UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 14A (Rule 14a-101) SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. __ ) Filed by the RegistrantxFiled by a Party other than the Registranto Check the appropriate box: o Preliminary Proxy Statement o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) x Definitive Proxy Statement o Definitive Additional Materials o Soliciting Material Pursuant to §240.14a-12 NEW ULM TELECOM, INC. (Name of Registrant as Specified In Its Charter) (Name of Person(s) Filing Proxy Statement, if other than the Registrant) Payment of Filing Fee (Check the appropriate box): x No fee required. o Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: (2) Aggregate number of securities to which transaction applies: (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): (4) Proposed maximum aggregate value of transaction: (5) Total fee paid: o Fee paid previously with preliminary materials. o Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. (1) Amount Previously Paid: (2) Form, Schedule or Registration Statement No.: (3) Filing Party: (4) Date Filed: NEW ULM TELECOM, INC NOTICE OF ANNUAL MEETING The Annual Meeting of the Shareholders of New Ulm Telecom, Inc. (the Company) will be held atTurner Hall, (1) To elect the (2) (3) To vote on the Director Stock Plan (see proposal three on pages 33-35 for a description of the Plan and the Board of Director’s recommendation on the proposal); and (4) To transact such other business as may properly come before the meeting or at any adjournment thereof. The Board of Directors has fixed the close of business on BY THE ORDER OF THE BOARD OF DIRECTORS NEW ULM TELECOM, INC. /s/ Barbara A.J. Bornhoft Barbara A.J. Bornhoft -Corporate Secretary New Ulm, Minnesota 17, 2012 IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY This Proxy Statement, along with the New Ulm Telecom, Inc. 2 4 7 16 19 20 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 21 22 24 27 28 29 30 31 PROPSAL 3 – APPROVAL OF THE NEW ULM TELECOM, INC. DIRECTOR STOCK PLAN 33 35 35 36 IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING 36 36 37 NEW ULM TELECOM, INC PROXY STATEMENT What is the purpose of this Proxy Statement? This proxy statement is being made available to shareholders beginning on or about April Who can vote? Record holders of the Company’s common stock at the close of business on How do I vote? Registered Shareholders.If your shares are registered in your name, you may vote in person or by proxy. If you decide to vote by proxy, you may do so inONEof the following three ways: • By Internet – You may vote using the Internet at the website • By telephone – You may vote by using the toll-free telephone number,1-800-690-6903.Using a touch-tone telephone, you can transmit the voting instructions up until 10:59 p.m., Central Daylight Time, the day before the Annual Meeting, or May • By mailing – You may vote your shares by marking, signing, dating and returning your Proxy Card in the postage paid envelope provided, addressed to The Internet and telephone voting procedures have been set up for your convenience and have been designed to authenticate your identity, allow you to give voting instructions and confirm that those instructions have been recorded properly. Whether you choose to vote over the Internet, by telephone or by mail, you can specify whether your shares should be voted for Beneficial Owners/Nominee Shares.If your shares are held by a bank, broker, trustee or some other nominee that entity will give you separate voting instructions. If you do not provide voting instructions to your nominee, your shares will not be voted in the election of Directors. Registered shareholders and beneficial owners of shares held in street name may also vote in person at the Annual Meeting. If you are a registered shareholder and attend the Annual Meeting, you may deliver your completed proxy card in person. Additionally, written ballots will be available for any shareholder that wishes to vote in person at the Annual Meeting. Beneficial owners of shares held in registered name who wish to vote at the Annual Meeting will need to obtain a legal proxy from the institution that holds their shares. The persons named as proxies were selected by the Board of Directors (Board) and are Directors who are not currently standing for election. If any other matters are properly presented for action at the Annual Meeting, including a question of adjourning or postponing the Annual Meeting from time to time, the persons named in the proxies and acting in that capacity, will have discretion to vote on these matters in accordance with their best judgment. The notice of the Annual Meeting, this proxy statement and related proxy card are being mailed to shareholders on or about April May I change my vote? Your proxy may be revoked at any time before it is voted. You may change your vote after you submit your proxy card by: • Sending a written notice addressed to the Chief Executive Officer (CEO) of the Company, which must be received prior to the Annual Meeting, stating that you want revoke your proxy; • Submitting a new completed proxy card to the CEO of the Company, which must be received prior to the Annual Meeting and contain a later date than the previously submitted proxy; • Entering later-dated telephone or Internet voting instructions, which will automatically revoke the earlier proxy; or • Attending the Annual Meeting and voting in person and informing the Secretary of the Company that you are revoking your proxy. Attendance of a shareholder at the Annual Meeting will not automatically revoke any proxy previously submitted. Who is soliciting proxies? The enclosed proxy is being solicited by the Board and the Company will pay the cost of the solicitation, including preparing, assembling and mailing the proxies and solicitation materials. The Company is soliciting proxies principally by mail. In addition, the Directors, Officers and regular employees of the Company may solicit proxies personally or by telephone, for which they will receive no financial consideration other than their regular compensation. The Company will also request brokerage houses, nominees, custodians and fiduciaries to forward soliciting material to the beneficial owners of the shares of the Company common stock held as of the record date and will reimburse these persons for their reasonable expenses so incurred. When are shareholder proposals due for the next Annual Meeting? Shareholders who want to have their proposals considered for inclusion in the Company’s proxy materials for the Shareholder suggestions for Directors The Company’s Corporate Governance/Nominating Committee will consider shareholder suggestions for nominees for election to the Company’s Board if these suggestions are in writing and include biographical data and a description of the nominee’s qualifications. These suggestions must also be accompanied by the written consent of each nominee and can be mailed to the Corporate Governance/Nominating Committee, New Ulm Telecom, Inc., Attention: Corporate Secretary, 27 North Minnesota Street, New Ulm, Minnesota 56073. These suggestions must be received by the Corporate Secretary no later than December Quorum, Abstentions, and Broker Non-Votes The presence, in person or by proxy, of the shareholders of thirty-five percent of the shares of common stock outstanding and entitled to vote is necessary to constitute a quorum for the transaction of Company business at the Annual Meeting. Proxies containing abstentions and non-votes are counted as present for the purposes of determining whether a quorum is present at the Annual Meeting. All votes will be tabulated by the inspector of election for the Annual Meeting, who will separately tabulate affirmative and negative votes, abstentions and broker non-votes. If a properly executed proxy is returned and the shareholder has abstained from voting on any matter, the shares represented by that proxy will be considered present at the Annual Meeting for purposes of determining a quorum and for purposes of calculating the vote, but will not be considered to have been voted in favor of that matter. If a properly executed proxy that is returned by a broker holding shares in street name indicates that the broker does not have discretionary authority as to certain shares to vote on one or more matters, these shares will be considered present at the Annual Meeting for purposes of determining a quorum, but will not be considered to be represented at the Annual Meeting for purposes of calculating the vote with respect to those matters. There are currently seven Directors serving on the Board and each Director serves a three-year term. Directors are elected by a plurality of the votes cast, i.e. the nominees receiving the greatest number of votes will be elected. For each share held, shareholders may cast one vote for each of the If no shareholder provides a notice of such intent, the nominees who receive the affirmative vote of the holders of a plurality of the voting power of the shares present and entitled to vote at the Annual Meeting will be elected to serve on the Board. If any shareholder determines to vote on a cumulative basis and an individual other than the above-stated nominees has been nominated to serve as a Director, then the Votes cast for a nominee will be counted in favor of election. Withheld votes and broker non-votes will not count either in favor of or against election of a nominee. The persons appointed as proxies in the accompanying proxy card, unless authorization to do so is withheld, will vote for the election of the Board’s nominees. Your Board recommends a vote FOR these nominees. Shares represented by proxy will be voted FOR the nominees, unless you specify otherwise in your voting instructions BOARD OF DIRECTORS Set forth on the following pages is biographical information on the NOMINEES FOR ELECTION To Serve a Three-Year Term Expiring In 2015 Dennis E. Miller Term: Expires in Recent Business Mr. Miller currently serves on the Board of New Ulm Telecom, Inc. Mr. Miller serves as the President and CEO of Mavericks Wireless, LLC, providing consulting services to telecommunications companies (2007–present). Mr. Miller served as the President and CEO (1995–2007) of Midwest Wireless Holdings in Mankato, Minnesota, where he was responsible for strategic development, including consolidating partnerships; identifying, financing, acquiring and integrating new markets; integrating multiple network technologies; and innovating product development and deployment. Mr. Miller led Midwest Wireless from a start-up Company, culminating in successfully completing its sale to Alltel Wireless for $1.075 billion in 2006. From 1990–1995, Mr. Miller served as Vice President of Minnesota Operations for Pacific Telecom Cellular, Appleton, Wisconsin, where he served as the senior state executive in Minnesota and was responsible for the development of 10 rural service areas for wireless services and developing business polices, practices and operations for businesses. Mr. Miller also has prior business experience in sales, including leading sales teams and developing sales and distribution programs and processes. New Ulm Telecom, Member of the Compensation Committee and Member of the Corporate Governance /Nominating Committee. Other Directorships: Coughlan Companies (Governance Committee Chair and member of the Audit Committee), a publishing firm, Mankato, Minnesota (2007–present); Member, CTIA – The Wireless Association Board of Directors (also serving on the Executive Committee (1999–2007), Treasurer (2006) and Chair of Small Operators Caucus (1999–2007), (1996–2007); Member, Rural Cellular Association (President 2003), (1995–2007); Member, Immanuel St. Joseph’s – Mayo Health System Board of Directors (including Vice Chair of regional Mayo owned and operated health system of clinics and hospitals, Compensation Committee Chair and Finance Committee), (1999–present); Chair, Technology Plus, Mankato, Minnesota (1997–2004); Member, Minnesota Telecom Alliance (Wireless Committee Chair) (1998–2002). Selection Criteria: Mr. Miller brings to the Board his experience on the Board of New Ulm Telecom, Inc., his experience on other Boards and his wireless telecommunications experience. In addition, Mr. Miller is also active as a member of the Minnesota State University Foundation (2006 – present); the Minnesota State University College of Business Advisory Council (2000–present); Chair of the Southern Minnesota Initiative Foundation Leader’s Circle (2003–present) and as a member of the University of St. Thomas College of Business Advisory Board (2002 – present). Due to Mr. Miller’s extensive experience in the wireless telecommunications industry, his experience in regulatory and legislative affairs, at both the state and federal level, and his participation on business and industry Boards, the Board believes that Mr. Miller contributes to the Board and the Committees on which he serves. Age: 52 Wesley E. Schultz Term: Will expire in 2015. Recent Business Mr. Schultz is currently a candidate to serve on the Board of New Ulm Telecom, Inc. Mr. Schultz served as the Chief Financial Officer (CFO) (1996–2008) of Rural Cellular Corporation (RCC), headquartered in Alexandria, Minnesota. RCC, a wireless communications company, was listed among the 50 largest publicly traded companies in Minnesota prior to its sale to Verizon Wireless in 2008. Mr. Schultz was responsible for all accounting and financing activities, Securities and Exchange Commission (SEC) filings and reporting, financial planning and analysis, treasury, budgeting, audit, tax, accounting, human resources, purchasing, insurance and the oversight of company-owned and leased office facilities nationwide. Mr. Schultz was a senior management team member involved in major business