rights of any Secured Party with respect thereto as against the Borrower or any other Loan Party, or cause or permit to be invoked any alteration in the time, amount or manner of payment by the Borrower or any other Loan Party of any or all of the Guaranteed Liabilities.

12.7   Subordination. For so long as this Agreement remains in effect, each Guarantor hereby unconditionally subordinates all present and future debts, liabilities or obligations now or hereafter owing to such Guarantor (a) of the Borrower, to the Payment In Full of the Guaranteed Liabilities, (b) of every other Guarantor (an “obligated guarantor”), to the Payment In Full of the Guarantors’ Obligations of such obligated guarantor, and (c) of each other Person now or hereafter constituting a Loan Party, to the Payment In Full of the obligations of such Loan Party owing to any Secured Party and arising under the Loan Documents or with respect to any Secured Bank Product or Secured Hedge. All amounts due under such subordinated debts, liabilities, or obligations shall, upon the occurrence and during the continuance of an Event of Default, be collected and, upon request by the Administrative Agent, paid over forthwith to the Administrative Agent for the benefit of the Secured Parties on account of the Guaranteed Liabilities, the Guarantors’ Obligations, or such other obligations, as applicable, and, after such request and pending such payment, shall be held by such Guarantor as agent and bailee of the Secured Parties separate and apart from all other funds, property and accounts of such Guarantor.

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12.8   Enforcement. Each Guarantor from time to time shall pay to the Administrative Agent for the benefit of the Secured Parties, on demand, at the Administrative Agent’s Principal Office or such other address as the Administrative Agent shall give notice of to such Guarantor, the Guarantors’ Obligations as they become or are declared due, and in the event such payment is not made forthwith, the Administrative Agent may proceed to suit against any one or more or all of the Guarantors. At the Administrative Agent’s election, one or more and successive or concurrent suits may be brought hereon by the Administrative Agent against any one or more or all of the Guarantors, whether or not suit has been commenced against the Borrower, any other Guarantor, or any other Person and whether or not the Secured Parties have taken or failed to take any other action to collect all or any portion of the Guaranteed Liabilities or have taken or failed to take any actions against any Collateral securing payment or performance of all or any portion of the Guaranteed Liabilities, and irrespective of any event, occurrence, or condition described in Section 12.3.

12.9   Set-Off and Waiver. Each Guarantor waives any right to assert against any Secured Party as a defense, counterclaim, set-off, recoupment or cross claim in respect of its Guarantors’ Obligations, any defense (legal or equitable) or other claim which such Guarantor may now or at any time hereafter have against the Borrower or any other Loan Party or any or all of the Secured Parties without waiving any additional defenses, set-offs, counterclaims or other claims otherwise available to such Guarantor. Each Guarantor agrees that each Secured Party shall have a lien for all the Guarantors’ Obligations upon all deposits or deposit accounts, of any kind, or any interest in any deposits or deposit accounts, now or hereafter pledged, mortgaged, transferred or assigned to such Secured Party or otherwise in the possession or control of such Secured Party for any purpose (other than solely for safekeeping) for the account or benefit of such Guarantor, including any balance of any deposit account or of any credit of such Guarantor with the Secured Party, whether now existing or hereafter established, and hereby authorizes each Secured Party from and after the occurrence of an Event of Default at any time or times with or without prior notice to apply such balances or any part thereof to such of the Guarantors’ Obligations to the Secured Parties then due and in such amounts as provided for in this Agreement or otherwise as they may elect.

12.10   Waiver of Notice; Subrogation.

(a)Each Guarantor hereby waives to the extent not otherwise expressly prohibited by applicable Law notice of the following events or occurrences: (i) acceptance of the Guaranty set forth in this Article XII; (ii) the Lenders’ heretofore, now or from time to time hereafter making Loans and otherwise loaning monies or giving or extending credit to or for the benefit of the Borrower or any other Loan Party, or otherwise entering into arrangements with any Loan Party giving rise to Guaranteed Liabilities, whether pursuant to this Agreement or the Notes or any other Loan Document or Related Agreement or any amendments, modifications, or supplements thereto, or replacements or extensions thereof; (iii) presentment, demand, default, non-payment, partial payment and protest; and (iv) any other event, condition, or occurrence described in Section 12.3. Each Guarantor agrees that each Secured Party may heretofore, now or at any time hereafter do any or all of the foregoing in such manner, upon such terms and at such times as each Secured Party, in its sole and absolute discretion, deems advisable, without in any way or respect impairing, affecting, reducing or releasing such Guarantor from its Guarantors’ Obligations, and each Guarantor hereby consents to each and all of the foregoing events or occurrences.

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(b)Each Guarantor hereby agrees that payment or performance by such Guarantor of its Guarantors’ Obligations under this Article XII may be enforced by the Administrative Agent on behalf of the Secured Parties upon demand by the Administrative Agent to such Guarantor without the Administrative Agent being required, such Guarantor expressly waiving to the extent not otherwise expressly prohibited by applicable Law any right it may have to require the Administrative Agent, to (i) prosecute collection or seek to enforce or resort to any remedies against the Borrower or any other Guarantor or any other guarantor of the Guaranteed Liabilities, or (ii) seek to enforce or resort to any remedies with respect to any security interests, Liens or encumbrances granted to the Administrative Agent or any Lender or other party to a Related Agreement by the Borrower, any other Guarantor or any other Person on account of the Guaranteed Liabilities or any guaranty thereof, IT BEING EXPRESSLY UNDERSTOOD, ACKNOWLEDGED AND AGREED BY SUCH GUARANTOR THAT DEMAND UNDER THE GUARANTY SET FORTH IN THIS ARTICLE XII MAY BE MADE BY THE ADMINISTRATIVE AGENT, AND THE PROVISIONS HEREOF ENFORCED BY THE ADMINISTRATIVE AGENT, EFFECTIVE AS OF THE FIRST DATE ANY EVENT OF DEFAULT OCCURS AND IS CONTINUING.

(c)Each Guarantor further agrees that such Guarantor shall not exercise any of its rights of subrogation, reimbursement, contribution, indemnity or recourse to security for the Guaranteed Liabilities until at least ninety-five (95) days immediately following the Termination Date shall have elapsed without the filing or commencement, by or against any Loan Party, of any state or federal action, suit, petition or proceeding seeking any reorganization, liquidation or other relief or arrangement in respect of creditors of, or the appointment of a receiver, liquidator, trustee or conservator in respect to, such Loan Party or its assets. If an amount shall be paid to any Guarantor on account of such rights at any time prior to Termination Date, such amount shall be held in trust for the benefit of the Secured Parties and shall forthwith be paid to the Administrative Agent, for the benefit of the Secured Parties, to be credited and applied upon the Guarantors’ Obligations, whether matured or unmatured, in accordance with the terms of this Agreement or otherwise as the Secured Parties may elect. The agreements in this subsection shall survive repayment of all of the Guarantors’ Obligations, the termination or expiration of this Agreement in any manner and occurrence of the Termination Date.

12.11   No Stay. Without limitation of any other provision set forth in this Article XII, if any declaration of default or acceleration or other exercise or condition to exercise of rights or remedies under or with respect to any Guarantors’ Obligation or any of the Guaranteed Liabilities shall at any time be stayed, enjoined, or prevented for any reason (including but not limited to stay or injunction resulting from the pendency against any Loan Party or any other Person of a bankruptcy, insolvency, reorganization or similar proceeding), the Guarantors agree that, for the purposes of this Article XII and their obligations hereunder, the Guarantors’ Obligations and the Guaranteed Liabilities shall be deemed to have been declared in default or accelerated, and such other exercise or conditions to exercise shall be deemed to have been taken or met.

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12.12   Additional Guarantors. At any time after the initial execution and delivery of this Agreement to the Administrative Agent and the Lenders, additional Persons may become parties to this Agreement and thereby acquire the duties and rights of being Guarantors hereunder by executing and delivering to the Administrative Agent and the Lenders a duly executed Guarantor Joinder pursuant to this Agreement. No notice of the addition of any Guarantor shall be required to be given to any pre-existing Guarantor and each Guarantor hereby consents thereto.

12.13   Reliance. Each Guarantor represents and warrants to the Administrative Agent, for the benefit of the Secured Parties, that: (a) such Guarantor has adequate means to obtain on a continuing basis (i) from the Borrower, information concerning the Loan Parties and the Loan Parties’ financial condition and affairs and (ii) from other reliable sources, such other information as it deems material in deciding to provide its Guaranty under this Article XII and any Guarantor Joinder (“Other Information”), and has full and complete access to the Loan Parties’ books and records and to such Other Information; (b) such Guarantor is not relying on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, to provide any such information, now or in the future; (c) such Guarantor has been furnished with and reviewed the terms of such Loan Documents and Related Agreements as it has requested, is executing this Agreement (or the Guarantor Joinder to which it is a party, as applicable) freely and deliberately, and understands the obligations and financial risk undertaken by providing its Guaranty under this Agreement; (d) such Guarantor has relied solely on the Guarantor’s own independent investigation, appraisal and analysis of the Borrower and the other Loan Parties, such Persons’ financial condition and affairs, the Other Information, and such other matters as it deems material in deciding to provide this Guaranty and is fully aware of the same; and (e) such Guarantor has not depended or relied on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, for any information whatsoever concerning the Borrower or the Borrower’s financial condition and affairs or any other matters material to such Guarantor’s decision to provide this Guaranty, or for any counseling, guidance, or special consideration or any promise therefor with respect to such decision. Each Guarantor agrees that no Secured Party has any duty or responsibility whatsoever, now or in the future, to provide to such Guarantor any information concerning the Borrower or any other Loan Party or such Persons’ financial condition and affairs, or any Other Information, other than as expressly provided herein, and that, if such Guarantor receives any such information from any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, such Guarantor will independently verify the information and will not rely on any Secured Party or its or their employees, directors, agents or other representatives or Affiliates, with respect to such information.

12.14   Receipt of Credit Agreement, Other Loan Documents, Benefits.

(a)Each Guarantor hereby acknowledges that it has received a copy of this Agreement and the other Loan Documents and each Guarantor certifies that the representations and warranties made therein with respect to such Guarantor are true and correct in all material respects. Further, each Guarantor acknowledges and agrees to perform, comply with, and be bound by all of the provisions of this Agreement and the other Loan Documents applicable to such Guarantor.

(b)Each Guarantor hereby acknowledges, represents, and warrants that it receives direct and indirect benefits by virtue of its affiliation with Borrower and the other Guarantors and that it will receive direct and indirect benefits from the financing arrangements contemplated by this Agreement and that such benefits, together with the rights of contribution and subrogation that may arise in connection herewith are a reasonably equivalent exchange of value in return for providing the Guaranty set forth in this Article XII.

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12.15   Joinder. Each Person that shall at any time execute and deliver to the Administrative Agent a Guarantor Joinder shall thereupon irrevocably, absolutely and unconditionally become a party hereto and obligated hereunder as a Guarantor, and all references herein and in the other Loan Documents to the Guarantors or to the parties to this Guaranty shall be deemed to include such Person as a Guarantor hereunder.

[SIGNATURE PAGES FOLLOW]

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[SIGNATURE PAGE TO CREDIT AGREEMENT]

IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Agreement as of the day and year first above written.

BORROWER:

NUVERA COMMUNICATIONS, INC., as Borrower

By: /s/ Glenn H. Zerbe
Name:  Glenn H. Zerbe
Title:    Chief Executive Officer and President

GUARANTORS:

PEOPLES TELEPHONE COMPANY
WESTERN TELEPHONE COMPANY
HUTCHINSON TELEPHONE COMPANY
HUTCHINSON TELECOMMUNICATIONS, INC.
HUTCHINSON CELLULAR, INC.
TECH TRENDS, INC.
SLEEPY EYE TELEPHONE COMPANY
SCOTT-RICE TELEPHONE CO., each as Guarantor

By: /s/ Glenn H. Zerbe
Name:  Glenn H. Zerbe
Title:    Chief Executive Officer and President

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[SIGNATURE PAGE TO CREDIT AGREEMENT]

COBANK, ACB, as a Lender, the Administrative Agent and the Swing Line Lender

By: /s/ Lennie Blakeslee
Lennie Blakeslee
Managing Director

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SCHEDULE 1.1(B)
COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES

Part 1 - Commitments of Lenders

LENDER	AMOUNT OF COMMITMENT FOR REVOLVING LOANS	AMOUNT OF COMMITMENT FOR TERM A-1 LOANS	AMOUNT OF COMMITMENT FOR DELAYED DRAW TERM LOANS	AMOUNT OF COMMITMENT FOR SWING LINE LOANS	AGGREGATE COMMITMENT	PRO RATA SHARE
COBANK, ACB	$30,000,000	$50,000,000	$50,000,000	$3,000,000	$130,000,000	100%

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SCHEDULE 1.1(B)
COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES

Part 2 - Addresses for Notices to Administrative Agent, Swing Line Lender Borrower and Guarantors:

ADMINISTRATIVE AGENT and SWING LINE LENDER

Name:              CoBank, ACB
Address:          6340 S. Fiddlers Green Circle
                        Greenwood Village, CO 80111
                        Attention: Loan Administration
Telecopy:         (303) 740-4021
Email:              loanadmin@cobank.com

With a Copy To:

Name:              CoBank, ACB
Address:          6340 S. Fiddlers Green Circle
                        Greenwood Village, CO 80111
Attention:        Communications Banking Group
Telephone:       (303) 740-4000
Telecopy:         (303) 740-4021
Email:              cobankloanaccounting@cobank.com; pfruge@cobank.com

BORROWER:

Name:              Nuvera Communications, Inc.
Address:          400 Second Street North
                        P.O. Box 697
                        New Ulm, Minnesota 56073-0697
Attention:        Chief Financial Officer
Telephone:       (507) 233-4172
Telecopy:         (507) 354-1982
Email:              curtiskawlewski@nuvera.net

GUARANTORS:

In the care of the Borrower in accordance with the notice
information for the Borrower set forth above.

With a Copy to:

Name:              Ballard Spahr LLP
Address:          200 IDS Center
                        80 South Eighth Street
                        Minneapolis, Minnesota 55402
Attention:        Thomas Lovett, IV
Telephone:       (612) 371-3270
Telecopy:         (612) 371-3207
Email: lovettt@ballardspahr.com

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SCHEDULE 1.1(C)
PRICING

Part 1 – Applicable Unused DDTL Commitment Fee Rate

“Applicable Unused DDTL Commitment Fee Rate” means (a) for the period commencing on the Closing Date and ending on the date that is one day prior to the second anniversary of the Closing Date, the percentage rate per annum based on the Leverage Ratio then in effect according to the Pricing Grid below the heading “Applicable Unused Commitment Fee Rate” and (b) for the period commencing on the date that is the second anniversary of the Closing Date, 0.75% per annum.

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Part 2 – Pricing Grid

Level	Total Leverage Ratio	Applicable Margin for Base Rate Loans (Revolving Credit Facility)	Applicable Margin for Base Rate Loans (Term Loans)	Applicable Margin for Term SOFR Rate Loans (Revolving Credit Facility)	Applicable Margin for Term SOFR Rate Loans (Term Loans)	Applicable Unused Commitment Fee Rate
Level I	> 4.00:1.00	1.900%	2.150%	2.900%	3.150%	0.300%
Level II	< 4.00:1.00 but > 3.50:1.00	1.650%	1.900%	2.650%	2.900%	0.300%
Level III	< 3.50:1.00 but > 3.00:1.00	1.400%	1.650%	2.400%	2.650%	0.300%
Level IV	< 3.00:1.00 but > 2.50:1.00	1.150%	1.400%	2.150%	2.400%	0.250%
Level V	< 2.50:1.00 but > 2.00:1.00	0.900%	1.150%	1.900%	2.150%	0.250%
Level VI	< 2.00:1.00	0.650%	0.900%	1.650%	1.900%	0.200%

For purposes of determining the Applicable Margin and the Applicable Unused Commitment Fee Rate:

(a)        The Applicable Margin and the Applicable Unused Commitment Fee Rate shall be determined on the Closing Date based on the Leverage Ratio computed on such date pursuant to a Compliance Certificate to be delivered on the Closing Date.

(b)        The Applicable Margin and the Applicable Unused Commitment Fee Rate shall be recomputed as of the end of each fiscal quarter ending after the Closing Date based on the Leverage Ratio as of such quarter end. Any increase or decrease in the Applicable Margin and the Applicable Unused Commitment Fee computed as of a quarter end shall be effective no later than five (5) Business Days following the date on which the Compliance Certificate evidencing such computation is delivered under Section 6.1(c). If a Compliance Certificate is not delivered when due in accordance with such Section 6.1(c), then the rates in Level I shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the date on which such Compliance Certificate is delivered.

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(c)        If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the Leverage Ratio as calculated by the Borrower as of any applicable date was inaccurate and (ii) a proper calculation of the Leverage Ratio would have resulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the applicable Lenders, promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code, automatically and without further action by the Administrative Agent or any Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This clause (c) shall not limit the rights of the Administrative Agent or any Lender, as the case may be, under Section 3.5, or Article IX.

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EXHIBIT B
EXHIBIT F-5 - FORM OF SWING LINE NOTE

[See attached.]

145

SWING LINE NOTE

$3,000,000.00                                                                                                                                                                                                                                                                                    [______ __, ____]

FOR VALUE RECEIVED, the undersigned, Nuvera Communications, Inc., a Minnesota corporation (herein called the “Borrower”), unconditionally promises to pay to CoBank, ACB (the “Lender”), at the office of the Administrative Agent (as defined below) at 6340 S. Fiddlers Green Circle, Greenwood Village, Colorado 80111, the lesser of (i) the principal sum of THREE MILLION AND NO/100 DOLLARS (US$3,000,000.00) or (ii) the aggregate unpaid principal balance of all the Swing Line Loans made by the Lender to the Borrower pursuant to Section 2.4 of that certain Credit Agreement, dated as of July 15, 2022 (as amended by that certain First Amendment to Credit Agreement, dated as of the date hereof, and as further amended, modified, supplemented, extended or restated from time to time, the “Credit Agreement”), among the Borrower, the Guarantors now or hereafter party thereto, the Lenders now or hereafter party thereto and CoBank, ACB, as administrative agent (hereinafter referred to in such capacity as the “Administrative Agent”), together with all outstanding interest thereon on the Maturity Date with respect to the Revolving Credit Facility.

This Swing Line Note (this “Note”) may be prepaid in whole or in part at any time subject to the terms of the Credit Agreement.

The Borrower shall pay interest on the unpaid principal balance hereof from time to time outstanding from the date hereof at the rate or rates per annum as provided in the Credit Agreement. If any payment or action to be made or taken hereunder shall be stated to be or become due on a day which is not a Business Day, such payment or action shall be made or taken on the next following Business Day, unless otherwise provided in the Credit Agreement, and such extension of time shall be included in computing interest or fees, if any, in connection with such payment or action. Upon the occurrence and during the continuation of an Event of Default, subject to the terms of the Credit Agreement, the Borrower shall pay interest on the entire principal amount of the then outstanding Swing Line Loans evidenced by this Note and the other Loan Documents at a rate per annum as set forth in Section 3.4(b) of the Credit Agreement.

Subject to the provisions of the Credit Agreement, payments of both principal and interest shall be made without set-off, counterclaim or other deduction of any nature to the Administrative Agent unless otherwise directed in writing by the Administrative Agent, and in lawful money of the United States of America in immediately available funds.

This Note is the Swing Line Note referred to in, and is entitled to the benefits of, the Credit Agreement and the other Loan Documents, including the representations, warranties, covenants, conditions, security interests and liens contained or granted therein. The Credit Agreement among other things contains provisions for acceleration of the maturity hereof upon the happening of certain stated events and also for prepayments, in certain circumstances, on account of principal hereof prior to maturity upon the terms and conditions therein specified. The Borrower waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note and the Credit Agreement.

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This Note shall bind the Borrower and its successors and assigns, and the benefits hereof shall inure to the benefit of the Lender and its successors and assigns. All references herein to the “Borrower” and the “Lender” shall be deemed to apply to the Borrower and the Lender, respectively, and their respective successors and assigns as permitted under the Credit Agreement.

This Note and any other documents delivered in connection herewith and the rights and obligations of the parties hereto and thereto shall for all purposes be governed by, and construed and enforced in accordance with, the law of the State of Colorado without regard to conflicts of law principles that require or permit application of the laws of any other state or jurisdiction.

All capitalized terms used herein shall, unless otherwise defined herein, have the same meanings given to such terms in the Credit Agreement, and the rules of construction set forth in Sections 1.2 through 1.7 of the Credit Agreement shall apply to this Note.

[Signature Page Follows]

147

IN WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned has executed this Note by its duly authorized officer as of the date first written above.

Nuvera Communications, Inc.

By: /s/ Glenn H. Zerbe
Name:  Glenn H. Zerbe
Title:    Chief Executive Officer and President

148

EX-19.1

                                                EXHIBIT 19.1

NUVERA COMMUNICATIONS, INC.

INSIDER TRADING POLICY
(As amended, February 29, 2024)

This Insider Trading Policy (this “Policy”) of Nuvera Communications, Inc. (the “Company”) consists of seven sections:

• Section I provides an overview;

• Section II sets forth the policies of the Company prohibiting insider trading;

• Section III explains insider trading;

• Section IV consists of procedures that have been put in place by the Company to prevent insider trading;

• Section V sets forth additional transactions that are prohibited by this Policy;

• Section VI explains Rule 10b5-1 trading plans and provides information about Section 16 and Rule 144; and

• Section VII refers to the execution and return of a certificate of compliance.

In this Policy, “Nuvera,” the “Company,” “we,” “us” and “our” refer to Nuvera Communications, Inc., and any subsidiaries, unless the context otherwise requires.

I.SUMMARY

Preventing insider trading is necessary to comply with securities laws and to preserve the reputation and integrity of the Company as well as that of all persons affiliated with the Company. “Insider trading” occurs when any person purchases or sells a security while in possession of inside information relating to the security. As explained in Section III below, “inside information” is information that is both “material” and “nonpublic.” Insider trading is a crime. The penalties for violating insider trading laws include imprisonment, disgorgement of profits, civil fines, and criminal fines of up to $5.0 million for individuals and $25.0 million for corporations. Insider trading is also prohibited by this Policy, and violation of this Policy may result in Company-imposed sanctions, including removal or dismissal for cause.

This Policy applies to all officers, directors and employees of the Company, and as noted below, others that have access to material nonpublic information. Individuals subject to this Policy are responsible for ensuring that members of their households also comply with this Policy. This Policy also applies to any entities controlled by individuals subject to the Policy, including any corporations, partnerships or trusts, and transactions by these entities should be treated for the purposes of this Policy and applicable securities laws as if they were for the individual’s own account. This Policy extends to all activities within and outside an individual’s Company duties. Every officer, director and employee must review this Policy. Questions regarding the Policy should be directed to the Company’s Compliance Officer (as defined in this Policy).

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II.STATEMENT OF POLICIES PROHIBITING INSIDER TRADING

            No officer, director or employee shall purchase or sell any type of security while in possession of material, nonpublic information relating to the security, whether the issuer of the security is the Company or any other company.

Additionally, no officer, director or employee designated by the Company as subject to blackout periods shall purchase or sell any security of the Company during the period beginning on the fifteenth calendar day before the end of any fiscal quarter of the Company and ending upon the completion of the second full trading day after the public release of earnings data for such fiscal quarter or during any other trading suspension period declared by the Company. For the purposes of this Policy, a “trading day” is a day on which national stock exchanges are open for trading.

These prohibitions do not apply to:

• purchases of the Company’s securities from the Company or sales of the Company’s securities to the Company;

• exercises of stock options or other equity awards or the surrender of shares to the Company in payment of the exercise price or in satisfaction of any tax withholding obligations in a manner permitted by the applicable equity award agreement, or vesting of equity-based awards, that in each case do not involve a market sale of the Company’s securities; (the “cashless exercise” of a Company stock option through a broker does involve a market sale of the Company’s securities, and therefore would not qualify under this exception); or

• purchases or sales of the Company’s securities made pursuant to any Trading Plan approved pursuant to Section VI of this Policy.

No officer, director or employee shall directly or indirectly communicate (or “tip”) material, nonpublic information to anyone outside of the Company (except in accordance with the Company’s policies regarding the protection or authorized external disclosure of Company information) or to anyone within the Company other than on a need-to-know basis.

III.EXPLANATION OF INSIDER TRADING

            “Insider trading” refers to the purchase or sale of a security while in possession of “material,” “nonpublic” information relating to the security or its issuer.

“Securities” include stocks, bonds, notes, debentures, options, warrants and other convertible securities, as well as derivative instruments.

“Purchase” and “sale” are defined broadly under the federal securities law. “Purchase” includes not only the actual purchase of a security, but any contract to purchase or otherwise acquire a security. “Sale” includes not only the actual sale of a security, but any contract to sell or otherwise dispose of a security. These definitions extend to a broad range of transactions, including conventional cash-for-stock transactions, conversions, the exercise of stock options, and acquisitions and exercises of warrants or puts, calls or other derivative securities.

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It is generally understood that insider trading includes the following:

• trading by insiders while in possession of material, nonpublic information;

• trading by persons other than insiders while in possession of material, nonpublic information, if the information either was given in breach of an insider’s fiduciary duty to keep it confidential or was misappropriated; and

• communicating or tipping material, nonpublic information to others, including recommending the purchase or sale of a security while in possession of such information.

A.Which Facts are Material?

The materiality of a fact depends upon the circumstances. A fact is considered “material” if there is a substantial likelihood that a reasonable investor would consider it important in making a decision to buy, sell or hold a security, or if the fact is likely to have a significant effect on the market price of the security. Material information can be positive or negative and can relate to virtually any aspect of a company’s business or to any type of security, debt or equity.

