Exhibit 10.1

 

FOURTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER

 

This FOURTH AMENDMENT TO CREDIT AGREEMENT AND WAIVER (“Amendment”), is made
effective as of October 31, 2016 (the “Fourth Amendment Date”), by and between
DATALINK CORPORATION, a Minnesota corporation, having its chief executive office
located at 10050 Crosstown Circle, Suite 500, Eden Prairie, Minnesota 55344
(“Borrower”), and CASTLE PINES CAPITAL LLC, a Delaware limited liability
company, having its chief executive office located at 116 Inverness Drive East,
Suite 375, Englewood, Colorado 80112 (“CPC”). Capitalized terms not defined
herein have the meanings given to them in the Credit Agreement (as defined
herein).

 

W I T N E S S E T H :

 

WHEREAS, CPC and Borrower are parties to that certain Credit Agreement dated as
of July 17, 2013, as amended (the “Existing Credit Agreement”, together with the
amendment referred to herein, and as may further be amended, modified or amended
and restated from time to time, “Credit Agreement”); and

 

WHEREAS,  Borrower has requested a waiver of its failure to meet the
requirements of the Minimum Quarterly Free Cash Flow covenant for the trailing
twelve month period ending September 30, 2016; and

 

WHEREAS, Borrower and CPC desire to modify the Minimum Quarterly Free Cash Flow
covenant;

 

NOW, THEREFORE, in consideration of the premises, the parties hereto hereby
agree as follows:

 

SECTION ONE — Amendment.

 

Section 4.9 of the Existing Credit Agreement is hereby amended by deleting
paragraph “(c), Minimum Quarterly Free Cash Flow”, and replacing it with a new
paragraph (c) Minimum Quarterly Free Cash Flow covenant, as follows:

 

“(c)         Minimum Quarterly Free Cash Flow.  At any time and from time to
time that Borrower’s ‘cash’ as reported on Borrower’s fiscal quarterly balance
sheet is less than $25,000,000, Borrower shall have Free Cash Flow of at least
$1.00 at the end of such fiscal quarter for the trailing twelve month period
then ended, and shall continue to have Free Cash Flow of at least $1.00 at the
end of Borrower’s trailing twelve month period ending each fiscal quarter
thereafter, until such time as Borrower’s ‘cash’ as reported on Borrower’s
fiscal quarterly balance sheet is greater than $25,000,000.

 

Free Cash Flow means, with respect to the trailing twelve months ending as of
any period of measurement, an amount equal to:

 

Recurring Operating EBITDA

 

minus

 

(a) the sum of:

 

(i) unfinanced capital expenditures, plus

(ii) income taxes paid in cash by Borrower, plus

(iii) Distributions paid in cash during such period,

 

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minus

 

(b) the sum of:

 

(i) interest expense paid in cash, plus

(ii) current maturities of long term debt, during such period.

 

Distribution means (a) any distribution, dividend or payment to any person on
account of any equity interest of Borrower, (b) loans by Borrower to any holder
of equity interests of Borrower, (c) any payment of management, consulting or
similar fees payable by Borrower or any subsidiary of Borrower to any affiliate
of Borrower, or (d) any redemption, purchase, retirement, defeasance, sinking
fund or similar payment or any claim of rescission with respect to any equity
interest of Borrower.

 

Net Income means, with respect to the trailing twelve months ending as of any
period of measurement, net earnings (or net loss) after taxes of the Borrower
during such period determined in accordance with GAAP.

 

Recurring Operating EBITDA means, with respect to the trailing twelve months
ending as of any period of measurement, an amount equal to: Net Income, plus
(a) the such of the following to the extent deducted in calculating such Net
Income, the sum of: (i) interest expenses for such period, plus, (ii) the
provision for federal, state, local and foreign income taxes payable by the
Borrower for such period, plus (iii) depreciation and amortization expense for
such period and plus (iv) other non-cash or non-recurring expenses of the
Borrower reducing such Net Income (including without limitation non-cash
stock-based compensation expense), and minus (b) all non-cash or non-recurring
items increasing Net Income for such period.”

 

SECTION TWO — Waiver.  Subject to Section Three hereof, CPC hereby waives
Borrower’s failure to its failure to meet the requirements of the Minimum
Quarterly Free Cash Flow covenant for the trailing twelve month period ending
September 30, 2016.

 

SECTION THREE - Conditions to Effectiveness.  This Amendment shall be effective
as of the Fourth Amendment Date provided:

 

A.            CPC has received counterparts of this Amendment executed by the
Borrower;

 

B.            No event shall have occurred since December 31, 2015, which has a
material adverse effect on the business, assets, revenues, financial condition
or Collateral of Borrower, the ability of Borrower to perform Borrower’s payment
obligations when due or to perform any other material obligation under the
Credit Agreement; or any right, remedy or benefit of CPC under the Credit
Agreement; and

 

C.            CPC has received such other documents and information as requested
by CPC and its counsel.

 

In addition, the effectiveness of this Amendment is conditioned upon the
continuing accuracy of the representations and warranties set forth in
Section Four hereof.

 

SECTION FOUR — Representations and Warranties. In order to induce CPC to enter
into this Amendment, Borrower represents and warrants to CPC that upon the
effectiveness of this Amendment (i) the Credit Agreement, as amended, does
remain the legal, valid, enforceable and binding obligation of Borrower, (ii) no
Default has occurred and is continuing, (iii) all of the representations and
warranties in the Credit Agreement are true and complete in all material
respects on and as of the date hereof as if made on the date hereof (or, if any
such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date), and (iv) Borrower have no claims,
defenses, or offsets against CPC.

 

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SECTION FIVE - Miscellaneous. Borrower waives notice of CPC’s acceptance of this
amendment. All other terms and provisions of the Credit Agreement, to the extent
not inconsistent with the foregoing, are ratified and remain unchanged and in
full force and effect.

 

SECTION SIX — Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Amendment by facsimile
shall be effective as delivery of a manually executed counterpart of this
Amendment.

 

SECTION SEVEN — Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of Colorado (without giving
effect to any provisions thereof relating to conflicts of law).

 

THIS AMENDMENT AND THE CREDIT AGREEMENT CONTAIN BINDING ARBITRATION, JURY WAIVER
AND PUNITIVE DAMAGE WAIVER PROVISIONS.

 

(Signature Page(s) to Follow)

 

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IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be duly
executed and delivered by its proper and duly authorized officer, effective as
of the date first set above.

 

 

BORROWER:

 

 

 

DATALINK CORPORATION

 

 

 

 

 

By:

/s/ Gregory T. Barnum

 

Name: Gregory T. Barnum

 

Title: Vice President, Finance and Chief Financial Officer

 

 

 

 

ACKNOWLEDGED AND AGREED TO:

 

 

 

CASTLE PINES CAPITAL LLC

 

 

 

 

 

By:

/s/ Lloyd Squire

 

Name: Lloyd Squire

 

Title: Regional Manager

 

 

Signature page to Datalink. Fourth Amendment

 

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