decisions; developing and implementing strategic plans for growth and integrating its financial strategy. In addition to being the CFO, he was Executive Vice President and a member of the Board of Directors. Prior to working at RCC, Mr. Schultz was the CFO for two companies where he led their initial public offerings; Spanlink, Inc. (1996) and Serving Software, Inc. (1991–1994). Other Directorships: OrthoCor Medical, Inc., an innovator of devices utilizing pulsed electromagnetic frequency and thermal technologies to alleviate joint pain and minimize swelling, Minneapolis, Minnesota (2011–present); Geneva Capital, LLC, an equipment leasing company, Alexandria, Minnesota (2005–present); RCC, a wireless communications company, Alexandria, Minnesota (1999–2008) and Professional Support Solutions, Inc., an IVR and CTI Support Solutions and Integration Company, Dublin, California (2009–2011). Selection Criteria: Mr. Schultz brings 18 years of CFO experience, including 13 years of public company experience in the telecommunications industry, to the Board along with his background and experience in accounting and reporting. The Board believes that Mr. Schultz will contribute to the Board with his business and telecommunications experience and his experience of being a CFO of a publicly held company. Age: 55 Suzanne M. Spellacy Term: Will expire in 2015. Recent Business Ms. Spellacy is currently a candidate to serve on the Board of New Ulm Telecom, Inc. Ms. Spellacy is Vice President and General Counsel of Taylor Corporation, which operates more than 80 subsidiaries, devoted to print services and marketing solutions and is one of the largest privately-held corporations in the country. Ms. Spellacy is responsible for the legal affairs of Taylor Corporation and its subsidiaries, which collectively have over 9,000 employees globally. Ms. Spellacy joined Taylor Corporation in 2000 and previously served as Vice President, Human Resources (2001–2005) and Assistant General Counsel (2005–2011). Prior to joining Taylor Corporation, Ms. Spellacy was a shareholder in the Twin Cities law firm of Winthrop and Weinstine, P.A. and received her law degree from the University of Minnesota in 1992. Other Directorships: Minnesota Job Skills Partnership Board (Board Member (2004–2011)); Greater Mankato Early Learning Initiative (Board Member (2011–present)), President (2008–2011); Greater Mankato YMCA (Board Member and Finance Committee Member (2006–2009)); Loyola Catholic School Board of Trustees (2009–2011); Loyola Catholic School Board (Board Member (2004–2005), Chair (2005–2009)); Southern Minnesota Advocates (Board Member (2009–present)). Selection Criteria: Ms. Spellacy brings 20 years of legal and business experience to the Board, including experience with business transactions, mergers and acquisitions, executive compensation, employee benefits, employment law and other legal matters. Ms. Spellacy gained experience in state policy and legislative affairs by serving as the Governor’s business representative on the Minnesota Job Skills Partnership Board. She has been an active member of the community and brings her leadership skills from service with many community organizations, including her role as a founding board member and first board chair for the Greater Mankato Early Learning Initiative, a collaborative effort between business, education and non-profits. With Ms. Spellacy’s legal and business experience, participation on various Boards and her extensive community involvement, the Board believes Ms. Spellacy will contribute to the Board through the skills and experience she has developed. Age: 46 THE BOARD RECOMMENDS A VOTE “FOR” EACH NOMINEE FOR DIRECTOR RETIRING DIRECTORS ROSEMARY J. DITTRICH, age 70, has served as an Independent Director Of New Ulm Telecom, Inc. since 1997. Ms. Dittrich is a co-owner and the Executive Secretary of D & A Trucklines, Inc., a family-owned trucking company of 50 years. Ms. Dittrich has been active in all aspects of a growing company, including decisions regarding consolidating partnerships, developing business policies, succession planning and serving as the Director of Human Resources. Ms. Dittrich currently serves as a Member of the Compensation Committee of New Ulm Telecom, Inc. MARY ELLEN DOMEIER, age 70, has served as an Independent Director of New Ulm Telecom, Inc. since 1999. From 1972 until her retirement in 2003, Ms. Domeier served in various positions at Frandsen Bank & Trust Company, New Ulm, Minnesota, including as CEO from 1988–2003 and Chair from 1997–2003. At Frandsen Bank & Trust Company, Ms. Domeier oversaw all areas of administration, operations, policies and business lines. She currently continues to be active in banking, serving on the Board of Bank Midwest, Spirit Lake, Iowa, most recently serving as its Chair, and currently as Chair of its Audit Committee and a member of its Trust Committee and Governance/Nominating Committee. From 2004 to July, 2006, Ms. Domeier served as the part-time Executive Officer of New Ulm Area Catholic Schools, providing administrative direction, coordinating a capital campaign and re-establishing its foundation. Ms. Domeier currently serves as a Member of the Audit Committee and the Corporate Governance/Nominating Committee of New Ulm Telecom, Inc. CONTINUING DIRECTORS Paul W. Erick Term: Expires in 2014. Independent Director since 2005. Recent Business Mr. Erick currently serves on the Board of New Ulm Telecom, Inc. Prior to his Experience: retirement in September 2000, Mr. Erick was an Officer and Shareholder of Olsen Thielen & Co., Ltd., a public accounting firm. Mr. Erick was a licensed Certified Public Accountant in Minnesota, South Dakota, Wisconsin and Iowa. At Olsen Thielen & Co., Ltd., Mr. Erick served as the Firm’s Corporate Secretary, Co-Trustee its of retirement plan, Quality Review Committee Chair and Continuing Professional Education Committee Chair. Mr. Erick has performed many Mr. Erick researched or supervised the research of issues related to accounting, auditing and financial reporting, including SEC issues. He performed concurring reviews of SEC engagements. He has consulted on acquisitions and sales of businesses. Mr. Erick served many years on Minnesota Society of Certified Public Accountants Committees, including Auditing Procedures, Accounting Policies, Continuing Professional Education, Cooperation with the Bar, Government and Not For Profit Committees. He also served as Chair of the Financial Statement Review and Quality Review Committees for which he received Outstanding Committee Awards. New Ulm Telecom, Mr. Erick serves as the Chair of the Audit Committee. Selection Criteria: Mr. Erick brings 34 years of public accounting experience to the Board along with his background and experience in SEC accounting and reporting. The Board has determined that Mr. Erick satisfies the criteria adopted by the SEC to serve as “Audit Committee Financial Expert.” The Board believes that Mr. Erick contributes to the Board and the Audit Committee with his expertise from his extensive public accounting knowledge and experience, and his prior New Ulm Telecom, Inc. Board experience. Age: Term: Expires in 2013. Independent Director since 1982. Recent Business Mr. Jensen currently serves on the Board of New Ulm Telecom, Inc. Since 2003, Mr. Jensen has been the President of Jensen Business, New Ulm Telecom, Chair of the Executive Committee, Chair of the Corporate Governance/Nominating Committee and Chair of the Board. Also serves as an ad-hoc member of the Audit Committee and the Compensation Committee. Other Directorships: Alliance Bank, New Ulm, Minnesota Selection Criteria: The Board believes that Mr. Jensen brings to the Board his business experience in retail, and sales and marketing, as well as his experience as a business owner, which allows him to provide the Company with insight that can be used in its business-decision making. In addition to Mr. Jensen’s business experience, he is or has been active in various community organizations, including a member of the New Ulm Retail Development Committee, past Chair of the New Ulm Chamber of Commerce, past President of the New Ulm Retail Association, past member of the Board of Directors of the Brown County Agriculture Society, past member of the Lions Club of New Ulm and a charter member of the Big Brothers of New Ulm. Mr. Jensen contributes to the Board and the Committees on which he serves through the skills and expertise he has developed in his retail endeavors and his consulting business, his knowledge and experience on other Boards, his perspective as an active community member and his prior New Ulm Telecom, Inc. Board experience. Age: Duane D. Lambrecht Term: Expires in 2014. Independent Director since 1999. Recent Business Mr. Lambrecht currently serves on the Board of New Ulm Telecom, Inc. Mr. Lambrecht is the founder of Shelter Products, Inc., a regional wholesale building materials distributor serving the five-state area encompassing Minnesota. Mr. Lambrecht has served as Chair, President and CEO since the founding of Shelter Products in 1981. In this capacity, he has been responsible for product and market development, distribution systems, personnel recruitment and training, as well as all aspects of financial controls and relationships. From 1972–1981, Mr. Lambrecht worked for a material distributor as a Division Manager. New Ulm Telecom, Mr. Lambrecht serves as a member of the Executive Committee and a member of the Audit Committee. Other Directorships: Past Board member of North American Building Material Distribution Association - also served as President (2008–2009); Board member of the New Ulm Economic Development Corporation – also served as President (2004–2007), New Ulm, Minnesota (2003–2011); Board Member of New Ulm Medical Foundation, New Ulm, Minnesota (2003–2011); Board member of New Ulm Area Foundation, New Ulm, Minnesota (2006–2011); Member of Undergraduate Advisory Board – University of Minnesota, Carlson School of Management, Minneapolis, Minnesota (1996–2008); Board member, New Ulm United Way – also served as President (1984–1985), New Ulm, Minnesota (1983–1989); Director for Sioux Valley Hospital – also served as Board Chair (1991–1993), New Ulm, Minnesota (1984–1994); President of New Ulm Rotary Club, New Ulm, Minnesota (1984–1985); Board member of Minnesota Manufactured Housing Association, St. Paul, Minnesota (1990–1995). Selection Criteria: Mr. Lambrecht brings to the Board his experience on the Board of New Ulm Telecom, Inc., his experience on other Boards and his experience as a business entrepreneur. In addition to his Board experiences, Mr. Lambrecht is also an active member of the community, including his membership on the New Ulm Medical Foundation; New Ulm Area Foundation and the New Ulm Rotary Club (past President). Mr. Lambrecht is a Life Member Disabled American Veteran; Life Member Purple Heart Association and a Vietnam Combat Veteran. As an independent business operator and an active member of community organizations and business organizations, the Board believes that Mr. Lambrecht contributes to the Board and the Committees on which he serves through the skills and expertise he has developed in his founding of businesses, 30 years’ operating as a regional wholesale building materials distributor, his knowledge and experience on other Boards, his perspective as an active community member and his prior New Ulm Telecom, Inc. Board experience. Age: 65 Perry L. Meyer Term: Expires in 2013. Independent Director since 1995. Recent Business Mr. Meyer currently serves on the Board of New Ulm Telecom, Inc. Mr. Meyer oversees all operations of a 2,300-acre diversified grain and livestock farm. Mr. Meyer serves as President of Steamboat Pork, a 1,400 head/sow farm started in 1998 by eight Nicollet and Sibley county farmers to produce isowean pigs. New Ulm Telecom, Chair of the Compensation Committee, Member of the Executive Committee. Other Directorships: President, St. John’s Lutheran Church Selection Criteria: The Board believes Mr. Meyer brings to the Board his previous experience both on the Board of New Ulm Telecom, Inc. and his experience on other Boards, in particular his experience on the Heartland Corn Products Board. In addition to his Board experiences, Mr. Meyer is also an active member of the community, including his membership on the Planning and Zoning Commission for the City of New Ulm, Minnesota and as Age: Director Independence All of the Company’s Directors have met the criteria for independence under the rules of the SEC and Rule 5605(a)(2) of NASDAQ. Director Qualifications Criteria for Membership The Company’s Corporate Governance/Nominating Committee is responsible for annually reviewing the composition of the Board for desired skills and characteristics of Directors, as well as the composition of the Board as a whole. Terms, Limitations and Retirement All Directors are elected to three-year terms. The Board does not believe it should establish a limit on the number of times that a Director may stand for election. To ensure that the Board of the Company is made up of individuals who are active in the business, agriculture, professional or working life of the community, our By-Laws state that it is in the best interest of the Company that age limits are set for members of the Board. No individual is eligible to be appointed or elected as a Director after attaining the age of 69. Ownership of Company Stock All Directors are required to own common stock of the Company. Selecting Nominees for Election to the Board The Corporate Governance/Nominating Committee is the standing committee responsible for recommending to the full Board the nominees for election as directors at our annual shareholder meetings. Our Bylaws call for the Board to then select nominees to stand for election. In making its recommendations, the