Item 1.01 Entry Into a Material Definitive Agreement

On September 23, 2020 (dated effective September 14, 2020), Highwater Ethanol, LLC (the "Company") and Compeer Financial, PCA f/k/a AgStar Financial Services, PCA, as administrative agent, ("Compeer"), executed a Second Amendment to Second Amended and Restated Credit Agreement (the "Second Amendment"), which amends the Second Amended and Restated Credit Agreement dated January 22, 2016. In connection therewith, as of the same date, the Company executed a Term Note and a Fourth Amended and Restated Mortgage, Security Agreement, Assignment of Leases and Fixture Financing Statement with Compeer and a Term Note with AgCountry Farm Credit Services, PCA.

The Amendment provides for a $6,000,000 term loan (the "2020 Term Loan") to be used to fund certain improvements to the ethanol production facility (the "Facility Improvement Project"). The Term Loan is subject to a variable interest rate based on the Wall Street Journal's Prime Rate plus 45 basis points. Beginning on October 1, 2020, monthly principal payments are due on the 2020 Term Loan of $250,000 plus accrued interest. Payments of all amounts outstanding are due on September 14, 2022. The Company paid $30,000 in commitment and amendment fees. The loan facility with Compeer is secured by substantially all business assets and also subjects the Company to various financial and non-financial covenants that limit distributions and debt and require minimum debt service coverage, tangible net worth, and working capital requirements.

In addition, the Company is limited to annual capital expenditures of $5,000,000 in the aggregate without prior approval, incurring additional debt over certain amounts without prior approval, and making additional investments without prior approval. The Second Amendment provides for Compeer's consent to the Facility Improvement Project which will be in addition to capital expenditures for the 2020 fiscal year.

Item 9.01 Financial Statements and Exhibits



(a)None.

(b)None.

(c)None.

(d)Exhibits.



       Exhibit No. Description

       99.1        Second Amendment to Second Amended and Restated Credit Agreement
       99.2        Fourth Amended and Restated Mortgage, Security Agreement, Assignment of Leases
                   and Fixture Financing Statement
       99.3        Term Note with Compeer Financial, PCA
       99.4        Term Note with AgCountry Farm Credit Services, PCA

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