OTC: NUVR

Recent Business Development

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

Nuvera’s fiber Internet prices range from $50 per month to $200 per month for Gig/Multi Gig-speed fiber services. Customers can choose the right speed at an affordable price, including low-income households through Federal programs.

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Communications Segment

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

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Communications Companies:

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Nuvera Communications, Inc., the parent Company,

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HTC, a wholly owned subsidiary of Nuvera,

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PTC, a wholly owned subsidiary of Nuvera,

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Scott-Rice, a wholly owned subsidiary of Nuvera,

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SETC, a wholly owned subsidiary of Nuvera,

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WTC, a wholly owned subsidiary of Nuvera; and

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HTI, a wholly owned subsidiary of HTC, located in Litchfield and Glencoe, Minnesota

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

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

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

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Fiber Minnesota, LLC (FM) – 7.63% subsidiary equity ownership interest. FM is a Minnesota state-wide network that provides connectivity for regional businesses.

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

The Communications Segment operates the following communications companies: Nuvera, HTC, PTC, Scott-Rice, SETC, WTC and Litchfield, Minnesota. Nuvera, HTC, Scott-Rice, SETC, WTC and Litchfield are independent communications companies that are regulated by the Minnesota Public Utilities Commission at the state level, while PTC is an independent communications company that is regulated by the Iowa Utilities Board at the state level. Our communications companies located in Redwood Falls and Litchfield are currently not under the same level of regulatory oversight as our other communications companies. As of December 31, 2025, we served 34,843 data connections and 9,889 access lines in many Minnesota communities. We provide broadband and/or voice services in Arlington, Bellechester, Belle Plaine, Cokato, Cologne, Courtland, Dassel, Evan, Goodhue, Hanska, Hector, Howard Lake, Hutchinson, Klossner, Litchfield, Mazeppa, Elko New Market, New Ulm, Olivia, Prior Lake, Redwood Falls, Sanborn, Savage, Searles, Sleepy Eye, Springfield, Waverly, Webster and White Rock, as well as the adjacent rural areas of Blue Earth, Brown, Goodhue, McLeod, Meeker, Nicollet, Redwood, Rice, Scott and Wabasha counties in south central Minnesota. We also serve the community of Aurelia, Iowa as well as the adjacent rural areas surrounding Aurelia. The Communications Segment also operates multiple IPTV and CATV systems in Minnesota (including the cities of Cologne, Courtland, Glencoe, Goodhue, Hanska, Hutchinson, Litchfield, Mayer, Elko New Market, New Germany, New Ulm, Plato, Prior Lake, Redwood Falls, Sanborn, Savage, Searles, Sleepy Eye and Springfield) and one IPTV system in Aurelia, Iowa. These systems serve 6,795 customers.

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

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

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

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

We receive most of our revenues through the following sources:

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

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

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

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

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

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

Sales and Marketing

The key components of our overall marketing strategy include:

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

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

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

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

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

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

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

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

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

Business Strategies

Transform our Company into a dominant Gig-speed fiber broadband provider:

On December 15, 2021, the Company announced plans to build and deploy Gig-speed fiber Internet across its network creating crucial access to the fastest speeds available for rural communities, small cities, and suburban areas across Minnesota. The five-year build plan, which began in late 2021, will, when complete, include location passings to fiber enabling Gig-speed fiber capable services to a majority of our service territories by 2025. In 2025, we upgraded 6,123 locations with fiber services and faster broadband speeds and plan to upgrade more than 3,300 locations in 2026. Project-to-date, we have upgraded a total of 51,462 overall passings with these fiber services. This marks the biggest fiber deployment project in our Company’s history. In addition to best-in-class upload and download speeds, we believe the resulting fiber network will offer better reliability, improved speed consistency, and a lower operating cost relative to competing broadband network technologies. Given these benefits, we believe that our fiber deployment strategy will allow us to realize meaningful improvements to our operating results, broadband subscriber penetration and customer retention.