Committee reviews the composition of the full Board to determine the qualifications and areas of expertise needed to further enhance the composition of the Board, and works with management in attracting candidates with those qualifications. Although the Committee does not have a formal policy regarding diversity, the Committee seeks to Other Board Information Frequency of Meetings The Board typically holds twelve regularly scheduled meetings per year. If necessary, special meetings of the Board are held as determined by the Board. Annual Evaluations The Corporate Governance/Nominating Committee conducts, or causes to be conducted, annual evaluations to assess the Board’s performance and composition. Executive Sessions of Independent Directors The Company’s independent Directors (all members of the Board are independent Directors) meet in executive sessions (without members of management present) regularly. Committees Currently, the Board has four standing Committees: (i) Executive, (ii) Audit, (iii) Compensation and (iv) Corporate Governance/Nominating. CEO and Management Succession The Corporate Governance/Nominating Committee conducts periodic reviews to assess the succession planning for the Company’s Executive Officers. In the event of the loss of the CEO or any other Executive Officer, a meeting of the Corporate Governance/Nominating Committee would be held to discuss the implementation of the existing succession plan and, in the case of the CEO, provide recommendations to the Board for interim management of the Company. Review and Access to Guidelines The Corporate Governance/Nominating Committee reviews the Company’s Corporate Governance Policy annually, and if deems appropriate, recommends amendments to the Board. Communication with the Board The Board has implemented a process by which Company shareholders may send written communications to the Board’s attention. Any shareholder desiring to communicate with the Board, or one or more of its Directors, may send a letter addressed to: New Ulm Telecom, Inc. Attention: Corporate Secretary (Board Matters) 27 North Minnesota Street New Ulm, Minnesota 56073 The Board has instructed the Corporate Secretary to promptly forward all communications received to the full Board or the individual Board members specifically addressed in the communication, without first screening those communications. The Company encourages all of its Directors and Officers to attend the Annual Meeting of Shareholders. All Code of Business Conduct The Company-adopted Code of Business Conduct for Directors, Executive Officers and all employees is available on the Company’s website at • Act with honesty and integrity; • Promote full, fair, accurate, timely and understandable disclosures in reports and documents filed with the SEC and other public communications; • Comply with laws, rules and regulations of governments and their agencies; • Respect the confidentiality of information acquired in the course of performing work for the Company, except when authorized or otherwise legally obligated to disclose the information; and • Do not use confidential information of the Company for personal advantage or for the benefit of acquaintances, friends or relatives. Risk Oversight The Board and each of its Committees are involved in overseeing risk associated with the Company and its operations. The Board and Audit Committee monitor the Company’s credit risk, liquidity risk and regulatory risk through regular reviews with management, external auditors and other advisors. In its periodic meetings with management and the Company’s independent registered public accounting firm, the Audit Committee discusses the scope and plan for the audits and includes management in its review of accounting and financial controls, assessment of business risks, and legal and ethical compliance programs. The Board and the Corporate Governance/Nominating Committee monitor the Company’s governance and succession risk through regular reviews with management and outside advisors. The Board and the Compensation Committee monitor the Company’s compensation and benefit policies and related risks through regular reviews with management and the Committee’s outside advisors. The Board and its Executive Committee monitor operational risk and enterprise risk by monitoring the Company’s overall strategic goals and objectives with management and the Board, and review and consider merger, acquisition and growth opportunities for recommendation to the Board. The Board as a whole monitors any potential for reputation risk. Board Leadership The Board does not have a formal policy regarding the separation of the roles of CEO and Chair of the Board, but believes it is in the best interest of the Company to make that determination based on the position and direction of the Company and the membership of the Board. THE BOARD OF DIRECTORS AND COMMITTEES Board of Director Committees The Board consists of seven members with staggered terms of three years. The Board typically holds regular monthly meetings and several special Corporate Governance/Nominating Committee • Develop and recommend governance principles applicable to the Company and to the Board; • Oversee the evaluation of the Board and its Committees; • Make recommendations to the Chair and the Board as to composition of all Board Committees; • Maintain shareholder relations efforts; • Develop, maintain and implement a board-approved nomination process for seats on the Company’s Board, although the ultimate decision for nominations rests with the entire Board; • Ensure appropriate succession planning is in place for both senior management and members of the • Ensure Board and Committee assessments are completed; and • Board educational opportunities are identified and recommended from the completed assessments. Board policy requires consideration of candidates for Director Positions as recommended by shareholders, if they are qualified to serve on the Board. The Board may elect not to consider an unsolicited recommendation if no vacancy exists on the Board and the Board does not perceive a need to increase its size. In order for a Director candidate to be considered for nomination at the Annual Meeting of Shareholders, the recommendation must be received by the Company as provided under “Shareholder Proposals for 36. The Corporate Governance/Nominating Committee held Audit Committee Members of the Audit Committee are Paul W. Erick (Chair), Mary Ellen Domeier and Duane D. Lambrecht. All members of the Audit Committee are independent, as defined in Rule 5605(a)(2) of the The Audit Committee is responsible for overseeing the Company’s accounting procedures, financial reporting processes and internal controls and The Audit Committee held Compensation Committee Members of the Compensation Committee are Perry L. Meyer (Chair), Rosemary J. Dittrich and Dennis E. Miller. The Compensation Committee’s duties include evaluating employee compensation and benefit plans as well as staffing. The Compensation Committee also makes recommendations pertaining to the compensation of Directors. The Compensation Committee held Executive Committee The Executive Committee was established on January 21, 2010. Members of the Executive Committee are James P. Jensen (Chair), Duane D. Lambrecht and Perry L. Meyer. In addition, the Company’s CEO, Chief Operating Officer (COO) and Board and (vi) implementation of Board member education based on input given by the Corporate Governance/Nominating Committee and other committees. The Executive Committee held NON-EMPLOYEE DIRECTOR COMPENSATION In Under Board policy for non-employee Director Compensation established May The following table shows the compensation paid or accrued to each of the Company’s Directors in Name Fees Earned or All Other Total ($) James P. Jensen 47,028 0 47,028 Perry L. Meyer 27,384 8,400 35,784 Duane D. Lambrecht 32,088 0 32,088 Paul W. Erick 35,324 0 35,324 Rosemary J. Dittrich 25,620 0 25,620 Mary Ellen Domeier 32,088 0 32,088 Dennis E. Miller 27,972 0 27,972 Name Fees Earned All Other Total ($) James P. Jensen 47,616 0 47,616 Perry L. Meyer 27,972 0 27,972 Duane D. Lambrecht 29,736 8,400 38,136 Paul W. Erick 33,560 0 33,560 Rosemary J. Dittrich 26,796 0 26,796 Mary Ellen Domeier 32,676 0 32,676 Dennis E. Miller 30,324 0 30,324 (1) The amount listed in the All Other Compensation column represents the change in the non-employee Director Compensation policy value accruing to each Director for future payment under the Company’s Director Separation policy dated May SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table includes information regarding beneficial ownership of the Company’s common stock as of March 31, Name and Address of Beneficial Owner Amount and Percent of Ruth B. Wines, Trustee of the Ralph K. Wines & 274,320 5.4 Bill D. Otis 206,477 4.0 James P. Jensen (3) 18,453 * Perry L. Meyer 12,000 * Rosemary J. Dittrich (4) 25,090 * Dennis E. Miller 4,570 * Barbara A. J. Bornhoft 2,300 * Mary Ellen Domeier (5) 2,220 * Duane D. Lambrecht (6) 1,150 * Paul W. Erick 100 * Curtis O. Kawlewski 0 * All nominees, Directors and Executive Officers as a 272,360 5.3 Name and Address of Beneficial Owner Amount and Percent of Ruth B. Wines, Trustee of the Ralph K. Wines & 274,320 5.4 % Bill D. Otis 206,477 4.0 James P. Jensen (3) 18,453 * Perry L. Meyer 12,000 * Rosemary J. Dittrich (4) 25,090 * Dennis E. Miller 4,570 * Barbara A. J. Bornhoft 2,300 * Mary Ellen Domeier (5) 2,220 * Duane D. Lambrecht (6) 1,150 * Wesley E. Schultz 800 * Suzanne M. Spellacy 200 * Paul W. Erick 100 * Curtis O. Kawlewski 0 * All nominees, Directors and Executive Officers as a 273,360 5.3 % * Represents less than 1.0% (1) Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to securities. Securities (2) Percentage of beneficial ownership is based on 5,115,435 shares outstanding as of March 31, (3) Includes 3,654 shares owned by Mr. Jensen’s spouse. (4) Includes 4,970 shares owned by Ms. (5) Includes 370 shares owned by Ms. Domeier’s spouse. (6) Includes 250 shares owned by Mr. Lambrecht’s spouse. (7) Includes Summary Compensation Table The following table shows compensation paid to or earned by the CEO, COO and CFO “Named Executive Officers” during Name and Principal Position Year Salary ($) Non-Equity All Other Total ($) Bill D. Otis 2010 260,005 79,103 12,250 351,358 President and CEO 2009 259,730 — 8,996 268,726 Barbara A.J. Bornhoft 2010 153,879 34,885 7,674 196,438 Vice President/COO 2009 152,421 — 5,092 157,513 and Corporate Secretary Curtis O. Kawlewski 2010 125,240 29,664 5,389 160,293 CFO (beginning 11/16/09) 2009 12,019 — — 12,019 Name and Principal Position Year Salary ($) Non-Equity All Other Total ($) Bill D. Otis 2011 260,000 84,825 29,843 374,668 President and CEO 2010 250,000 79,103 22,255 351,358 Barbara A.J. Bornhoft 2011 155,000 37,929 18,781 211,710 Vice President/COO 2010 147,000 34,885 14,553 196,438 and Corporate Secretary Curtis O. Kawlewski 2011 130,000 31,811 9,877 171,688 CFO 2010 125,000 29,664 5,629 160,293 (a) Represents taxable fringe benefits and contributions made by the Company under its 401(k) plan. Grants of Plan-Based Awards in The following table sets forth information relating to potential plan-based awards in Potential Payouts Under Non-Equity Name Threshold Target Maximum Bill D. Otis 25,000 50,000 100,000 Barbara A. J. Bornhoft 11,025 22,050 44,100 Curtis O. Kawlewski 9,375 18,750 37,500 Potential Payouts Under Non-Equity Name Threshold Target Maximum Bill D. Otis 26,000 52,000 104,000 Barbara A. J. Bornhoft 11,625 23,250 46,500 Curtis O. Kawlewski 9,750 19,500 39,000 (1) Represents awards that may have been earned during Options and Warrants The Company did not issue any options or warrants during Mr. Otis and the Company entered into an employment agreement in July 2006 that provided for an annual base salary of no less than $170,000 and that Mr. Otis would be eligible for incentive compensation under the New Ulm Telecom Management Incentive Plan in the form of a cash incentive (Annual Incentive Award) on an annual basis. The base salary for Mr. Otis was set at $260,000 for Ms. Bornhoft and the Company entered into an employment agreement in July 2006 that provided for an annual base salary of no less than $110,000 and that Ms. Bornhoft would be eligible for incentive compensation under the New Ulm Telecom Management Incentive Plan in the form of an Annual Incentive Award. The base salary for Ms. Bornhoft was set at Mr. Kawlewski and the Company entered into an employment agreement in March 2012 that provided for an annual base salary of no less than $145,000 and that Mr. Kawlewski would be eligible for incentive compensation under the New Ulm Telecom Management Incentive Plan in the form of an Annual Incentive Award. The base salary for Mr. Kawlewski was set at $145,000 for 2012. The target incentive for Mr. Kawlewski is 15% of his base salary. The maximum incentive award payable under the plan is 30% of base salary (2 times the target). The minimum incentive award payable under the plan is $0. Upon termination of Mr. Kawlewski’s employment by the Company without cause or by Mr. Kawlewski for good reason, Mr. Kawlewski would receive 12 months of base salary at the annualized rate of pay at termination. Upon a change-in-control transaction, if Mr. Kawlewski is terminated by the Company, without cause or by Mr. Kawlewski for good reason within 12 months of the change-in-control transaction, Mr. Kawlewski would receive a lump sum payment equal to 12 months of base salary at the annualized rate of pay at The Compensation Committee, which is comprised solely of Independent Directors, is responsible for evaluating and monitoring the Company’s general compensation policies and compensation plans, as well as the specific compensation levels for Executive Officers, including our CEO. The Compensation Committee