--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 
EXHIBIT 10.1
 
 
SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT
AND FIRST AMENDMENT TO FEE LETTER

This SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT AND FIRST AMENDMENT TO FEE
LETTER (this “Amendment”), dated as of December 30, 2010, is made by and among
the financial institutions party hereto (collectively, “Lenders”), Bank of
America, N.A., as a Lender and as agent for Lenders (in its capacity as agent,
“Agent”), Hypercom U.S.A., Inc., a Delaware corporation (“Hypercom U.S.A.”), and
Hypercom Manufacturing Resources, Inc., an Arizona corporation (“Hypercom
Manufacturing”; and together with Hypercom U.S.A., collectively, “Borrowers” and
each individually a “Borrower”).

R E C I T A L S:

A. WHEREAS, Borrowers, Agent and Lenders have entered into that certain Loan and
Security Agreement dated as of January 15, 2008 (as amended, restated, or
otherwise modified from time to time, the “Loan Agreement”); and
 
B. WHEREAS, Borrowers have requested that Agent and Lenders amend the Loan
Agreement and the Fee Letter (as defined in the Loan Agreement) in certain
respects (including an extension of the maturity date under the Loan Agreement),
and Agent and Lenders have agreed to the foregoing request in accordance with
the terms of this Amendment.
 
NOW, THEREFORE, in consideration of the premises, and in order to induce Agent
and Lenders to amend the Loan Agreement and the Fee Letter pursuant to the terms
hereof, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree as follows:

1. Recitals.  The foregoing Recitals are accurate and are incorporated herein
and made a part hereof for all purposes.

2. Definitions.  Unless otherwise defined in this Amendment, all initially
capitalized terms and phrases wherever used in this Amendment shall have the
respective meanings given to them in the Loan Agreement, as amended hereby.

3. Loan Agreement: Amendment of Definitions.  The following definitions
contained in Section 1.1 of the Loan Agreement are hereby amended and restated
in their entirety to read as follows:

Borrowing Base: on any date of determination, an amount equal to the lesser of
(a) the aggregate amount of Revolver Commitments, minus the LC Reserve, minus
the Availability Block; or (b) the sum of the Accounts Formula Amount, plus the
Installment Receivables Formula Amount, minus the Availability Reserve; provided
that in no event shall the amount under this clause (b) attributable to the
Accounts Formula Amount related to Account Debtors located in the EU exceed the
lesser of (i) $15,000,000 or (ii) 50% of the total Borrowing Base, and further
provided that, for purposes of clause (ii) of the foregoing proviso only, the
calculation of the Borrowing Base shall exclude the Availability Block and the
LC Reserve.
 
Revolver Termination Date: January 14, 2012.
 
4. Loan Agreement: Deletion of Section 2.1.4(a) and Related Amendment.  Section
2.1.4(a) of the Loan Agreement is hereby amended and restated to read in its
entirety as follows: “Intentionally omitted.”  The language on the cover page of
the Loan Agreement that reads “(as may be increased pursuant to the terms and
conditions herein to an amount not to exceed $40,000,000)” is hereby deleted.
 

 
 

--------------------------------------------------------------------------------

 

 
5. Fee Letter: Deletion of Reference to Size of Facility.  The language in the
first sentence of the Fee Letter that reads “(as may be increased to
$40,000,000)” is hereby deleted.

6. Fee Letter: Amendment of Commitment Fee Paragraph.  The paragraph of the Fee
Letter labeled “Commitment Fee” is hereby amended and restated to read in its
entirety as follows:

“           1.           Commitment Fee.  On the Closing Date, Borrowers shall
pay to Agent, for Agent’s own account, a commitment fee equal to .50% of the
Revolver Commitment.  The foregoing fees will be due and payable by the
Borrowers as set forth above in consideration of Agent’s commitments under the
Credit Facility and shall be fully-earned when due.”

7. Conditions Precedent.  This Amendment shall not be binding upon Agent or any
Lender until each of the following conditions precedent has been satisfied in
form and substance satisfactory to Agent and Lenders:

(a) The representations and warranties contained herein and in the Loan
Agreement shall be true and correct in all material respects as of the date
hereof as if made on the date hereof, except for those representations and
warranties that are limited by their terms to a specific date (such
representations and warranties being true and correct in all material respects
as of the specified date relative thereto);

(b) No Default or Event of Default shall have occurred and be continuing;

(c) Borrowers shall have delivered to Agent an executed original of this
Amendment (including all consents and ratifications hereto);

(d) Borrowers shall have paid to Agent an amendment fee of $25,000, which amount
shall be paid to Agent in immediately available funds;

(e) Borrowers shall have paid to Agent all fees, costs, and expenses owed to
and/or incurred by Agent arising in connection with this Amendment (including
reasonable attorneys’ fees and costs);

(f) Agent shall have received such other documents, certificates, opinions, and
information that Agent shall require, each in form and substance satisfactory to
Agent in its sole discretion.