Examples of material information include (but are not limited to) information about corporate earnings or earnings forecasts; possible mergers, acquisitions, tender offers or dispositions; major new product or service offerings; important business developments such as regulatory actions, developments regarding strategic collaborators; management or control changes; significant financing developments including pending public sales or offerings of debt or equity securities; defaults on borrowings; bankruptcies; and significant litigation. Moreover, material information does not have to be related to a company’s business. For example, the contents of a forthcoming newspaper column that is expected to affect the market price of a security can be material.

A good general rule of thumb: When in doubt, do not trade.

B.What is Non-Public?

Information is “non-public” if it is not available to the general public. Information would be considered public if it were widely disseminated through a newswire services, a broadcast on widely available radio or television programs, publication in a widely available newspaper, magazine or news website, a Regulation FD-compliant conference call, or public disclosure documents filed with the Securities and Exchange Commission (“SEC”) and available on the SEC’s website.

The circulation of rumors, even if accurate and reported in the media, does not constitute effective public dissemination. In addition, even after a public announcement, a reasonable period of time must lapse in order for the market to react to the information. Generally, one should allow two full trading days following publication as a reasonable waiting period before such information is deemed to be public.

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C.Who is an Insider?

“Insiders” include officers, directors and employees of a company and anyone else who has material inside information about a company; this may include consultants and contractors who may have access to material nonpublic information in the course of their activities for the company. Insiders have independent fiduciary duties to their company and its shareholders not to trade on material, nonpublic information relating to the company’s securities. All officers, directors and employees of the Company, and others who may have access to material nonpublic information in the course of their activities for the Company should consider themselves insiders with respect to material, non-public information about the Company’s business, activities and securities.  These officers, directors, employees and third parties may not trade in the Company’s securities while in possession of material, non-public information relating to the Company, nor may they tip this information to anyone outside the Company (except in accordance with the Company’s policies regarding the protection or authorized external disclosure of Company information) or to anyone within the Company other than on a need-to-know basis.

Individuals subject to this Policy are responsible for ensuring that members of their households also comply with this Policy. This Policy also applies to any entities controlled by individuals subject to the Policy, including any corporations, partnerships or trusts, and transactions by these entities should be treated for the purposes of this Policy and applicable securities laws as if they were for the individual’s own account.

The Company and its officers are authorized (i) to include in Company agreements with third parties such as consultants and contractors a covenant under which these parties agree to comply with applicable provisions of the Company’s insider trading policy or (ii) to develop and implement a separate policy more closely tailored for non-employees.

D.Trading by Persons Other than Insiders

Insiders may be liable for communicating or tipping material, nonpublic information to a third party (“tippee”), and insider trading violations are not limited to trading or tipping by insiders. Persons other than insiders also can be liable for insider trading, including tippees who trade on material, nonpublic information tipped to them or individuals who trade on material, nonpublic information that has been misappropriated.

Tippees inherit an insider’s duties and are liable for trading on material, nonpublic information illegally tipped to them by an insider. Similarly, just as insiders are liable for the insider trading of their tippees, so are tippees who pass the information along to others who trade. In other words, a tippee’s liability for insider trading is no different from that of an insider. Tippees can obtain material, non-public information by receiving overt tips from others or through, among other things, conversations at social, business, or other gatherings.

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E.Penalties for Engaging in Insider Trading

            Penalties for trading on or tipping material, nonpublic information can extend significantly beyond any profits made or losses avoided, both for individuals engaging in such unlawful conduct and their employers. The SEC and Department of Justice have made the prosecution of insider trading violations a top priority. Enforcement remedies available to the government or private plaintiffs under the federal securities laws include:

·administrative sanctions;

·securities industry self-regulatory organization sanctions;

·civil injunctions;

·damage awards to private plaintiffs;

·disgorgement of all profits;

·civil fines for the violator of up to three times the amount of profit gained or loss avoided;

·significant civil fines for the employer or other controlling person of a violator;

·criminal fines for individual violators of up to $5.0 million ($25.0 million for an entity); and

·jail sentences of up to 20 years.

In addition, insider trading could result in serious sanctions by the Company, including dismissal. Insider trading violations are not limited to violations of the federal securities laws. Other federal and state civil or criminal laws, such as the laws prohibiting mail and wire fraud and the Racketeer Influenced and Corrupt Organizations Act (“RICO”), also may be violated in connection with insider trading.

F.Size of Transaction and Reason for Transaction Do Not Matter

            The size of the transaction or the amount of profit received does not have to be significant to result in prosecution. Securities regulatory authorities, including the SEC, have the ability to monitor even the smallest trades, and the SEC performs routine market surveillance. Brokers and dealers are required by law to inform the SEC of any possible violations by people who may have material, nonpublic information. The SEC aggressively investigates even small insider trading violations.

G.Examples of Insider Trading

             Examples of insider trading cases include actions brought against corporate officers, directors, and employees who traded in a company’s securities after learning of significant confidential corporate developments; friends, business associates, family members and other tippees of these officers, directors, and employees who traded in the securities after receiving such information; government employees who learned of such information in the course of their employment; and other persons who misappropriated, and took advantage of, confidential information from their employers.

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The following are illustrations of insider trading violations. These illustrations are hypothetical and, consequently, not intended to reflect on the actual activities or business of the Company or any other entity.

Trading by Insider

An officer of X Corporation learns that earnings to be reported by X Corporation will increase dramatically. Prior to the public announcement of such earnings, the officer purchases X Corporation’s stock. The officer, an insider, is liable for all profits as well as penalties of up to three times the amount of all profits. The officer also is subject to, among other things, criminal prosecution, including up to $5.0 million in additional fines and 20 years in jail. Depending upon the circumstances, X Corporation and the individual to whom the officer reports also could be liable as controlling persons.

Trading by Tippee

An officer of X Corporation tells a friend that X Corporation is about to publicly announce that it has concluded an agreement for a major acquisition. This tip causes the friend to purchase X Corporation’s stock in advance of the announcement. The officer is jointly liable with his friend for all of the friend’s profits, and each is liable for all civil penalties of up to three times the amount of the friend’s profits. The officer and his friend are also subject to criminal prosecution and other remedies and sanctions, as described above.

H.Prohibition of Records Falsification and False Statements

            Section 13(b)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) requires companies subject to the Securities Act of 1933, as amended (the “Securities Act”), to maintain proper internal books and records and to devise and maintain an adequate system of internal accounting controls. The SEC has supplemented the statutory requirements by adopting rules that prohibit (1) any person from falsifying records or accounts subject to the above requirements and (2) officers or directors from making any materially false, misleading, or incomplete statement to any accountant in connection with any audit or filing with the SEC. These provisions reflect the SEC’s intent to discourage officers, directors and other persons with access to the Company’s books and records from taking action that might result in the communication of materially misleading financial information to the investing public.

IV.STATEMENT OF PROCEDURES PREVENTING INSIDER TRADING

            The following procedures have been established, and will be maintained and enforced, by the Company to prevent insider trading. Every officer, director and employee are required to follow these procedures.

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A.Pre-Clearance of All Trades by All Officers, Directors and Certain Employees

            To provide assistance in preventing inadvertent violations of applicable securities laws and to avoid the appearance of impropriety in connection with the purchase and sale of the Company’s securities, all transactions in the Company’s securities (including, without limitation, acquisitions and dispositions of Company shares, the exercise of stock options and the sale of Company shares issued upon exercise of stock options) by officers, directors and such other employees as are designated from time to time by the Board of Directors or the Compliance Officer as being subject to this pre-clearance process (a “Pre-Clearance Person”) must be pre-cleared by the Company’s Compliance Officer or his/her designee. Pre-clearance does not relieve anyone of his or her responsibility under SEC rules.

A request for pre-clearance may be oral or in writing (including, without limitation, by e-mail), should be made at least two business days in advance of the proposed transaction and should include the identity of the Pre-Clearance Person, the type of proposed transaction (for example, an open market purchase, a privately negotiated sale, an option exercise, etc.), the proposed date of the transaction and the number of shares or options to be involved. In addition, the Pre-Clearance Person must execute a certification (in the form approved by the Compliance Officer) that he, she or it is not aware of material, nonpublic information about the Company. The Compliance Officer shall have sole discretion to decide whether to clear any contemplated transaction. The Chief Executive Officer or other designee, however, shall have sole discretion to decide whether to clear transactions by the Compliance Officer or persons or entities subject to this Policy as a result of their relationship with the Compliance Officer. All trades that are pre-cleared must be effected within five business days of receipt of the pre-clearance unless a specific exception has been granted by the Compliance Officer (or the Chief Executive Officer, in the case of the Compliance Officer or persons or entities subject to this Policy as a result of their relationship with the Compliance Officer). A pre-cleared trade (or any portion of a pre-cleared trade) that has not been effected during the five business day period must be pre-cleared again prior to execution. Notwithstanding receipt of pre-clearance, if the Pre-Clearance Person becomes aware of material, nonpublic information or becomes subject to a black-out period before the transaction is effected, the transaction may not be completed.

B.Black-Out Periods for All Officers, Directors and Certain Employees

            Additionally, no officer, director or employee designated from time to time by the Board of Directors or the Compliance Officer as being subject to black-out periods shall purchase or sell any security of the Company during the period beginning on the fifteenth calendar day before the end of any fiscal quarter of the Company and ending upon the completion of the second full trading day after the public release of earnings data for such fiscal quarter or during any other trading suspension period declared by the Company, except for purchases and sales made pursuant to the permitted transactions described in Section II.

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Exceptions to the black-out period policy may be approved only by the Compliance Officer (or, in the case of an exception for the Compliance Officer or persons or entities subject to this Policy as a result of their relationship with the Compliance Officer, the Chief Executive Officer or, in the case of exceptions for directors or persons or entities subject to this Policy as a result of their relationship with a director, the Board of Directors).

From time to time, the Company, through the Board of Directors, the Company’s disclosure committee or the Compliance Officer, may recommend that officers, directors, employees or others suspend trading in the Company’s securities because of developments that have not yet been disclosed to the public. Subject to the exceptions noted above, all of those affected should not trade in the Company’s securities while the suspension is in effect and should not disclose to others that the Company has suspended trading.

If the Company is required to impose a “pension fund black-out period” under Regulation BTR, each director and executive officer shall not, directly or indirectly sell, purchase or otherwise transfer during such black-out period any equity securities of the Company acquired in connection with his or her service as a director or officer of the Company, except as permitted by Regulation BTR.

C.Post-Termination Transactions

            With the exception of the pre-clearance requirement, this Policy continues to apply to transactions in the Company’s securities even after termination of service to the Company. If an individual is in possession of material, nonpublic information when his or her service terminates, that individual may not trade in the Company’s securities until that information has become public or is no longer material.

D.Information Relating to the Company

1.Access to Information

            Access to material, nonpublic information about the Company, including the Company’s business, earnings or prospects, should be limited to officers, directors and employees of the Company on a need-to-know basis. In addition, such information should not be communicated to anyone outside the Company under any circumstances (except in accordance with the Company’s policies regarding the protection or authorized external disclosure of Company information) or to anyone within the Company other than on a need-to-know basis.

In communicating material nonpublic information to employees of the Company, all officers, directors and employees must take care to emphasize the need for confidential treatment of such information and adherence to the Company’s policies with regard to confidential information.

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2.Inquiries from Third Parties

            Inquiries from third parties, such as industry analysts or members of the media, about the Company should be directed to the Chief Financial Officer.

E.Limitations on Access to Company Information

            The following procedures are designed to maintain confidentiality with respect to the Company’s business operations and activities.

            All officers, directors and employees should take all steps and precautions necessary to restrict access to, and secure, material, nonpublic information by, among other things:

• maintaining the confidentiality of Company-related transactions;

• conducting their business and social activities so as not to risk inadvertent disclosure of confidential information. Review of confidential documents in public places should be conducted so as to prevent access by unauthorized persons;

• restricting access to documents and files (including computer files) containing material, nonpublic information to individuals on a need-to-know basis (including maintaining control over the distribution of documents and drafts of documents);

• promptly removing and cleaning up all confidential documents and other materials from conference rooms following the conclusion of any meetings;

• disposing of all confidential documents and other papers, after there is no longer any business or other legally required need, through shredders when appropriate;

• restricting access to areas likely to contain confidential documents or material, nonpublic information;

• safeguarding laptop computers, mobile devices, tablets, memory sticks, CDs and other items that contain confidential information; and

• avoiding the discussion of material, nonpublic information in places where the information could be overheard by others, such as in elevators, restrooms, hallways, restaurants, airplanes or taxicabs.

Personnel involved with material, nonpublic information, to the extent feasible, should conduct their business and activities in areas separate from other Company activities.

V.ADDITIONAL PROHIBITED TRANSACTIONS

            The Company has determined that there could be heightened legal risk or the appearance of improper or inappropriate conduct if the persons subject to this Policy engage in certain types of transactions. Therefore, officers, directors and employees shall comply with the following policies with respect to certain transactions in the Company’s securities:

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A.Short Sales

            Short sales of the Company’s securities evidence an expectation on the part of the seller that the securities will decline in value, and therefore signal to the market that the seller does not have confidence in the Company or its short-term prospects. In addition, short sales may reduce the seller’s incentive to improve the Company’s performance. For these reasons, short sales of the Company’s securities by any officer, director or employee are prohibited by this Policy. In addition, as noted below, Section 16(c) of the Exchange Act absolutely prohibits Section 16 reporting persons from making short sales of the Company’s equity securities, i.e., sales of shares that the insider does not own at the time of sale, or sales of shares against which the insider does not deliver the shares within 20 days after the sale.

B.Publicly Traded Options

            A transaction in options is, in effect, a bet on the short-term movement of the Company’s common stock and therefore creates the appearance that an officer, director or employee is trading based on inside information. Transactions in options also may focus an officer’s, director’s or employee’s attention on short-term performance at the expense of the Company’s long-term objectives. Accordingly, transactions in puts, calls or other derivative securities involving the Company’s equity securities, on an exchange or in any other organized market, are prohibited by this Policy for any director, officer or employee.

C.Hedging Transactions

            Certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale contracts, allow an officer, director or employee to lock in much of the value of his or her stock holdings, often in exchange for all or part of the potential for upside appreciation in the stock. These transactions allow the officer, director or employee to continue to own the covered securities, but without the full risks and rewards of ownership. When that occurs, the officer, director or employee may no longer have the same objectives as the Company’s other shareholders. Therefore, such transactions involving the Company’s equity securities are prohibited by this Policy by any director, officer or employee.

D.Purchases of the Company’s Securities on Margin; Pledging the Company’s Securities to Secure Margin or Other Loans

            Purchasing on margin means borrowing from a brokerage firm, bank or other entity in order to purchase the Company’s securities (other than in connection with a cashless exercise of stock options through a broker under the Company’s equity plans). Margin purchases of the Company’s securities by any director, officer or employee are prohibited by this Policy. Pledging the Company’s securities as collateral to secure loans is prohibited. This prohibition means, among other things, that you cannot hold the Company’s securities in a “margin account” (which would allow you to borrow against your holdings to buy securities).

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E.Director and Executive Officer Cashless Exercises

            Cashless exercises by directors and executive officers will be structured and coordinated with the Company so as to make sure that the Company is not “extending credit” in the form of a personal loan to the director or executive officer. Questions about cashless exercises should be directed to the Compliance Officer.

F.Partnership Distributions

            Nothing in this Policy is intended to limit the ability of a venture capital partnership or other similar entity with which a director is affiliated to distribute Company securities to its partners, members or other similar persons. It is the responsibility of each affected director and the affiliated entity, in consultation with their own counsel (as appropriate), to determine the timing of any distributions, based on all relevant facts and circumstances and applicable securities laws.

VI.RULE 10b5-1 TRADING PLANS, SECTION 16 AND RULE 144

A.Rule 10b5-1 Trading Plans

1.Overview

            Rule 10b5-1 can provide a “safe harbor” to protect directors, officers and employees from insider trading liability for transactions under a previously established contract, plan or instruction to trade in the Company’s common stock (a “Trading Plan”) entered into in good faith and in accordance with the terms of Rule 10b5-1 and all applicable state laws and will be exempt from the trading restrictions set forth in this Policy. The initiation of, and any modification to, any such Trading Plan will be deemed to be a transaction in the Company’s securities, and such initiation or modification is subject to all limitations and prohibitions relating to transactions in the Company’s securities. Each such Trading Plan, and any modification thereof, must be submitted to and pre-approved by the Compliance Officer, or such other person as the Board of Directors may designate from time to time (the “Authorizing Officer”), who may impose such conditions on the implementation and operation of the Trading Plan as the Authorizing Officer deems necessary or advisable. Compliance of the Trading Plan with the terms of Rule 10b5-1 and the execution of transactions pursuant to the Trading Plan are the sole responsibility of the person initiating the Trading Plan, however, not the Company or the Authorizing Officer.

Trading Plans do not exempt individuals from complying with Section 16 short-swing profit rules or liability.

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Rule 10b5-1 presents an opportunity for insiders to establish arrangements to sell (or purchase) Company shares without the restrictions of trading windows and black-out periods, even when there is undisclosed material information. A Trading Plan may also help reduce negative publicity that may result when key executives sell Company shares. Rule 10b5-1 only provides an “affirmative defense” in the event there is an insider trading lawsuit. It does not prevent someone from bringing a lawsuit.

A director, officer or employee may enter into a Trading Plan only when he or she is not in possession of material, nonpublic information, and only during a trading window period outside of the trading black-out period. Company officers and directors adopting a Trading Plan must have a cooling-off period until the later of (a) 90 days following plan adoption or modification, and (b) two business days following disclosure in Forms 10-K and 10-Q of the company’s financial results for the fiscal quarter in which the plan was adopted or modified (but not to exceed 120 days following plan adoption or modification). Persons other than the Company and its directors and officers are required to have a 30-day cooling-off period for plan adoptions and modifications. Modifications to the price, amount of securities, or timing of transactions under a Rule 10b5-1 would be deemed the termination of such plan and the adoption of a new plan—and would trigger a new cooling-off period. Modifications that do not change the price, amount of securities, or timing of transactions under a Rule 10b5-1 plan would not trigger a new cooling-off period.

Although transactions effected under a Trading Plan will not require further pre-clearance at the time of the trade, any transaction (including the quantity and price) made pursuant to a Trading Plan of a Section 16 reporting person must be reported to the Company promptly on the day of each trade to permit the Company’s filing coordinator to assist in the preparation and filing of a required Form 4. This reporting may be oral or in writing (including by e-mail) and should include the identity of the reporting person, the type of transaction, the date of the transaction, the number of shares involved and the purchase or sale price. The ultimate responsibility and liability for timely filing remains, however, with the Section 16 reporting person.

Directors and officers must personally certify, at the time of plan adoption, that (a) they are “not aware of any material nonpublic information about the security or issuer,” and (b) they are “adopting the plan in good faith and not as part of a plan or scheme to evade the prohibitions” of Exchange Act Section 10(b) and Rule 10b-5. This certification is not required to be a separate document—instead, it will be a representation in the Rule 10b5-1 plan itself.

The Company reserves the right from time to time to suspend, discontinue or otherwise prohibit any transaction in the Company’s securities, even pursuant to a previously approved Trading Plan, if the Authorizing Officer or the Board of Directors, in its discretion, determines that such suspension, discontinuation or other prohibition is in the best interests of the Company. Any Trading Plan submitted for approval hereunder should explicitly acknowledge the Company’s right to prohibit transactions in the Company’s securities. Failure to discontinue purchases and sales as directed shall constitute a violation of the terms of this Section VI and result in a loss of the exemption set forth herein.

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Officers, directors and employees may adopt Trading Plans with brokers that outline a pre-set plan for trading of the Company’s common stock, including the exercise of options. Trades pursuant to a Trading Plan generally may occur at any time. However, the Company requires a cooling-off period of 30 days between the establishment of a Trading Plan and commencement of any transactions under such plan. An individual may not have more than one Trading Plan in effect at a time. Please review the following description of how a Trading Plan works.

Pursuant to Rule 10b5-1, an individual’s purchase or sale of securities will not be “on the basis of” material, nonpublic information if:

·First, before becoming aware of the information, the individual enters into a binding contract to purchase or sell the securities, provides instructions to another person to sell the securities or adopts a written plan for trading the securities (i.e., the Trading Plan).

·Second, the Trading Plan must either:

ospecify the amount of securities to be purchased or sold, the price at which the securities are to be purchased or sold and the date on which the securities are to be purchased or sold;

oinclude a written formula or computer program for determining the amount, price and date of the transactions; or

oprohibit the individual from exercising any subsequent influence over the purchase or sale of the Company’s shares under the Trading Plan in question.

·Third, the purchase or sale must occur pursuant to the Trading Plan and the individual must not enter into a corresponding hedging transaction or alter or deviate from the Trading Plan.

2.Revocation of and Amendments to Trading Plans

            Revocation of Trading Plans should occur only in unusual circumstances. Effectiveness of any revocation or amendment of a Trading Plan will be subject to the prior review and approval of the Authorizing Officer. Revocation is effected upon written notice to the broker. Once a Trading Plan has been revoked, the participant must comply with the 90-day cooling off period above before the effective date of a new Trading Plan.

Under certain circumstances, a Trading Plan must be revoked. This includes circumstances such as the announcement of a merger or the occurrence of an event that would cause the transaction either to violate the law or to have an adverse effect on the Company. The Authorizing Officer or administrator of the Company’s equity-based plans is authorized to notify the broker in such circumstances, thereby insulating the insider in the event of revocation.

3.Separate Reporting of Company Rule 10b5-1 Trading Plans

            In addition, if the Company adopts or terminates any Rule 10b5-1 trading arrangement during a quarter, it must describe the material terms of the Rule 10b5-1 trading arrangement (other than the price, including (i)the date on which the Company adopted or terminated the Rule 10b5-1 trading arrangement; (ii) the duration of the Rule 10b5-1 trading arrangement; and (iii) the aggregate number of securities to be purchased or sold pursuant to the Rule 10b5-1 trading arrangement, with disclosure pursuant to SEC Regulation S-K, Item 408, and with the effective date depending on whether the Company is a smaller reporting company.

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4.Discretionary Plans

            Although non-discretionary Trading Plans are preferred, discretionary Trading Plans, where the discretion or control over trading is transferred to a broker, are permitted if pre-approved by the Authorizing Officer.

The Authorizing Officer of the Company must pre-approve any Trading Plan, arrangement or trading instructions, etc., involving potential sales or purchases of the Company’s common stock or option exercises, including but not limited to, blind trusts, discretionary accounts with banks or brokers, or limit orders. The actual transactions effected pursuant to a pre-approved Trading Plan will not be subject to further pre-clearance for transactions in the Company’s common stock once the Trading Plan or other arrangement has been pre-approved.

5.Reporting (if required)

            If required, an SEC Form 144 will be filled out and filed by the individual/brokerage firm in accordance with the existing rules regarding Form 144 filings. A footnote at the bottom of the Form 144 should indicate that the trades “are in accordance with a Trading Plan that complies with Rule 10b5-1.” For Section 16 reporting persons, Forms 4 should be filed before the end of the second business day following the date that the broker, dealer or plan administrator informs the individual that a transaction was executed, provided that the date of such notification is not later than the second business day following the trade date. A similar footnote should be placed at the bottom of the Form 4 as outlined above.

6.Options

            Exercises of options for cash may be executed at any time. “Cashless exercise” option exercises through a broker are subject to trading windows. However, the Company will permit same-day sales under Trading Plans. If a broker is required to execute a cashless exercise in accordance with a Trading Plan, then the Company must have exercise forms attached to the Trading Plan that are signed, undated and with the number of shares to be exercised left blank. Once a broker determines that the time is right to exercise the option and dispose of the shares in accordance with the Trading Plan, the broker will notify the Company in writing and the administrator of the Company’s equity-based plans will fill in the number of shares and the date of exercise on the previously signed exercise form. The insider should not be involved with this part of the exercise.

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7.Trades Outside of a Trading Plan

            Except in the case of the Company’s officers and such other employees as are designated from time to time by the Board of Directors, the Chief Executive Officer or the Chief Financial Officer, during an open trading window, trades that differ from Trading Plan instructions that are already in place are allowed as long as the Trading Plan continues to be followed.

8.Public Announcements and Required SEC Reporting

            The Company may make a public announcement that a Trading Plan is being implemented in accordance with Rule 10b5-1. It will consider in each case whether a public announcement of a particular Trading Plan should be made. It may also make public announcements or respond to inquiries from the media as transactions are made under a Trading Plan.  In addition, under SEC Regulation S-K Item 408, the Company must report in each quarterly (Form 10-Q) or Annual Report (Form 10-K), if any officer or director adopted or terminated any Rule 10b-5 plans during the quarter covered by the report, including (i) the name and title of the officer or director; (ii) the date on which the director or officer adopted or terminated the trading arrangement; (iii) the duration of the trading arrangement; and (iv) the aggregate number of securities to be purchased or sold pursuant to the trading arrangement. This disclosure does not need to disclose the price.

9.Prohibited Transactions

            The transactions prohibited under Section V of this Policy, including, among others, short sales and hedging transactions, may not be carried out through a Trading Plan or other arrangement or trading instruction involving potential sales or purchases of the Company’s securities.

10.Limitation on Liability

            None of the Company, the Compliance Officer, the Authorizing Officer or the Company’s other employees will have any liability for any delay in reviewing, or refusal of, a Trading Plan submitted pursuant to this Section VI or a request for pre-clearance submitted pursuant to Section IV of this Policy. Notwithstanding any review of a Trading Plan pursuant to this Section VI or pre-clearance of a transaction pursuant to Section IV of this Policy, none of the Company, the Compliance Officer, the Authorizing Officer or the Company’s other employees assumes any liability for the legality or consequences of such Trading Plan or transaction to the person engaging in or adopting such Trading Plan or transaction.