reviews and recommends annual base salary levels and annual cash award opportunity levels for each Named Executive Officer to the Board. Under the supervision of the Board, the compensation philosophy is designed to: • Attract and retain well-qualified executive talent; • Tie annual cash incentives to achievement of measurable corporate performance objectives; and • Align executive incentives with shareholder value creation. To achieve these objectives, the Compensation Committee implemented and maintains a compensation plan that ties a significant portion of an executive’s overall compensation to the Company’s financial performance. Overall, the total compensation opportunity is intended to create an executive compensation program that is set competitively compared to similar-sized companies, particularly telecommunication companies. Each Executive Officer’s compensation package is generally comprised of three elements: • Base salary and fringe benefits, which reflects an individual’s qualifications, scope of responsibilities, experience level, expertise, performance and contribution to the Company’s financial results; • Cash-based incentive compensation tied to measurable targets of the Company’s overall success; and • The Company’s qualified 401(k) plan, in which the executives The Executive Officers were not present during, and did not participate in, deliberations or decisions involving their own compensation during The level of base salary is established primarily on the basis of an executive’s qualifications and relevant experience; the scope of his or her responsibilities; the strategic goals that he or she manages; the compensation levels of Executive Officers at similar-sized companies, particularly telecommunications companies; the relationship between the executive’s performance and the Company’s results; and market rates of compensation required to retain qualified management. The Company believes that executive base salaries should be competitive with salaries at similar-sized companies. The Compensation Committee reviews the base salary of each executive annually and makes recommendations to the Board pertaining to any adjustments in base salary that (i) take into account the individual’s performance and any changes in the The Company engaged an outside consultant in 2005 to advise the Company on its development of Employee Incentive Plans for (i) employees other than Executive Officers and (ii) Executive Officers. Both plans were implemented in 2006. Payments on each plan were based on achievement of objectives of measurable corporate performance, with financial and customer-related targets. The financial targets included achievement of specified certain operating revenue and net income criteria based on the Company’s budget, while the customer service targets were based on several The Executive Officer potential awards under the 2006 Management Incentive Plan, as amended, and in effect in Position Target Award Maximum Award CEO 20% of base salary 40% of base salary COO 15% of base salary 30% of base salary CFO 15% of base salary 30% of base salary The award formula was weighted according to each of the percentages listed below. Net Income 60 % Operating Revenue 25 % Customer Service 15 % Total 100 % The Company will continue the Management Incentive Plan in Grants of Plan-Based Awards in The following table sets forth certain information concerning plan-based potential awards to be granted to the Named Executive Officers below during the fiscal year ending December 31, Estimated Future Payouts Under Non-Equity Name Threshold Target Maximum Bill D. Otis 26,000 52,000 104,000 Barbara A.J. Bornhoft 12,375 24,750 49,500 Curtis O. Kawlewski �� 10,875 21,750 43,500 Estimated Future Payouts Under Non-Equity Name Threshold Target Maximum Bill D. Otis 26,000 52,000 104,000 Barbara A. J. Bornhoft 11,625 23,250 46,500 Curtis O. Kawlewski 9,750 19,500 39,000 The Company has a qualified 401(k) Retirement Savings Plan (Retirement Plan). The Named Executive Officers, along with other employees who made contributions to the Retirement Plan, receive matching contributions of 50% of every dollar, up to 6% of all eligible employee contributions. The Company matches a portion of employee contributions to the Retirement Plan in order to encourage employees to participate in their own retirement savings and to provide another competitive recruiting tool to attract and retain employees. In addition, on Elements of Post-Termination Compensation As noted above under “Employment Agreements,” our Employment Agreements with Mr. Otis, The Company does not grant stock awards and does not have any pension plans or any nonqualified deferred compensation plans for its Executive Officers or employees. REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION The compensation program for the CEO and the Board is the responsibility of the Compensation Committee of the Board. The Compensation Committee is comprised entirely of independent members of the Board. The Compensation Committee oversees the Company’s compensation practices and establishes the principles and strategies that guide the design of compensation plans and benefit programs for all employees of the Company, and makes recommendations to the Board. The Compensation Committee is comprised of three Directors: Mr. Meyer (Chair), Ms. Dittrich and Mr. Miller. The following discussion describes the Company’s approach pertaining to executive compensation. The Compensation Committee retains the right to consider factors other than those set forth below in setting executive compensation levels for individual officers. The The Compensation Committee considers Company performance and compensation levels of comparable companies when making its recommendations pertaining to annual base salaries and making awards under the incentive plan. The Compensation Committee’s goal is to remain reasonably competitive with comparable companies. The Compensation Committee worked with a consultant to develop the Management Incentive Plan. This plan was effective beginning in the year 2006. This Management Incentive Plan enables the Company to motivate its Executive Officers to achieve key financial and strategic objectives. The Compensation Committee of the Board has reviewed and discussed with management the Executive Compensation discussion and analysis. Based on the review and discussions, the Compensation Committee recommended that the Board include the Executive Compensation discussion and analysis in the proxy statement. In reviewing the CEO’s Submitted by the Compensation Committee of the Board of Directors Perry L. Meyer, Chair Rosemary J. Dittrich Dennis E. Miller The members of the Audit Committee as of December 31, The Audit Committee acts under a written charter that sets forth its responsibilities and duties as well as requirements for the Audit Committee’s composition and meetings. The Audit Committee Charter is available on the Company’s website at During the year ended December 31, The Audit Committee reviews each of the Company’s quarterly and annual reports, including Management’s Discussion and Analysis of Financial Condition and Results of Operations. As part of this review, the Audit Committee discusses these reports with the Company’s management and the Company’s independent registered public accounting firm prior to the filing of each report with the SEC. In addition, the Audit Committee also reviews related matters, such as the quality of the Company’s accounting practices, alternative methods of accounting under generally accepted accounting principles in the United States and the preferences of the independent registered public accounting firm in this regard. The Company’s critical accounting policies and the clarity and completeness of the Company’s financial and other disclosures are also discussed. Management of the Company has the primary responsibility for the Company’s financial statements. The independent registered public accounting firm has responsibility for the audit of the Company’s financial statements. The responsibility of the Audit Committee is to oversee financial matters, among other responsibilities fulfilled by the Audit Committee under its charter. The Audit Committee meets periodically with representatives of Olsen Thielen & Co., Ltd. without the presence of management, to ensure candid and constructive discussions about the Company’s compliance with accounting standards and best practices among public companies comparable in size and scope to the Company. The Audit Committee has also discussed with Olsen Thielen & Co., Ltd. that their firm is retained by the Audit Committee and that they must raise any concerns about the Company’s financial reporting and procedures directly with the Audit Committee. The Audit Committee has: • Reviewed and discussed the audited financial statements with the Company’s management; and • Discussed with Olsen Thielen & Co., Ltd., the matters required to be discussed under Statement on Auditing Standards No. 114, The Auditors Communication with Those Charged with Governance, as amended and as adopted by the Public Company Accounting Oversight Board (PCAOB). The Audit Committee has received written disclosures and a letter, required by PCAOB Rule 3526, Communications with Audit Committees Concerning Independence. The Audit Committee has also discussed with Olsen Thielen & Co., Ltd., its independence as it relates to the Company. The Audit Committee has concluded that Olsen Thielen & Co., Ltd. is independent with respect to the Company and its management. The Audit Committee has reviewed and discussed the fees paid to Olsen Thielen & Co., Ltd. during the year ended December 31, ” The Audit Committee has adopted a policy that requires pre-approval of all services of Olsen Thielen & Co., Ltd. by the Audit Committee or the Chair of the Audit Committee. When services are pre-approved by the Chair of the Audit Committee, notice of this approval is given to the other members of the Audit Committee and presented to the full Audit Committee at its next scheduled meeting. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS It is the The Audit Committee assists the Board in its oversight of the Company’s financial reporting process. The Audit Committee operates under a written charter adopted by the Board. In addition to its other duties described in the Committee’s Charter, the Audit Committee has: • Reviewed and discussed with the Company’s management and the independent registered public accounting firm, the audited financial statements as of December 31, • Discussed with the independent registered public accounting firm, the matters required to be discussed by Statement on Auditing Standards No. 114,The Auditor’s Communication with Those Charged with Governance;and • Received from the independent registered public accounting firm, the written disclosures and letter required by PCAOB Rule 3526,Communications with Audit Committees Concerning Independence,and discussed their independence with them. Based upon the review and discussions summarized above, together with the Committee’s other deliberations, the Audit Committee recommended to the Board that the audited financial statements of the Company, as of December 31, Management is responsible for the Company’s internal controls and financial reporting processes. The independent registered public accounting firm is responsible for performing an independent audit of the Company’s consolidated financial statements in accordance with auditing standards generally accepted in the United States and for expressing an opinion thereon. The Audit Committee’s responsibility is generally to monitor and oversee these processes, as described in the Audit Committee Charter. Submitted by the Audit Committee of the Board of Directors PROPOSAL 2 – RATIFICATION OF OLSEN THIELEN & CO., LTD. AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Services of Independent Registered Public Accounting Firm for Olsen Thielen & Co., Ltd. served as the Company’s independent registered public accounting firm for the fiscal year ended December 31, Fees Billed and Paid to Independent Registered Public Accounting Firm The following is a summary of fees billed by Olsen Thielen & Co., Ltd. for professional services rendered for the fiscal years ended December 31, 2011 and 2010, Fee Category 2011 Fees 2010 Fees Audit Fees $ 130,564 $ 132,578 Audit - Related Fees 5,812 6,500 Tax Fees 1,160 — All Other Fees 26,396 27,450 Total Fees $ 163,932 $ 166,528 Fee Category 2010 Fees 2009 Fees Audit Fees $ 132,578 $ 117,103 Audit - Related Fees 6,500 — Tax Fees — 5,636 All Other Fees 27,450 20,975 Total Fees $ 166,528 $ 143,714 Audit Fees Audit fees are Audit-Related Fees Audit-related fees Tax Fees Tax fees are All Other Fees All other fees are Independence The Audit Committee of the Board has determined that the provision of the services described above is compatible with maintaining the independence of the independent registered public accounting firm’s independence. Audit Committee Pre-Approval Policy for Services of Independent Registered Public Accounting Firm The Audit Committee annually approves the scope and fees payable for the year-end audit to be performed by the independent registered public accounting firm for the next fiscal year. The Audit Committee is required to pre-approve audit and non-audit services performed by the independent registered public accounting firm in order to assure that the provision of such services does not impair the independent registered public accounting firm’s independence. The Audit Committee does not delegate to management, its responsibilities to Appointment of Independent Registered Public Accounting Firm for Subject to ratification by the shareholders at the May Ratification of the appointment of Olsen Thielen & Co., Ltd. as the Company’s