Document:

Exhibit
10.13

VARIABLE
RATE NOTE

 

	
  Note
  Date:  February 26, 2010

  	
   

  	
  $3,607,142.86

  
	
  Maturity
  Date: February 26, 2015

  	
   

  	
   

  

 

FOR VALUE RECEIVED, HIGHWATER ETHANOL, LLC, a
Minnesota limited liability company (“BORROWER”), promises to pay to the order
of First Bank & Trust in care of FIRST NATIONAL BANK OF OMAHA (“AGENT”)
at its principal office or such other address as AGENT or holder may designate
from time to time, the principal sum of Three Million Six Hundred Seven
Thousand One Hundred Forty Two and 86/100 Dollars ($3,607,142.86) or the amount
shown on AGENT’s records to be outstanding, plus interest (calculated on the
basis of actual days elapsed in a 360-day year) accruing each day on the unpaid
principal balance at the annual interest rates defined below.  Absent manifest error, AGENT’s records shall
be conclusive evidence of the principal and accrued interest owing hereunder.

 

This
VARIABLE RATE NOTE is executed pursuant to a Construction Loan Agreement
between BORROWER and BANK dated as of April 24, 2008, (the Construction
Loan Agreement, together with all amendments, modifications and supplements
thereto and all restatements and replacements thereof is called the “AGREEMENT”).  All capitalized terms not otherwise defined
in this note shall have the meanings provided in the AGREEMENT.

 

INTEREST ACCRUAL. 
Interest on the principal amount outstanding shall accrue at the rate
provided for in the AGREEMENT, adjusted as provided for in the AGREEMENT.  Interest shall be calculated on the basis of
a 360-day year, counting the actual number of days elapsed.

 

INCENTIVE PRICING.  The interest rate applicable
to this VARIABLE RATE NOTE is subject to reduction after a date six months
subsequent to the CONSTRUCTION LOAN TERMINATION DATE, as provided for in Section 2.15
of the AGREEMENT.

 

REPAYMENT TERMS.  Interest and
principal shall be due and payable at the times, in the amounts and applied in
the manner provided for in Section 2.5 of the AGREEMENT.  Any remaining principal balance, plus any
accrued but unpaid interest, shall be fully due and payable on the Maturity
Date, if not sooner paid.

 

PREPAYMENT.  BORROWER
may prepay this VARIABLE RATE NOTE in full or in part at any time; provided,
however, that any prepayment fees provided for in the AGREEMENT shall be due at
the time of any such prepayment.  Any
prepayment may be applied in inverse order of maturity or as BANK in its sole
discretion may deem appropriate.  Such
prepayment shall not excuse BORROWER from making subsequent payments each
quarter until the indebtedness is paid in full.

 

ADDITIONAL
TERMS AND CONDITIONS.  This
VARIABLE RATE NOTE is executed pursuant to the AGREEMENT.  The AGREEMENT, and any amendments or 

 

 

substitutions
thereof or thereto, contains additional terms and conditions, including default
and acceleration provisions, which are incorporated into this VARIABLE RATE
NOTE by reference.

 

The aggregate unpaid principal amount hereof plus interest shall become
immediately due and payable without demand or further action on the part of
BANK upon the occurrence of an EVENT OF DEFAULT as set forth under the
AGREEMENT or any other LOAN DOCUMENT.  If
the maturity date of this VARIABLE RATE NOTE is accelerated as a consequence of
an EVENT OF DEFAULT, then BANK shall have all the rights and remedies provided
for in the AGREEMENT, the other LOAN DOCUMENTS or otherwise available at law or
in equity.  The rights, powers,
privileges, options and remedies of BANK provided in the AGREEMENT, the other
LOAN DOCUMENTS or otherwise available at law or in equity shall be cumulative
and concurrent, and may be pursued singly, successively or together at the sole
discretion of BANK, and may be exercised as often as occasion therefor shall
occur.  No delay or discontinuance in the
exercise of any right, power, privilege, option or remedy shall be deemed a
waiver of such right, power, privilege, option or remedy, nor shall the
exercise of any right, power, privilege, option or remedy be deemed an election
of remedies or a waiver of any other right, power, privilege, option or remedy.  Without limiting the generality of the
foregoing, BANK’s waiver of an EVENT OF DEFAULT shall not constitute a waiver
of acceleration in connection with any future EVENT OF DEFAULT.  BANK may rescind any acceleration of this
VARIABLE RATE NOTE without in any way waiving or affecting any acceleration of
this VARIABLE RATE NOTE in the future as a consequence of an EVENT OF
DEFAULT.  BANK’s acceptance of partial
payment or partial performance shall not in any way affect or rescind any
acceleration of this VARIABLE RATE NOTE made by BANK.

 

Unless prohibited by law, BORROWER will pay on demand all reasonable
costs of collection, reasonable legal expenses and reasonable attorneys’ fees
and costs incurred or paid by BANK in collecting and/or enforcing this VARIABLE
RATE NOTE.  Furthermore, BANK reserves
the right to offset without notice all funds held by BANK against debts owing
to BANK by BORROWER.

 

WAIVER OF PRESENTMENT AND NOTICE OF DISHONOR.  BORROWER and any other
person who signs, guarantees or endorses this VARIABLE RATE NOTE, to the extent
allowed by law, hereby waives presentment, demand for payment, notice of
dishonor, protest, and any notice relating to the acceleration of the maturity
of this VARIABLE RATE NOTE.

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

Executed as of the Note Date first above written.