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B.Section 16: Insider Reporting Requirements, Short-Swing Profits and Short Sales

1.Reporting Obligations under Section 16(a): SEC Forms 3, 4 and 5

            Section 16(a) of the Exchange Act generally requires all officers, directors and 10% shareholders (“insiders”), within 10 days after the insider becomes an officer, director or 10% shareholder, to file with the SEC an “Initial Statement of Beneficial Ownership of Securities” on SEC Form 3 listing the amount of the Company’s common stock, options, restricted stock units and warrants that the insider beneficially owns. Following the initial filing on SEC Form 3, changes in beneficial ownership of the Company’s common stock, options, restricted stock units, bona fide gifts given, and warrants must be reported on SEC Form 4, generally within two business days after the date on which such change occurs, or in certain cases on Form 5, within 45 days after fiscal year end. A Form 4 must be filed even if, as a result of balancing transactions, there has been no net change in holdings. In certain situations, purchases or sales of Company common stock made within six months prior to the filing of a Form 3 must be reported on Form 4. Similarly, certain purchases or sales of Company common stock made within six months after an officer or director ceases to be an insider must be reported on Form 4.

2.Recovery of Profits under Section 16(b)

            For the purpose of preventing the unfair use of information that may have been obtained by an insider, any profits realized by any officer, director or 10% shareholder from any “purchase” and “sale” of Company common stock during a six-month period, so called “short-swing profits,” may be recovered by the Company. When such a purchase and sale occur, good faith is no defense. The insider is liable even if compelled to sell for personal reasons, and even if the sale takes place when the insider does not possess any material, nonpublic information.

The liability of an insider under Section 16(b) of the Exchange Act is only to the Company itself. The Company, however, cannot waive its right to short-swing profits, and any Company shareholder can bring suit in the name of the Company. Reports of ownership filed with the SEC on Form 3, Form 4 or Form 5 pursuant to Section 16(a) (discussed above) are readily available to the public, and certain attorneys carefully monitor these reports for potential Section 16(b) violations. In addition, liabilities under Section 16(b) may require separate disclosure in the Company’s annual report on Form 10-K or its proxy statement for its annual meeting of shareholders. No suit may be brought more than two years after the date the profit was realized. However, if the insider fails to file a report of the transaction under Section 16(a), as required, the two-year limitation period does not begin to run until after the transactions giving rise to the profit have been disclosed. Failure to report transactions and late filing of reports require separate disclosure in the Company’s proxy statement.

Officers and directors should consult the attached “Short-Swing Profit Rule Section 16(b) Checklist” attached hereto as Exhibit A in addition to consulting the Compliance Officer prior to engaging in any transactions involving the Company’s securities, including, without limitation, the Company’s common stock, options or warrants.

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3.Short Sales Prohibited under Section 16(c)

            Section 16(c) of the Exchange Act prohibits insiders absolutely from making short sales of the Company’s equity securities. Short sales include sales of stock that the insider does not own at the time of sale, or sales of stock against which the insider does not deliver the shares within 20 days after the sale. Under certain circumstances, the purchase or sale of put or call options, or the writing of such options, can result in a violation of Section 16(c). Insiders violating Section 16(c) face criminal liability.

The Compliance Officer should be consulted if you have any questions regarding reporting obligations, short-swing profits or short sales under Section 16.

C.Rule 144

            Rule 144 provides a safe harbor exemption to the registration requirements of the Securities Act for certain resales of “restricted securities” and “control securities.” “Restricted securities” are securities acquired from an issuer, or an affiliate of an issuer, in a transaction or chain of transactions not involving a public offering. “Control securities” are any securities owned by directors, executive officers or other “affiliates” of the issuer, including stock purchased in the open market and stock received upon exercise of stock options. Sales of Company restricted and control securities must comply with the requirements of Rule 144, which are summarized below:

• Holding Period. Restricted securities must be held for at least six months before they may be sold in the market.

• Current Public Information. The Company must have filed all SEC-required reports during the last 12 months or such shorter period that the Company was required to file such reports.

• Volume Limitations. For affiliates, total sales of Company common stock for any three-month period may not exceed the greater of: (i) 1% of the total number of outstanding shares of Company common stock, as reflected in the most recent report or statement published by the Company, or (ii) if the Company’s securities are traded on a national securities exchange, the average weekly reported volume of such shares traded during the four calendar weeks preceding the filing of the requisite Form 144.

• Method of Sale. For affiliates, the shares must be sold either in a “broker’s transaction” or in a transaction directly with a “market maker.” A “broker’s transaction” is one in which the broker does no more than execute the sale order and receive the usual and customary commission. Neither the broker nor the selling person can solicit or arrange for the sale order. In addition, the selling person or Board member must not pay any fee or commission other than to the broker. A “market maker” includes a specialist permitted to act as a dealer, a dealer acting in the position of a block positioner, and a dealer who holds himself out as being willing to buy and sell Company common stock for his own account on a regular and continuous basis.

• Notice of Proposed Sale. For affiliates, a notice of the sale (a Form 144) may be required to be filed with the SEC at the time of the sale. Brokers generally have internal procedures for executing sales under Rule 144 and will assist you in completing the Form 144 and in complying with the other requirements of Rule 144.  This must be filed electronically.

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If you are subject to Rule 144, you must instruct your broker who handles trades in Company securities to follow the brokerage firm’s Rule 144 compliance procedures in connection with all trades.

VII.INSIDER TRADING COMPLIANCE OFFICER

            The Company has designated the Chief Financial Officer as its Insider Trading Compliance Officer (the “Compliance Officer”). The Compliance Officer will review, consult with securities law counsel (if necessary), and either approve or prohibit trades by Insiders or other individuals and proposed Trading Plans in accordance with the procedures set forth in this policy.

In addition to the trading approval duties described above, the duties of the Compliance Officer will include the following:

1.Administering this policy and monitoring and enforcing compliance with all policy provisions and procedures.

2.Responding to all inquiries relating to this policy and its procedures.

3.Designating and announcing event-specific trading blackout periods during which directors, officers and certain other individuals designated by the Compliance Officer may not trade in Company securities and determining which employees and consultants, in addition to directors and officers, would be subject to an event-specific trading blackout period.

4.Providing copies of this policy and other appropriate materials to all current and new directors, officers, employees and consultants, and such other persons who the Compliance Officer determines have access to material nonpublic information concerning the Company.

5.Administering, monitoring and enforcing compliance with all federal and state insider trading laws and regulations, including without limitation Sections 10(b), 16, 20A, 20 and 21A of the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, and Rule 144 under the Securities Act of 1933; and assisting in the preparation and filing of all required SEC reports relating to insider trading in Company securities, including without limitation Forms 3, 4, 5 and 144 and Schedules 13D and 13G.

6.Revising the policy as necessary to reflect changes in federal or state insider trading laws and regulations.

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7.Maintaining as company records originals or copies of all documents required by the provisions of this policy or the procedures set forth herein, and copies of all required SEC reports relating to insider trading, including without limitation Forms 3, 4, 5 and 144 and Schedules 13D and 13G.

8.Maintaining the accuracy of the list of Insiders and other individuals who are subject to blackout periods, and the list of Pre-Clearance Persons who are subject to the pre-clearance procedures and updating them periodically as necessary to reflect additions to or deletions from each category of individuals.

9.Reviewing and pre-approving all Trading Plans.

            The Compliance Officer may designate one or more individuals who may perform the Compliance Officer’s duties in the event that the Compliance Officer is unable or unavailable to perform such duties.

VIII.EXECUTION AND RETURN OF CERTIFICATION OF COMPLIANCE

After reading this Policy, all officers, directors and employees of the Company should execute and return to the Company’s Compliance Officer the Certification of Compliance form attached hereto as Exhibit B.

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Exhibit A

Short-Swing Profit Rule Section 16(b) Checklist

Note: Any combination of purchase and sale or sale and purchase within six months of each other by an officer, director or 10% shareholder (or any family member living in the same household or certain affiliated entities) results in a violation of Section 16(b), and the “profit” must be recovered by Nuvera Communications, Inc. (the “Company”). It does not matter how long the shares being sold have been held or, for officers and directors, that you were an insider for only one of the two matching transactions. The highest-priced sale will be matched with the lowest-priced purchase within the six-month period.

Sales

If a sale is to be made by an officer, director or 10% shareholder (or any family member living in the same household or certain affiliated entities):

1.Have there been any purchases by the insider (or family members living in the same household or certain affiliated entities) within the past six months?

2.Have there been any option grants or exercises or restricted stock unit grants or vesting not exempt under Rule 16b-3 within the past six months?

3.Are any purchases (or non-exempt option exercises) anticipated or required within the next six months?

4.Has a Form 4 been prepared?

Note: If a sale is to be made by an affiliate of the Company, has a Form 144 been prepared and has the broker been reminded to sell pursuant to Rule 144?

Purchases, Option Exercises and RSU Vesting

If a purchase or option exercise for Company shares or vesting of a restricted stock unit is to be made:

1.Have there been any sales by the insider (or family members living in the same household or certain affiliated entities) within the past six months?

2.Are any sales anticipated or required within the next six months (such as tax-related or year-end transactions)?

A-1

3.Has a Form 4 been prepared?

Before proceeding with a purchase or sale, consider whether you are aware of material, nonpublic information which could affect the price of the Company’s shares of common stock. All transactions in the Company’s securities by officers and directors must be pre-cleared by contacting the Company’s Compliance Officer.

A-2

Exhibit B

Certification of Compliance

TO:                                                      , Compliance Officer

FROM:                                                ,

RE:      Insider Trading Policy

I have received, reviewed and understand the Nuvera Communications, Inc. Insider Trading Policy and undertake, as a condition to my present and continued employment (or, if I am not an employee, affiliation with) Nuvera Communications, Inc. or any of its subsidiaries, to comply fully with the policies and procedures contained therein.

I hereby certify, to the best of my knowledge, that during the calendar year ending December 31, 2023, I have complied fully with all policies and procedures set forth in the Insider Trading Policy.

                                                                    SIGNATURE                                                                     TITLE                                                                          DATE

B-1

EX-21

EXHIBIT 21

SUBSIDIARIES OF NUVERA COMMUNICATIONS, INC.

Name of Subsidiary	Ownership	Jurisdiction of Incorporation
Hutchinson Cellular, Inc.	100% owned by HTC	Minnesota
Hutchinson Telecommunications, Inc.	100% owned by HTC	Minnesota
Hutchinson Telephone Company	100%	Minnesota
Peoples Telephone Company	100%	Iowa
Scott Rice Telephone Co.	100%	Minnesota
Sleepy Eye Telephone Company	100%	Minnesota
TechTrends, Inc.	100%	Minnesota
Western Telephone Company	100%	Minnesota

The financial statements of all wholly owned subsidiaries listed above are included in the Consolidated Financial Statements of Nuvera Communications, Inc. on this Form 10-K for the year 2023. Nuvera Communications, Inc. is incorporated in the state of Minnesota.

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement Nos. 333-204576 and 333-218261 on Form S-8 of our reports dated March 15, 2024, relating to the financial statements of Nuvera Communications, Inc and subsidiaries (the “Company”) appearing in this annual report on Form 10-K of the Company for the year ended December 31, 2023.

/s/ OlsenThielen & Co. Ltd
Roseville, Minnesota
March 15, 2024

EX-31.1

EXHIBIT 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

UNDER RULE 13a-14(a) ADOPTED

PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Glenn H. Zerbe, President and Chief Executive Officer of Nuvera Communications, Inc., certify that:

1.     I have reviewed this 2023 Annual Report on Form 10-K of Nuvera Communications, Inc.;

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materiality affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:         March 15, 2024                                                            /s/ Glenn H. Zerbe                                 

                                                                                                         Glenn H. Zerbe

                                                                                                         President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION 

UNDER RULE 13a-14(a) ADOPTED

PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Curtis O. Kawlewski, Chief Financial Officer of Nuvera Communications, Inc., certify that:

1.     I have reviewed this 2023 Annual Report on Form 10-K of Nuvera Communications, Inc.;

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and 

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:         March 15, 2024                                                     /s/ Curtis O. Kawlewski                                   

                                                                                                  Curtis O. Kawlewski

                                                                                                  Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (“Section 906”), Glenn H. Zerbe and Curtis O. Kawlewski, President and Chief Executive Officer and Chief Financial Officer, respectively, of Nuvera Communications, Inc., each certify that to his knowledge (i) the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and (ii) the information contained in such report fairly represents, in all material respects, the financial condition and results of operations of Nuvera Communications, Inc.

/s/ Glenn H. Zerbe

Glenn H. Zerbe

President and Chief Executive Officer

(Principal Executive Officer)

March 15, 2024

/s/ Curtis O. Kawlewski

Curtis O. Kawlewski

Chief Financial Officer

(Principal Financial Officer and Chief

Accounting Officer)

March 15, 2024

EX-97.1

EXHIBIT 97.1

NUVERA COMMUNICATIONS, INC.
CLAWBACK AND FORFEITURE POLICY
(As Amended, February 29, 2024)

1.Purpose

Nuvera Communications, Inc. (the “Company”) is committed to conducting business with integrity in accordance with high ethical standards and in compliance with all applicable laws, rules and regulations. This includes the Company’s commitment to comply with all applicable laws, rules and regulations, including those applicable to the presentation of the Company’s financial information to the public. As a result, the Board of Directors of the Company (the “Board”) has adopted this Clawback and Forfeiture Policy (this “Policy”), which provides for the recoupment or forfeiture or cancellation of certain executive officer incentive compensation in the event of an accounting restatement or other executive egregious misconduct that has a substantial detrimental effect on the Company or its subsidiaries or its results of operations.

2.Administration

This Policy will be administered by the Compensation Committee of the Board (the “Committee”). Except as limited by law, the Committee will have full power, authority, and sole and exclusive discretion to reasonably construe, interpret and administer this Policy. Any determinations made by the Committee will be made in its reasonable discretion and will be final, conclusive and binding on all affected individuals.

In the event of any change in any federal or state law, rule or regulation, or rule, regulation, policy or listing standard of the Securities and Exchange Commission or any securities exchange on which the Company’s securities are listed that requires the Company to recoup certain compensation from a Covered Executive (as defined below), the Committee will be required to seek recoupment under this Policy to the fullest extent required by these laws, rules, regulations or listing standards.

3.Covered Executives

This Policy will cover the Company’s current and former executive officers as determined by the Board from time to time in accordance with Rule 10D-1 under the Securities Exchange Act of 1934, as amended (the “Covered Executives”).

4.Covered Compensation

(a)The Policy will apply to all incentive compensation paid, granted, earned, vested or otherwise awarded to a Covered Executive, including annual bonuses and other short- and long-term cash incentive awards, stock options, restricted stock units and other equity-based awards (“Incentive Compensation”).

1

5.Definitions

(a)“Incentive-Based Compensation” means any compensation that is granted, earned or vested based wholly or in part upon the attainment of a “financial reporting measure,” which means a measure that is determined and presented in accordance with Generally Accepted Accounting Principles that are used in preparing the Company’s financial statements, and any measure that is derived wholly or in part from these measures. Stock price and total shareholder return are also financial reporting measures for this purpose.

(b)“Recoverable Incentive-Based Compensation” means all Incentive-Based Compensation received on or after the Effective Date of this Policy by a Covered Executive (i) after beginning service as an executive officer; (ii) who served as an executive officer at any time during the performance period for the Incentive-Based Compensation; (iii) while the Company has a class of securities registered with the Securities and Exchange Commission or listed on a national securities exchange; and (iv) during the three completed fiscal years immediately preceding the date that the Company is required to prepare a Restatement [as defined below], including any applicable transition period that results from a change in the Company’s fiscal year within or immediately following those three completed fiscal years. For this purpose, the Company is deemed to be required to prepare a Restatement on the earlier of: (i) the date the Board, or if Board action is not required -- the Company’s officers authorized to take such action, concludes, or reasonably should have concluded, that the Company is required to prepare a Restatement; and (ii) the date a court, regulator or other legally authorized body directs the Company to prepare a Restatement. The Company’s obligation to recover Erroneously Awarded Incentive-Based Compensation is not dependent on if or when the restated financial statements are filed with the Securities and Exchange Commission.

6.Authority

(a)Authority to Recoup Incentive-Based Compensation in the Event of a Restatement. If the Company is required to prepare an accounting restatement of its financial statements due to the Company’s material noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period, (a “Restatement”), the Committee must require repayment promptly, thorough reimbursement or forfeiture, of any Covered Executive the amount of any “Erroneously Awarded Incentive-Based Compensation received by any Covered Executive during the three completed fiscal years immediately preceding the date on which the Company is required to prepare an accounting restatement.

(b)Authority to Recoup Incentive Compensation in Event Other than Restatements. In addition, if the Committee determines that the Covered Executive has engaged in egregious conduct that is substantially detrimental to the Company, the Committee may require the Covered Executive to reimburse the Company for all or a portion of Incentive Compensation previously vested or paid to such Covered Executive during the one-year period preceding the date on which the Company discovers such conduct or authorize the cancellation of unpaid or unvested Incentive Compensation, as determined by the Committee pursuant to this Policy, or both.

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(c) “Egregious conduct substantially detrimental to the Company” will mean any one of the following:

· any act or omission that would constitute “Cause” for termination under the terms of the Covered Executive’s employment agreement;

· the material breach of a written policy applicable to the Covered Executive, including, but not limited to, the Code of Ethics;

· egregious misconduct by the Covered Executive including, but not limited to, fraud, criminal activities, falsification of Company records, theft, violent acts or threats of violence, or a violation of law, unethical conduct or inappropriate behavior that causes substantial reputational harm to the Company or exposes the Company to substantial legal liability; or

· the commission of an act or omission which causes the Covered Executive or the Company to be in violation of federal or state securities laws, rules, or regulations.

7.Recoupment Amount

(a)Amount. The amount of Incentive-Based Compensation that must be recovered from a Covered Executive is the amount of “Recoverable Incentive-Based Compensation” received by a Covered Executive that exceeds the amount of Recoverable Incentive-Based Compensation that otherwise would have been received had it been determined based on the restated amounts, computed without regard to any taxes paid (referred to as the “Erroneously Awarded Incentive-Based Compensation”). For Recoverable Incentive-Based Compensation based on stock price or total shareholder return where the amount of Erroneously Awarded Incentive-Based Compensation is not subject to mathematical recalculation directly from the information in a Restatement, the amount must be based on a reasonable estimate of the effect of the Restatement on the stock price or total shareholder return, as applicable, upon which the Recoverable Incentive-Based Compensation was received. The Company must maintain documentation of that reasonable estimate and, if the Company’s securities are listed on Nasdaq, provide this documentation to Nasdaq.  For the purposes of this Policy, Recoverable Incentive-Based Compensation will be deemed to be received in the fiscal period during which the financial reporting measure specified in the applicable Incentive-Based Compensation award is attained, even if the payment or grant occurs after the end of that period.

(b)In the event the recoupment is triggered by egregious conduct substantially detrimental to the Company by the Covered Executive, then the Committee will determine the amount of Incentive Compensation to recoup from such Covered Executive based on the following factors:

·the amount of Incentive Compensation received by the Covered Executive that exceeds the amount of Incentive Compensation that otherwise would have been received or granted had the Covered Executive’s egregious conduct substantially detrimental to the Company been known;

·the relative fault or degree of involvement by the Covered Executive;

3

·the overall work performance of the Covered Executive;

·the relative impact of the Covered Executive’s conduct on the Company and the magnitude of any restatement, loss, or variance from budget or plan;

·the cost or difficulty of obtaining recoupment, including but not limited to whether the Covered Executive has any outstanding equity-based awards that may be cancelled, whether the Covered Executive continues to be employed by the Company or its subsidiaries, and the language of this Policy in effect on the relevant date; and

·any other facts and circumstances determined relevant by the Committee, in its sole discretion.

8.Recovery: Method of Recoupment or Forfeiture

(a)The Company must recover the Erroneously Awarded Incentive-Based Compensation from Covered Executive unless the Board determines that recovery is impracticable because: (i) the direct expense to a third party to assist in enforcing this Policy would exceed the amount of Erroneously Awarded Incentive-Based Compensation; provided that, the Company must make a reasonable attempt to recover the Erroneously Awarded Incentive-Based Compensation before concluding that recovery is impracticable, document this reasonable attempt to recover the Erroneously Awarded Incentive-Based Compensation and, if the Company’s securities are listed on Nasdaq, provide this documentation to Nasdaq; or (ii) recovery would likely cause an otherwise tax-qualified retirement plan under which benefits are broadly available to employees of the Company to fail to meet the applicable requirements of 26 U.S.C. 401(a)(13) or 26 U.S.C. 411(a) and regulations thereunder.

(b)The Committee will determine, in its reasonable discretion, the method for recouping or cancelling, as the case may be, Incentive Compensation hereunder, which may include, without limitation, any one or more of the following:

·requiring reimbursement of cash Incentive Compensation previously paid;

·seeking recovery of any gain realized on the vesting, exercise, settlement, sale, transfer or other disposition of any equity-based awards;

·cancelling or rescinding some or all outstanding vested or unvested equity-based awards;

·adjusting or withholding from unpaid compensation or other set-off;

·cancelling or setting-off against planned future grants of equity-based awards; or

·any other method authorized by applicable law or contract.

9.Not Exclusive

(a)The application and enforcement of this Policy does not preclude the Company from taking any other action to enforce a Covered Executive’s obligations to the Company, including termination of employment or institution of legal proceedings. Nothing in this Policy may be deemed, however, to determine that any Restatement automatically constitutes “cause” under a Covered Executive’s employment agreement or other agreement with the Company. Further, nothing in this Policy restricts the Company from seeking recoupment under any other compensation recoupment Policy or any applicable provisions in plans, agreements, awards or other arrangements that contemplate the recoupment of compensation from a Covered Executive. If a Covered Executive fails to repay Erroneously Awarded Incentive-Based Compensation that is owed to the Company under this Policy, the Company must take all appropriate action to recover any Erroneously Awarded Incentive-Based Compensation from the Covered Executive, and the Covered Executive will be required to reimburse the Company for all expenses (including legal expenses) incurred by the Company in recovering the Erroneously Awarded Incentive-Based Compensation.

4

(b)Any recoupment, forfeiture, or cancellation under this Policy is in addition to, and not in lieu of, any other remedies or rights of recoupment that may be available to the Company pursuant to the terms of any similar policy in any employment agreement, incentive or equity compensation plan or award or other agreement and any other legal rights or remedies available to the Company. Notwithstanding the generality of the foregoing, to the extent that the requirements under the provisions of Section 304 of the Sarbanes-Oxley Act of 2002 are broader than the provisions in this Policy, the provisions of such law will apply to the Company’s Chief Executive Officer and Chief Financial Officer.

10.No Indemnification

In no event will the Company indemnify any Covered Executive for any amounts that are recovered under this Policy. This Policy is in addition to (and not in lieu of) any right of repayment, forfeiture or right of offset against any employees that is required pursuant to any statutory repayment requirement (regardless of whether implemented at any time prior to or following the adoption or amendment of this Policy), including Section 304 of the Sarbanes-Oxley Act of 2002. Any amounts paid to the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 will be considered in determining any amounts recovered under this Policy.

11.Binding Effect.

The terms of this Policy will be binding and enforceable against all Covered Executives subject to this Policy and their beneficiaries, heirs, executors, administrators or other legal representatives. If any provision of this Policy or the application of such provision to any Covered Executive is adjudicated to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability will not affect any other provisions of this Policy, and the invalid, illegal or unenforceable provisions will be deemed amended to the minimum extent necessary to render any such provision (or the application of such provision) valid, legal or enforceable.

12.Acknowledgement by Employee.

Each Covered Executive must sign and return to the Company, within 30 calendar days following the later of (i) the Effective Date of this Policy or (ii) the date the individual becomes a Covered Executive, the Acknowledgement Form attached hereto as Exhibit A, pursuant to which the Covered Executive agrees to be bound by, and to comply with, the terms and conditions of this Policy.

5

13.Interpretation.

This Policy will be interpreted in a manner that is consistent with Rule 10D-1 under the Exchange Act, Rule 5608 of the Nasdaq listing rules and any related rules or regulations adopted by the Securities and Exchange Commission or Nasdaq (the “Applicable Rules”) as well as any other applicable law. To the extent the Applicable Rules require recovery of Incentive-Based Compensation in additional circumstances beyond those specified above, nothing in this Policy will be deemed to limit or restrict the right or obligation of the Company to recover Incentive-Based Compensation to the fullest extent required by the Applicable Rules.

14.Effective Date

This Policy was effective as of December 19, 2019, the (“Effective Date), and was amended as of February 29, 2024, and will apply to all Incentive Compensation that is approved, awarded or granted to Covered Executives on or after the Effective Date, except as otherwise agreed by any Covered Executive or pursuant to the terms of any Company plan regarding Incentive Compensation.

15.Amendments

The Board may amend, modify or terminate this Policy in whole or in part at any time in its sole discretion and may adopt such rules and procedures that it deems necessary or appropriate to implement this Policy or to comply with applicable laws and regulations.

6

EXHIBIT A

NUVERA COMMUNICATIONS, INC.
CLAWBACK AND FORFEITURE POLICY
ACKNOWLEDGEMENT FORM

By signing below, the undersigned acknowledges and confirms that the undersigned has received and reviewed a copy of the Nuvera Communications, Inc. (the “Company”) Clawback and Forfeiture Policy (the “Policy”).

By signing this Acknowledgement Form, the undersigned acknowledges and agrees that the undersigned is and will continue to be subject to the Policy and that the Policy will apply both during and after the undersigned’s employment with the Company. Further, by signing below, the undersigned agrees to abide by the terms of the Policy, including, without limitation, by returning any Erroneously Awarded Incentive-Based Compensation or other Incentive Compensation (as defined in the Policy) to the Company to the extent required by, and in a manner consistent with, the Policy.

The undersigned expressly agrees that the Company may deduct from the undersigned’s paycheck or other compensation otherwise to the undersigned any Erroneously Awarded Incentive-Based Compensation or other Incentive Compensation required to be returned to the Company pursuant to the Policy.