independent registered public accounting firm requires that a majority of the votes cast, whether in person or by proxy, be cast in favor of the proposal. Broker non-votes are counted in determining the votes present at a meeting for purposes of establishing a quorum; but are not considered votes cast and will not count either in favor or against the proposal. Abstentions are counted as present and entitled to vote for the purposes of determining a quorum, but are not counted for the purposes of determining whether shareholders have approved the matter. Therefore, if you abstain from voting on Proposal 2: Ratification of Olsen Thielen & Co., Ltd. as the Company’s Independent Registered Public Accounting Firm, it has the same effect as a vote against the proposal. Representatives of Olsen Thielen & Co., Ltd. are expected to be present at the annual meeting and will have an opportunity to make a statement if they desire to do so. They will also be available to respond to appropriate questions from shareholders in attendance. THE BOARD AND THE AUDIT COMMITTEE RECOMMEND A VOTE “FOR” THE RATIFICATION OF APPOINTMENT OF OLSEN THIELEN & CO., LTD. AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. SHARES REPRESENTED BY PROXY WILL BE VOTED “FOR” THIS PROPOSAL, UNLESS YOU SPECIFY A DIFFERENT CHOICE ON THE ACCOMPANYING PROXY CARD. PROPOSAL 3 – APPROVAL OF THE NEW ULM TELECOM, INC. DIRECTOR STOCK PLAN On February, 28, 2012, our Board adopted the New Ulm Telecom, Inc. Director Stock Plan (the “Plan”), subject to shareholder approval. A copy of the Director Plan is attached to this proxy statement as Appendix A. Purpose of the Plan The purpose of the Plan is to enable the Company to retain and attract qualified non-employee individuals to serve as directors of the Company, and to enable these directors to participate in the long-term success and growth of the Company by paying them in Company common stock instead of cash for a portion of their retainer. Key Plan Features Description Effective Date of the Plan May 31, 2012, subject to shareholder approval. Duration of Plan Share payments may be made until the earlier of (i) May 31, 2022 or (ii) the date on which all shares reserved under the Plan have been issued or are no longer available for use under the Plan. Eligible Participants Non-employee members of the Board. Total Shares Available 200,000 shares of common stock to fund the Plan over its duration. Share Counting Shares available under the Plan are reduced by one share for each share that is issued. Type of Share Issued Share payments to non-employee directors, partially in lieu of cash paid for director retainers will vest immediately or at such other time as the Committee determines. Shares issued may be subject, after vesting, to restrictions on the resale imposed by the Committee. Features Not Permitted Increase the maximum number of shares that may be issued under the Plan without shareholder approval. Extend the term of the Plan without shareholder approval. Who is Eligible The Plan only authorizes a payment of non-restricted or restricted stock to non-employee Board members in lieu of retainers. Currently, the Company has seven non-employee Board members and expects to have seven non-employee Board members when the Plan is approved. Operation of the Plan The Board has the power to delegate, by resolution, all or any portion of its authority under this Plan to any committee (“Committee”) of the Board. Until such time as the Board delegates this authority, the Plan will be administered by the Board. The Committee will have the power and authority to designate by resolution: • A percentage of the annual retainer for each non-employee director to be paid in common stock (“minimum stock retainer percentage”); • The date or dates on which the common stock will be issued; and • The vesting schedule, if any, for the shares of common stock to be issued. Each director will have the right to elect to receive an additional percentage of his or her retainer, to be issued in common stock (“additional stock percentage election”), but only after the Committee establishes rules and procedures for this additional stock percentage election. The Committee has the authority to adopt, alter and repeal administrative rules, guidelines and practices governing the Plan and interpret the terms and provisions of the Plan. As noted above, the Committee has the power to establish the vesting schedule for any shares issued under the Plan, including the power to fully vest the shares upon issuance. Whenever the Committee establishes a minimum stock retainer percentage, it must also establish a vesting schedule for the shares to be issued. All shares of common stock issued under the Plan will be issued at fair market value. The Board expects that the minimum stock retainer percentage will be 50%. Any non-employee director may elect to choose his or her additional stock retainer percentage up to a maximum of 100% when the Board establishes rules and procedures, but at a minimum, a percentage of the annual retainer will be paid in Company common stock, as set by the Board. We set below examples of the current payment of director retainers and how the Plan would operate if a director has 50% of their retainer paid in common stock. Director Retainer Payments Prior to Approval of the Plan (1) Director Retainer Total Cash Paid $16,800 $16,800 (1) Excludes director meeting fees and additional chair retainers. Director Retainer Payments after Approval of the Plan (1, 2) Director Retainer Director Retainer Paid Total Value of $8,400 1,200 Shares = $8,400 $16,800 (1) Excludes director meeting fees. (2) Assumes fair market value on date of issuance of $7.00 per share. We currently anticipate that, for administrative convenience, all common stock payments will be issued in connection with the Company’s Annual Meeting of Shareholders based upon the minimum stock retainer percentage elected by each director. If the shareholders approve the Plan, the Board anticipates implementation of the Plan on the date of the Annual Meeting of Shareholders. We do not expect to adopt any rules or procedures that would enable individual directors to affect an additional stock percentage election in 2012, but may do so in the future. In addition, the Board has limited the stock percentage election to retainers and not to any meeting fees. The Committee may amend or suspend the Plan, except that no amendment to increase the total number of shares authorized for issuance under the Plan will be permitted without shareholder approval. Tax Consequences of stock payments to Participants and the Company Payments of stock that immediately vest are subject to ordinary income tax at the time the stock is issued. Restricted stock is generally subject to ordinary income tax at the time the restrictions lapse. The Company is entitled to a corresponding deduction at the time the participant recognizes taxable income on the stock or restricted stock. Registration with the SEC If the Plan is approved by our shareholders, we intend to file a registration statement with the SEC pursuant to the Securities Exchange Act of 1933, as amended, covering the 200,000 share issuable under the Plan. Board Voting Recommendation The Board recommends a vote “for” the Plan. The approval of the Plan will help the Company in several ways, but not limited to: • Enable the directors to participate in the long-term success and growth of the Company by enabling them to obtain Company stock, which may otherwise be difficult for them to obtain due to the strict insider trading laws that the Company operates under; and • Provide the Company with additional cash to use in other areas of the business that would otherwise have been used to pay the directors. THE BOARD RECOMMENDS A VOTE “FOR” THE DIRECTOR STOCK PLAN SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE The Upon written request to New Ulm Telecom, Inc., 27 North Minnesota Street, New Ulm, Minnesota 56073, Attention: President, the Company will send, without charge, a copy of its Annual Report on Form 10-K for the fiscal year ended December 31, SHAREHOLDER PROPOSALS FOR If any shareholder intends to present a proposal to be considered for inclusion in the Company’s proxy materials in connection with the Company’s IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS The Proxy Statement, Proxy Form and Annual Report on Form 10-K, are available at the Company’s website, located atwww.proxyvote.com. The Company did not receive notice by December YOUR VOTE IS IMPORTANT. Whether or not you expect to attend the meeting, please sign and date the proxy and return it promptly in the enclosed envelope, or take advantage of the option to vote by Internet or telephone. If you choose to return the proxy card by mail, we have enclosed an envelope, for which no postage is required if mailed in the United States. You may also vote your shares electronically either over the Internet atwww.proxyvote.com or by touch tone telephone at 1-800-690-6903. By Order of the Board of Directors /s/ Barbara A.J. Bornhoft Barbara A.J. Bornhoft New Ulm, Minnesota April 17, 2012 NEW ULM TELECOM, INC. DIRECTOR STOCK PLAN TABLE OF CONTENTS 38 38 SECTION 3. Stock Subject to 39 40 SECTION 5. Amendments and 40 40 40 NEW ULM TELECOM, INC. (b) The Committee will have the power and authority to designate by resolution (i) the percentage of the annual (ii) the date or dates on which the (iii) the vesting schedule, if any, for (c) Each director will have the (d) The Committee has the authority to: (i) adopt, alter and repeal administrative rules, guidelines and practices governing the Plan as it, from time to time, deems advisable; (ii) interpret the terms and provisions of the Plan and any (iii) otherwise supervise the administration of the Plan. (e) As provided in Section 2(b) above, the Committee has the power to (f) All shares of common stock issued under the Plan are to be issued at fair market value as determined by the Committee. 3. (a) The total number of shares of common stock reserved and available for issue under the Plan will be 200,000. (b) In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, other change in corporate structure affecting the common stock, or VOTE BY INTERNET - www.proxyvote.com ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS VOTE BY PHONE - 1-800-690-6903 VOTE BY MAIL TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. For Withhold For All To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. The Board of Directors recommends you vote o o o 1. Election of Directors Nominees: 01 Dennis E. Miller 02 Wesley E. Schultz 03 Suzanne M. Spellacy The Board of Directors recommends you vote FOR proposals 2 and 3. For Against Abstain 2. To ratify the selection of Olsen Thielen & Co., Ltd. as the Company’s independent public accounting firm. o o o 3. To approve the New Ulm Telecom, Inc. Director Stock Plan. o o o NOTE: The nominees for Board of Directors, if elected, will each hold office until the Annual Meeting of Shareholders to be held in 2015 or until his/her successor is elected and qualified. For address change/comments, mark here. o Yes No Please indicate if you plan to attend this meeting o o Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer. Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date 0000138296_1 R1.0.0.11699 The Board of Directors recommends that you vote FOR the following: For Withhold For All To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. ☐ ☐ ☐ 1. Election of Directors 01 Paul Erick 02 Duane Lambrecht The Board of Directors recommends that you vote FOR the following proposal: For Against Abstain 2. To ratify the selection of Olsen Thielen & Co., Ltd. as the Company’s independent public accounting firm. ☐ ☐ ☐ NOTE: The nominees for Board of Directors, if elected, will each hold office until the Annual Meeting of Shareholders to be held in 2014 or until his/her successor is elected and qualified. For address change/comments, mark here. ☐ Yes No Please indicate if you plan to attend this meeting. ☐ ☐ Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer. Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Notice & Proxy Statement, Annual Report, Telephone/Internet insert (BR supplied), Form 10-K is/are available atwww.proxyvote.com. NEW ULM TELECOM, INC. The undersigned hereby appoints Rosemary Dittrich,Mary Ellen Domeier, Paul Erick, James Jensen, Duane Lambrecht and Perry Meyer, THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS, WHICH RECOMMENDS VOTING FOR THE ITEMS ON THE REVERSE SIDE. THIS PROXY WILL BE VOTED AS SPECIFIED. IF NOT SPECIFIED, THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR THE ITEMS ON THE REVERSE SIDE. ABSTENTIONS WILL BE COUNTED TOWARDS THE EXISTENCE OF A QUORUM. (If you noted any Address Changes and/or Comments above, please mark corresponding box on the reverse side.) Continuedand to be signedon reverse side 0000138296_2 R1.0.0.11699UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549SCHEDULE 14A(Rule 14a-101)SCHEDULE 14A INFORMATIONProxy Statement Pursuant to Section 14(a) of theSecurities Exchange Act of 1934(Amendment No. ___ )NEW ULM TELECOM, INC.
27 North Minnesota Street
New Ulm, Minnesota 56073
(507) 354-4111
OF SHAREHOLDERS TO BE HELD ON
THURSDAY, MAY 26, 2011
31, 2012,located at 102 South State Street in New Ulm, Minnesota, on Thursday, May 26, 201131, 2012 at 10:00 a.m., Central Daylight Time, for the following purposes:twothree Directors named in the attached proxy statement to serve for ensuing three-year terms;RatifyTo ratify Olsen Thielen & Co., Ltd. as our independent registered public accounting firm and auditors for 2011; and2012;March 31, 2011,April 5, 2012, as the record date for the determination of shareholders entitled to notice of, and to vote at, the Annual Meeting and any adjournment thereof.DIRECTORS NEW ULM TELECOM, INC.