 

 

	
   

  	
  HIGHWATER
  ETHANOL, LLC, a Minnesota limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Kletscher

  
	
   

  	
  Title:

  	
  CEOExhibit
10.14

 

VARIABLE
RATE NOTE

 

	
  Note
  Date:  February 26, 2010

  	
   

  	
  $200,396.83

  
	
  Maturity
  Date: February 26, 2015

  	
   

  	
   

  

 

FOR VALUE RECEIVED, HIGHWATER ETHANOL, LLC, a
Minnesota limited liability company (“BORROWER”), promises to pay to the order
of Granite Falls Bank in care of FIRST NATIONAL BANK OF OMAHA (“AGENT”) at its
principal office or such other address as AGENT or holder may designate from
time to time, the principal sum of Two Hundred Thousand Three Hundred Ninety
Six and 83/100 Dollars ($200,396.83) or the amount shown on AGENT’s records to
be outstanding, plus interest (calculated on the basis of actual days elapsed
in a 360-day year) accruing each day on the unpaid principal balance at the
annual interest rates defined below. 
Absent manifest error, AGENT’s records shall be conclusive evidence of
the principal and accrued interest owing hereunder.

 

This
VARIABLE RATE NOTE is executed pursuant to a Construction Loan Agreement
between BORROWER and BANK dated as of April 24, 2008, (the Construction
Loan Agreement, together with all amendments, modifications and supplements
thereto and all restatements and replacements thereof is called the “AGREEMENT”).  All capitalized terms not otherwise defined
in this note shall have the meanings provided in the AGREEMENT.

 

INTEREST ACCRUAL. 
Interest on the principal amount outstanding shall accrue at the rate
provided for in the AGREEMENT, adjusted as provided for in the AGREEMENT.  Interest shall be calculated on the basis of
a 360-day year, counting the actual number of days elapsed.

 

INCENTIVE PRICING.  The interest rate applicable
to this VARIABLE RATE NOTE is subject to reduction after a date six months
subsequent to the CONSTRUCTION LOAN TERMINATION DATE, as provided for in Section 2.15
of the AGREEMENT.

 

REPAYMENT TERMS.  Interest and
principal shall be due and payable at the times, in the amounts and applied in
the manner provided for in Section 2.5 of the AGREEMENT.  Any remaining principal balance, plus any
accrued but unpaid interest, shall be fully due and payable on the Maturity
Date, if not sooner paid.

 

PREPAYMENT.  BORROWER
may prepay this VARIABLE RATE NOTE in full or in part at any time; provided,
however, that any prepayment fees provided for in the AGREEMENT shall be due at
the time of any such prepayment.  Any
prepayment may be applied in inverse order of maturity or as BANK in its sole
discretion may deem appropriate.  Such
prepayment shall not excuse BORROWER from making subsequent payments each
quarter until the indebtedness is paid in full.

 

ADDITIONAL
TERMS AND CONDITIONS.  This
VARIABLE RATE NOTE is executed pursuant to the AGREEMENT.  The AGREEMENT, and any amendments or 

 

 

substitutions
thereof or thereto, contains additional terms and conditions, including default
and acceleration provisions, which are incorporated into this VARIABLE RATE
NOTE by reference.

 

The aggregate unpaid principal amount hereof plus interest shall become
immediately due and payable without demand or further action on the part of
BANK upon the occurrence of an EVENT OF DEFAULT as set forth under the
AGREEMENT or any other LOAN DOCUMENT.  If
the maturity date of this VARIABLE RATE NOTE is accelerated as a consequence of
an EVENT OF DEFAULT, then BANK shall have all the rights and remedies provided
for in the AGREEMENT, the other LOAN DOCUMENTS or otherwise available at law or
in equity.  The rights, powers,
privileges, options and remedies of BANK provided in the AGREEMENT, the other
LOAN DOCUMENTS or otherwise available at law or in equity shall be cumulative
and concurrent, and may be pursued singly, successively or together at the sole
discretion of BANK, and may be exercised as often as occasion therefor shall
occur.  No delay or discontinuance in the
exercise of any right, power, privilege, option or remedy shall be deemed a
waiver of such right, power, privilege, option or remedy, nor shall the
exercise of any right, power, privilege, option or remedy be deemed an election
of remedies or a waiver of any other right, power, privilege, option or remedy.  Without limiting the generality of the
foregoing, BANK’s waiver of an EVENT OF DEFAULT shall not constitute a waiver
of acceleration in connection with any future EVENT OF DEFAULT.  BANK may rescind any acceleration of this
VARIABLE RATE NOTE without in any way waiving or affecting any acceleration of
this VARIABLE RATE NOTE in the future as a consequence of an EVENT OF
DEFAULT.  BANK’s acceptance of partial
payment or partial performance shall not in any way affect or rescind any
acceleration of this VARIABLE RATE NOTE made by BANK.

 

Unless prohibited by law, BORROWER will pay on demand all reasonable
costs of collection, reasonable legal expenses and reasonable attorneys’ fees
and costs incurred or paid by BANK in collecting and/or enforcing this VARIABLE
RATE NOTE.  Furthermore, BANK reserves
the right to offset without notice all funds held by BANK against debts owing
to BANK by BORROWER.

 

WAIVER OF PRESENTMENT AND NOTICE OF DISHONOR.  BORROWER and any other
person who signs, guarantees or endorses this VARIABLE RATE NOTE, to the extent
allowed by law, hereby waives presentment, demand for payment, notice of
dishonor, protest, and any notice relating to the acceleration of the maturity
of this VARIABLE RATE NOTE.

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

Executed as of the Note Date first above written.

 

 

	
   

  	
  HIGHWATER
  ETHANOL, LLC, a Minnesota limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brian Kletscher

  
	
   

  	
  Title:

  	
  CEO

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