8. Acknowledgment of the Borrower.  Each Borrower hereby represents and warrants
that the execution and delivery of this Amendment and compliance by such
Borrower with all of the provisions of this Amendment:  (i) are within the
powers and purposes of such Borrower; (ii) have been duly authorized or approved
by the board of directors of such Borrower; and (iii) when executed and
delivered by or on behalf of such Borrower, will constitute valid and binding
obligations of such Borrower, enforceable in accordance with its terms, except
as limited by applicable bankruptcy, insolvency, reorganization, moratorium, or
similar laws affecting the rights of creditors generally and to the effects of
general principles of equity whether applied by a court of law or equity.  Each
Borrower further represents and warrants that the Borrowers no longer own HBNet,
Inc., previously a guarantor under the Loan Documents,  Each Borrower reaffirms
its obligation to pay all amounts due to Agent and Lenders under the Loan
Agreement and the other Loan Documents in accordance with the terms thereof.
 

 
 

--------------------------------------------------------------------------------

 

 
9. Effect on Loan Agreement and other Loan Documents.  Except as specifically
amended hereby, the terms and provisions of the Loan Agreement and the other
Loan Documents are, in all other respects, ratified and confirmed and remain in
full force and effect.  No reference to this Amendment need be made in any
notice, writing, or other communication relating to the Loan Agreement and the
other Loan Documents, any such reference to the Loan Agreement and the other
Loan Documents to be deemed a reference thereto as respectively amended by this
Amendment.  All references to the Loan Agreement and the other Loan Documents in
any document, instrument, or agreement executed in connection with the Loan
Agreement and the other Loan Documents will be deemed to refer to the Loan
Agreement and the other Loan Documents as respectively amended hereby.

10. Fees and Expenses.  Each Borrower hereby agrees to pay all fees and other
reasonable out-of-pocket expenses incurred by Agent in connection with the
preparation, negotiation, and consummation of this Amendment, and all other
documents related hereto, including without limitation, the reasonable fees and
expenses of Lenders’ counsel.

11. Successors.  This Amendment will be binding upon and inure to the benefit of
each Borrower, Lenders, Agent, and their respective successors and assigns,
provided, however, that no interest herein may be assigned by any Borrower
without the prior written consent of Agent and each Lender.

12. Governing Law.  This Amendment shall be governed by the laws of the State of
New York, without giving effect to any conflict of law principles (but giving
effect to federal laws relating to national banks).

13. Jury Trial Waiver.  To the fullest extent permitted by applicable law, each
of the parties hereto waives its right to trial by jury in any proceeding or
dispute of amy kind relating to this Amendment or the other Loan Documents,
Obligations or Collateral.  Without limiting the applicability of any other
section of the Loan Agreement, Section 14.15 of the Loan Agreement is hereby
incorporated by this reference and shall apply to any action, proceeding, claim
or controversy arising out of this Amendment.

14. Counterparts.  This Amendment may be executed in the original or by telecopy
in any number of counterparts, each of which will be deemed original and all of
which taken together will constitute one and the same Amendment.

15. Total Agreement.  This Amendment, the Loan Agreement, and all other Loan
Documents embody the entire understanding of the parties with respect to the
subject matter thereof and supersede all prior understandings regarding the same
subject matter.