April 20, 201126, 2011.31, 2012.20102011 Annual Report and Annual Report on Form 10-K are available free of charge on the following website: www.proxyvote.com1Page136141718192022252627282930313131312
27 North Minnesota Street
New Ulm, Minnesota 56073
(507) 354-4111
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON THURSDAY, MAY 26, 2011
31, 201220, 2011 in connection with the Board of Directors (Board) of the Company,17, 2012 for the solicitation of proxies for the Annual Meeting of Shareholders and any adjournment thereof, to be held commencing at 10:00 a.m., Thursday, May 26, 201131, 2012 at Turner Hall, located at 102 South State Street, New Ulm, Minnesota.March 31, 2011April 5, 2012 are entitled to vote at this Annual Meeting. Shareholders are entitled to one vote for each share held on the March 31, 2011April 5, 2012 record date. On that date, there were 5,115,435 shares outstanding. In addition, shareholders have the right to cumulate votes in the election of Directors, as described on page 6. 7.www.proxyvote.com.www.proxyvote.com. You can transmit the voting instructions via electronic delivery of the information up until 10:59 p.m., Central Daylight Time, the day before the Annual Meeting, or May 25, 2011.30, 2012. Use the proxy card when accessing the web site and follow the instructions to obtain the records and to create an electronic voting instruction form.25, 2011.30, 2012. Use the proxy card when you call and follow the instructions provided.New Ulm Telecom, Inc.,Vote Processing, c/o Broadridge.Broadridge, 51 Mercedes Way, Edgewood, NY 11717. Proxy cards must be received by Broadridge on or before May 25, 2011.30, 2012.3both, oneall, any, or neithernone of the nominees for Director. You can also specify whether you want to vote for or against, or abstain from voting for, the ratification of the appointment of the independent registered public accounting firm. You can also specify whether you want to vote for or against, or abstain from voting for, the ratification of the Director Stock Plan. If you make these specifications, your shares will be voted in accordance therewith. If you sign, date and return your Proxy Card, but do not specify how you want to vote, your shares will be votedFORthe election of all Director Nominees, and FORthe ratification of the appointment of the independent auditors.auditors andFOR the approval of the Director Stock Plan.20, 2011.17, 2012.420122013 Annual Meeting of Shareholders must submit their proposals to the Company no later than December 15, 2011.18, 2012.31, 2011.18, 2012.5TwoThree Directors will be elected at this Annual Meeting. The Board has nominated and recommends for election, Paul W. ErickDennis E. Miller, Wesley E. Schultz and Duane D. Lambrecht. Each of the nomineesSuzanne M. Spellacy. Mr. Miller currently serves as a Director and has agreed to stand for re-election. The two other nominees are new candidates for Directors and both of the nominees have agreed to stand for election. Biographical information on each of the nominees is set forth below. on the following pages.The intent isWe recommend that each proxy will be votedvote in favor of these nominees. The Board believes that each named nominee will be able to serve, but if eitherany of the nominees areis unable to stand for election, the Board may designate a substitute. Shares represented by proxies may be voted for the substitute, but will not be voted for more than the twothree nominees. The twothree nominees receiving the greatest number of votes will be elected.two Directorshipsthree Director positions to be filled at this Annual Meeting. Each shareholder entitled to vote also has the right to vote shares on a cumulative basis in the election of Directors by giving written notice of intent to do so to any Officer of the Company before the Annual Meeting, or to the presiding Officer at the Annual Meeting at any time before the election. If notice of this intent is given, the presiding Officer at the Annual Meeting will announce before the election of Directors that shareholders will vote their shares on a cumulative basis by multiplying the number of shares held by the shareholder by the number of Directors to be elected. Each shareholder then may cast that shareholder’s votes for one candidate or may distribute the votes among any number of candidates.twothree nominees receiving the largest number of votes, taking into account cumulative voting, will be elected to serve on the Board.Your Board recommends a vote FOR these nominees. Shares represented by proxy will be voted FOR the nominees…..unless you specify otherwise in your voting instructionstwothree nominees for election and the other continuing Directors with unexpired terms of office. All information is given as of March 31, 2011,2012, unless otherwise indicated. The following table sets forth information, including business experience and memberships on other Boards during the past five years, pertaining to the nomineesnominee standing for election, as well as for other continuing Directors. Information concerning beneficial ownership of the Company’s common stock as of March 31, 20112012 can be found on page 19.pages 21-22. We are not aware of any arrangement or understanding pursuant to which any individual is to be selected as a Director or nominee. There are no familial relationships between any Director and Executive Officer.6NOMINEES FOR ELECTIONTo Serve a Three-Year Term Expiring In 2014Paul W. Erick2011.2012. Independent Director since 2009.
Experience:
Inc. Committees:
Experience:
Experience:Experience:Security and Exchange Commission (SEC)SEC Practice Section and Private Companies Practice Section peer reviews as a team captain or team member. He was an instructor at the South Dakota Society of Certified Public Accountants peer review conference. He drafted the Olsen Thielen & Co., Ltd’s quality control policies and procedures and made annual revisions. He acted as a liaison with the firm’s peer reviewers and was in charge of annual internal inspections.
Inc. Committees:67687Duane D. LambrechtTerm:Expires in 2011. Independent Director since 1999.Recent BusinessExperience:James P. JensenMr. Lambrecht currently serves on the Board of New Ulm Telecom, Inc. Mr. Lambrecht is the founder of Shelter Products, Inc., a regional wholesale building materials distributor serving the five-state area encompassing Minnesota. Mr. Lambrecht has served as Chair, President and CEO since the founding of Shelter Products in 1981. In this capacity, he has been responsible for product and market development, distribution systems, personnel recruitment and training as well as all aspects of financial controls and relationships. From 1972 – 1981, Mr. Lambrecht worked for a material distributor as a Division Manager.New Ulm Telecom,Inc. Committees:Mr. Lambrecht serves as a member of the Executive Committee and a member of the Audit Committee.Other Directorships:Past Board member of North American Building Material Distribution Association - also served as President (2008 – 2009); Board member of the New Ulm Economic Development Corporation – also served as President (2004 – 2007), New Ulm, Minnesota (2003 – Present); Board Member of New Ulm Medical Foundation, New Ulm, Minnesota (2003–Present); Board member of New Ulm Area Foundation, New Ulm, Minnesota (2006–Present); Member of Undergraduate Advisory Board – University of Minnesota, Carlson School of Management, Minneapolis, Minnesota (1996 - 2008); Board member, New Ulm United Way – also served as President (1984 – 1985), New Ulm, Minnesota (1983 – 1989); Director for Sioux Valley Hospital – also served as Board Chair (1991 – 1993), New Ulm, Minnesota (1984 – 1994); President of New Ulm Rotary Club, New Ulm, Minnesota (1984 – 1985); Board member of Minnesota Manufactured Housing Association, St. Paul, Minnesota (1990 – 1995).Selection Criteria:Mr. Lambrecht brings to the Board his experience on the Board of New Ulm Telecom, Inc., his experience on other Boards and his experience as a business entrepreneur. In addition to his Board experiences, Mr. Lambrecht is also an active member of the community, including his membership on the New Ulm Medical Foundation; New Ulm Area Foundation and the New Ulm Rotary Club (past President). Mr. Lambrecht is a Life Member Disabled American Veteran; Life Member Purple Heart Association and a Vietnam Combat Veteran. As an independent business operator and an active member of community organizations and business organizations, the Board believes that Mr. Lambrecht contributes to the Board and the Committees on which he serves through the skills and expertise he has developed in his founding of businesses, 30 years operating as a regional wholesale building materials distributor, his knowledge and experience on other Boards, his perspective as an active community member and his prior New Ulm Telecom, Inc. Board experience.Age:64THE BOARD RECOMMENDS A VOTE "FOR" EACH NOMINEE FOR DIRECTOR8CONTINUING DIRECTORSRosemary J. DittrichTerm:Expires in 2012. Independent Director since 1997.Recent BusinessExperience:Ms. Dittrich currently serves on the Board of New Ulm Telecom, Inc. Ms. Dittrich is a co-owner and the Executive Secretary of D & A Trucklines, Inc., a family-owned trucking company of 50 years. Ms. Dittrich has been active in all aspects of a growing company, including decisions regarding consolidating partnerships, developing business policies, succession planning and serving as the Director of Human Resources.New Ulm Telecom,Inc. Committees:Member of the Compensation Committee.Selection Criteria:Ms. Dittrich brings to the Board her hands-on business experience as a business owner. In addition, Ms. Dittrich has been active in the community, including her involvement with the United Way of Brown County; Midwest Safety Group (a Trucking Association); and her previous memberships in the New Ulm Chamber of Commerce Board and the Sister Cities Commission. She and her husband have received the Service to Mankind Award in recognition of their outstanding volunteer service to the community. As a business owner and an active member of the community, the Board believes that Ms. Dittrich contributes to the Board and the Committee on which she serves through the hands-on experience and expertise garnered from her roles in running a family-owned trucking business and her prior experience on the New Ulm Telecom, Inc. Board.Age:699Mary Ellen DomeierTerm:Expires in 2012. Independent Director since 1999.��Recent BusinessExperience:Ms. Domeier currently serves on the Board of New Ulm Telecom, Inc. In addition, from 1972 until her retirement in 2003, Ms. Domeier served in various positions at Frandsen Bank & Trust Company, New Ulm, Minnesota, including as CEO from 1988 - 2003 and Chair from 1997 – 2003. At Frandsen Bank & Trust Company, Ms. Domeier oversaw all areas of administration, operations, policies and business lines. She currently continues to be active in banking, serving on the Board of Bank Midwest, Spirit Lake, Iowa, most recently serving as its Chair, and currently as Chair of its Audit Committee and a member of its Trust Committee and Governance/Nominating Committee. From 2007 to present; Ms. Domeier served as the part-time Executive Officer of New Ulm Area Catholic Schools, providing administrative direction, coordinating a capital campaign and re-establishing its foundation.New Ulm Telecom,Inc. Committees:Ms. Domeier currently serves as a Member of the Audit Committee, and a Member of the Corporate Governance/Nominating Committee.Other Directorships:Board Member of Bank Midwest, Spirit Lake, IA (also serving on the Audit Committee, Trust Committee, Governance and Nominating Committee) and a member of Bank Midwest – New Ulm Community Advisory Board (2009 – present); Chair and Board member, Minnesota Bankers Association (1997 – 2003); Member, Federal Reserve Bank Consumer Advisory Council, Washington, DC (1999 – 2003); Member and Board Vice-Chair, American Artstone Company (also serving as Chair, Audit Committee; Strategic Planning Committee, Chair; Governance Committee), New Ulm, Minnesota (2003 – 2009); Member of the Governor’s Judiciary Commission on Judicial Selection, State of Minnesota (1999 – 2006).Selection Criteria:Ms. Domeier brings to the Board her experience on the Board of New Ulm Telecom, Inc., her experience on other Boards and her diverse banking experience, another highly regulated and complex industry. In addition to her board and banking experiences, Ms. Domeier brings her leadership skills from service with many community organizations, including serving as a current board member and past Chair of the New Ulm Retail Development Corporation; and her past associations, including Oak Hills Living Center Foundation (past Chair), New Ulm Area Foundation (past Chair and founder), Chamber of Commerce (past Chair), United Way of New Ulm (past Chair), Rotary Club of New Ulm (past Chair), Brown County Historical Society (past Treasurer) and Minnesota State University – Mankato Business Advisory Council. With Ms. Domeier’s banking experience, participation on various Boards, her extensive community involvement and her prior New Ulm Telecom, Inc. Board experience, the Board believes that Ms. Domeier contributes to the Board and the Committees on which she serves through the skills and expertise she has developed.Age:6910James P. Jensen
Experience:Consulting, Inc., which offers services, primarily in the areas of sales, customer service and advertising support. In addition, fromMr. Jensen is also a published author and a motivational speaker to businesses and other groups. From January 2008 until January 2010, Mr. Jensen was a business partner in J Longs Clothing, where he was responsible for supervising all aspects of marketing and advertising, as well as being responsible for the motivation and training of sales staff, merchandise purchasing, public relations contacts and sales. Mr. Jensen was also the President of Jensen Clothing, Inc. from 1970 until 2003, overseeing all business operations, including employee management, sales, marketing, advertising, promotions, and purchasing. Mr. Jensen has served as Chair of the Board of New Ulm Telecom, Inc. since 1999.