COVERED EXECUTIVE

Signature

Print Name

Date

7

XML

Document And Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2023	Mar. 15, 2024	Jun. 30, 2023
Document Information Line Items
Entity Registrant Name	NUVERA COMMUNICATIONS, INC.
Trading Symbol	NUVR
Document Type	10-K
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		5,133,207
Entity Public Float			$ 55,420,052
Amendment Flag	false
Entity Central Index Key	0000071557
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Dec. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	FY
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
ICFR Auditor Attestation Flag	false
Document Annual Report	true
Document Transition Report	false
Entity File Number	0-3024
Entity Incorporation, State or Country Code	MN
Entity Tax Identification Number	41-0440990
Entity Address, Address Line One	27 North Minnesota Street
Entity Address, City or Town	New Ulm
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	56073
City Area Code	507
Local Phone Number	354-4111
Entity Interactive Data Current	Yes
Document Financial Statement Error Correction [Flag]	false
Title of 12(g) Security	Common Stock - $1.66 par value
Auditor Name	Olsen Thielen & Co., Ltd
Auditor Firm ID	251
Auditor Location	Roseville, Minnesota

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
OPERATING REVENUES:
Operating Revenues	$ 65,791,968	$ 65,714,469
OPERATING EXPENSES:
Plant Operations (Excluding Depreciation and Amortization)	15,168,203	14,383,362
Cost of Video	9,520,628	10,042,132
Cost of Data	4,817,072	4,118,439
Cost of Other Non-Regulated Services	1,672,935	1,635,837
Depreciation and Amortization	15,440,415	14,108,246
Selling, General, and Administrative	9,937,451	9,916,482
Total Operating Expenses	56,556,704	54,204,498
OPERATING INCOME	9,235,264	11,509,971
OTHER INCOME (EXPENSE):
Interest During Construction	720,659	284,871
CoBank Patronage Dividends	692,371	567,468
Interest/Dividend Income	181,081	261,181
Interest Expense	(6,817,430)	(3,485,805)
Gain on Sale of Investments	3,970,496	217,876
Impairment of Goodwill	(9,300,000)
Other Investment Income	418,521	539,803
Total Other Income (Expense)	(10,134,302)	(1,614,606)
INCOME (LOSS) BEFORE INCOME TAXES	(899,038)	9,895,365
INCOME TAXES EXPENSE	2,315,656	2,698,663
NET INCOME (LOSS)	$ (3,214,694)	$ 7,196,702
NET INCOME (LOSS) PER SHARE
Basic (in Dollars per share)	$ (0.63)	$ 1.41
Diluted (in Dollars per share)	(0.62)	1.41
DIVIDENDS PER SHARE (in Dollars per share)	$ 0.28	$ 0.56
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic (in Shares)	5,116,953	5,090,407
Diluted (in Shares)	5,190,289	5,115,801
Voice Services [Member]
OPERATING REVENUES:
Operating Revenues	$ 5,263,385	$ 5,694,428
Network Access [Member]
OPERATING REVENUES:
Operating Revenues	3,819,297	4,759,084
Video Service [Member]
OPERATING REVENUES:
Operating Revenues	12,061,703	12,497,458
Data Service [Member]
OPERATING REVENUES:
Operating Revenues	27,509,073	27,028,332
ACAM/FUSF [Member]
OPERATING REVENUES:
Operating Revenues	12,479,376	11,721,412
Other Non Regulated [Member]
OPERATING REVENUES:
Operating Revenues	$ 4,659,134	$ 4,013,755

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Statement of Comprehensive Income [Abstract]
NET INCOME (LOSS)	$ (3,214,694)	$ 7,196,702
OTHER COMPREHENSIVE GAIN (LOSS):
Unrealized Gains (Losses) on Interest Rate Swaps	(871,834)	3,097,827
Income Tax Expense (Benefit) Related to Unrealized Gains (Losses) on Interest Rate Swaps	248,821	(884,119)
OTHER COMPREHENSIVE GAIN (LOSS):	(623,013)	2,213,708
COMPREHENSIVE INCOME (LOSS)	$ (3,837,707)	$ 9,410,410

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2023	Dec. 31, 2022
CURRENT ASSETS:
Cash	$ 1,259,904	$ 310,556
Receivables, Net	3,411,892	3,725,422
Income Taxes Receivable		283,665
Materials, Supplies and Inventories	34,438,857	23,617,800
Prepaid Expenses and Other Current Assets	2,245,160	1,886,480
Total Current Assets	41,355,813	29,823,923
INVESTMENTS & OTHER ASSETS:
Goodwill	40,603,029	49,903,029
Intangibles	14,488,608	16,363,192
Other Investments	8,322,252	11,016,246
Right of Use Asset	1,348,290	1,341,029
Financial Derivative Instruments	1,342,628	2,214,462
Other Assets	884,122	461,445
Total Investments and Other Assets	66,988,929	81,299,403
PROPERTY, PLANT & EQUIPMENT:
Communications Plant	277,357,371	219,891,050
Other Property & Equipment	32,433,191	29,836,775
Video Plant	18,848,612	16,096,032
Total Property, Plant and Equipment	328,639,174	265,823,857
Less Accumulated Depreciation	173,088,602	159,632,293
Net Property, Plant & Equipment	155,550,572	106,191,564
TOTAL ASSETS	263,895,314	217,314,890
CURRENT LIABILITIES:
Current Portion of Long-Term Debt, Net of Unamortized Loan Fees
Accounts Payable	12,803,435	7,012,264
Checks Written in Excess of Cash Balance	2,270,832
Accrued Income Taxes	581,098
Other Accrued Taxes	253,490	243,965
Deferred Compensation	45,797	62,765
Accrued Compensation	1,562,115	2,051,316
Other Accrued Liabilities	1,059,163	2,291,630
Total Current Liabilities	18,575,930	11,661,940
LONG-TERM DEBT, Net of Unamortized Loan Fees	122,891,638	78,552,197
NONCURRENT LIABILITIES:
Loan Guarantees		169,565
Deferred Income Taxes	23,032,099	22,737,530
Unrecognized Tax Benefit		23,304
Other Accrued Liabilities	1,132,799	1,236,949
Deferred Compensation	256,605	351,553
Total Noncurrent Liabilities	24,421,503	24,518,901
COMMITMENTS AND CONTINGENCIES:
STOCKHOLDERS' EQUITY:
Preferred Stock - $1.66 Par Value, 10,000,000 Shares Authorized, No Shares Issued and Outstanding
Common Stock - $1.66 Par Value, 90,000,000 Shares Authorized, 5,133,207 and 5,093,213 Shares Issued and Outstanding	8,555,345	8,488,689
Accumulated Other Comprehensive Gain	959,442	1,582,455
Unearned Compensation		79,892
Retained Earnings	88,491,456	92,430,816
Total Stockholders' Equity	98,006,243	102,581,852
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 263,895,314	$ 217,314,890

XML

CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Preferred stock par value (in Dollars per share)	$ 1.66	$ 1.66
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock par value (in Dollars per share)	$ 1.66	$ 1.66
Common stock, shares authorized	90,000,000	90,000,000
Common stock, shares issued	5,133,207	5,093,213
Common stock, shares outstanding	5,133,207	5,093,213

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)	$ (3,214,694)	$ 7,196,702
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Depreciation and Amortization	15,649,902	14,294,377
Gain on Sale of Investments	(4,062,759)
Impairment of Goodwill	9,300,000
Unrealized (Gains) Losses on Investments	92,263	(217,876)
Undistributed Earnings of Other Equity Investment	(280,000)	(515,963)
Noncash Patronage Refund	(123,745)	(133,467)
Stock Issued in Lieu of Cash Payment	471,092	398,424
Distributions from Equity Investments	128,048	210,917
Stock-based Compensation	221,749	64,301
Changes in Assets and Liabilities:
Receivables	(190,494)	34,677
Income Taxes Receivable	283,665	1,121,957
Inventories for Resale	41,522	10,238
Prepaid Expenses	(358,652)	89,882
Other Assets	(458,211)	(40,627)
Accounts Payable	49,249	199,257
Checks Written in Excess of Cash Balance	2,270,832
Accrued Income Taxes	581,098
Other Accrued Taxes	9,525	(16,048)
Other Accrued Liabilities	(1,833,079)	1,524,133
Deferred Income Tax	520,086	2,349,440
Deferred Compensation	(111,916)	(46,059)
Net Cash Provided by Operating Activities	18,985,481	26,524,265
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to Property, Plant, and Equipment, Net	(55,547,283)	(37,977,118)
Materials and Supplies for Construction	(13,404,354)	(15,651,923)
Proceeds from Sale of Equity Investments	5,876,305
Other, Net	229,854	4,804
Net Cash Used in Investing Activities	(62,845,478)	(53,624,237)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal Payments of Long-Term Debt		(57,330,775)
Loan Proceeds	40,000,000	56,063,223
Loan Origination Fees	(151,237)	(1,165,859)
Changes in Revolving Credit Facility	4,281,191	33,172,860
Grants Received for Construction of Plant	2,110,162	396,360
Repurchase of Common Stock		(3,187,500)
Dividends Paid	(1,430,771)	(2,843,930)
Net Cash Used in Financing Activities	44,809,345	25,104,379
NET CHANGE IN CASH	949,348	(1,995,593)
CASH at Beginning of Period	310,556	2,306,149
CASH at End of Period	1,259,904	310,556
Supplemental cash flow information:
Cash paid for interest	7,131,224	1,505,687
Net cash paid (received) for income taxes	$ 930,807	$ (770,934)

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)	Common Stock [Member]	AOCI Attributable to Parent [Member]	Unearned Compensation [Member]	Retained Earnings [Member]	Total
BALANCE at Dec. 31, 2021	$ 8,683,422	$ (631,253)	$ 259,620	$ 90,338,806	$ 98,650,595
BALANCE (in Shares) at Dec. 31, 2021	5,210,053
Directors Stock Plan	$ 33,030			354,412	387,442
Directors Stock Plan (in Shares)	19,818
Employee Stock Plan	$ 7,793			92,741	100,534
Employee Stock Plan (in Shares)	4,676
Restricted Stock Grant			(30,712)		(30,712)
Non-Cash, Share-Based Compensation				95,013	95,013
Exercise of RSU's	$ 14,444		(149,016)	134,572
Exercise of RSU's (in Shares)	8,666
Repurchases of Common Stock	$ (250,000)			(2,937,500)	(3,187,500)
Repurchases of Common Stock (in Shares)	(150,000)
Net Income (loss)				7,196,702	7,196,702
Dividends				(2,843,930)	(2,843,930)
Unrealized Gain on Interest Rate Swap		2,213,708			2,213,708
BALANCE at Dec. 31, 2022	$ 8,488,689	1,582,455	79,892	92,430,816	102,581,852
BALANCE (in Shares) at Dec. 31, 2022	5,093,213
Directors Stock Plan	$ 46,193			341,277	387,470
Directors Stock Plan (in Shares)	27,716
Employee Stock Plan	$ 9,420			74,230	83,650
Employee Stock Plan (in Shares)	5,652
Restricted Stock Grant			(21,884)		(21,884)
Non-Cash, Share-Based Compensation				243,633	243,633
Exercise of RSU's	$ 11,043		(58,008)	46,965
Exercise of RSU's (in Shares)	6,626
Net Income (loss)				(3,214,694)	(3,214,694)
Dividends				(1,430,771)	(1,430,771)
Unrealized Gain on Interest Rate Swap		(623,013)			(623,013)
BALANCE at Dec. 31, 2023	$ 8,555,345	$ 959,442	$ 0	$ 88,491,456	$ 98,006,243
BALANCE (in Shares) at Dec. 31, 2023	5,133,207

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Business Description and Accounting Policies [Text Block]

NOTE 1 – BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Nuvera is a diversified communications company headquartered in New Ulm, Minnesota with more than 118 years of experience in the communications business. Our principal line of business is the operation of seven communications companies. Our businesses consist of connecting customers to our state-of-the-art, advanced fiber communications network, providing managed services, switched service and dedicated private lines, connecting customers to long distance service providers and providing many other services associated with our Company. We also provide IPTV, CATV, Internet access services, including high-speed broadband access, and long-distance service. We also install and maintain communications systems to the areas in and around our service territories in southern Minnesota and northern Iowa. 

Basis of Presentation and Principles of Consolidation

Our accounting policies conform to GAAP and rules and regulations of the SEC and, where applicable, conform to the accounting principles as prescribed by federal and state telephone utility regulatory authorities. We presently give accounting recognition to the actions of regulators where appropriate in preparing general purpose financial statements for most public utilities. In general, the type of regulation covered by this statement permits rates (prices) for some services to be set at levels intended to recover the estimated costs of providing regulated services or products, including the cost of capital (interest costs and a provision for earnings on stockholders’ investments).

Our consolidated financial statements report the financial condition and results of operations for Nuvera and its subsidiaries in one business segment: the Communications Segment. Inter-company transactions have been eliminated from the consolidated financial statements.

Classification of Costs and Expenses

Cost of services (excluding depreciation and amortization expense) includes all costs related to the delivery of communication services and products. These operating costs include all costs of performing services and providing related products including engineering, network monitoring and transportation costs.

Selling, general and administrative expenses include direct and indirect selling expenses, customer service, billing and collections, advertising and all other general and administrative costs associated with our operations.

Use of Estimates

The preparation of our consolidated financial statements in conformity with GAAP requires our management to make estimates and judgements that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and liabilities at the date of the financial statements and during the reporting period. The estimates and judgements used in the accompanying consolidated financial statements are based on our management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from those estimates and assumptions.

Revenue Recognition

See Note 2 – “Revenue Recognition” for a discussion of our revenue recognition policies.

Accounts Receivables and Allowance for Credit Losses

As of December 31, 2023, and 2022 our consolidated AR totaled $3,411,892 and $3,725,422, net of the AFCLs. We believe our receivables as of December 31, 2023, and 2022 are recorded at their fair value.

AR consists primarily of amounts due to the Company from normal business activities. We maintain an AFCLs based on our historical loss experience, current conditions and forecasted changes including but not limited to changes related to the economy, our industry and business. Uncollectible accounts are written-off (removed from AR and charged against the AFCLs) when internal collection efforts have been unsuccessful. Subsequently, if payment is received from the customer, the recovery is credited to the AFCLs.

As of December 31, 2023, and 2022, the fair value of our net AR approximated their carrying values; therefore, no fair value adjustment for fresh start accounting was required. Our AFCLs increased during the year ended December 31, 2023, compared to 2022.

Allowance for Credit Losses

AR are recorded at amortized cost less an AFCLs that are not expected to be recovered. The gross amount of AR is recorded net of the corresponding AFCLs in the consolidated balance sheets. We maintain AFCLs resulting from the expected failure or inability of our customers to make their required payments. We recognize the AFCLs based on management’s expectation of the asset’s collectability. The allowance is based on multiple factors including historical experience with bad debts, the credit quality of the customer base, the aging of such receivable and current macroeconomic conditions, as well as management’s expectation of conditions in the future, as applicable. Our AFCLs is recorded on a monthly basis based on the aging of our overall AR. Our AR collection policy includes internal collection efforts after an AR balance is 30 days due with service being suspended after approximately 40 days and terminated upon 60 days past due.   

The following table summarizes the activity in the AFCLS for the years ended December 31, 2023, and 2022:

	Year Ended December 31
	2023		2022
Balance at beginning of year	$	140,000	$	80,000
Provision charged to expense		175,559		206,398
Write-offs, less recoveries		(165,559)		(146,398)
Balance at end of year	$	150,000	$	140,000

Inventories

Inventory includes parts, materials and supplies stored in our warehouses to support basic levels of service and maintenance as well as scheduled capital projects and equipment awaiting configuration for customers. Inventory also includes (i) parts and equipment shipped directly from vendors to customer locations while in transit and (ii) parts and equipment returned from customers that are returned to vendors for credit. Our inventory value as of December 31, 2023, and 2022 was $34,438,857 and $23,617,800.

We value inventory using the lower of cost or net realizable value. Like our AFCLs, we make estimates related to the valuation of inventory. As of December 31, 2023, and 2022, we had no inventory reserve. We adjust our inventory carrying value for estimated obsolescence or unmarketable inventory to the net realizable value based upon assumptions about future demand and market conditions. As market and other conditions change, we may establish additional inventory reserves at a time when the facts that give rise to a lower value are warranted. We use the average cost method of inventory costing.

Property, Plant and Equipment

We record impairment losses on long-lived assets used in operations when events and circumstances indicate the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. In assessing the recoverability of long-lived assets, we compare the carrying value to the undiscounted future cash flows the assets are expected to generate. If the total of the undiscounted future cash flows is less than the carrying amount of the assets, we would write down those assets based on the excess of the carrying amount over the fair value of the assets. Fair value is generally determined by calculating the discounted future cash flows expected from those assets. Changes in these estimates could have a material adverse effect on the assessment of long-lived assets, thereby requiring a write-down of the assets. Write-downs of long-lived assets are recorded as impairment charges and are a component of operating expenses. We have reviewed our long-lived assets and concluded that no impairment charge on our long-lived assets is necessary.

We use the group life method (mass asset accounting) to depreciate the assets of our communications companies. Communications plant acquired in a given year is grouped into similar categories and depreciated over the remaining estimated useful life of the group. When an asset is retired, both the asset and the accumulated depreciation associated with that asset are removed from the books. Due to rapid changes in technology, selecting the estimated economic life of communications plant and equipment requires a significant amount of judgment. We periodically review data on the expected utilization of new equipment, asset retirement activity and net salvage values to determine adjustments to our depreciation rates. In 2022, we accelerated depreciation on our copper cable networks as we transition to a new FTTP network. Other than this change, we have not made any other significant changes to the lives of these assets in the two-year period ended December 31, 2023.

Grant money received from governmental entities for reimbursement of capital expenditures is accounted for as a reduction from the cost of the asset. As the grant was to be used in the Company’s regulated network, the Company accounts for this funding as aid to construction as outlined in the FCC’s Part 32 “Uniform System of Accounts for Telecommunications Companies.” The resulting balance sheet presentation reflects the Company’s net investment in the assets in our property, plant and equipment. Depreciation is calculated and recorded based on the reduced cost of the investment, therefore the impact of prior grants received is reflected in earnings as a reduction in depreciation. Grant funds are shown as inflows in the financing activities section of the statement of cash flows.

Goodwill and Intangible Assets

We amortize our definite-lived intangible assets over their estimated useful lives. Customer relationships are amortized over fourteen to fifteen years, regulatory rights are amortized over fifteen years and trade names are amortized over three to five years. Intangible assets with finite lives are amortized over their respective estimated useful lives. In accordance with GAAP, goodwill and intangible assets with indefinite useful lives are not amortized but tested for impairment at least annually. See Note 5 – “Goodwill and Intangibles” for a more detailed discussion of the intangible assets and goodwill. Our goodwill balance was $40,603,029 and $49,903,029 as of December 31, 2023, and 2022. The reduction in goodwill in 2023 was the result of the HTC impairment recognized in 2023. In the fourth quarter of 2023 and 2022 we completed our annual impairment tests for existing acquired goodwill. This testing resulted in no impairment charges to goodwill for SETC and Scott-Rice as of December 31, 2023. This testing did result in an impairment charge to goodwill for HTC of $9.3 million as of December 31, 2023. 

Financial Derivative Instruments and Fair Value Measurements

We have adopted the rules prescribed under GAAP for our financial assets and liabilities. GAAP includes a fair value hierarchy that is intended to increase consistency and comparability in fair value measurements and related disclosures. The fair value hierarchy is based on inputs to valuation techniques used to measure fair value that is either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions. The fair value hierarchy consists of the following three levels:

Level 1:	Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2:	Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs that are derived principally from or corroborated by observable market data.
Level 3:	Inputs are derived from valuation techniques where one or more significant inputs or value drivers are unobservable.

We have used financial derivative instruments to manage our overall cash flow exposure to fluctuations in interest rates. We accounted for derivative instruments in accordance with GAAP that requires derivative instruments to be recorded on the balance sheet at fair value. Changes in the fair value of derivative instruments must be recognized in earnings unless specific hedge accounting criteria are met, in which case, the gains and losses are included in other comprehensive income rather than in earnings.

We have entered into IRSAs with our lender, CoBank to manage our cash flow exposure to fluctuations in interest rates. These instruments are designated as cash flow hedges and are effective at mitigating the risk of fluctuations on interest rates in the marketplace. Any gains or losses related to changes in the fair value of these derivatives are accounted for as a component of accumulated other comprehensive gain (loss) for as long as the hedge remains effective.

The fair value of our IRSAs is discussed in Note 7 – “Interest Rate Swaps”. The fair value of our swap agreements was determined based on Level 2 inputs.

The fair value of our Goodwill is discussed in Note 5 – “Goodwill and Intangibles”. The fair value of our Goodwill was determined based on Level 3 inputs.

Other Financial Instruments

Other Investments - We conducted an evaluation of our investments in all of our investees in connection with the preparation of our audited financial statements as of December 31, 2023. As of December 31, 2023, we believe the carrying value of our investments is not impaired.

Debt – We estimate the fair value of our long-term debt based on the discounted future cash flows we expect to pay using current rates of borrowing for similar types of debt. Fair value of the debt approximates carrying value.

Other Financial Instruments - Our financial instruments also include cash equivalents, trade AR and accounts payable where the current carrying amounts approximate fair market value.

Investments and Other Assets

We are a co-investor with other communication companies in several partnerships and limited liability companies. These joint ventures make it possible to offer services to customers, including digital video services and fiber transport services that we would have difficulty offering on our own. These joint ventures also make it possible to invest in new technologies with a lower level of financial risk. We use the equity method of accounting for these investments that reflects original cost and recognition of our share of the net income or losses from the respective operations. See Note 16 – “Segment Information” for a listing of our investments.

Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at fair value where there are readily determinable fair values. Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at cost where there are no readily determinable fair values.  See Note 12 – “Other Investments” for additional information regarding our investments.

Advertising Expense

Advertising is expensed as incurred. Advertising expense charged to operations was $1,022,312 and $723,261 in 2023 and 2022. 

Interest During Construction

We include an average cost of debt for the construction of plant in our communications plant accounts.

Income Taxes

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. Accordingly, deferred tax assets and liabilities arise from the difference between the tax basis of an asset or liability and its reported amount in the financial statements and operating and tax credit carryforwards. Deferred tax assets and liabilities are determined using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. We recognize interest and penalties related to income tax matters as income tax expense. Income tax expense or benefit is the tax payable or refundable, respectively, for the period plus or minus the change in deferred tax assets and liabilities during the period.

GAAP requires us to recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. See Note 8 – “Income Taxes” for additional information regarding income taxes.

Collection of Taxes from Customers

Sales, excise and other taxes are imposed on most of our sales to nonexempt customers. We collect these taxes from our customers and remit the entire amounts to governmental authorities. Our accounting policies dictate that we exclude these taxes collected and remitted from our revenues and expenses.

Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments and receivables. We deposit our cash investments in high credit quality financial institutions accounts which, at times, may exceed federally insured limits. We have not experienced any losses in these accounts and do not believe we are exposed to any significant credit risk. Concentrations of credit risk with respect to trade receivables are limited due to our large number of customers.

Earnings and Dividends Per Share

The basic and diluted net income per share are calculated as follows:

	Year Ended December 31, 2023				Year Ended December 31, 2022
	Basic		Diluted		Basic		Diluted
Net Income (Loss)	$	(3,214,694)	$	(3,214,694)	$	7,196,702	$	7,196,702
Weighted-average common shares outstanding		5,116,953		5,190,289		5,090,407		5,115,801
Net income (loss) per share	$	(0.63)	$	(0.62)	$	1.41	$	1.41

The weighted-average shares outstanding, basic and diluted are calculated as follows:

	Year Ended December 31, 2023		Year Ended December 31, 2022
	Basic	Diluted	Basic	Diluted
Weighted-average common shares outstanding	5,116,953	5,116,953	5,090,407	5,090,407
Dilutive RSU's/Options	-	73,336	-	25,394
Weighted-average common shares outstanding	5,116,953	5,190,289	5,090,407	5,115,801

Nuvera’s BOD reviews quarterly dividend declarations based on our anticipated earnings, capital requirements and our operating and financial conditions.

Recent Accounting Developments

Effective January 1, 2022, we adopted Accounting Standards Update (ASU) No. 2021-10 “Disclosures by Business Entities about Government Assistance.” ASU 2021-10 requires disclosure by business entities of the types of government assistance received, the method of accounting for such assistance and the effects of the assistance on its financial statements. The adoption of this guidance did not have a material impact on our related disclosures.

In March 2020, the Financial Accounting Standards Board (FASB) issued ASU 2020-04, “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional guidance for a limited period to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. During the quarter ended June 30, 2022, we novated a certain hedging relationship to one our IRSAs by changing the reference rated from the London Inter-Bank Offered Rate to a secured overnight financing rate (SOFR). The amendment did not have a material impact on our consolidated financial statements.   

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosures relating to the credit quality of trade and other receivables, including information relating to management’s estimate of AFCLs. The Company is required to adopt ASU 2016-13 for fiscal periods beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption as of December 15, 2018, was permitted. As of January 1, 2022, the Company adopted ASU 2016-13 and the adoption did not have a significant impact on our consolidated financial statements.

We have reviewed all other significant newly issued accounting pronouncements and determined that they are either not applicable to our business or that no material effect is expected on our financial position and results of operations.

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REVENUE RECOGNITION

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

NOTE 2 – REVENUE RECOGNITION

The Company recognizes revenue based on the following single principles-based, five-step model that is applied to all contracts with customers. These steps include (1) identify the contract(s) with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when each performance obligation is satisfied.  

Our revenue contracts with customers may include a promise or promises to deliver services such as broadband, video or voice services. Promised services are considered distinct as the customer can benefit from the services either on their own or together with other resources that are readily available to the customer and the Company’s promise to transfer service to the customer is separately identifiable from other promises in the contract. The Company accounts for services as separate performance obligations. Each service is considered a single performance obligation as it provides a series of distinct services that are substantially the same and have the same pattern of transfer.