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

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

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

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

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

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

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

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

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

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

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

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Commercial services are expected to be a key growth area in the future. We are focused on enhancing our broadband and commercial product suite and are continually enhancing our commercial product offerings to meet the needs of our business customers. We tailor our services for business customers by developing solutions to fit their specific needs. Additionally, we are continuously enhancing our suite of managed and cloud services, which increases efficiency and enables greater scalability and reliability for businesses. We are utilizing multiple software platforms to gather relevant leads and for customer relations management.

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

Competition

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

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

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

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

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We compete in the cities of Redwood Falls, Litchfield and Glencoe, Minnesota as a competitive local exchange carrier (LEC). These communications companies are currently not under the same level of regulatory oversight as our other communications companies. Lumen Technologies is the existing communications company in these markets. Competition also exists in the other communities and areas served by us as the incumbent LEC for traditional telephone service from wireless communications providers and we also expect competition to increase from service providers offering VoIP. In Minnesota, these communities include Glencoe, Hutchinson, Litchfield, Elko New Market, New Ulm, Prior Lake, Redwood Falls, Savage, Sleepy Eye, Springfield and Webster. In Iowa, we provide service in Aurelia. Nuvera also provides video service in these communities. Comcast is the existing incumbent provider of video services in New Ulm. Mediacom is the existing incumbent provider of video services in the Hutchinson, Litchfield, Elko New Market, Prior Lake, Redwood Falls, Savage, Sleepy Eye and Springfield markets. Several other communications providers compete with us in our markets in providing Internet services. Additional communities where we provide internet only are Arlington, Belle Plain, Cokato, Dassel, Hector, Howard Lake, Olivia and Waverly. We have responded to these competitive pressures by creating active programs to market our products and enhance our infrastructure to create higher customer value.

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

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

Human Capital Resources

As of December 31, 2025, we employed approximately 205 employees, including part-time employees. We also use temporary employees in the normal course of our business. Our employees are the cornerstone of our success. We are committed to providing meaningful, challenging work and opportunities for professional growth in a positive environment. To attract and retain qualified and experienced employees, we offer compensation and benefit packages, which we believe are competitive within the industry and the local markets in which we operate. Our benefit packages, may include, among other items, incentive compensation based on the achievement of financial targets, healthcare and insurance benefits, health savings and flexible spending accounts, a 401(k) savings plan with an employer match, paid time off, and wellness and employee assistance programs. Additionally, for certain eligible employees, we provide long-term incentive compensation, in the form of cash-based incentive. In addition, we are committed to providing employees continuing education and training programs in order for employees to achieve career goals and professional growth.

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

We also strive to create and provide a safe, healthful and secure workplace that is free from discrimination or harassment. Our workplace policies and procedures protect against behavior that creates an offensive, hostile, or intimidating work environment. Safety is a top priority, and we have a strong, ongoing commitment to ensure employees are properly trained and have appropriate safety and emergency equipment.

Materials and Supplies

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

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Regulation

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

Overview

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

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

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

Federal Regulatory Framework

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

The TA96 and Local Competition

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

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

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To interconnect directly or indirectly with other carriers,

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To allow others to resell services,

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

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To ensure dialling parity,

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

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

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Access Charges

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

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

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

Wireline Interstate

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

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

Intercarrier Compensation (ICC) and FUSF Reform

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

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

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

Due to the combination of rate reforms instituted by the FCC, competitive substitution by wireless and other carriers and decreased use of the switched network, the aggregate amount of interstate network access charges paid by long-distance carriers to access providers such as our Company, has decreased and we project that this decline will continue. For the year ended December 31, 2025, communications network access revenue represented 3.6% of our operating revenue, down from 4.5% for the year ended December 31, 2024. This excludes any funding received from FUSF and the A-CAM for broadband funding (see below for more information).

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FUSF

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

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

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

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

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

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

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

For the year ended December 31, 2025, we recorded an aggregate of $8,333,904 from FUSF, consisting of $1,659,442 of CAF support and $6,674,462 for Consumer Broadband-Only Loop Support (CBOL) funding. Our net FUSF in 2025 comprised 11.6% of our total revenue for the year. For the year ended December 31, 2024, we received an aggregate of $6,553,866 from FUSF, consisting of $1,557,760 of CAF support and $4,996,106 of CBOL funding. Our net FUSF in 2024 comprised 9.5% of our total revenue for the year. We receive no State USF as the states in which we operate have not established state USF mechanisms.