Inc. Committees:(1989 – Present)(1989–present); Riverbend Center for Entrepreneurial Facilitation, Mankato, Minnesota (2006 – (2006–2008); Leuthold Company, Inc., Albert Lea, Minnesota (1970 – (1970–1994) and Oak Hills Foundation Board, New Ulm, Minnesota (2004 – Present)(2004–present).666711
Experience:
Inc. Committees:
Experience:
Inc. Committees:(2010-present)(2010–present); Planning and Zoning Commission, City of New Ulm (2009-present)(2009–present); Chair of the Board for Heartland Corn Products – also serving as Secretary (1992 – (1992–2005), Winthrop, Minnesota (1992 – Present)(1992–present); Treasurer for Lafayette Township, Nicollet County, Minnesota (1987 – (1987–2005); New Ulm Rural Fire Association, New Ulm, Minnesota (1987 – (1987–2005); Chair of the Minnesota Valley Lutheran High School Foundation (2010–present); Minnesota Valley Lutheran High School Board Member, New Ulm, Minnesota (1996 – (1996–2002); New Ulm Area Foundation, New Ulm, Minnesota (1997 – (1997–2003); Director/Board Secretary for Cenex Harvest States Soybean Processing, Mankato, Minnesota (1997 – (1997–2001); Secretary/Treasurer of the Nicollet County Township Officer Association, Nicollet County, Minnesota (1993 – (1993–1996) and Nicollet County Corn Growers, Nicollet County, Minnesota (1988 – (1988–1994).a Directorthe Chair of the Minnesota Valley Lutheran High School Foundation. As an independent business operator and an active member of community organizations and business organizations, the Board believes that Mr. Meyer contributes to the Board and the Committees on which he serves, through the skill and expertise he has developed in his operation of a diverse grain and livestock farm, his knowledge and experience on other Boards, his perspective as an active community member and his prior New Ulm Telecom, Inc. Board experience.565712Dennis E. MillerTerm:Expires in 2012. Independent Director since 2009.Recent BusinessExperience:Mr. Miller currently serves on the Board of New Ulm Telecom, Inc. Mr. Miller serves as the President and CEO of Mavericks Wireless, LLC, providing consulting services to telecommunications companies (2007 – present). Mr. Miller served as the President and CEO (1995 – 2007) of Midwest Wireless Holdings in Mankato, Minnesota, where he was responsible for strategic development, including consolidating partnerships; identifying, financing, acquiring and integrating new markets; integrating multiple network technologies; and innovating product development and deployment. Mr. Miller led Midwest Wireless from a start-up Company, culminating in successfully completing its sale to Alltel Wireless for $1.075 billion in 2006. From 1990 – 1995, Mr. Miller served as Vice President of Minnesota Operations for Pacific Telecom Cellular, Appleton, Wisconsin, where he served as the senior state executive in Minnesota and was responsible for the development of 10 rural service areas for wireless services and developing business polices, practices and operations for businesses. Mr. Miller also has prior business experience in sales, including leading sales teams and developing sales and distribution programs and processes.New Ulm Telecom,Inc. Committees:Member of the Compensation Committee and Member of the Corporate Governance /Nominating Committee.Other Directorships:Coughlan Companies (Governance Committee Chair and member of the Audit Committee ), a publishing firm, Mankato, Minnesota (2007 – present); Member, CTIA – The Wireless Association Board of Directors (also serving on the Executive Committee (1999 – 2007), Treasurer (2006) and Chair of Small Operators Caucus (1999 – 2007), (1996 – 2007); Member, Rural Cellular Association (President 2003), ( 1995 – 2007); Member, Immanuel St. Joseph’s – Mayo Health System Board of Directors (including Vice Chair of regional Mayo owned and operated health system of clinics and hospitals, Compensation Committee Chair and Finance Committee), (1999 – present); Chair, Technology Plus, Mankato, Minnesota (1997 – 2004); Member, Minnesota Telecom Alliance (Wireless Committee Chair) (1998 – 2002).Selection Criteria:Mr. Miller brings to the Board his experience on the Board of New Ulm Telecom, Inc., his experience on other Boards and his wireless telecommunications experience. In addition, Mr. Miller is also active as a member of the Minnesota State University Foundation (2006 – present); the Minnesota State University College of Business Advisory Council (2000 – Present); Chair of the Southern Minnesota Initiative Foundation Leader’s Circle (2003 – present) and as a member of the University of St. Thomas College of Business Advisory Board (2002 – present). Due to Mr. Miller’s extensive experience in the wireless telecommunications industry, his experience in regulatory and legislative affairs, at both the state and federal level, and his participation on business and industry Boards, the Board believes that Mr. Miller contributes to the Board and the Committees on which he serves.Age:5113Criteria for MembershipThe Company’s Corporate Governance/Nominating Committee is responsible for annually reviewing the composition of the Board for desired skills and characteristics of Directors, as well as the composition of the Board as a whole.Terms, Limitations and RetirementAll Directors are elected to three-year terms. The Board does not believe it should establish a limit on the number of times that a Director may stand for election. To ensure that the Board of the Company is not be made up of individuals who are not active in the business, agriculture, professional or working life of the community, our By-Laws state that it is in the best interest of the Company that an age limit be set for members of the Board. No individual is eligible to be appointed or elected as a Director after attaining the age of 69.Ownership of Company StockAll Directors are required to own common stock of the Company.have aprovide the Board prospective nominees that reflectsreflect diversity in background, education, gender, business experience, skills, business relationships and associations, and other factors that would contribute to the Board’s governance of the Company.Frequency of MeetingsThe Board typically holds twelve regularly scheduled meetings per year. If necessary, special meetings of the Board are held as determined by the Board.Annual EvaluationsThe Corporate Governance/Nominating Committee conducts, or causes to be conducted, annual evaluations to assess the Board’s performance and composition.14Executive Sessions of Independent DirectorsThe Company’s independent Directors (all members of the Board are independent Directors) meet in executive sessions (without members of management present) regularly.New Ulm Telecom, Inc.27 North Minnesota StreetNew Ulm, Minnesota 56073Attention: Corporate Secretary (Board Matters)of the Company’s seven Directors attended the 2010Company’s 2011 Annual Meeting of Shareholders.www.nutelecom.net.www.nutelecom.net. The Code of Business Conduct includes the following principles related to the Company’s Directors, Officers and employees:15TheHowever, at this time, the Board has determined however, that it is in the best interest of the Company’s shareholders at this time for the roles of Chair and CEO to be separated. The current CEO, Bill Otis, is not a member of the Board. This structure ensures a greater role for the Chair, together with the active participation of the independent Directors, in setting agendas and establishing Board priorities and procedures. Further, this structure permits the CEO to focus on the management of the Company’s day-to-day operations.16meetings, andmeetings. It has established the following Committees: (i) Corporate Governance/Nominating Committee; (ii) Audit Committee; (iii) Compensation Committee and (iv) Executive Committee. Committee Charters can be viewed on the Company’s website at www.nutelecom.net.www.nutelecom.net. The Chair of the Board is an ex-officio member of all Committees. The Board held 1112 meetings in 2010.2011. All Committees meet as required and each Director attended 75% or more of the Board meetings and applicable Committee meetings.This Committee was established on January 21, 2010. Members of the Corporate Governance and Nominating Committee are James P. Jensen (Chair), Mary Ellen Domeier and Dennis E. Miller. In addition, the Company’s CEO is also a member of the Corporate Governance/Nominating Committee. The Corporate Governance/Nominating Committee is responsible for reviewing, addressing and making recommendations to the Board on matters pertaining to appropriate governance standards (including the Board’s nominating process and succession planning). Committee responsibilities include: andBoard.Board;20122013 Annual Meeting,”Meeting” on page 31.threeseven meetings in 2010.2011.NASDAQ'sNASDAQ’s listing standards. Each member of the Audit Committee is financially literate and at least one member of the Committee has accounting or related financial management expertise. The Board has determined that Mr. Paul Erick (Chair of the Audit Committee), satisfies the criteria adopted by the SEC to serve as an “Audit Committee Financial Expert.”17audit, andaudit. It consults with management and the independent registered public accounting firm on, among other items, matters related to the annual audit, the published financial statements and the accounting principles applied. As part of its duties, the Audit Committee appoints, evaluates and retains the Company’s independent registered public accounting firm and evaluates that firm’s qualifications, performance and independence. The Audit Committee has established policies and procedures for the pre-approval of all services provided by the independent registered public accounting firm.10six meetings in 2010.2011. The Audit Committee’s Report is included on page 2830 of this proxy statement. This2three meetings in 2010.2011. The Compensation Committee’s Report is included on page 27 of this proxy statement.Chief Financial Officer (CFO)CFO are also members of the Executive Committee. This Committee is responsible for carrying out the Board’s overall responsibility with respect to: (i) exercising the Board’s authority when the Board is not in session; (ii) discussing Board agenda topics beyond those on the Consent Agenda; (iii) strategic planning; (iv) consideration of the Company’s merger, acquisition and growth opportunities andopportunities; (v) monitoring the status of any litigation and making recommendations to the Board. threetwo meetings in 2010.2011.2010,2011, the Directors were paid an annual retainer of $16,800. In addition, Directors received $588 for each Board and Committee meeting they attended. The Chair of the Board, who is not an employee of the Company, receives an additional annual retainer of $12,000. Also, the Audit Committee Chair, who is not an employee of the Company, receivesreceived an additional annual retainer of $5,000.20, 2010,26, 2009, a Director who serves at least three full terms (nine years) is entitled to receive as compensation three times the Board annual retainer in effect at the time of separation from the Board. A Director who serves full terms beyond the initial three terms is entitled to receive additional compensation of one-half times the annual Board retainer in effect at the time of separation for each additional full term served, not to exceed three additional terms. Separation includes retirement, resignation, death, disability or change of corporate ownership. This compensation to Directors will generally be paid within sixty days of the Director’s separation from the Board, and otherwise in accordance with Section 409A of the Internal Revenue Code. The Company’s future obligations under this policy as of December 31, 20102011 were $302,000.$310,800. The Company developed this policy with the assistance of Organizational Concepts International (OCI), an outside compensation consultant, in an effort to remain competitive in attracting outside Directors. The decision to engage OCI was made by the Compensation Committee.182010:2011:20102011 DIRECTOR COMPENSATION
Paid in Cash ($)
Compensation (1) ($)
or Paid in
Cash ($)
Compensation
(1) ($)30, 2010.26, 2009.20112012 by (a) each person who beneficially owns five percent or more of our common stock, (b) each Director and nominee for Director, (c) each Executive Officer and (d) all Directors and Executive Officers as a group. Unless otherwise noted, each person identified below possesses sole voting and investment power with respect to such shares. Except as noted below, we know of no agreements among our shareholders that relate to voting or investment power with respect to our common stock.
Nature of
Beneficial
Ownership (1)
Class (2)
Ruth B. Wines Family Trust
216 Apolena, Newport Beach, California%
group (10 persons) (7)% ___________________
Nature of
Beneficial
Ownership (1)
Class (2)
Ruth B. Wines Family Trust
216 Apolena, Newport Beach, California
group (12 persons) (7)19"beneficially owned"“beneficially owned” by a person may include;include: securities owned by or for, among others; the spouse, children or certain other relatives of such person, as well as other securities, as to which the person has, or shares voting, or investment power, or has the option to acquire within 60 days. Unless otherwise indicated, the address of each shareholder is: c/o New Ulm Telecom, Inc., 27 North Minnesota Street, New Ulm, Minnesota 56073.2011.2012.Dittrich'sDittrich’s spouse.13,4839,244 shares owned by the spouses of Directors and Executive Officers.2010.2011. For more information regarding the Company’s salary policies and executive compensation plans, please review the information under the caption “Report of Compensation Committee on Executive Compensation,” on page 25.27.
Incentive Plan
Compensation ($)
Compensation
(a) ($)___________________
Incentive Plan
Compensation ($)
Compensation
(a) ($)202010201120102011 for Named Executive Officers under the 2006 Management Incentive Plan, as amended:
Incentive Plan Awards (1)
($)
($)
($)
Incentive Plan Awards (1)
($)
($)
($)20102011 by the Named Executive Officers under the Company’s 2006 Management Incentive Plan as amended. For actual award amounts earned and paid under all Company plans, please see the Summary Compensation Table column entitled “Non-Equity Incentive Plan Compensation” on page 2022 of this proxy statement. For explanation of this plan, refer to the description on page 2325 of this proxy statement under the heading “Compensation Policy - Cash-Based Incentive Compensation.”20102011 and had no options or warrants outstanding as of December 31, 2010.2011.Employment Agreements
2011.2012. The target incentive payout for Mr. Otis is set at 20% of his base salary. The maximum incentive award payable under the plan is 40% of base salary (2 times the target). The minimum incentive award payable under the plan is $0. UponThe employment agreement was amended in March, 2012 and provides that upon termination of Mr. Otis’ employment by the Company without cause or by Mr. Otis for good reason, Mr. Otis willwould receive 24 months2.99 years of base salary at the annualized rate of pay at termination. Upon a change-in-control transaction, and if the employment of Mr. Otis is terminated by the Company without cause or by Mr. Otis for good reason within 12 months of the change-in-control transaction, Mr. Otis willwould receive a lump sum payment equal to 24 months2.99 years of base salary at the annualized rate of pay at termination. This amount would have been $500,000equal to $520,000 at December 31, 2010.2011, based on the employment agreement that was in effect at that time.21$155,000$165,000 for 2011.2012. The target incentive for Ms. Bornhoft is 15% of her base salary. The maximum incentive award payable under the plan is 30% of base salary (2 times the target). The minimum incentive award payable under the plan is $0. UponThe employment agreement was amended in March, 2012 and states that upon termination of Ms. Bornhoft’s employment by the Company, without cause or by Ms. Bornhoft for good reason,reason; Ms. Bornhoft willwould receive 1224 months of base salary at the annualized rate of pay at termination. Upon a change-in-control transaction, and if Ms. Bornhoft is terminated by the Company without cause or by Ms. Bornhoft for good reason within 12 months of the change-in-control transaction, Ms. Bornhoft willwould receive a lump sum payment equal to 24 months of base salary at the annualized rate of pay at termination. This amount would have been equal to $155,000 at December 31, 2011, based on the employment agreement that was in effect at that time.termination, which would have been equal to $147,000 at December 31, 2010.termination.General Compensation Philosophy
participate along with all other Company employees.participate.2010.2011. While Executive Officers do not play a role in setting their own compensation, the Company’s CEO does make recommendations to the Compensation Committee concerning individual performance of other Executive Officers.22Base Salary
individualsindividual’s responsibility and (ii) are necessary or appropriate to maintain a competitive salary structure.Cash-Based Incentive Compensation
factors;factors, including (i) “uptime” (the amount of time that the Company’s phone, cable and Internet services were available to customers) and restoration time (the ability of the Company to restore service when an interruption occurs),; (ii) customer retention and (iii) customer service (derived from customer service data).2010,2011, were as follows:Position60%25%15%100%20112012 based upon similar factors and the same performance ratios. Potential payouts under the Plan are set forth below.23201120122011.2012. This information is based on criteria contained in the 2006 Management Incentive Plan as amended and described above.