The transaction price is determined at contract inception and reflects the amount of consideration to which we expect to be entitled in exchange for transferring service to the customer. This amount is generally equal to the market price of the services promised in the contract and may include promotional or bundling discounts. Most of our prices are based on tariffed rates filed with regulatory bodies or standard company price lists. The transaction price excludes amounts collected on behalf of third parties such as sales taxes and regulatory fees. Conversely, nonrefundable up-front fees, such as service activation and set-up fees, which are immaterial to our overall revenues, are included in the transaction price. In determining the transaction price, we consider our enforceable rights and obligations within the contract. We do not consider the possibility of a contract being cancelled, renewed or modified, which is consistent with Accounting Standards Codification (ASC 606-10-32-4).

The transaction price is allocated to each performance obligation based on the standalone selling price of the service, net of the related discount, as applicable.

Revenue is recognized when performance obligations are satisfied by transferring service to the customer as described below.

Significant Judgments

The Company often provides multiple services to a customer. Provision of CPE and additional service tiers may have a significant level of integration and interdependency with the subscription voice, video, Internet or connectivity services. Judgement is required to determine whether the provision of CPE, installation services and additional service tiers are considered distinct and accounted for separately, or not distinct and accounted for together with the subscription services.

Allocation of the transaction price to the distinct performance obligations in bundled service subscriptions requires judgement. The transaction price for a bundle of services is frequently less than the sum of standalone selling prices of each individual service. Bundled discounts are allocated proportionally to the selling price of each individual service within the bundle. Standalone selling prices for the Company’s services are directly observable.

Disaggregation of Revenue

The following table summarizes revenue from contracts with customers for the years ended December 31, 2023, and 2022:

	Twelve Months Ended December 31,
	2023		2022
Voice Service¹	$	5,818,241		6,254,287
Network Access¹		3,938,587		4,898,470
Video Service¹		12,061,703		12,497,213
Data Service¹		25,214,978		24,680,039
Directory²		597,189		645,250
Other Contracted Revenue³		2,695,719		2,755,039
Other4		2,014,586		1,353,475
Revenue from customers		52,341,003		53,083,773
Subsidy and other revenue outside scope of ASC 6065		13,450,965		12,630,696
Total revenue	$	65,791,968	$	65,714,469
¹ Month-to-Month contracts billed and consumed in the same month.
² Directory revenue is contracted annually, however, this revenue is recognized monthly over the contract period as the advertising is used.
³ This includes long-term contracts where the revenue is recognized monthly over the term of the contract.
4 This includes CPE and other equipment sales.
5 This includes governmental subsidies and lease revenue outside the scope of ASC 606.

For the year ended December 31, 2023, approximately 76.50% of our total revenue was from month-to-month and other contracted revenue from customers. Approximately 20.44% of our total revenue was from revenue sources outside of the scope of ASC 606. The remaining 3.06% of total revenue was from other sources including CPE and equipment sales and installation.

For the year ended December 31, 2022, approximately 78.72% of our total revenue was from month-to-month and other contracted revenue from customers. Approximately 19.22% of our total revenue was from revenue sources outside of the scope of ASC 606. The remaining 2.06% of total revenue was from other sources including CPE and equipment sales and installation.

A significant portion of our revenue is derived from customers who may generally cancel their subscriptions at any time without penalty. As such, the amount of revenue related to unsatisfied performance obligations is not necessarily indicative of the future revenue to be recognized from our existing customer base. Revenue from customers with a contractually specified term and non-cancelable service period will be recognized over the term of such contracts, which is generally three to ten years for these types of contracts.

Nature of Services

Revenues are earned from our customers primarily through the connection to our advanced fiber networks, digital and commercial TV programming, Internet services (high-speed broadband), and hosted and managed services. Revenues for these services are billed based on set rates for monthly service or based on the amount of time the customer is utilizing our facilities. The revenue for these services is recognized over time as the service is rendered.

Voice Service – We receive recurring revenue for basic local services that enable end-user customers to make and receive telephone calls within a defined local calling area for a flat monthly fee. In addition to subscribing to basic local telephone services, our customers may choose from multiple voice service plans with a variety of custom calling features such as call waiting, call forwarding, caller identification and voicemail. Our VOIP digital phone service is also available as an alternative to the traditional telephone line. Customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

Network Access – We provide access services to other communication carriers for the use of our facilities to terminate or originate long distance calls on our fiber network. Additionally, we bill monthly SLCs to substantially all our customers for access to the public switched network. These monthly SLCs are regulated and approved by the FCC. In addition, network access revenue is derived from several federally administered pooling arrangements designed to provide support and distribute funding to us.

Revenues earned from other communication carriers accessing our network are based on the utilization of our network by these carriers as measured by minutes of use on the network or special access to the network by the individual carriers monthly. Revenues are billed at tariffed access rates for both interstate and intrastate calls and are recognized into revenue monthly based on the period the access was provided.

The NECA pools and redistributes the SLCs to various communication providers through the CAF. These revenues are earned and recognized into revenue monthly. Any adjustments to these amounts received by NECA are adjusted for in revenue upon receipt of the adjustment.

Video Service – We provide a variety of enhanced video services on a monthly recurring basis to our customers.  Depending on geographical market availability, our video services range from limited basic service to advanced digital TV, which includes several plans each with hundreds of local, national music channels including premium and pay-per-view channels as well as video-on-demand service. Certain customers may also subscribe to our advanced video services, which consist of HD TV, DVR and Whole Home DVR. Our Whole Home DVR allows customers the ability to watch recorded shows on any TV in the house, record multiple shows at one time and utilize an intuitive on-screen guide and user interface. Video subscribers also have access to our TV Everywhere service which allows subscriber access to full episodes of available shows, movies and live screens using a computer or mobile device. We also receive monthly recurring revenue from our subscribers for providing commercial TV programming in competition with CATV, satellite dish TV and off-air TV service providers. Customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

Data Service – We provide high speed Internet to business and residential customers depending on the nature of the network facilities that are available, the level of service selected and the location. Our revenue is earned based on the offering of various flat packages based on the level of service, data speeds and features. We also provide e-mail and managed services, such as web hosting and design, on-line file back up and on-line file storage. Data customers may generally cancel their subscriptions at any time without penalty. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized over a one-month service period as the subscription services are delivered. Other optional services purchased by the customer are generally accounted for as a distinct performance obligation when purchased and revenue is recognized when the service is provided.

Directory – Our directory publishing revenue in our telephone directories recurs monthly and is recognized as revenue monthly. 

Other Contracted Revenue - Managed services and certain other data customers include advanced fiber-delivered communications and managed information technology solutions to mainly business customers, as well as high-capacity last-mile data connectivity services to wireless and wireline carriers. Services are primarily offered on a subscription basis with a contractually specified and non-cancelable service period. The non-cancelable contract terms for these customers generally range from three to ten years. Each subscription service provided is accounted for as a distinct performance obligation and revenue is recognized ratably over the contract period as the subscription services are delivered. These services are billed as monthly recurring charges to customers. 

Other – We also generate revenue from the sales, service and installation of CPE and other services. Sales and service of CPE are billed and recognized into revenue once the sale or service is complete or delivered. These sales and services are generally short-term in nature and are completed within one month. Other revenues are immaterial to our total revenues.

Subsidy and Other Revenue outside the Scope of ASC 606 – We receive subsidies from governmental entities to operate and expand our advanced fiber networks. In addition, we have revenue from leasing arrangements. Both revenue streams are outside of the scope of ASC 606. 

Interstate access rates are established by a nationwide pooling of companies known as NECA. The FCC established NECA in 1983 to develop and administer interstate access service rates, terms and conditions. Revenues are pooled and redistributed based on a company's actual or average costs. There has been a change in the composition of interstate access charges in recent years, shifting more of the charges to the end user and reducing the amount of access charges paid by the IXC’s. We believe this trend will continue.

Intrastate access rates are filed with state regulatory commissions in Minnesota and Iowa.

The Company currently receives funding based on the A-CAM as described below, except for Scott-Rice, which receives funding from the FUSF. Scott-Rice’s settlements from the pools are based on nationwide average schedules, which includes the pooling and redistribution of revenues based on a company’s actual or average costs as described below. 

A-CAM

As described above, except Scott-Rice, the remainder of our companies receive funding from A-CAM.

Per the FCC Public Notice DA 19-115, the Company receives A-CAM support and has corresponding service deployment obligations under that program. The Company annually receives (i) $596,084 for its Iowa operations and (ii) $8,354,481 for its Minnesota operations. The Company will receive the A-CAM support for a period of 10 years, which started in 2019. The Company uses the funding that it receives through the A-CAM program to meet its defined broadband build-out obligations, which the Company is currently completing.

On September 29, 2023, Nuvera announced that it had notified the FCC that the Company had decided to remain on the current A-CAM funding, rather than moving to the E-ACAM program that the FCC introduced earlier in 2023. A-CAM and E-ACAM are FCC administered programs to subsidize the deployment of broadband to rural areas. E-ACAM is a successor to this program which requires participating carriers to offer broadband and voice services at speeds of 100/20 Mbps or faster to all E-ACAM required locations within its study area. Broadband providers were required to choose one of the two funding options and notify the FCC by September 29, 2023.

Accounts Receivable, Contract Assets and Contract Liabilities

The following table provides information about our receivables, contracts assets and contract liabilities from revenue contracts with our customers:

	Year Ended December 31,
	2023		2022		2021
Accounts receivable, net	$	1,966,012	$	1,477,692	$	1,512,369
Contract assets		1,458,631		794,193		662,437
Contract liabilities		551,995		626,306		602,007

Accounts Receivable

A receivable is recognized in the period the Company provides goods and services when the Company’s right to consideration is unconditional. Payment terms on invoiced amounts are generally 30-60 days.

Contract Assets

Contract assets include costs that are incremental to the acquisition of a contract. Incremental costs are those that result directly from obtaining a contract or costs that would not have been incurred if the contract had not been obtained, which primarily relates to sales commissions. We defer and amortize these costs over the expected customer life as the contract obligations are satisfied. We determined that the expected customer life is the expected period of benefit as the commission on the renewal contact is commensurate with the commission on the initial contract. During the years ended December 31, 2023, and 2022, the Company recognized expenses of $493,987 and $300,614, respectively, related to deferred contract acquisition costs. Short-term contract assets are included in current assets under prepaid expenses and other current assets. Long-term contract assets are included in investments and other assets under other assets.

Contract Liabilities

Contract liabilities include deferred revenues related to advanced payments for services and nonrefundable, upfront service activation and set-up fees, which are generally deferred. In addition, contact liabilities include customer deposits that are not recognized as revenue, but are instead returned to the customer after a holding period. Short-term contract liabilities include deferred revenues for advanced payments for managed services and other long-term contracts. This includes the current portion of the deferred revenues that will be recognized monthly within one year. Short-term contact liabilities are included in current liabilities under other accrued liabilities. Long-term contract liabilities include deferred revenues for advanced payments for managed services and other long-term contracts. This includes the portion longer than one year and the corresponding deferred revenues are recognized into revenue on a monthly basis based on the term of the contract. Long-term contact liabilities are included in noncurrent liabilities under other accrued liabilities.

During the years ended December 31, 2023, and 2022 the Company recognized revenues of $364,644 and $349,109, respectively, related to deferred revenues.

Performance Obligations

ASC 606, Revenue from Contracts with Customers, requires that the Company disclose the aggregate amount of the transaction price that is allocated to remaining performance obligations that are unsatisfied as of December 31, 2023. The guidance provides certain practical expedients that limit this requirement. The service revenue contracts of the Company meet the following practical expedients provided by ASC 606:

1.  The performance obligation is part of a contract that has an original expected duration of one year or less.

2.  Revenue is recognized from the satisfaction of the performance obligations in the amount billable to the customer in accordance with ASC 606-10-55-18.

The Company has elected these practical expedients. Performance obligations related to our service revenue contracts are generally satisfied over time. For services transferred over time, revenue is recognized based on amounts invoiced to the customer as the Company has concluded that the invoice amount directly corresponds with the value of services provided to the customer. Management considers this a faithful depiction of the transfer of control as services are substantially the same and have the same pattern of transfer over the life of the contract. As such, revenue related to unsatisfied performance obligations that will be billed in future periods has not been disclosed.

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LEASES

12 Months Ended

Dec. 31, 2023

Disclosure Text Block [Abstract]

Lessee, Operating Leases [Text Block]

NOTE 3 – LEASES

Under FASB’s ASU 2016-02, “Leases,” which, together with its related clarifying ASUs, provided revised guidance for lease accounting and related disclosure requirements and established a right-to-use (ROU) model that requires lessees to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. The ASU also requires disclosures to allow financial statement users to better understand the amount, timing and uncertainty of cash flows arising from leases. These disclosures include qualitative requirements, providing additional information about the amounts recorded in the financial statements.    

The following tables include the ROU assets and operating lease liabilities as of December 31, 2023, and 2022. Short-term operating lease liabilities are included in current liabilities in other accrued liabilities. Long-term operating lease liabilities are included in noncurrent liabilities in other accrued liabilities.

Right of Use Assets	Balance  December 31, 2023		Balance  December 31, 2022
Operating Lease Right-Of-Use Assets	$	1,348,290	$	1,341,029

Operating Lease Liabilities	Balance December 31, 2023		Balance December 31, 2022
Short-Term Operating Lease Liabilities	$	352,969	$	356,400
Long-Term Operating Lease Liabilities		1,029,910		1,026,978
Total	$	1,382,879	$	1,383,378

Maturity analysis under these lease agreements are as follows:

Maturity Analysis	Balance December 31, 2023
2024	$	429,410
2025		241,574
2026		198,377
2027		149,229
2028		151,424
Thereafter		554,492
Total		1,724,506
Less Imputed interest		(341,627)
Present Value of Operating Leases	$	1,382,879

The following summarizes other information related to leases for the year ended December 31, 2023, as follows:

Weighted Average Remaining Lease Term (Years)	6.75
Weighted Average Discount Rate	6.27%

We amortize our leases over the shorter of the term of the lease or the useful life of the asset. Lease expenses for the years ended December 31, 2023, and 2022 was $506,138 and $357,303, respectively.

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PROPERTY, PLANT AND EQUIPMENT

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

NOTE 4 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of December 31, 2023, and 2022, include the following:

	2023		2022
Communications Plant:
Land	$	707,648	$	712,503
Buildings		11,007,636		10,918,490
Other Support Assets		24,419,429		22,980,859
Central Office and Circuit Equipment		63,323,590		61,046,604
Cable and Wire Facilities		154,273,968		118,171,835
Other Plant and Equipment		404,883		404,883
Plant Under Construction		23,220,217		5,655,876
		277,357,371		219,891,050
Other Property		32,433,191		29,836,775
Video Plant		18,848,612		16,096,032
Total Property, Plant and Equipment	$	328,639,174	$	265,823,857

Depreciation is computed using the straight-line method based on the estimated service or remaining useful lives of the various classes of depreciable assets. Depreciation expense was $13,565,831 and $12,155,871 in 2023 and 2022. The composite depreciation rates on communications plant and equipment for the two years ended December 31, 2023, and 2022, respectively, were 4.4% and 4.7%. Other property and video plant is depreciated over estimated useful lives of three to twenty-five years.

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GOODWILL AND INTANGIBLES

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 5 - GOODWILL AND INTANGIBLES

We account for goodwill and other intangible assets under GAAP. Under GAAP, goodwill and intangible assets with indefinite useful lives are not amortized but are instead tested for impairment (i) on at least an annual basis and (ii) when changes in circumstances indicate that the fair value of goodwill may be below its carrying value. These circumstances include but are not limited to (i) a significant adverse change in the business climate, (ii) unanticipated competition or (iii) an adverse action or assessment by a regulator. Determining impairment involves estimating the fair value of a reporting unit using a combination of (i) the income or discounted cash flow approach and (ii) the market approach that utilizes comparable companies’ data. If the carrying amount of a reporting unit exceeds its fair value, the amount of the impairment loss must be measured. The impairment loss is calculated by comparing the implied fair value of the reporting unit’s goodwill to its carrying amount. In calculating the implied fair value of the reporting unit’s goodwill, the fair value of the reporting unit is allocated to all the assets and liabilities of the reporting unit. The excess of the fair value of a reporting unit over the amount assigned to its other assets and liabilities is the implied value of goodwill. We recognize impairment loss when the carrying amount of goodwill exceeds its implied fair value. Our goodwill totaled $40,603,029 as of December 31, 2023, and $49,903,029 as of December 31, 2022. The reduction in goodwill in 2023 was the result of the HTC impairment recognized in 2023.

In 2023 and 2022, we engaged an independent valuation firm to aid in the completion of an annual impairment test for existing goodwill acquired. For 2023 and 2022, the testing resulted in no impairment to goodwill for Scott-Rice and SETC and no impairment to goodwill for HTC for 2022 as the determined fair value was sufficient to pass the impairment test. For 2023, the testing resulted in an impairment to goodwill for HTC of $9.3 million as the determined fair value was not sufficient to pass the impairment test.

Our intangible assets subject to amortization consist of acquired customer relationships, regulatory rights and trade names. We amortize intangible assets with finite lives over their respective estimated useful lives. Identifiable intangible assets that are subject to amortization are evaluated for impairment. In addition, we periodically reassess the carrying value, useful lives and classifications of our identifiable intangible assets.

The components of our identified intangible assets are as follows:

		December 31, 2023				December 31, 2022
	Useful Lives		Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Definite-Lived Intangible Assets
Customers Relationships	14-15 yrs	$	42,878,445	$	32,053,361	$	42,878,445	$	30,429,708
Regulatory Rights	15 yrs		4,000,000		4,000,000		4,000,000		4,000,000
Video Franchise			3,000,000		214,290		-		-
Trade Name	3-5 yrs		310,106		310,106		310,106		273,465
Indefinitely-Lived Intangible Assets
Video Franchise			-		-		3,000,000		-
Spectrum			877,814		-		877,814		-
Total		$	51,066,365	$	36,577,757	$	51,066,365	$	34,703,173
Net Identified Intangible Assets				$	14,488,608			$	16,363,192

Amortization expense related to the definite-lived assets was $1,874,584 for 2023 and $1,952,375 for 2022. Amortization expense for the next five years is estimated to be:

2024	$	2,052,234
2025	$	2,047,312
2026	$	2,042,389
2027	$	1,335,247
2028	$	1,335,247

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LONG-TERM DEBT

12 Months Ended

Dec. 31, 2023

Debt Disclosure [Abstract]

Long-Term Debt [Text Block]

NOTE 6 - LONG-TERM DEBT

On July 15, 2022, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and secured a new credit facility in the aggregate principal amount of $130.0 million.

Under the Agreements, among other things, (i) the Company received a $50.0 million term loan to replace existing debt, (ii) a $50.0 million delayed draw term loan, (iii) the Company’s revolving loan was increased from $20.0 million to $30.0 million, (iv) the maturity date of the term loans were set at July 15, 2029, and the maturity day of the revolving loan was set at July 15, 2027, and (v) the Company’s operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on July 20, 2022, for further details regarding the new credit agreements with CoBank.

On December 21, 2023, Nuvera and CoBank entered into (i) an Agreement Regarding Amendments to Loan Documents and (ii) an Amended and Restated Revolving Loan Promissory Note. The agreements amended our existing credit facility with CoBank and increased the Company’s existing credit facility from an aggregate principal amount of $130.0 million to $140.0 million. Under the Agreements, among other things, (i) the Company’s revolving loan was increased from $30.0 million to $40.0 million and (ii) the Company operating subsidiaries agreed to extend their previous guarantees, security interests and mortgages to cover the increased amount of the revolving note. The financing was secured to facilitate the Company’s advanced fiber-build plans announced on December 15, 2021. Refer to the Company’s 8-K filing with the SEC on December 21, 2023, for further details regarding the new credit agreements with CoBank.

Under the new credit agreement, the Company and its respective subsidiaries have entered into security agreements under which substantially all the assets of Nuvera and its respective subsidiaries have been pledged to CoBank as collateral. In addition, Nuvera and its respective subsidiaries have guaranteed all the obligations under the credit facility. The credit agreement contains certain customary events of default, which include failure to make payments when due, the material inaccuracy of representations or warranties, failure to observe or perform certain covenants, cross-defaults, bankruptcy and insolvency-related events, certain judgments, certain ERISA-related events, or a change in control (as defined in the credit agreement).

Secured Credit Facility:

New Credit Agreement

● TERM A-1 LOAN - $50,000,000 term note with interest payable quarterly. Final maturity date of this note is July 15, 2029. Twelve quarterly principal payments of $625,000 are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of $937,500 commencing on December 31, 2028, through maturity date. A final balloon payment of $39,687,500 is due at maturity of this note on July 15, 2029. We have currently drawn $50,000,000 on this Term Loan as of December 31, 2023.

● DELAYED DRAW TERM LOAN - $50,000,000 Delayed Draw Term Loan with interest on any outstanding amounts payable quarterly. Final maturity date of this loan is July 15, 2029. Twelve quarterly principal payments of 1.25% of the outstanding loan balance are due commencing December 31, 2025, through September 30, 2028, and three quarterly principal payments of 1.875% of the outstanding loan balance commencing on December 31, 2028, through maturity date. A final balloon payment of the balance of the Delayed Draw Term Loan is due at maturity of this note on July 15, 2029. We currently have drawn $50,000,000 on this Delayed Draw Term Loan as of December 31, 2023.

●

REVOLVING LOAN - $40,000,000 revolving loan with interest payable quarterly. Final maturity date of this note is July 15, 2027. We currently have drawn $24,166,273 on this revolving note as of December 31, 2023.

The term loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 2.15% above the applicable base rate. The margin for base rate loans for term loans increases as our “Leverage Ratio” increases. The revolving loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 1.90% above the applicable base rate. The margin for base rate loans for revolving loans increases as our “Leverage Ratio” increases.

We generally use variable-rate debt to finance our operations, capital expenditures and acquisitions. These variable-rate debt obligations expose us to variability in interest payments due to changes in interest rates. The terms of our credit facility with CoBank require that we enter into interest rate agreements designed to protect us against fluctuations in interest rates, in an aggregate principal amount and for a duration determined under the credit facility.

Under the new credit facility, Nuvera can enter into IRSAs in connection with amounts borrowed from CoBank. In connection with the closing of the new credit facility, the Company “rolled over” its two exiting IRSAs. 

As described in Note 7 – “Interest Rate Swaps,” on August 1, 2018 we entered into an IRSA with CoBank covering 25 percent of our then existing debt balance or $16,137,500 of our aggregate indebtedness to CoBank on August 1, 2018. As of December 31, 2023, our IRSA covered $9,798,200, with a weighted average interest rate of 6.11%.

As described in Note 7 – “Interest Rate Swaps,” on August 29, 2019 we entered into a second IRSA with CoBank covering an additional $42,000,000 of our then aggregate indebtedness to CoBank on August 29, 2019. As of December 31, 2023, our IRSA covered $27,462,606, with a weighted average interest rate of 4.44%.

Our remaining outstanding debt of $86.9 million remains subject to variable interest rates at an effective weighted average interest rate of 8.55%, as of December 31, 2023.

As of December 31, 2023, our unused revolving credit facility of $15.8 million is subject to an unused commitment fee of 0.25% annually, until drawn. Once drawn, this debt would be subject to an effective weighted average interest rate based on a current rate of interest in effect at the time.

Our loan agreements include restrictions on our ability to pay cash dividends to our stockholders. However, we are allowed to pay dividends in an amount up to $3,000,000 in any year as long as no default or event of default has occurred. Our current Total Leverage Ratio as of December 31, 2023, was 5.03, which exceeded our maximum total leverage ratio of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.   

Our credit facility requires us to comply with specified financial ratios and tests. These financial ratios include total leverage ratio, debt service coverage ratio and equity to total assets ratio. On December 31, 2023, other than our total leverage ratio, we were in compliance with all the stipulated financial ratios in our loan agreements.

There are security and loan agreements underlying our current CoBank credit facility that contain restrictions on our distributions to stockholders and investment in, or loans, to others. Also, our credit facility contains restrictions that, among other things, limits or restricts our ability to enter into guarantees and contingent liabilities, incur additional debt, issue stock, transact asset sales, transfers or dispositions, and engage in mergers and acquisitions, without CoBank approval.  

Long-term debt is as follows:	2023		2022
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of $625,000 (beginning on December 31, 2025) and    quarterly installments of $937,500 (beginning on December 31, 2028),    plus a notional variable rate of interest through July 15, 2029.	$	50,000,000	$	50,000,000
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of 1.25% of loan balance (beginning on    December 31, 2025) and quarterly installments of 1.875% of loan balance    beginning on December 31, 2028), plus a notional variable rate of    interest through July 15, 2029.		50,000,000		10,000,000
Secured five-year revolving credit facility of up to $40,000,000 to    CoBank, ACB, plus a notional variable rate of interest through    July 15, 2027.		24,166,273		19,885,082
Less:  Unamortized Loan Fees		(1,274,635)		(1,332,885)
		122,891,638		78,552,197
Less:  Amount due within one year		-		-
Net of Current Portion of Unamortized Loan Fees		-		-
Total Long Term Debt	$	122,891,638	$	78,552,197

Required principal payments for the next five years are as follows:

2024	$	-
2025	$	1,250,000
2026	$	4,922,845
2027	$	28,970,229
2028	$	5,272,117

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INTEREST RATE SWAPS

12 Months Ended

Dec. 31, 2023

Disclosure Text Block Supplement [Abstract]

Financial Instruments Disclosure [Text Block]

NOTE 7 – INTEREST RATE SWAPS 

We assess interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely affect expected future cash flows and by evaluating hedging opportunities.

We generally use variable-rate debt to finance our operations, capital expenditures and acquisitions. These variable-rate debt obligations expose us to variability in interest payments due to changes in interest rates. The terms of our credit facility with CoBank required that we enter into interest rate agreements designed to protect us against fluctuations in interest rates, in an aggregate principal amount and for a duration determined under the credit facility.