16. Acknowledgements and Release.  Each Borrower hereby acknowledges that:  (a)
it has no defenses, claims or set-offs to the enforcement by Agent or Lenders of
the Obligations on the date hereof; (b) to its knowledge, Agent and Lenders have
fully performed all undertakings and obligations owed to it as of the date
hereof; and (c) except to the limited extent expressly set forth in this
Amendment, Agent and Lenders do not waive, diminish or limit any term or
condition contained in the Loan Agreement or any of the other Loan
Documents.  EACH BORROWER HEREBY IRREVOCABLY RELEASES AND FOREVER DISCHARGES
AGENT AND LENDERS AND THEIR AFFILIATES, AND EACH SUCH PERSON’S RESPECTIVE
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, MEMBERS, ATTORNEYS AND REPRESENTATIVES
(EACH, A “RELEASED PERSON”) OF AND FROM ALL DAMAGES, LOSSES, CLAIMS, DEMANDS,
LIABILITIES, OBLIGATIONS, ACTIONS OR CAUSES OF ACTION WHATSOEVER (EACH A
“CLAIM”) THAT SUCH BORROWER MAY NOW HAVE OR CLAIM TO HAVE AGAINST ANY RELEASED
PERSON ON THE DATE HEREOF, WHETHER KNOWN OR UNKNOWN, OF EVERY NATURE AND EXTENT
WHATSOEVER, FOR OR BECAUSE OF ANY MATTER OR THING DONE, OMITTED OR SUFFERED TO
BE DONE OR OMITTED BY ANY OF THE RELEASED PERSONS THAT BOTH (I) OCCURRED PRIOR
TO OR ON THE DATE HEREOF AND (II) IS ON ACCOUNT OF OR IN ANY WAY CONCERNING,
ARISING OUT OF OR FOUNDED UPON THE LOAN AGREEMENT OR ANY OTHER LOAN DOCUMENT.
 

 
 

--------------------------------------------------------------------------------

 

 
EACH BORROWER INTENDS THE ABOVE RELEASE TO COVER, ENCOMPASS, RELEASE, AND
EXTINGUISH, INTER ALIA, ALL CLAIMS, DEMANDS, AND CAUSES OF ACTION THAT MIGHT
OTHERWISE BE RESERVED BY THE CALIFORNIA CIVIL CODE SECTION 1542 (AND ANY
EQUIVALENT PROVISION UNDER NEW YORK LAW), WHICH PROVIDES AS FOLLOWS:
 
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”
 
EACH BORROWER ACKNOWLEDGES THAT IT MAY HEREAFTER DISCOVER FACTS DIFFERENT FROM
OR IN ADDITION TO THOSE NOW KNOWN OR BELIEVED TO BE TRUE WITH RESPECT TO SUCH
CLAIMS, DEMANDS, OR CAUSES OF ACTION, AND AGREES THAT THIS AMENDMENT AND THE
ABOVE RELEASE ARE AND WILL REMAIN EFFECTIVE IN ALL RESPECTS NOTWITHSTANDING ANY
SUCH DIFFERENCES OR ADDITIONAL FACTS.

[Remainder of Page Intentionally Left Blank]
 

 
 

--------------------------------------------------------------------------------

 

 
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed as of the date first written above.

BORROWERS:

HYPERCOM U.S.A., INC.,
a Delaware corporation

By: /s/ Scott
Tsujita                                                              
Name: Scott Tsujita
Title: Treasurer

HYPERCOM MANUFACTURING RESOURCES, INC., an Arizona corporation

 
By: /s/ Scott
Tsujita                                                                
Name: Scott Tsujita
Title: Treasurer

 
 
 

--------------------------------------------------------------------------------

 

 
AGENT AND LENDERS:

BANK OF AMERICA, N.A.,
as Agent and Lender

By: /s/ Carlos
Gil                                                               
Name: Carlos Gil
Title:   Vice President

 
 

--------------------------------------------------------------------------------

 

 
CONSENTS AND REAFFIRMATIONS

Each of HYPERCOM CORPORATION, a Delaware corporation, HYPERCOM EMEA, INC., an
Arizona corporation, HYPERCOM LATINO AMERICA, INC., an Arizona corporation,
HYPERCOM PUERTO RICO REPAIR FACILITY, G.P., an Arizona general partnership, and
HYPERCOM EMEA LTD., a company organized under the laws of the United Kingdom
(collectively, “Obligors”, and each individually, an “Obligor”), hereby
acknowledges the execution of, and consents to, the terms and conditions of that
Second Amendment to Loan and Security Agreement and First Amendment to Fee
Letter dated as of December 30, 2010 (the “Amendment”), by and among HYPERCOM
U.S.A., INC., HYPERCOM MANUFACTURING RESOURCES, INC. (collectively,
“Borrowers”), certain financial institutions party thereto as lenders, and BANK
OF AMERICA, N.A. (“Agent”), and reaffirms its obligations under each Secured
Continuing Guaranty (each, a “Guaranty”) dated as of January 15, 2008, and
executed individually by each of the undersigned in favor of Agent in connection
with that certain Loan and Security Agreement dated as of January 15, 2008 (as
amended, restated, or otherwise modified from time to time, the “Loan
Agreement”) by and among Borrowers, Agent and Lenders.  Each of the undersigned
acknowledges and agrees that each such Guaranty remains in full force and effect
and is hereby ratified and confirmed.  All initially capitalized terms and
phrases wherever used in this consent shall have the respective meanings given
to them in the Loan Agreement, as amended by the Amendment.
 