Incentive Plan Awards
($)
($)
($)
Incentive Plan Awards
($)
($)
($)Other Compensation Programs
December 28, 2010,March 5, 2012, the Board authorized the Company to make a discretionary corporate contribution of 2%3% of eligible compensation for all eligible employees to their respective 401(k) plan accounts for the fiscal year 20102011 under the Company’s Retirement Plan.and Ms. Bornhoft and Mr. Kawlewski contain change-in-control provisions. The Compensation Committee believes that severance and change-in-control arrangements for these Named Executive Officers aids in the recruitment and retention of Executive Officers and provideprovides incentives for Executive Officers to grow our business and maintain focus on creating value for our shareholders. The Compensation Committee believes that providing protection to Executive Officers whose employment may be terminated in connection with a change-in-control transaction strikes an appropriate balance between the interests of our Executive Officers and the interests of others if a change-in-control transaction occurs.2420102011 salary program consisted of two elements: (i) an annual base salary and (ii) a cash award under a Management Incentive Plan. The purpose of the Plan was to reward key executives for the long-term success of the Company and to assist in the recruitment and retention of key executives. The Plan was also used to link total executive compensation to the Company’s financial performance. Overall, the philosophy for the executive compensation program is to pay executives competitively compared to similar-sized companies, particularly telecommunications companies.20102011 performance, the Compensation Committee determined that Mr. Otis’ total compensation package was in alignment with the Company’s overall performance in 2010.2011. The Compensation Committee also reviewed the compensation levels of executives in comparable companies, and determined that Mr. Otis’ compensation was competitive within the industry. In addition, the Compensation Committee believes that the Company’s compensation practices and compensation philosophy align executive interests with those of its shareholders by linking total executive compensation to the Company’s overall financial performance.Compensation Committee of the Board of Directors2520102011 were Mr. Paul W. Erick (Chair), Ms. Mary Ellen Domeier and Mr. Duane D. Lambrecht. Each member of the Audit Committee has been determined by the Board to be independent under the rules of the SEC. The Board has determined that Mr. Paul W. Erick is our “Audit Committee Financial Expert,” as defined in Item 407(c)(5) of Regulation S-K promulgated under the Exchange Act of 1934. www.nutelecom.netwww.nutelecom.net and is also available in print, free of charge, upon request. Requests for a printed copy of the Audit Committee Charter should be submitted to the Corporate Secretary, New Ulm Telecom, Inc., at 27 North Minnesota Street, New Ulm, Minnesota 56073.2010,2011, the Audit Committee met with the Company’s management at each of its regularly scheduled meetings. The Audit Committee also met with a representative from Olsen Thielen & Co., Ltd., the Company’s independent registered public accounting firm, at several of its meetings. Agendas for the Audit Committee’s meetings are established by the Chair of the Audit Committee in consultation with the CFO. At those meetings, the Audit Committee reviewed and discussed various financial and regulatory issues, accounting and financial management issues, developments in the accounting profession as well as a summary of anonymous reports received via the Company’s anonymous reporting process (there were no anonymous reports received in 2010)2011). The Audit Committee also had separate executive sessions from time to time. The Audit Committee provides reports of its activities at each regularly scheduled Board meeting.262010.2011. The fees paid were for services related to the audit and other services and are included below under "Fees“Fees Paid to Independent Registered Public Accounting Firm."Company'sCompany’s policy that all proposed transactions by the Company with Directors, Officers, five percent shareholders and their affiliates, be entered into only if these transactions are on terms no less favorable to the Company than could be obtained from unaffiliated parties, are reasonably expected to benefit the Company and are approved by a majority of the disinterested, independent members of its Board.2720102011 and for the year then ended;20102011 and for the year then ended, be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 20102011 to be filed with the SEC.
Paul W. Erick, Chair
Mary Ellen Domeier
Duane D. Lambrecht28PROPOSAL 2 – RATIFICATION OF OLSEN THIELEN & CO., LTD. AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM201120122010.2011. The Audit Committee of the Board appointed Olsen Thielen & Co., Ltd. as the independent registered public accounting firm for the Company beginning with the fiscal year ended December 31, 2008.and 2009, respectively.of feesthose billed for professional services rendered for the audit of the Company’s annual consolidated financial statements and review of the interim consolidated financial statements included in quarterly reports.are feesthose billed for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s consolidated financial statements and are not reported under “Audit Fees.” The audit-related fees for 2011 and 2010 related to the auditaudits of the Company’s employee benefit plan.feesthose billed for professional services for tax compliance and tax advice.feesthose for products and services other than the services reported above. The fees billed for all other services paid in 20102011 and 2009,2010, respectively, were for general regulatory assistance. The Company typically does not engage its current independent registered public accounting firm directly for other fees or services.29pre‑approvepre-approve services performed by the independent registered public accounting firm. The Audit Committee pre-approved all services the Company received from Olsen Thielen & Co., Ltd. during the year ended December 31, 2010.2011.2011201226, 201131, 2012 Annual Meeting, the Audit Committee of the Board has appointed Olsen Thielen & Co., Ltd. as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2011.2012. In the event the shareholders fail to ratify the appointment, the Audit Committee will reconsider this appointment. Even if the appointment is ratified, the Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit Committee determines that such a change would be in the Company’s and its shareholders’ best interests.THE BOARD AND THE AUDIT COMMITTEE RECOMMEND A VOTE "FOR" THE RATIFICATION OF APPOINTMENT OF OLSEN THIELEN & CO.Table of ContentsLTD. AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. SHARES REPRESENTED BY PROXY WILL BE VOTED “FOR” THIS PROPOSAL, UNLESS YOU SPECIFY A DIFFERENT CHOICE ON THE ACCOMPANYING PROXY CARD.
Paid in Cash
Paid in Cash
in Shares of New Ulm
Common Stock
Cash and Common
Stock PaidCompany'sCompany’s Officers, Directors and beneficial owners of more than ten percent of the Company’s common stock are required to file reports of their beneficial ownership with the SEC. Based on the Company'sCompany’s review of copies of such reports received by it, or written representations from reporting persons, the Company believes that during the fiscal year ended December 31, 2010,2011, Executive Officers and Directors of the Company filed all reports with the SEC required under Section 16(a) to report their beneficial ownership on a timely basis.302010,2011, including the financial statements and the financial statement schedules as filed with the SEC, to any person whose proxy is being solicited. The Annual Report on Form 10-K can also be found on the Company’s website atwww.nutelecom.net.20122013 ANNUAL MEETING20122013 Annual Meeting of Shareholders, the proposal must be in proper form (per SEC Regulation 14A, Rule 14a-8 – Shareholder Proposals) and be received at the principal Executive Offices of the Company at 27 North Minnesota Street, New Ulm, Minnesota 56073, Attention: Bill Otis, no later than December 15, 2011.18, 2012. In addition, if the Company is not notified by February 29, 2012,March 3, 2013, of a proposal to be brought before the 20122013 Annual Meeting of Shareholders by a shareholder, the proxies held by management may provide the discretion to vote against the proposal even though it is not discussed in the proxy statement for the meeting.
FOR THE ANNUAL MEETING14, 201015, 2011 of any shareholder proposals that are to be presented for a vote at the meeting. Therefore, no shareholder proposals are included in this proxy statement and if any other matter requiring a vote properly comes before the meeting, the persons named on the accompanying proxy card will vote your shares on that matter in their discretion.
Corporate SecretaryNew Ulm, MinnesotaApril 20, 201131NEW ULM TELECOM, INC.27 NORTH MINNESOTA STREETNEW ULM, MN 56073VOTE BY INTERNET- www.proxyvote.comUseSECTION 1. General Purpose of the InternetPlan and Definitionstransmit your voting instructionsthe Planfor electronic deliveryTermination
DIRECTOR STOCK PLANreports electronically via e-mailretainer for each non-employee director to be paid in common stock (“minimum stock retainer percentage”);Internet. To sign upcommon stock will be issued; andelectronic delivery, please follow the instructions aboveshares of common stock to vote usingbe issued.Internet and, when prompted, indicate that you agreeright to elect to receive an additional percentage of his or access proxy materials electronicallyher retainer to be issued in future yearscommon stock (“individual stock percentage election”), but only after the Committee establishes rules and procedures for this individual stock percentage election.VOTE BY PHONE - 1-800-690-6903Usetouch-tone telephoneshare payments issued under the Plan (and any agreements relating thereto); andtransmit your voting instructions up until 10:59 P.M. Central Timeestablish the day beforevesting schedule, if any, for the cut-off dateshares of common stock to be issued under this Plan, including the power to fully vest the shares upon issuance, and the power to establish procedures with respect to dividends on any unvested shares. Whenever the Committee establishes a minimum stock retainer percentage, it must also establish a vesting schedule for the shares to be issued. The Committee also has the power to place restrictions on the sale of shares for a period of time after issuance and also has the power to establish provisions allowing the Company to repurchase shares issued under this Plan.meeting date. Have your proxy card in hand when you call and then followspin-off or other distribution of assets to shareholders, the instructions.VOTE BY MAILMark, sign and date your proxy card and return itBoard will have the power to make such substitution or adjustment in the postage-paid envelope we have provided or return itaggregate number of shares reserved for issuance under the Plan, and in the number of outstanding unvested shares granted under the Plan, as may be determined to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.be appropriate by the Board, in its sole discretion.
27 NORTH MINNESOTA STREET
NEW ULM, MN 56073
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 10:59 P.M. Central Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
If you would like to reduce the costs incurred by New Ulm Telecom, Inc. in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
Use any touch-tone telephone to transmit your voting instructions up until 10:59 P.M. Central Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions.
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
All
All
Except
FOR the following:
(see reverse for instructions)
All
All
Except
Nominees
(see reverse for instructions)NEW ULM TELECOM,INC.27 North MinnesotaStreetNew Ulm, MN 56073(507) 354-4111
27 North Minnesota Street
New Ulm, MN 56073
(507) 354-4111 and Dennis Miller, or any of them, with power of substitution,as proxies to vote the shares of common stock of the undersigned in New Ulm Telecom, Inc. at the Annual Meeting of Shareholders to be held on May 26, 201131, 2012 at 10:00 a.m. at Turner Hall, located at 102 South StateStreet,New Ulm, Minnesota and at any adjournment thereof,upon all business that may properly come before the meeting, including the business identified(and (and in the manner directed) on this proxy and described in the proxy statementfurnished herewith.THISPROXYIS SOLICITEDON BEHALFOF THE BOARD OF DIRECTORS,WHICH RECOMMENDS VOTINGFOR THE ITEM ON THE REVERSESIDE.THISPROXYWILLBE VOTEDAS SPECIFIED.IF NOT SPECIFIED,THE SHARESREPRESENTEDBY THISPROXYWILLBE VOTEDFOR THE ITEM ON THE REVERSESIDE.ABSTENTIONSWILLBE COUNTEDTOWARDSTHE EXISTENCEOF A QUORUM.
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