Under the new credit facility, Nuvera can enter into IRSAs in connection with amounts borrowed from CoBank. In connection with the closing of the new credit facility, the Company “rolled over” its two exiting IRSAs. 

To meet this objective, we have entered into an IRSA with CoBank covering 25 percent of our then existing outstanding debt balance or $16,137,500 of our aggregate indebtedness to CoBank at August 1, 2018. The swap effectively locked in the interest rate on 25 percent of our variable-rate debt through July 2025. Under this IRSA, we have changed the variable-rate cash flow exposure on the debt obligations to fixed cash flows. Under the terms of the IRSA, we pay a fixed contractual interest rate and (i) make an additional payment if the SOFR variable rate payment is below a contractual rate or (ii) receive a payment if the SOFR variable rate payment is above the contractual rate.

On August 29, 2019, we entered into a second IRSA with CoBank covering an additional $42,000,000 of our then aggregate indebtedness to CoBank on August 29, 2019. The swap effectively locked in a significant portion of our variable-rate debt through July 2025. Under this IRSA, we have changed the variable rate cash flow exposure on the debt obligations to fixed cash flows. Under the terms of the IRSA, we pay a fixed contractual interest rate and (i) make an additional payment if the SOFR variable rate payment is below a contractual rate or (ii) receive a payment if the SOFR variable rate payment is above the contractual rate.

Each month, we make interest payments to CoBank under its loan agreements based on the current applicable SOFR plus the contractual SOFR margin then in effect with respect to the loan, without reflecting our IRSAs. At the end of each calendar month, CoBank adjusts our aggregate interest payments based on the difference, if any, between the amounts paid by us during the month and the current effective interest rate. Net interest payments are reported in our consolidated income statement as interest expense.

As of December 31, 2023 we had the following IRSAs in effect.

Loan #	Maturity Date	Notional Amount		Current Effective Interest Rate (1)
TERM A-1 LN	7/31/2029	$	9,798,200	6.11% (SOFR Base Rate of 2.96% plus 3.15% Base Rate Margin)
TERM A-1 LN	7/31/2029	$	27,462,606	4.44% (SOFR Base Rate of 1.29% plus 3.15% Base Rate Margin)

(1) As described in Note 6 – “Long-Term Debt,” the notes above initially bears interest at a SOFR rate determined by the maturity of the note, plus a “Base Rate Margin” rate equal to a maximum of 2.90% according to the individual secured credit facility. The Base Rate Margin increases as the borrower’s “Leverage Ratio” increases. The “Current Effective Interest Rate” in the table reflects the rate we pay giving effect to the swaps.

Our IRSAs under our credit facilities both qualify as cash flow hedges for accounting purposes under GAAP. We reflect the effect of these hedging transactions in the financial statements. The unrealized gain/loss is reported in other comprehensive income. If we terminate our IRSAs, the cumulative change in fair value at the date of termination would be reclassified from accumulated other comprehensive gain (loss), which is classified in stockholders’ equity, into earnings on the consolidated statements of income.

The fair value of the Company’s IRSAs were determined based on valuations received from CoBank and were based on the present value of expected future cash flows using discount rates appropriate with the terms of the IRSAs. The fair value indicates an estimated amount we would be required to pay if the contracts were canceled or transferred to other parties. On December 31, 2023, the fair value asset of these swaps was $1,342,628, which has been recorded net of deferred tax expense of $383,186, resulting in the $959,442 in accumulated other comprehensive income gain. As of December 31, 2022, the fair value asset of these swaps was $2,214,462, which has been recorded net of deferred tax expense of $632,007, resulting in the $1,582,455 in accumulated other comprehensive income gain.

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INCOME TAXES

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 8 - INCOME TAXES

Income taxes recorded in our consolidated statements of income consists of the following:

	2023		2022
Taxes currently payable
Federal	$	-	$	(50,330)
State		1,795,530		380,082
Deferred Income Taxes		520,126		2,368,911
Total Income Tax Expense	$	2,315,656	$	2,698,663

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. As required by GAAP, we recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. 

As of December 31, 2022, we had $19,787 of unrecognized tax benefits that if recognized would affect the tax rate. As of December 31, 2023, the uncertain tax position was reduced to $0 due to a lapse in stature of limitations for the year the position originated.

A reconciliation of the beginning and ending amount of total unrecognized benefits for the years ended December 31, 2023, and 2022 are as follows:

	2023		2022
Balance, beginning of year	$	19,787	$	38,673
Increases related to prior year tax positions		-		-
Decreases related to prior year tax positions		-		(18,886)
Increases related to current year tax positions		-		-
Decreases due to lapse of statute of limitations		(19,787)		-
Settlements		-		-
Balance, end of year	$	-	$	19,787

We are primarily subject to United States, Minnesota, Iowa, Nebraska, North Dakota and Wisconsin income taxes. Tax years subsequent to 2019 remain open to examination by federal and state tax authorities. Our policy is to recognize interest and penalties related to income tax matters as income tax expense. As of December 31, 2023, and 2022 we had $0 and $3,518 of interest or penalties accrued that related to income tax matters.

The differences between the statutory federal tax rate and the effective tax rate were as follows:

	2023		2022
Statutory Tax Rate	21.00	%	21.00	%
Effect of:
State Income Taxes Net of Federal Tax Benefit	(65.32)		8.17
Non deductible goodwill impairment	(217.23)		-
Permanent Differences and Other, Net	3.98		(1.90)
Effective tax rate	(257.57)	%	27.27	%

The Company’s income tax provision was computed based on the federal statutory rate and the average state statutory rates, net of the related federal benefit. The Company’s effective rate for the year ended December 31, 2023 was significantly impacted by a nondeductible goodwill impairment charge. Absent the impairment charge, the Company’s effective tax rate would have been 27.56%.

Deferred income taxes and unrecognized tax benefits reflected in our consolidated balance sheets are summarized as follows:

	2023		2022
Deferred Tax Assets
Accrued Expenses	$	(200,541)	$	(382,546)
Deferred Compensation		(86,319)		(118,265)
Other		(219,058)		(106,371)
State NOL		(27,367)		(19,668)
Federal NOL		(4,643,453)		(3,472,536)
Sec. 163(j) business interest limitation		(2,823,686)		-
Leases		(394,736)		(394,878)
Total Deferred Tax Assets		(8,395,160)		(4,494,264)
Deferred Tax Liabilities
Fixed Assets		26,429,560		21,076,220
Intangible Assets		3,089,966		3,591,783
Investments		723,264		1,322,296
Unrealized Gain on SWAP		383,247		632,007
Contract Assets		416,359		226,698
Leases		384,863		382,790
Total Deferred Tax Liabilities:		31,427,259		27,231,794
Total Net Deferred Taxes	$	23,032,099	$	22,737,530

As of December 31, 2023, the Company has net operating loss carryforwards of approximately $22.1 million for tax purposes, which will be available to offset future taxable income. The losses may be carried forward indefinitely.

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INCENTIVE AND RETIREMENT PLANS

12 Months Ended

Dec. 31, 2023

Retirement Benefits [Abstract]

Retirement Benefits [Text Block]

NOTE 9 – INCENTIVE AND RETIREMENT PLANS

In 2006, we implemented an EIP for employees other than executive officers and a MIP for executive officers (collectively the 2006 Plan). In 2015, our BOD adopted, and our shareholders approved our 2015 Employee Stock Plan (2015 ESP), which permits the issuance of up to 200,000 shares of our Common Stock in stock awards for performance under the 2006 Plan. Each qualified employee of the Company may elect to receive up to 50% of their incentive compensation in Company Common Stock in lieu of cash. Each Company executive officer is required to receive 50% of their incentive compensation earned in Company Common Stock in lieu of cash. As of March 15, 2024, 149,747 shares remain available to be issued under the 2015 ESP.

We have a 401(k)-employee savings plan in effect for employees who meet age and service requirements. Our contributions to our 401(k)-employee savings plan were $435,317 and $402,398 in 2023 and 2022.

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

NOTE 10 – COMMITMENTS AND CONTINGENCIES

On December 15, 2021, the Company announced plans for a fiber network initiative. The Company has made commitments to purchase materials and entered into contracts with various parties to successfully build this next-generation fiber network. As of December 31, 2023, the Company had outstanding contract amounts of approximately $17.7 million, with estimate completions of approximately $11.5 million in 2024 and $6.2 million in 2025.

We are involved in certain contractual disputes in the ordinary course of business. We do not believe the ultimate resolution of any of these existing matters will have a material adverse effect on our financial position, results of operations or cash flows. 

Our capital budget for 2024 is approximately $41.1 million and will be financed through internally generated funds and our credit facility with CoBank debt financing.    

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NONCASH ACTIVITIES

12 Months Ended

Dec. 31, 2023

Noncash Investing Abstract

Noncash Investing [Text Block]

NOTE 11 - NONCASH ACTIVITIES

Noncash investing activities included $11,020,966 and $5,279,044 during the years ended December 31, 2023 and 2022. These activities related to plant and equipment additions placed in service and are recorded in our accounts payable at year-end.

Noncash financing activities include $0 and $1,501,850 during the years ended December 31, 2023, and 2022. The activities related to broadband grants awarded and are recorded in our AR at year-end.

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OTHER INVESTMENTS

12 Months Ended

Dec. 31, 2023

Other Investments [Abstract]

Other Investments [Text Block]

NOTE 12 – OTHER INVESTMENTS

We are a co-investor with other communication companies in several partnerships and limited liability companies. These joint ventures make it possible to offer services to customers, including digital video services and fiber transport services that we would have difficulty offering on our own. These joint ventures also make it possible to invest in new technologies with a lower level of financial risk. We recognize income and losses from these investments on the equity method of accounting. For a listing of our investments, see Note 16 – “Segment Information.”  

Nuvera recognized a gain of $4,060,775, net of escrow true ups, after the sale, in book value in connection with the sale of the FiberComm investment. 

The FASB requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. As of December 31, 2023, the Company had recorded losses on our investments of $90,279. As of December 31, 2022, the Company has recorded a gain on one of our investments of $217,876.  

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GUARANTEES

12 Months Ended

Dec. 31, 2023

Guarantees [Abstract]

Guarantees [Text Block]

NOTE 13 - GUARANTEES

On March 31, 2023, Nuvera and the other owners of FiberComm sold 100% of their investment in FiberComm to ImOn Communications, LLC. FiberComm has been providing high quality Internet and voice services to businesses in the Sioux City, Iowa market for over 20 years. Nuvera owned a 20% interest in FiberComm through its wholly owned subsidiary PTC. Nuvera announced the execution of the FiberComm sale agreement in January 2023.

Prior to the sale of Nuvera’s equity investment in FiberComm, Nuvera had guaranteed a portion of a ten-year loan owed by FiberComm, set to mature on April 30, 2026. On March 31, 2023, upon closing of the sale, the loan was paid and Nuvera was released from their guarantee of loan.

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DEFERRED COMPENSATION

12 Months Ended

Dec. 31, 2023

Disclosure Text Block Supplement [Abstract]

Compensation and Employee Benefit Plans [Text Block]

NOTE 14 – DEFERRED COMPENSATION

As of December 31, 2023, and 2022, we have recorded other deferred compensation relating to executive compensation payable to certain former executives of the Company and certain former executives of past acquisitions.  

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STOCK BASED COMPENSATION

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Share-Based Payment Arrangement [Text Block]

NOTE 15 – STOCK BASED COMPENSATION

The Company’s 2017 OSP was adopted by the Company’s BOD on February 24, 2017, and approved by the Company’s shareholders at the May 25, 2017, Annual Meeting of Shareholders. The 2017 OSP enables the Company to grant stock incentive awards to current and new employees, including officers, and to Board members and service providers. The 2017 OSP permits stock incentive awards in the form of Options (incentive and non-qualified), stock appreciation rights, restricted stock, RSUs, performance stock, performance units, and other awards in stock or cash. The 2017 OSP permits the issuance of up to 625,000 shares of our Common Stock in any of the above stock awards. As of March 15, 2024, 199,051 shares remain available for future grants under the 2017 OSP.

Starting in 2017, our BOD and Compensation Committee granted RSU awards to the Company’s executive officers under the 2017 OSP. We recognize share-based compensation expense for these RSUs over the vesting period of the RSUs, which is determined by our BOD. Forfeitures of RSUs are accounted for as they occur. Each executive officer was eligible to receive time-based RSUs and performance based RSUs. The time-based RSUs are computed as a percentage of the executive officer’s base salary based on the closing price of Company common stock on a date set by the BOD, and vest over a three-year period, subject to the executive officer being employed by the Company on the vesting date. The performance based RSUs are also computed as a percentage of the executive officer’s base salary based on the closing price of Company common stock on a date set by the BOD and vest over a three-year period based on the Company attaining an average Return on Invested Capital (ROIC) over that three-year period. The ROIC target is set by the BOD. Executive officers may earn more or fewer performance based RSUs based on if the actual ROIC achieved over the time period is more or less than target. Upon vesting of either time-based or performance based RSUs, the executive officers are issued Common Stock in exchange for the RSUs.

RSUs currently issued, exercised or forfeited are as follows:

	Time-Based RSUs	Targeted Performance-Based RSUs	Closing Stock Price		Vesting Date
Balance at December 31, 2021	9,440	13,270
Forfeited	(1,685)	(4,325)
Exercised	(4,391)	(4,244)	$	17.18	12/31/2022
Balance at December 31, 2022	3,364	4,701
Forfeited	(516)	(923)
Exercised	(2,848)	(3,778)	$	10.48	12/31/2023
Balance at December 31, 2023	0	0

Option Awards

In 2022, after considerable study, discussion and interaction with our consultants, the Compensation Committee decided to replace RSUs with Options. The Compensation Committee believes that grants of Options more directly align management long-term equity compensation with increased shareholder value creation at a time when the Company is engaged in significant investment and transformation as part of its long-term strategy. The Compensation Committee also determined to extend the grant of Options include Named Executive Officers, senior employee directors and other employee directors as key members of the Company leadership team and contributors to overall success.

As previously disclosed, the number of Options awarded was computed as a percentage of the employee’s base salary using a Black-Scholes formula using an exercise price equal to the closing price of Company common stock of $14.70 on March 31, 2023, and $21.20 on April 11, 2022. The 2023 Options will vest one-third each on March 31, 2024, 2025 and 2026. The 2022 Options will vest one-third each on April 11, 2023, 2024 and 2025.

	Options		Closing Stock Price	Vesting Date
Balance at December 31, 2021	-
Issued	40,577	$	21.20	4/11/2023
Issued	40,583	$	21.20	4/11/2024
Issued	40,583	$	21.20	4/11/2025
Balance at December 31, 2022	121,743
Issued	51,431	$	14.70	3/31/2024
Issued	51,431	$	14.70	3/31/2025
Issued	51,432	$	14.70	3/31/2026
Balance at December 31, 2023	276,037

The grant date fair value of employee stock Option awards is determined using the Black Scholes Option-pricing model. The following assumptions were used during the following periods:

	2023 Grants		2022 Grants
Exercise Price	$	14.70	$	21.20
Risk-Free Rate of Interest		2.957%		1.515%
Expected Term (Years)		10		10
Expected Stock Price Volatility		20.7%		18.1%
Dividend Yield		2.83%		2.44%

The following table summarizes the Company’s employee stock Option activity under the 2017 OSP, which was approved by the Company’s shareholders, for the following periods:

		Weighted Average Exercise Price		Weighted Average Remaining Term (Years)	Aggregate Intrinsic Value (in Thousands)
	Number of Shares
Outstanding as of December 31, 2021	-	$	-	-	$	-
Granted	121,743		21.20	8.28		-
Forfeited	-		-	-		-
Outstanding as of December 31, 2022	121,743	$	21.20	8.28	$	-
Granted	154,294		14.70	9.25	$	-
Forfeited	-		-	-		-
Outstanding as of December 31, 2023	276,037	$	17.57	8.82	$	-

The Options had no intrinsic value as of December 31, 2023.

The weighted average grant date fair value per share for employee stock and non-employee Option grants issued on March 31, 2023, was $2.90. The weighted average grant date fair value per share for employee stock and non-employee Option grants issued on April 11, 2022, was $3.24. As of December 31, 2023, the total unrecognized compensation related to unvested employee and non-employee stock Option awards granted was $503,254, which the Company expects to recognize over a weighted-average period of approximately 1.93 years. As of December 31, 2022, the total unrecognized compensation related to unvested employee and non-employee stock Option awards granted was $299,434, which the Company expects to recognize over a weighted-average period of approximately 2.28 years.

On March 13, 2023, the Company Board adopted changes to the Nuvera Communications, Inc. 2017 OSP. Most of the changes eliminate language specific to the requirements and limitations on grants under Internal Revenue Code Section162 (m), which has been repealed by Congress. This includes provisions related to “Performance-Based Exception” in several sections of the 2017 OSP. The Board also increased the limit on annual grants from 50,000 to 100,000 shares per participant and eliminated separate provisions on new-hire stock grants and cash-based grants. The Board also made minor changes to other sections of the 2017 OSP. The Board did not increase the number of shares authorized for issuance under the 2017 OSP or change the terms of eligibility for participants under the 2017 OSP. The foregoing description of the changes to the 2017 OSP does not purport to be complete and is qualified in its entirety by reference to the full text of the 2017 OSP, as amended, which is filed as Exhibit 10.12 to the 2022 Annual Report on Form 10-K and is incorporated by reference.

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SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

NOTE 16 – SEGMENT INFORMATION 

We operate in the Communications Segment and have no other significant business segments. The Communications Segment consists of voice, data and video communication services delivered to the customer over our advanced fiber communications network. No single customer accounted for a material portion of our consolidated revenues in any of the last two years.

The Communications Segment operates the following communications companies and has investment ownership interests as follows:

Communications Segment

● Communications Companies:

• Nuvera Communications, Inc., the parent Company;

• Hutchinson Telephone Company, a wholly owned subsidiary of Nuvera;

• Peoples Telephone Company, a wholly owned subsidiary of Nuvera;

• Scott-Rice Telephone Co., a wholly owned subsidiary of Nuvera;

• Sleepy Eye Telephone Company, a wholly owned subsidiary of Nuvera;

• Western Telephone Company, a wholly owned subsidiary of Nuvera; and

• Hutchinson Telecommunications, Inc., a wholly owned subsidiary of HTC, located in Litchfield and Glencoe, Minnesota;

● Our investments and interests in the following entities include some management responsibilities:

• Broadband Visions, LLC – 24.30% subsidiary equity ownership interest. BBV provides video headend and Internet services;

• Independent Emergency Services, LLC – 14.29% subsidiary equity ownership interest. IES is a provider of E-911 services to the State of Minnesota as well as a number of counties located in Minnesota; and

• Fiber Minnesota, LLC – 7.54% subsidiary equity ownership interest. FM is a Minnesota state-wide network that provides connectivity for regional businesses.

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BROADBAND GRANTS

12 Months Ended

Dec. 31, 2023

Broadband Grants Abstract

Broadband Grants [TextBlock]

NOTE 17 – BROADBAND GRANTS

In 2023, the Company was awarded a grant from Redwood County under the Community Development Block Grant administered by the Southwest Minnesota Housing Partnership. The grant was to be used to build broadband fiber to residential customers in areas that qualify as low to moderate income. The Company was awarded $1,559,643 to complete this project. The Company has not received any funds for this project as of December 31, 2023.

On December 8, 2022, the Company was awarded four broadband grants from the DEED. The grants will provide up to 45.0% to 50.0% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities and businesses in the Company’s service area. The Company is eligible to receive $8,594,688 of approximately $18,139,749 total project costs. The Company will provide the remaining 50.0% to 55.0% matching funds. Construction and expenditures for these projects will begin in the spring of 2023. We have not received any funds for these projects as of December 31, 2023.

In 2022, the Company was awarded two separate county grants from Nicollet County and Goodhue County to cover costs of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities. The Company was eligible to receive up to $2,139,562 to complete these projects. We have received $639,562 on these projects as of December 31, 2023.

On January 29, 2021, the Company was awarded five broadband grants from the DEED. The grant will provide up to 35.4% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved or underserved communities and businesses in the Company’s service area. The Company is eligible to receive $1,918,037 of approximately $5,419,617 total project costs. The Company will provide the remaining 64.6% of the matching funds. Construction and expenditures for these projects began in the spring of 2021. We have received $1,918,037 for these projects as of December 31, 2023.

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Transactions with equity method investments

12 Months Ended

Dec. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

Note 18 – Transactions with equity method investments

We receive and provide services to various partnerships and limited liability companies where we are an investor. Services received include digital video, special access and communications circuits. Services provided include BOD meeting attendance, labor, Internet help desk services and management services. Cost of services we receive from affiliated parties may not be the same as the costs of such services had they been obtained from different parties.

Total revenues from transactions with affiliates were $459,438 and $501,187 for 2023 and 2022. Total expenses from transactions with affiliates were $397,671 and $496,028 for 2023 and 2022.

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SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2023

Subsequent Events [Abstract]

Subsequent Events [Text Block]

NOTE 19 -- SUBSEQUENT EVENTS

On March 5, 2024, the Company was awarded a grant from the DEED. This Low-Density Broadband grant will provide up to 75% of the total cost of building fiber connections to homes and businesses for improved high-speed Internet in unserved and underserved communities in the Company’s service area. The Company is eligible to receive $1,884,429 of approximately $2,512,572 total project costs. The Company will provide the remaining 25% of the matching funds.

We have evaluated and disclosed subsequent events through the filing date of this Annual Report on Form 10-K.

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Accounting Policies, by Policy (Policies)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Description Of Business [Policy Text Block]

Description of Business

Nuvera is a diversified communications company headquartered in New Ulm, Minnesota with more than 118 years of experience in the communications business. Our principal line of business is the operation of seven communications companies. Our businesses consist of connecting customers to our state-of-the-art, advanced fiber communications network, providing managed services, switched service and dedicated private lines, connecting customers to long distance service providers and providing many other services associated with our Company. We also provide IPTV, CATV, Internet access services, including high-speed broadband access, and long-distance service. We also install and maintain communications systems to the areas in and around our service territories in southern Minnesota and northern Iowa. 

Consolidation, Policy [Policy Text Block]

Basis of Presentation and Principles of Consolidation

Our accounting policies conform to GAAP and rules and regulations of the SEC and, where applicable, conform to the accounting principles as prescribed by federal and state telephone utility regulatory authorities. We presently give accounting recognition to the actions of regulators where appropriate in preparing general purpose financial statements for most public utilities. In general, the type of regulation covered by this statement permits rates (prices) for some services to be set at levels intended to recover the estimated costs of providing regulated services or products, including the cost of capital (interest costs and a provision for earnings on stockholders’ investments).

Our consolidated financial statements report the financial condition and results of operations for Nuvera and its subsidiaries in one business segment: the Communications Segment. Inter-company transactions have been eliminated from the consolidated financial statements.

Cost of Goods and Service [Policy Text Block]

Classification of Costs and Expenses

Cost of services (excluding depreciation and amortization expense) includes all costs related to the delivery of communication services and products. These operating costs include all costs of performing services and providing related products including engineering, network monitoring and transportation costs.

Selling, general and administrative expenses include direct and indirect selling expenses, customer service, billing and collections, advertising and all other general and administrative costs associated with our operations.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of our consolidated financial statements in conformity with GAAP requires our management to make estimates and judgements that affect the reported amounts of assets, liabilities, revenue and expenses, and the related disclosure of contingent assets and liabilities at the date of the financial statements and during the reporting period. The estimates and judgements used in the accompanying consolidated financial statements are based on our management’s evaluation of the relevant facts and circumstances as of the date of the financial statements. Actual results may differ from those estimates and assumptions.

Revenue [Policy Text Block]

Revenue Recognition

See Note 2 – “Revenue Recognition” for a discussion of our revenue recognition policies.

Receivable [Policy Text Block]

Accounts Receivables and Allowance for Credit Losses

As of December 31, 2023, and 2022 our consolidated AR totaled $3,411,892 and $3,725,422, net of the AFCLs. We believe our receivables as of December 31, 2023, and 2022 are recorded at their fair value.

AR consists primarily of amounts due to the Company from normal business activities. We maintain an AFCLs based on our historical loss experience, current conditions and forecasted changes including but not limited to changes related to the economy, our industry and business. Uncollectible accounts are written-off (removed from AR and charged against the AFCLs) when internal collection efforts have been unsuccessful. Subsequently, if payment is received from the customer, the recovery is credited to the AFCLs.

As of December 31, 2023, and 2022, the fair value of our net AR approximated their carrying values; therefore, no fair value adjustment for fresh start accounting was required. Our AFCLs increased during the year ended December 31, 2023, compared to 2022.

Allowance For Doubtful Accounts [Policy Text Block]

Allowance for Credit Losses

AR are recorded at amortized cost less an AFCLs that are not expected to be recovered. The gross amount of AR is recorded net of the corresponding AFCLs in the consolidated balance sheets. We maintain AFCLs resulting from the expected failure or inability of our customers to make their required payments. We recognize the AFCLs based on management’s expectation of the asset’s collectability. The allowance is based on multiple factors including historical experience with bad debts, the credit quality of the customer base, the aging of such receivable and current macroeconomic conditions, as well as management’s expectation of conditions in the future, as applicable. Our AFCLs is recorded on a monthly basis based on the aging of our overall AR. Our AR collection policy includes internal collection efforts after an AR balance is 30 days due with service being suspended after approximately 40 days and terminated upon 60 days past due.   

The following table summarizes the activity in the AFCLS for the years ended December 31, 2023, and 2022:

	Year Ended December 31
	2023		2022
Balance at beginning of year	$	140,000	$	80,000
Provision charged to expense		175,559		206,398
Write-offs, less recoveries		(165,559)		(146,398)
Balance at end of year	$	150,000	$	140,000

Inventory, Policy [Policy Text Block]

Inventories

Inventory includes parts, materials and supplies stored in our warehouses to support basic levels of service and maintenance as well as scheduled capital projects and equipment awaiting configuration for customers. Inventory also includes (i) parts and equipment shipped directly from vendors to customer locations while in transit and (ii) parts and equipment returned from customers that are returned to vendors for credit. Our inventory value as of December 31, 2023, and 2022 was $34,438,857 and $23,617,800.