Each Obligor hereby acknowledges that:  (a) it has no defenses, claims or
set-offs to the enforcement by Agent or Lenders of the Obligations on the date
hereof; (b) to its knowledge, Agent and Lenders have fully performed all
undertakings and obligations owed to it as of the date hereof; and (c) except to
the limited extent expressly set forth in the Amendment, Agent and Lenders do
not waive, diminish or limit any term or condition contained in the Loan
Agreement or any of the other Loan Documents.  EACH OBLIGOR HEREBY IRREVOCABLY
RELEASES AND FOREVER DISCHARGES AGENT AND LENDERS AND THEIR AFFILIATES, AND EACH
SUCH PERSON’S RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, MEMBERS,
ATTORNEYS AND REPRESENTATIVES (EACH, A “RELEASED PERSON”) OF AND FROM ALL
DAMAGES, LOSSES, CLAIMS, DEMANDS, LIABILITIES, OBLIGATIONS, ACTIONS OR CAUSES OF
ACTION WHATSOEVER (EACH A “CLAIM”) THAT SUCH OBLIGOR MAY NOW HAVE OR CLAIM TO
HAVE AGAINST ANY RELEASED PERSON ON THE DATE HEREOF, WHETHER KNOWN OR UNKNOWN,
OF EVERY NATURE AND EXTENT WHATSOEVER, FOR OR BECAUSE OF ANY MATTER OR THING
DONE, OMITTED OR SUFFERED TO BE DONE OR OMITTED BY ANY OF THE RELEASED PERSONS
THAT BOTH (I) OCCURRED PRIOR TO OR ON THE DATE HEREOF AND (II) IS ON ACCOUNT OF
OR IN ANY WAY CONCERNING, ARISING OUT OF OR FOUNDED UPON ANY GUARANTY, THE LOAN
AGREEMENT OR ANY OTHER LOAN DOCUMENT.

EACH OBLIGOR INTENDS THE ABOVE RELEASE TO COVER, ENCOMPASS, RELEASE, AND
EXTINGUISH, INTER ALIA, ALL CLAIMS, DEMANDS, AND CAUSES OF ACTION THAT MIGHT
OTHERWISE BE RESERVED BY THE CALIFORNIA CIVIL CODE SECTION 1542 (AND ANY
EQUIVALENT PROVISION UNDER NEW YORK LAW), WHICH PROVIDES AS FOLLOWS:
 
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.”
 
EACH OBLIGOR ACKNOWLEDGES THAT IT MAY HEREAFTER DISCOVER FACTS DIFFERENT FROM OR
IN ADDITION TO THOSE NOW KNOWN OR BELIEVED TO BE TRUE WITH RESPECT TO SUCH
CLAIMS, DEMANDS, OR CAUSES OF ACTION, AND AGREES THAT THE AMENDMENT, EACH
GUARANTY AND THE ABOVE RELEASE ARE AND WILL REMAIN EFFECTIVE IN ALL RESPECTS
NOTWITHSTANDING ANY SUCH DIFFERENCES OR ADDITIONAL FACTS.
 

Dated as of December 30, 2010
 

HYPERCOM CORPORATION,
 
a Delaware corporation
 
                        
                    By: /s/ Scott
Tsujita                                                                
Name: Scott Tsujita
Title: SVP, Treasurer

 
HYPERCOM EMEA, INC.,
 
an Arizona corporation
 
 
                    By: /s/ Scott
Tsujita                                                                
Name: Scott Tsujita
Title: Treasurer

HYPERCOM LATINO AMERICA, INC.,
 
an Arizona corporation
 
 
                    By: /s/ Scott
Tsujita                                                                
Name: Scott Tsujita
Title: Treasurer

 
 

--------------------------------------------------------------------------------

 

 
HYPERCOM PUERTO RICO REPAIR
 
FACILITY, G.P.,
 
an Arizona general partnership
 
By:           HYPERCOM U.S.A., INC.,
its general partner

 
By: /s/ Scott Tsujita          
Name: Scott Tsujita
Title: Treasurer

 
By:
HYPERCOM LATINO AMERICA, INC.,
its general partner

 
By: /s/ Scott Tsujita          
Name: Scott Tsujita
                           Title: Treasurer

HYPERCOM EMEA LTD.,
 
a company organized under the laws of the United Kingdom
 

By: /s/ Douglas J. Reich           
Name: Douglas J. Reich
Title: Director, Secretary
 

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------