The monthly CBOL subsidy formula is reviewed and subjected to revision on an annual basis and subject to change based on updated USAC funding criteria July 1 of each year.

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

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A-CAM

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

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Establishes a voluntary cost model,

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Creates specific broadband deployment obligations,

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Provides a mechanism for support of broadband-only deployment,

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

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Eliminates support in those local areas served by unsubsidized competitors,

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Establishes “glide-path” transition periods for all the recent changes, and

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

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

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

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

Build-out obligations: A-CAM carriers under the original A-CAM program must complete deployment of 10 Mbps downstream/1 Mbps upstream service to a number of eligible locations equal to 40 percent of fully funded locations by the end of 2020, to 50 percent of fully funded locations by the end of 2021, to 60 percent of fully funded locations by the end of 2022, to 70 percent of fully funded locations by the end of 2023, to 80 percent of fully funded locations by the end of 2024, to 90 percent of fully funded locations by the end of 2025, and to 100 percent of fully funded locations by the end of 2026. A-CAM carriers who elected additional funding and additional obligations under the revised A-CAM program must complete deployment of 25 Mbps downstream/3 Mbps upstream service to a number of eligible locations equal to 40 percent of fully funded locations by the end of 2022, to 50 percent of fully funded locations by the end of 2023, to 60 percent of fully funded locations by the end of 2024, to 70 percent of fully funded locations by the end of 2025, to 80 percent of fully funded locations by the end of 2026, to 90 percent of fully funded locations by the end of 2027, and to 100 percent of fully funded locations by the end of 2028. As of December 31, 2025, Nuvera has completed the deployment of 10/1 service to 100% of its funded locations and 25/3 service to 74.5% of its funded locations in Minnesota and has completed deployment of 10/1 service to 100% of its funded locations and 25/3 service to 85% of its funded locations in Iowa.

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Infrastructure Investment and Jobs Act

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

The Infrastructure Act set aside $42.5 billion for Broadband Equity, Access, and Deployment grants. The National Telecommunications and Information Administration administers the grant program and is in the process of reviewing qualifications and approving state awards.

Privacy and Data Security Regulation

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

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

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

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

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Network Architecture and Technology

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

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

We operate advanced fiber networks which we own or have entered into long-term leases for fiber network access. As of December 31, 2025, our fiber networks consist of approximately 4,075 route miles.

As of December 31, 2025, we passed 51,462 locations with FTTP. We intend to continue to make strategic enhancements to our fiber network, including improvements in overall network reliability and increases to our broadband speeds. We offer data speeds of multi-gig+ in select markets, and up to 100 Mbps in markets where multi-gig+ is not yet available.

We also provide fixed wireless broadband service to homes and small businesses from 32 towers, 6 of which we own, with the remaining towers being leased. 15 of these towers utilize Citizens Broadband Radio Service (CBRS) spectrum. We have secured 21 licenses in 12 CBRS spectrum counties in Minnesota and Iowa which allows us to offer high-speed Internet to unserved, under-served and hard to serve rural areas.

Environmental Regulation

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

Employees

As of March 1, 2026, we had 195 full-time equivalent employees dedicated to Nuvera’s operations. In addition, as of March 1, 2026, we had an additional 8 full-time equivalent employees that are employed by Nuvera but are dedicated to IES. IES is a minority equity subsidiary of Nuvera and Nuvera acts as the managing entity for IES.

Intellectual Property

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

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Executive Officers of the Registrant

The names and ages of all our executive officers and the positions held by them as of March 1, 2026, are as follows:

Name and Age

Position with the Company

Age

Glenn H. Zerbe

President and Chief Executive Officer

60

Curtis O. Kawlewski

Chief Financial Officer and Treasurer

59

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

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

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