We value inventory using the lower of cost or net realizable value. Like our AFCLs, we make estimates related to the valuation of inventory. As of December 31, 2023, and 2022, we had no inventory reserve. We adjust our inventory carrying value for estimated obsolescence or unmarketable inventory to the net realizable value based upon assumptions about future demand and market conditions. As market and other conditions change, we may establish additional inventory reserves at a time when the facts that give rise to a lower value are warranted. We use the average cost method of inventory costing.

Property, Plant and Equipment, Policy [Policy Text Block]

Property, Plant and Equipment

We record impairment losses on long-lived assets used in operations when events and circumstances indicate the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amounts of those assets. In assessing the recoverability of long-lived assets, we compare the carrying value to the undiscounted future cash flows the assets are expected to generate. If the total of the undiscounted future cash flows is less than the carrying amount of the assets, we would write down those assets based on the excess of the carrying amount over the fair value of the assets. Fair value is generally determined by calculating the discounted future cash flows expected from those assets. Changes in these estimates could have a material adverse effect on the assessment of long-lived assets, thereby requiring a write-down of the assets. Write-downs of long-lived assets are recorded as impairment charges and are a component of operating expenses. We have reviewed our long-lived assets and concluded that no impairment charge on our long-lived assets is necessary.

We use the group life method (mass asset accounting) to depreciate the assets of our communications companies. Communications plant acquired in a given year is grouped into similar categories and depreciated over the remaining estimated useful life of the group. When an asset is retired, both the asset and the accumulated depreciation associated with that asset are removed from the books. Due to rapid changes in technology, selecting the estimated economic life of communications plant and equipment requires a significant amount of judgment. We periodically review data on the expected utilization of new equipment, asset retirement activity and net salvage values to determine adjustments to our depreciation rates. In 2022, we accelerated depreciation on our copper cable networks as we transition to a new FTTP network. Other than this change, we have not made any other significant changes to the lives of these assets in the two-year period ended December 31, 2023.

Grant money received from governmental entities for reimbursement of capital expenditures is accounted for as a reduction from the cost of the asset. As the grant was to be used in the Company’s regulated network, the Company accounts for this funding as aid to construction as outlined in the FCC’s Part 32 “Uniform System of Accounts for Telecommunications Companies.” The resulting balance sheet presentation reflects the Company’s net investment in the assets in our property, plant and equipment. Depreciation is calculated and recorded based on the reduced cost of the investment, therefore the impact of prior grants received is reflected in earnings as a reduction in depreciation. Grant funds are shown as inflows in the financing activities section of the statement of cash flows.

Goodwill and Intangible Assets, Policy [Policy Text Block]

Goodwill and Intangible Assets

We amortize our definite-lived intangible assets over their estimated useful lives. Customer relationships are amortized over fourteen to fifteen years, regulatory rights are amortized over fifteen years and trade names are amortized over three to five years. Intangible assets with finite lives are amortized over their respective estimated useful lives. In accordance with GAAP, goodwill and intangible assets with indefinite useful lives are not amortized but tested for impairment at least annually. See Note 5 – “Goodwill and Intangibles” for a more detailed discussion of the intangible assets and goodwill. Our goodwill balance was $40,603,029 and $49,903,029 as of December 31, 2023, and 2022. The reduction in goodwill in 2023 was the result of the HTC impairment recognized in 2023. In the fourth quarter of 2023 and 2022 we completed our annual impairment tests for existing acquired goodwill. This testing resulted in no impairment charges to goodwill for SETC and Scott-Rice as of December 31, 2023. This testing did result in an impairment charge to goodwill for HTC of $9.3 million as of December 31, 2023. 

Fair Value Measurement, Policy [Policy Text Block]

Financial Derivative Instruments and Fair Value Measurements

We have adopted the rules prescribed under GAAP for our financial assets and liabilities. GAAP includes a fair value hierarchy that is intended to increase consistency and comparability in fair value measurements and related disclosures. The fair value hierarchy is based on inputs to valuation techniques used to measure fair value that is either observable or unobservable. Observable inputs reflect assumptions market participants would use in pricing an asset or liability based on market data obtained from independent sources, while unobservable inputs reflect a reporting entity’s pricing based upon its own market assumptions. The fair value hierarchy consists of the following three levels:

Level 1:	Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2:	Inputs are quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable and market-corroborated inputs that are derived principally from or corroborated by observable market data.
Level 3:	Inputs are derived from valuation techniques where one or more significant inputs or value drivers are unobservable.

We have used financial derivative instruments to manage our overall cash flow exposure to fluctuations in interest rates. We accounted for derivative instruments in accordance with GAAP that requires derivative instruments to be recorded on the balance sheet at fair value. Changes in the fair value of derivative instruments must be recognized in earnings unless specific hedge accounting criteria are met, in which case, the gains and losses are included in other comprehensive income rather than in earnings.

We have entered into IRSAs with our lender, CoBank to manage our cash flow exposure to fluctuations in interest rates. These instruments are designated as cash flow hedges and are effective at mitigating the risk of fluctuations on interest rates in the marketplace. Any gains or losses related to changes in the fair value of these derivatives are accounted for as a component of accumulated other comprehensive gain (loss) for as long as the hedge remains effective.

The fair value of our IRSAs is discussed in Note 7 – “Interest Rate Swaps”. The fair value of our swap agreements was determined based on Level 2 inputs.

The fair value of our Goodwill is discussed in Note 5 – “Goodwill and Intangibles”. The fair value of our Goodwill was determined based on Level 3 inputs.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Other Financial Instruments

Other Investments - We conducted an evaluation of our investments in all of our investees in connection with the preparation of our audited financial statements as of December 31, 2023. As of December 31, 2023, we believe the carrying value of our investments is not impaired.

Debt – We estimate the fair value of our long-term debt based on the discounted future cash flows we expect to pay using current rates of borrowing for similar types of debt. Fair value of the debt approximates carrying value.

Other Financial Instruments - Our financial instruments also include cash equivalents, trade AR and accounts payable where the current carrying amounts approximate fair market value.

Investments and Other Assets [Policy Text Block]

Investments and Other Assets

We are a co-investor with other communication companies in several partnerships and limited liability companies. These joint ventures make it possible to offer services to customers, including digital video services and fiber transport services that we would have difficulty offering on our own. These joint ventures also make it possible to invest in new technologies with a lower level of financial risk. We use the equity method of accounting for these investments that reflects original cost and recognition of our share of the net income or losses from the respective operations. See Note 16 – “Segment Information” for a listing of our investments.

Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at fair value where there are readily determinable fair values. Investments in other companies that are not intended for resale and are not accounted for on the equity method of accounting are valued at cost where there are no readily determinable fair values.  See Note 12 – “Other Investments” for additional information regarding our investments.

Advertising Cost [Policy Text Block]

Advertising Expense

Advertising is expensed as incurred. Advertising expense charged to operations was $1,022,312 and $723,261 in 2023 and 2022. 

Interest During Construction Policy [Text Block]

Interest During Construction

We include an average cost of debt for the construction of plant in our communications plant accounts.

Income Tax, Policy [Policy Text Block]

Income Taxes

We account for income taxes in accordance with GAAP, which requires an asset and liability approach to financial accounting and reporting for income taxes. Accordingly, deferred tax assets and liabilities arise from the difference between the tax basis of an asset or liability and its reported amount in the financial statements and operating and tax credit carryforwards. Deferred tax assets and liabilities are determined using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. We recognize interest and penalties related to income tax matters as income tax expense. Income tax expense or benefit is the tax payable or refundable, respectively, for the period plus or minus the change in deferred tax assets and liabilities during the period.

GAAP requires us to recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more-likely-than-not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. See Note 8 – “Income Taxes” for additional information regarding income taxes.

Collection Of Taxes From Customers [Policy Text Block]

Collection of Taxes from Customers

Sales, excise and other taxes are imposed on most of our sales to nonexempt customers. We collect these taxes from our customers and remit the entire amounts to governmental authorities. Our accounting policies dictate that we exclude these taxes collected and remitted from our revenues and expenses.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash investments and receivables. We deposit our cash investments in high credit quality financial institutions accounts which, at times, may exceed federally insured limits. We have not experienced any losses in these accounts and do not believe we are exposed to any significant credit risk. Concentrations of credit risk with respect to trade receivables are limited due to our large number of customers.

Earnings Per Share, Policy [Policy Text Block]

Earnings and Dividends Per Share

The basic and diluted net income per share are calculated as follows:

	Year Ended December 31, 2023				Year Ended December 31, 2022
	Basic		Diluted		Basic		Diluted
Net Income (Loss)	$	(3,214,694)	$	(3,214,694)	$	7,196,702	$	7,196,702
Weighted-average common shares outstanding		5,116,953		5,190,289		5,090,407		5,115,801
Net income (loss) per share	$	(0.63)	$	(0.62)	$	1.41	$	1.41

The weighted-average shares outstanding, basic and diluted are calculated as follows:

	Year Ended December 31, 2023		Year Ended December 31, 2022
	Basic	Diluted	Basic	Diluted
Weighted-average common shares outstanding	5,116,953	5,116,953	5,090,407	5,090,407
Dilutive RSU's/Options	-	73,336	-	25,394
Weighted-average common shares outstanding	5,116,953	5,190,289	5,090,407	5,115,801

Nuvera’s BOD reviews quarterly dividend declarations based on our anticipated earnings, capital requirements and our operating and financial conditions.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Developments

Effective January 1, 2022, we adopted Accounting Standards Update (ASU) No. 2021-10 “Disclosures by Business Entities about Government Assistance.” ASU 2021-10 requires disclosure by business entities of the types of government assistance received, the method of accounting for such assistance and the effects of the assistance on its financial statements. The adoption of this guidance did not have a material impact on our related disclosures.

In March 2020, the Financial Accounting Standards Board (FASB) issued ASU 2020-04, “Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” ASU 2020-04 provides optional guidance for a limited period to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. During the quarter ended June 30, 2022, we novated a certain hedging relationship to one our IRSAs by changing the reference rated from the London Inter-Bank Offered Rate to a secured overnight financing rate (SOFR). The amendment did not have a material impact on our consolidated financial statements.   

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires entities to use a new forward-looking, expected loss model to estimate credit losses. It also requires additional disclosures relating to the credit quality of trade and other receivables, including information relating to management’s estimate of AFCLs. The Company is required to adopt ASU 2016-13 for fiscal periods beginning after December 15, 2022, including interim periods within that fiscal year. Early adoption as of December 15, 2018, was permitted. As of January 1, 2022, the Company adopted ASU 2016-13 and the adoption did not have a significant impact on our consolidated financial statements.

We have reviewed all other significant newly issued accounting pronouncements and determined that they are either not applicable to our business or that no material effect is expected on our financial position and results of operations.

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2023

Accounting Policies [Abstract]

Financing Receivable, Current, Allowance for Credit Loss [Table Text Block]

	Year Ended December 31
	2023		2022
Balance at beginning of year	$	140,000	$	80,000
Provision charged to expense		175,559		206,398
Write-offs, less recoveries		(165,559)		(146,398)
Balance at end of year	$	150,000	$	140,000

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Year Ended December 31, 2023				Year Ended December 31, 2022
	Basic		Diluted		Basic		Diluted
Net Income (Loss)	$	(3,214,694)	$	(3,214,694)	$	7,196,702	$	7,196,702
Weighted-average common shares outstanding		5,116,953		5,190,289		5,090,407		5,115,801
Net income (loss) per share	$	(0.63)	$	(0.62)	$	1.41	$	1.41

Schedule of Weighted Average Number of Shares [Table Text Block]

	Year Ended December 31, 2023		Year Ended December 31, 2022
	Basic	Diluted	Basic	Diluted
Weighted-average common shares outstanding	5,116,953	5,116,953	5,090,407	5,090,407
Dilutive RSU's/Options	-	73,336	-	25,394
Weighted-average common shares outstanding	5,116,953	5,190,289	5,090,407	5,115,801

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REVENUE RECOGNITION (Tables)

12 Months Ended

Dec. 31, 2023

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue [Table Text Block]

	Twelve Months Ended December 31,
	2023		2022
Voice Service¹	$	5,818,241		6,254,287
Network Access¹		3,938,587		4,898,470
Video Service¹		12,061,703		12,497,213
Data Service¹		25,214,978		24,680,039
Directory²		597,189		645,250
Other Contracted Revenue³		2,695,719		2,755,039
Other4		2,014,586		1,353,475
Revenue from customers		52,341,003		53,083,773
Subsidy and other revenue outside scope of ASC 6065		13,450,965		12,630,696
Total revenue	$	65,791,968	$	65,714,469
¹ Month-to-Month contracts billed and consumed in the same month.
² Directory revenue is contracted annually, however, this revenue is recognized monthly over the contract period as the advertising is used.
³ This includes long-term contracts where the revenue is recognized monthly over the term of the contract.
4 This includes CPE and other equipment sales.
5 This includes governmental subsidies and lease revenue outside the scope of ASC 606.

Contract with Customer, Contract Asset, Contract Liability, and Receivable [Table Text Block]

	Year Ended December 31,
	2023		2022		2021
Accounts receivable, net	$	1,966,012	$	1,477,692	$	1,512,369
Contract assets		1,458,631		794,193		662,437
Contract liabilities		551,995		626,306		602,007

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LEASES (Tables)

12 Months Ended

Dec. 31, 2023

Disclosure Text Block [Abstract]

ROU [Table Text Block]

Right of Use Assets	Balance  December 31, 2023		Balance  December 31, 2022
Operating Lease Right-Of-Use Assets	$	1,348,290	$	1,341,029

Operating Lease Liabilities [Table Text Block]

Operating Lease Liabilities	Balance December 31, 2023		Balance December 31, 2022
Short-Term Operating Lease Liabilities	$	352,969	$	356,400
Long-Term Operating Lease Liabilities		1,029,910		1,026,978
Total	$	1,382,879	$	1,383,378

Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block]

Maturity Analysis	Balance December 31, 2023
2024	$	429,410
2025		241,574
2026		198,377
2027		149,229
2028		151,424
Thereafter		554,492
Total		1,724,506
Less Imputed interest		(341,627)
Present Value of Operating Leases	$	1,382,879

Lease, Cost [Table Text Block]

Weighted Average Remaining Lease Term (Years)	6.75
Weighted Average Discount Rate	6.27%

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PROPERTY, PLANT AND EQUIPMENT (Tables)

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

	2023		2022
Communications Plant:
Land	$	707,648	$	712,503
Buildings		11,007,636		10,918,490
Other Support Assets		24,419,429		22,980,859
Central Office and Circuit Equipment		63,323,590		61,046,604
Cable and Wire Facilities		154,273,968		118,171,835
Other Plant and Equipment		404,883		404,883
Plant Under Construction		23,220,217		5,655,876
		277,357,371		219,891,050
Other Property		32,433,191		29,836,775
Video Plant		18,848,612		16,096,032
Total Property, Plant and Equipment	$	328,639,174	$	265,823,857

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GOODWILL AND INTANGIBLES (Tables)

12 Months Ended

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets [Table Text Block]

		December 31, 2023				December 31, 2022
	Useful Lives		Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Definite-Lived Intangible Assets
Customers Relationships	14-15 yrs	$	42,878,445	$	32,053,361	$	42,878,445	$	30,429,708
Regulatory Rights	15 yrs		4,000,000		4,000,000		4,000,000		4,000,000
Video Franchise			3,000,000		214,290		-		-
Trade Name	3-5 yrs		310,106		310,106		310,106		273,465
Indefinitely-Lived Intangible Assets
Video Franchise			-		-		3,000,000		-
Spectrum			877,814		-		877,814		-
Total		$	51,066,365	$	36,577,757	$	51,066,365	$	34,703,173
Net Identified Intangible Assets				$	14,488,608			$	16,363,192

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

2024	$	2,052,234
2025	$	2,047,312
2026	$	2,042,389
2027	$	1,335,247
2028	$	1,335,247

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LONG-TERM DEBT (Tables)

12 Months Ended

Dec. 31, 2023

Debt Disclosure [Abstract]

Schedule of Long-Term Debt Instruments [Table Text Block]

Long-term debt is as follows:	2023		2022
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of $625,000 (beginning on December 31, 2025) and    quarterly installments of $937,500 (beginning on December 31, 2028),    plus a notional variable rate of interest through July 15, 2029.	$	50,000,000	$	50,000,000
Secured seven-year reducing credit facility to CoBank, ACB, in    quarterly installments of 1.25% of loan balance (beginning on    December 31, 2025) and quarterly installments of 1.875% of loan balance    beginning on December 31, 2028), plus a notional variable rate of    interest through July 15, 2029.		50,000,000		10,000,000
Secured five-year revolving credit facility of up to $40,000,000 to    CoBank, ACB, plus a notional variable rate of interest through    July 15, 2027.		24,166,273		19,885,082
Less:  Unamortized Loan Fees		(1,274,635)		(1,332,885)
		122,891,638		78,552,197
Less:  Amount due within one year		-		-
Net of Current Portion of Unamortized Loan Fees		-		-
Total Long Term Debt	$	122,891,638	$	78,552,197

Schedule of Maturities of Long-Term Debt [Table Text Block]

2024	$	-
2025	$	1,250,000
2026	$	4,922,845
2027	$	28,970,229
2028	$	5,272,117

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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	2023		2022
Taxes currently payable
Federal	$	-	$	(50,330)
State		1,795,530		380,082
Deferred Income Taxes		520,126		2,368,911
Total Income Tax Expense	$	2,315,656	$	2,698,663

Schedule of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns Roll Forward [Table Text Block]

	2023		2022
Balance, beginning of year	$	19,787	$	38,673
Increases related to prior year tax positions		-		-
Decreases related to prior year tax positions		-		(18,886)
Increases related to current year tax positions		-		-
Decreases due to lapse of statute of limitations		(19,787)		-
Settlements		-		-
Balance, end of year	$	-	$	19,787

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	2023		2022
Statutory Tax Rate	21.00	%	21.00	%
Effect of:
State Income Taxes Net of Federal Tax Benefit	(65.32)		8.17
Non deductible goodwill impairment	(217.23)		-
Permanent Differences and Other, Net	3.98		(1.90)
Effective tax rate	(257.57)	%	27.27	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	2023		2022
Deferred Tax Assets
Accrued Expenses	$	(200,541)	$	(382,546)
Deferred Compensation		(86,319)		(118,265)
Other		(219,058)		(106,371)
State NOL		(27,367)		(19,668)
Federal NOL		(4,643,453)		(3,472,536)
Sec. 163(j) business interest limitation		(2,823,686)		-
Leases		(394,736)		(394,878)
Total Deferred Tax Assets		(8,395,160)		(4,494,264)
Deferred Tax Liabilities
Fixed Assets		26,429,560		21,076,220
Intangible Assets		3,089,966		3,591,783
Investments		723,264		1,322,296
Unrealized Gain on SWAP		383,247		632,007
Contract Assets		416,359		226,698
Leases		384,863		382,790
Total Deferred Tax Liabilities:		31,427,259		27,231,794
Total Net Deferred Taxes	$	23,032,099	$	22,737,530

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STOCK BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Share-Based Payment Arrangement, Restricted Stock Unit, Activity [Table Text Block]

	Time-Based RSUs	Targeted Performance-Based RSUs	Closing Stock Price		Vesting Date
Balance at December 31, 2021	9,440	13,270
Forfeited	(1,685)	(4,325)
Exercised	(4,391)	(4,244)	$	17.18	12/31/2022
Balance at December 31, 2022	3,364	4,701
Forfeited	(516)	(923)
Exercised	(2,848)	(3,778)	$	10.48	12/31/2023
Balance at December 31, 2023	0	0

Share-Based Compensation Arrangements by Share-Based Payment Award, Restricted Stock Units, Vested and Expected to Vest [Table Text Block]

	Options		Closing Stock Price	Vesting Date
Balance at December 31, 2021	-
Issued	40,577	$	21.20	4/11/2023
Issued	40,583	$	21.20	4/11/2024
Issued	40,583	$	21.20	4/11/2025
Balance at December 31, 2022	121,743
Issued	51,431	$	14.70	3/31/2024
Issued	51,431	$	14.70	3/31/2025
Issued	51,432	$	14.70	3/31/2026
Balance at December 31, 2023	276,037

Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

	2023 Grants		2022 Grants
Exercise Price	$	14.70	$	21.20
Risk-Free Rate of Interest		2.957%		1.515%
Expected Term (Years)		10		10
Expected Stock Price Volatility		20.7%		18.1%
Dividend Yield		2.83%		2.44%

Share-Based Payment Arrangement, Option, Activity [Table Text Block]

		Weighted Average Exercise Price		Weighted Average Remaining Term (Years)	Aggregate Intrinsic Value (in Thousands)
	Number of Shares
Outstanding as of December 31, 2021	-	$	-	-	$	-
Granted	121,743		21.20	8.28		-
Forfeited	-		-	-		-
Outstanding as of December 31, 2022	121,743	$	21.20	8.28	$	-
Granted	154,294		14.70	9.25	$	-
Forfeited	-		-	-		-
Outstanding as of December 31, 2023	276,037	$	17.57	8.82	$	-

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	12 Months Ended
	Dec. 31, 2023 USD ($)	Dec. 31, 2022 USD ($)
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Number of Reportable Segments	1
Accounts Receivable, after Allowance for Credit Loss, Current	$ 3,411,892	$ 3,725,422
Inventory, Net	34,438,857	23,617,800
Goodwill	40,603,029	49,903,029
Goodwill, Impairment Loss	9,300,000
Advertising Expense	$ 1,022,312	$ 723,261
Customer Relationships [Member] | Minimum [Member]
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	14 years
Customer Relationships [Member] | Maximum [Member]
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	15 years
Regulatory Rights [Member]
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	15 years
Trade Names [Member] | Minimum [Member]
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	3 years
Trade Names [Member] | Maximum [Member]
BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	5 years

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Allowance for doubtful accounts - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Allowance For Doubtful Accounts Abstract
Balance at beginning of year	$ 140,000	$ 80,000
Provision charged to expense	175,559	206,398
Write-offs, less recoveries	(165,559)	(146,398)
Balance at end of year	$ 150,000	$ 140,000

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Basic and diluted net income per share - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Basic And Diluted Net Income Per Share Abstract
Net Income (Loss), Basic	$ (3,214,694)	$ 7,196,702
Net Income (Loss), Diluted	$ (3,214,694)	$ 7,196,702
Weighted-average common shares outstanding, Basic	5,116,953	5,090,407
Weighted-average common shares outstanding, Diluted	5,190,289	5,115,801
Net income per share, Basic	$ (0.63)	$ 1.41
Net income per share, Diluted	$ (0.62)	$ 1.41

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BUSINESS DESCRIPTION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Weighted-average shares outstanding, basic and diluted - shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Weighted Average Shares Outstanding Basic And Diluted Abstract
Weighted-average common shares outstanding, Basic	5,116,953	5,090,407
Dilutive RSU's/Options	73,336	25,394
Weighted-average common shares outstanding, Diluted	5,190,289	5,115,801

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REVENUE RECOGNITION (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
REVENUE RECOGNITION (Details) [Line Items]
Professional and Contract Services Expense	$ 493,987	$ 300,614
Deferred Revenue, Noncurrent	$ 364,644	$ 349,109
Minimum [Member]
REVENUE RECOGNITION (Details) [Line Items]
Contract Term	3 years
Payment Term	30 days
Maximum [Member]
REVENUE RECOGNITION (Details) [Line Items]
Contract Term	10 years
Payment Term	60 days
Iowa Operations [Member]
REVENUE RECOGNITION (Details) [Line Items]
Construction Contractor, Receivable, Excluding Contract Retainage	$ 596,084
Minnesota Operations [Member]
REVENUE RECOGNITION (Details) [Line Items]
Construction Contractor, Receivable, Excluding Contract Retainage	$ 8,354,481
Other Contracted Revenue [Member] | Minimum [Member]
REVENUE RECOGNITION (Details) [Line Items]
Revenue Recognition Period	3 years
Other Contracted Revenue [Member] | Maximum [Member]
REVENUE RECOGNITION (Details) [Line Items]
Revenue Recognition Period	10 years
Product and Service, Other [Member]
REVENUE RECOGNITION (Details) [Line Items]
Revenue Recognition Period	1 month
ACAM [Member]
REVENUE RECOGNITION (Details) [Line Items]
Contract Receivable Period	10 years
Month To Month And Other Contracted Revenue [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member]
REVENUE RECOGNITION (Details) [Line Items]
Concentration Risk, Percentage	76.50%	78.72%
Outside of The Scope of ASC-606 [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member]
REVENUE RECOGNITION (Details) [Line Items]
Concentration Risk, Percentage	20.44%	19.22%
CPE and Equipment Sales And Installation [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member]
REVENUE RECOGNITION (Details) [Line Items]
Concentration Risk, Percentage	3.06%	2.06%

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REVENUE RECOGNITION (Details) - Revenue from contracts with customers - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue from customers	$ 52,341,003	$ 53,083,773
Subsidy and other revenue outside scope of ASC 6065	13,450,965	12,630,696
Total revenue	65,791,968	65,714,469
Voice Services [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	5,818,241	6,254,287
Total revenue	5,263,385	5,694,428
Network Access [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	3,938,587	4,898,470
Total revenue	3,819,297	4,759,084
Video Service [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	12,061,703	12,497,213
Total revenue	12,061,703	12,497,458
Data Service [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	25,214,978	24,680,039
Total revenue	27,509,073	27,028,332
Directory [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	597,189	645,250
Other Contracted Revenue [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	2,695,719	2,755,039
Product and Service, Other [Member]
Disaggregation of Revenue [Line Items]
Revenue from customers	$ 2,014,586	$ 1,353,475

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REVENUE RECOGNITION (Details) - Receivables, contracts assets and contract liabilities from revenue contracts with our customers - USD ($)	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Receivables Contracts Assets And Contract Liabilities From Revenue Contracts With Our Customers Abstract
Accounts receivable, net	$ 1,966,012	$ 1,477,692	$ 1,512,369
Contract assets	1,458,631	794,193	662,437
Contract liabilities	$ 551,995	$ 626,306	$ 602,007

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LEASES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Disclosure Text Block [Abstract]
Operating Lease, Expense	$ 506,138	$ 357,303

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LEASES (Details) - Right of Use Assets - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Right Of Use Assets Abstract
Operating Lease Right-Of-Use Assets	$ 1,348,290	$ 1,341,029

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LEASES (Details) - Operating Lease Liability - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Operating Lease, Liability [Abstract]
Short-Term Operating Lease Liabilities	Other Accrued Liabilities	Other Accrued Liabilities
Short-Term Operating Lease Liabilities	$ 352,969	$ 356,400
Long-Term Operating Lease Liabilities	Other Accrued Liabilities, Noncurrent	Other Accrued Liabilities, Noncurrent
Long-Term Operating Lease Liabilities	$ 1,029,910	$ 1,026,978
Total	$ 1,382,879	$ 1,383,378

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LEASES (Details) - Maturity analysis under these lease agreements - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Maturity Analysis Under These Lease Agreements Abstract
2024	$ 429,410
2025	241,574
2026	198,377
2027	149,229
2028	151,424
Thereafter	554,492
Total	1,724,506
Less Imputed interest	(341,627)
Present Value of Operating Leases	$ 1,382,879	$ 1,383,378

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LEASES (Details) - Other information related to leases	Dec. 31, 2023
Other Information Related To Leases Abstract
Weighted Average Remaining Lease Term (Years)	6 years 9 months
Weighted Average Discount Rate	6.27%

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PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
PROPERTY, PLANT AND EQUIPMENT (Details) [Line Items]
Depreciation	$ 13,565,831	$ 12,155,871
Public Utilities, Property, Plant and Equipment, Disclosure of Composite Depreciation Rate for Plants in Service	4.40%	4.70%
Other Property and Video [Member]
PROPERTY, PLANT AND EQUIPMENT (Details) [Line Items]
Property, Plant and Equipment, Useful Life	3 years	25 years

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PROPERTY, PLANT AND EQUIPMENT (Details) - Property, plant and equipment - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Communications Plant:
Communications Plant	$ 277,357,371	$ 219,891,050
Other Property	32,433,191	29,836,775
Video Plant	18,848,612	16,096,032
Total Property, Plant and Equipment	328,639,174	265,823,857
Land [Member]
Communications Plant:
Communications Plant	707,648	712,503
Building [Member]
Communications Plant:
Communications Plant	11,007,636	10,918,490
Other Support Assets [Member]
Communications Plant:
Communications Plant	24,419,429	22,980,859
Central Office And Circuit Equipment [Member]
Communications Plant:
Communications Plant	63,323,590	61,046,604
Cable and Wire Facilities [Member]
Communications Plant:
Communications Plant	154,273,968	118,171,835
Other Plant and Equipment [Member]
Communications Plant:
Communications Plant	404,883	404,883
Plant Under Construction [Member]
Communications Plant:
Communications Plant	$ 23,220,217	$ 5,655,876

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GOODWILL AND INTANGIBLES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 40,603,029	$ 49,903,029
Goodwill, Impairment Loss	9,300,000
Amortization of Intangible Assets	$ 1,874,584	$ 1,952,375

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GOODWILL AND INTANGIBLES (Details) - Components of our identified intangible assets - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Definite-Lived Intangible Assets
Gross Carrying Amount	$ 51,066,365	$ 51,066,365
Accumulated Amortization	36,577,757	34,703,173
Net Identified Intangible Assets	14,488,608	16,363,192
Franchise Rights [Member]
Definite-Lived Intangible Assets
Gross Carrying Amount		3,000,000
Spectrum [Member]
Definite-Lived Intangible Assets
Gross Carrying Amount	877,814	877,814
Customer Relationships [Member]
Definite-Lived Intangible Assets
Gross Carrying Amount	42,878,445	42,878,445
Accumulated Amortization	$ 32,053,361	30,429,708
Customer Relationships [Member] | Minimum [Member]
Definite-Lived Intangible Assets
Useful Lives	14 years
Customer Relationships [Member] | Maximum [Member]
Definite-Lived Intangible Assets
Useful Lives	15 years
Regulatory Rights [Member]
Definite-Lived Intangible Assets
Useful Lives	15 years
Gross Carrying Amount	$ 4,000,000	4,000,000
Accumulated Amortization	4,000,000	4,000,000
Franchise Rights [Member]
Definite-Lived Intangible Assets
Gross Carrying Amount	3,000,000
Accumulated Amortization	214,290
Trade Names [Member]
Definite-Lived Intangible Assets
Gross Carrying Amount	310,106	310,106
Accumulated Amortization	$ 310,106	$ 273,465
Trade Names [Member] | Minimum [Member]
Definite-Lived Intangible Assets
Useful Lives	3 years
Trade Names [Member] | Maximum [Member]
Definite-Lived Intangible Assets
Useful Lives	5 years

XML

GOODWILL AND INTANGIBLES (Details) - Summary of Future Amortization Expense	Dec. 31, 2023 USD ($)
Summary Of Future Amortization Expense Abstract
2024	$ 2,052,234
2025	2,047,312
2026	2,042,389
2027	1,335,247
2028	$ 1,335,247

XML

LONG-TERM DEBT (Details) - USD ($)		12 Months Ended
	Jul. 15, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 21, 2023	Aug. 29, 2019	Aug. 01, 2018
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount	$ 130,000,000
Proceeds from Issuance of Long-Term Debt	50,000,000	$ 40,000,000	$ 56,063,223
Long-Term Debt, Gross	50,000,000
Long-Term Debt		122,891,638	$ 78,552,197
Revolving Credit Facility [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount		40,000,000
Line of Credit, Current		$ 24,166,273
Debt Instrument, Interest Rate Terms		The revolving loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 1.90% above the applicable base rate
Line of Credit Facility, Remaining Borrowing Capacity		$ 15,800,000
Line of Credit Facility, Commitment Fee Percentage		0.25%
Term A-1 Loan [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount		$ 50,000,000
Long-Term Debt, Gross		50,000,000
Debt Instrument, Periodic Payment Terms, Balloon Payment to be Paid		39,687,500
Term A-1 Loan [Member] | Beginning on December 2025 [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Periodic Payment, Principal		625,000
Term A-1 Loan [Member] | Beginning on December 2028 [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Periodic Payment, Principal		937,500
Delayed Draw Term Loan [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount		50,000,000
Long-Term Debt		$ 50,000,000
Delayed Draw Term Loan [Member] | Beginning on December 2025 [Member]
LONG-TERM DEBT (Details) [Line Items]
DebtInstrument Periodic Payment Principal In Percentage		1.25%
Delayed Draw Term Loan [Member] | Beginning on December 2028 [Member]
LONG-TERM DEBT (Details) [Line Items]
DebtInstrument Periodic Payment Principal In Percentage		1.875%
Term Loan [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Interest Rate Terms		The term loan borrowings initially bear interest at a “Margin for Base Rate Loans” of 2.15% above the applicable base rate
Secured Debt [Member]
LONG-TERM DEBT (Details) [Line Items]
Long-Term Debt		$ 86,900,000
Debt Instrument, Interest Rate, Stated Percentage		8.55%
Debt Instrument, Covenant Description		Our loan agreements include restrictions on our ability to pay cash dividends to our stockholders. However, we are allowed to pay dividends in an amount up to $3,000,000 in any year as long as no default or event of default has occurred. Our current Total Leverage Ratio as of December 31, 2023, was 5.03, which exceeded our maximum total leverage ratio of 4.25 per our existing covenants with CoBank. On November 10, 2023, Nuvera received a waiver from CoBank to increase our maximum leverage ratio to 5.50 to accommodate our increased leverage ratio as of September 30 and December 31, 2023.
Debt Instrument Threshold Amount Dividends		$ 3,000,000
Ratio of Indebtedness to Net Capital		5.03
Secured Debt [Member] | Maximum [Member]
LONG-TERM DEBT (Details) [Line Items]
Ratio of Indebtedness to Net Capital		4.25
Revolving Credit Facility [Member]
LONG-TERM DEBT (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 20,000,000	$ 30,000,000
Agreement For Amendments to Loan and Amended and Restated Revolving Loan Promissory Note [Member] | Convertible Debt [Member]
LONG-TERM DEBT (Details) [Line Items]
Long-Term Line of Credit		140,000,000		$ 130,000,000
Agreement For Amendments to Loan and Amended and Restated Revolving Loan Promissory Note [Member] | Revolving Credit Facility [Member]
LONG-TERM DEBT (Details) [Line Items]
Long-Term Line of Credit		40,000,000		$ 30,000,000
First IRSA With Co Bank [Member]
LONG-TERM DEBT (Details) [Line Items]
Derivative, Notional Amount						$ 16,137,500
First IRSA With Co Bank [Member] | Interest Rate Swap [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount		16,137,500
Derivative, Notional Amount		$ 9,798,200
Debt, Weighted Average Interest Rate		6.11%
Second IRSA CoBank [Member]
LONG-TERM DEBT (Details) [Line Items]
Derivative, Notional Amount					$ 42,000,000
Second IRSA CoBank [Member] | Interest Rate Swap [Member]
LONG-TERM DEBT (Details) [Line Items]
Debt Instrument, Face Amount		$ 42,000,000
Derivative, Notional Amount		$ 27,462,606
Debt, Weighted Average Interest Rate		4.44%

XML

LONG-TERM DEBT (Details) - Long-term debt - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Long Term Debt	$ 122,891,638	$ 78,552,197
Less: Amount due within one year
Net of Current Portion of Unamortized Loan Fees
Total Long Term Debt	122,891,638	78,552,197
Less: Unamortized Loan Fees	(1,274,635)	(1,332,885)
Secured Debt [Member]
Debt Instrument [Line Items]
Long Term Debt	86,900,000
Seven Year Quarterly Installments of $625,000 Beginning December 31 2025 & $937,500 Beginning December 31 2028 [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long Term Debt	50,000,000	50,000,000
Seven Year Quarterly Installments of 1.25% of Loan Balance Beginning December 31 2025 & 1.875% of Loan Balance Beginning December 31 2028 [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long Term Debt	50,000,000	10,000,000
Five Year Revolving Credit Facility of $40,000,000 [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long Term Debt	$ 24,166,273	$ 19,885,082

XML

LONG-TERM DEBT (Details) - Long-term debt (Parentheticals) - Secured Debt [Member] - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Seven Year Quarterly Installments of $625,000 Beginning December 31 2025 & $937,500 Beginning December 31 2028 [Member] | Beginning on December 2025 [Member]
Debt Instrument [Line Items]
Quarterly Installments	$ 625,000	$ 625,000
Seven Year Quarterly Installments of $625,000 Beginning December 31 2025 & $937,500 Beginning December 31 2028 [Member] | Beginning on December 2028 [Member]
Debt Instrument [Line Items]
Quarterly Installments	$ 937,500	$ 937,500
Seven Year Quarterly Installments of 1.25% of Loan Balance Beginning December 31 2025 & 1.875% of Loan Balance Beginning December 31 2028 [Member] | Beginning on December 2025 [Member]
Debt Instrument [Line Items]
Quarterly Installments in Percentage	1.25%	1.25%
Seven Year Quarterly Installments of 1.25% of Loan Balance Beginning December 31 2025 & 1.875% of Loan Balance Beginning December 31 2028 [Member] | Beginning on December 2028 [Member]
Debt Instrument [Line Items]
Quarterly Installments in Percentage	1.875%	1.875%
Five Year Revolving Credit Facility of $40,000,000 [Member]
Debt Instrument [Line Items]
Revolving Credit Facility	$ 40,000,000	$ 40,000,000

XML

LONG-TERM DEBT (Details) - Required principal payments for the next five years	Dec. 31, 2023 USD ($)
Required Principal Payments For The Next Five Years Abstract
2024
2025	1,250,000
2026	4,922,845
2027	28,970,229
2028	$ 5,272,117

XML

INTEREST RATE SWAPS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Aug. 29, 2019	Aug. 01, 2018
INTEREST RATE SWAPS (Details) [Line Items]
Deferred Income Tax Expense (Benefit)	$ 520,126	$ 2,368,911
Accumulated Other Comprehensive Income (Loss), Net of Tax	959,442	1,582,455
Interest Rate Swap [Member]
INTEREST RATE SWAPS (Details) [Line Items]
Interest Rate Derivative Assets, at Fair Value	1,342,628	2,214,462
Deferred Income Tax Expense (Benefit)	383,186	632,007
Accumulated Other Comprehensive Income (Loss), Net of Tax	959,442	$ 1,582,455
First IRSA With Co Bank [Member]
INTEREST RATE SWAPS (Details) [Line Items]
Derivative, Notional Amount				$ 16,137,500
Derivative, Variable Interest Rate				25.00%
First IRSA With Co Bank [Member] | Term A-1 Loan [Member]
INTEREST RATE SWAPS (Details) [Line Items]
Derivative, Notional Amount	$ 9,798,200
Derivative Instrument Maturity Date	Jul. 31, 2029
Derivative Instrument Interest Rate Effective Percentage Description	6.11% (SOFR Base Rate of 2.96% plus 3.15% Base Rate Margin)
Second IRSA CoBank [Member]
INTEREST RATE SWAPS (Details) [Line Items]
Derivative, Notional Amount			$ 42,000,000
Second IRSA CoBank [Member] | Term A-1 Loan [Member]
INTEREST RATE SWAPS (Details) [Line Items]
Derivative, Notional Amount	$ 27,462,606
Derivative Instrument Maturity Date	Jul. 31, 2029
Derivative Instrument Interest Rate Effective Percentage Description	4.44% (SOFR Base Rate of 1.29% plus 3.15% Base Rate Margin)

XML

INCOME TAXES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Income Tax Examination Tax Positions Recognition Likelihood Threshold Percentage	50.00%
Unrecognized Tax Benefits that Would Impact Effective Tax Rate		$ 19,787
Liability for Uncertainty in Income Taxes, Current	$ 0
Unrecognized Tax Benefits, Interest on Income Taxes Accrued	0
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued		$ 3,518
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent		27.56%
Operating Loss Carryforwards	$ 22,100,000

XML

INCOME TAXES (Details) - Income taxes recorded in our consolidated statements of income consists of the following: - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Taxes currently payable
Federal		$ (50,330)
State	1,795,530	380,082
Deferred Income Taxes	520,126	2,368,911
Total Income Tax Expense	$ 2,315,656	$ 2,698,663

XML

INCOME TAXES (Details) - A reconciliation of the beginning and ending amount of total unrecognized benefits for the years end - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
AReconciliation Of The Beginning And Ending Amount Of Total Unrecognized Benefits For The Years End Abstract
Balance, beginning of year	$ 19,787	$ 38,673
Balance, end of year		19,787
Increases related to prior year tax positions
Decreases related to prior year tax positions		(18,886)
Increases related to current year tax positions
Decreases due to lapse of statute of limitations	(19,787)
Settlements

XML

INCOME TAXES (Details) - The differences between the statutory federal tax rate and the effective tax rate were as follows:	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
The Differences Between The Statutory Federal Tax Rate And The Effective Tax Rate Were As Follows Abstract
Statutory Tax Rate	21.00%	21.00%
Effect of:
State Income Taxes Net of Federal Tax Benefit	(65.32%)	8.17%
Non deductible goodwill impairment	(217.23%)
Permanent Differences and Other, Net	3.98%	(1.90%)
Effective tax rate	(257.57%)	27.27%

XML

INCOME TAXES (Details) - Deferred income taxes and unrecognized tax benefits reflected in our consolidated balance sheets are - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Deferred Tax Assets
Accrued Expenses	$ (200,541)	$ (382,546)
Deferred Compensation	(86,319)	(118,265)
Other	(219,058)	(106,371)
State NOL	(27,367)	(19,668)
Federal NOL	(4,643,453)	(3,472,536)
Sec. 163(j) business interest limitation	(2,823,686)
Leases	(394,736)	(394,878)
Total Deferred Tax Assets	(8,395,160)	(4,494,264)
Deferred Tax Liabilities
Fixed Assets	26,429,560	21,076,220
Intangible Assets	3,089,966	3,591,783
Investments	723,264	1,322,296
Unrealized Gain on SWAP	383,247	632,007
Contract Assets	416,359	226,698
Leases	384,863	382,790
Total Deferred Tax Liabilities:	31,427,259	27,231,794
Total Net Deferred Taxes	$ 23,032,099	$ 22,737,530

XML

INCENTIVE AND RETIREMENT PLANS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Mar. 15, 2024
INCENTIVE AND RETIREMENT PLANS (Details) [Line Items]
Defined Contribution Plan, Employer Discretionary Contribution Amount	$ 435,317	$ 402,398
2006 Plan [Member]
INCENTIVE AND RETIREMENT PLANS (Details) [Line Items]
Stock Issued During Period, Shares, Employee Stock Purchase Plans	200,000
Employees Incentive Plan Percentage Of Compensation In Lieu Of Cash	50.00%
Management Incentive Plan Percentage Of Compensation In Lieu Of Cash	50.00%
Subsequent Event [Member] | 2006 Plan [Member]
INCENTIVE AND RETIREMENT PLANS (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant			149,747

XML

COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	Dec. 31, 2023 USD ($)
COMMITMENTS AND CONTINGENCIES (Details) [Line Items]
Capital Budget	$ 41.1
Outstanding Commitments for Material [Member]
COMMITMENTS AND CONTINGENCIES (Details) [Line Items]
Other Commitment	17.7
Outstanding Contract [Member]
COMMITMENTS AND CONTINGENCIES (Details) [Line Items]
Contractual Obligation, to be Paid, Year One	11.5
Contractual Obligation, to be Paid, Year Two	$ 6.2

XML

NONCASH ACTIVITIES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Noncash Investing Abstract
Noncash or Part Noncash Acquisition, Fixed Assets Acquired	$ 11,020,966	$ 5,279,044
Noncash Financing Activities Related To Grants Awarded	$ 0	$ 1,501,850

XML

OTHER INVESTMENTS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
OTHER INVESTMENTS (Details) [Line Items]
Gain (Loss) on Sale of Other Investments	$ 4,062,759
Gain (Loss) on Investments	90,279	$ 217,876
Fiber Minnesota LLC [Member]
OTHER INVESTMENTS (Details) [Line Items]
Gain (Loss) on Sale of Other Investments	$ 4,060,775

XML

GUARANTEES (Details)	12 Months Ended
	Dec. 31, 2023
GUARANTEES (Details) [Line Items]
Sale of Stock, Percentage of Ownership before Transaction	100.00%
Fiber Minnesota LLC [Member]
GUARANTEES (Details) [Line Items]
Equity Method Investment, Ownership Percentage	7.54%
PTC [Member] | Fiber Minnesota LLC [Member]
GUARANTEES (Details) [Line Items]
Equity Method Investment, Ownership Percentage	20.00%

XML

STOCK BASED COMPENSATION (Details) - USD ($)				12 Months Ended
	Mar. 31, 2023	Mar. 13, 2023	Apr. 11, 2022	Dec. 31, 2023	Dec. 31, 2022	Mar. 15, 2024
Omnibus Stock Plan [Member]
STOCK BASED COMPENSATION (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized				625,000
Subsequent Event [Member] | Omnibus Stock Plan [Member]
STOCK BASED COMPENSATION (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant						199,051
Share-Based Payment Arrangement, Option [Member]
STOCK BASED COMPENSATION (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Weighted Average Exercise Price	$ 14.7		$ 21.2
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value	$ 2.9		$ 3.24
Share-Based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount				$ 503,254	$ 299,434
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition				1 year 11 months 4 days	2 years 3 months 10 days
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross				154,294	121,743
Share-Based Payment Arrangement, Option [Member] | Omnibus Stock Plan [Member]
STOCK BASED COMPENSATION (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross		50,000		100,000

XML

STOCK BASED COMPENSATION (Details) - RSUs currently issued, exercised or forfeited - Restricted Stock Units (RSUs) [Member] - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
STOCK BASED COMPENSATION (Details) - RSUs currently issued, exercised or forfeited [Line Items]
Balance	121,743
Exercised, closing stock price (in Dollars per share)	$ 10.48	$ 17.18
Exercised, vesting date	Dec. 31, 2023	Dec. 31, 2022
Balance	276,037	121,743
Time Based RSUs [Member]
STOCK BASED COMPENSATION (Details) - RSUs currently issued, exercised or forfeited [Line Items]
Balance	3,364	9,440
Forfeited, number of options	(516)	(1,685)
Exercised, number of options	(2,848)	(4,391)
Balance	0	3,364
Targeted Performance Based RSUs [Member]
STOCK BASED COMPENSATION (Details) - RSUs currently issued, exercised or forfeited [Line Items]
Balance	4,701	13,270
Forfeited, number of options	(923)	(4,325)
Exercised, number of options	(3,778)	(4,244)
Balance	0	4,701

XML

STOCK BASED COMPENSATION (Details) - Number of Options awarded - Restricted Stock Units (RSUs) [Member] - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
STOCK BASED COMPENSATION (Details) - Number of Options awarded [Line Items]
Balance	121,743
Balance	276,037	121,743
Share-Based Payment Arrangement, Tranche One [Member]
STOCK BASED COMPENSATION (Details) - Number of Options awarded [Line Items]
Options,Issued	51,431	40,577
Options,Issued Closing Stock Price (in Dollars per share)	$ 14.7	$ 21.2
Options,Issued Vesting Date	Mar. 31, 2024	Apr. 11, 2023
Share-Based Payment Arrangement, Tranche Two [Member]
STOCK BASED COMPENSATION (Details) - Number of Options awarded [Line Items]
Options,Issued	51,431	40,583
Options,Issued Closing Stock Price (in Dollars per share)	$ 14.7	$ 21.2
Options,Issued Vesting Date	Mar. 31, 2025	Apr. 11, 2024
Share-Based Payment Arrangement, Tranche Three [Member]
STOCK BASED COMPENSATION (Details) - Number of Options awarded [Line Items]
Options,Issued	51,432	40,583
Options,Issued Closing Stock Price (in Dollars per share)	$ 14.7	$ 21.2
Options,Issued Vesting Date	Mar. 31, 2026	Apr. 11, 2025

XML

STOCK BASED COMPENSATION (Details) - Grant date fair value of employee stock option awards assumptions - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Grant Date Fair Value Of Employee Stock Option Awards Assumptions Abstract
Exercise Price (in Dollars per share)	$ 14.7	$ 21.2
Risk-Free Rate of Interest	2.957%	1.515%
Expected Term (Years)	10 years	10 years
Expected Stock Price Volatility	20.70%	18.10%
Dividend Yield	2.83%	2.44%

XML

STOCK BASED COMPENSATION (Details) - Summaries of Company`s employee stock option activity - Share-Based Payment Arrangement, Option [Member] - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
STOCK BASED COMPENSATION (Details) - Summaries of Company`s employee stock option activity [Line Items]
Outstanding, Number of Shares	121,743
Outstanding, Weighted Average Exercise Price	$ 21.2
Outstanding, Aggregate Intrinsic Value
Granted, Number of Shares	154,294	121,743
Granted, Weighted Average Exercise Price	$ 14.7	$ 21.2
Granted, Weighted Average Remaining Term	9 years 3 months	8 years 3 months 10 days
Outstanding, Number of Shares	276,037	121,743
Outstanding, Weighted Average Exercise Price	$ 17.57	$ 21.2
Outstanding, Weighted Average Remaining Term	8 years 9 months 25 days	8 years 3 months 10 days
Outstanding, Aggregate Intrinsic Value

XML

SEGMENT INFORMATION (Details)	Dec. 31, 2023
Broadband Visions [Member]
SEGMENT INFORMATION (Details) [Line Items]
Equity Method Investment, Ownership Percentage	24.30%
Independent Emergency Services LLC [Member]
SEGMENT INFORMATION (Details) [Line Items]
Equity Method Investment, Ownership Percentage	14.29%
Fiber Minnesota LLC [Member]
SEGMENT INFORMATION (Details) [Line Items]
Equity Method Investment, Ownership Percentage	7.54%

XML

BROADBAND GRANTS (Details)	12 Months Ended
	Dec. 31, 2023 USD ($)
Redwood County [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Receivable	$ 1,559,643
December 2022 Grant [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Receivable	$ 8,594,688
Number Of Grants	4
Project Cost	$ 18,139,749
December 2022 Grant [Member] | Minimum [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Percentage	45.00%
Matching Fund Percentage Provided By Grantee	50.00%
December 2022 Grant [Member] | Maximum [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Percentage	50.00%
Matching Fund Percentage Provided By Grantee	55.00%
Nicollet County and Goodhue County [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Receivable	$ 2,139,562
Proceeds from Grantors	639,562
January 2021 Grant [Member]
BROADBAND GRANTS (Details) [Line Items]
Grants Receivable	$ 1,918,037
Number Of Grants	5
Grants Percentage	35.40%
Project Cost	$ 5,419,617
Matching Fund Percentage Provided By Grantee	64.60%
Proceeds from Grantors	$ 1,918,037

XML

Transactions with equity method investments (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Equity Method Investments and Joint Ventures [Abstract]
Related Party Transaction, Amounts of Transaction	$ 459,438	$ 501,187
Costs and Expenses, Related Party	$ 397,671	$ 496,028

XML

SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] - Grant [Member]	Mar. 05, 2024 USD ($)
SUBSEQUENT EVENTS (Details) [Line Items]
Grants Receivable	$ 1,884,429
Project Cost	$ 2,512,572
Matching Funds, Percentage	25.00%
Maximum [Member]
SUBSEQUENT EVENTS (Details) [Line Items]
Grants Percentage	75.00%