Exhibit 10.1

 

AMENDMENT No. 1

TO

AMENDED AND RESTATED CREDIT AGREEMENT

 

This Amendment No. 1 to Amended and Restated Credit Agreement, dated as of
April 1, 2004 (the “Amendment”), among FARGO ELECTRONICS, INC., a Delaware
corporation (“Company”), the financial institutions that are or may from time to
time become parties hereto (together with their respective successors and
assigns, the “Banks”), LASALLE BANK NATIONAL ASSOCIATION (in its individual
capacity, “LaSalle”), as Agent for the Banks and as the Issuing Bank, (the
Banks, the Issuing Bank and the Agent being collectively referred to herein as
the “Lender Parties”) to that certain Amended and Restated Credit Agreement
dated as of December 18, 2002, among the Company, LaSalle, in its capacities as
Agent, Issuing Bank, and as the sole Bank (the “Original Agreement”).

 

RECITALS:

 

A.                                   The Company has requested that the Lender
Parties amend certain Sections of the Original Agreement.

 

B.                                     Subject to the terms and conditions of
this Amendment, the Lender Parties will agree to the foregoing request of the
Company.

 

NOW, THEREFORE, the parties agree as follows:

 

1.                                       Defined Terms.  All capitalized terms
used in this Amendment shall, except where the context otherwise requires, have
the meanings set forth in the Original Agreement as amended hereby.

 

2.                                       Amendment.  The Original Agreement is
hereby amended as follows:

 

(a)                                  The definitions of “Cash Equivalent
Investment” and “Termination Date” appearing in Section 1 are amended in their
respective entireties to read as follows:

 

“Cash Equivalent Investment means, at any time, (a) any evidence of Debt,
maturing not more than eighteen months after such time, issued or guaranteed by
the United States Government or any agency thereof, (b) commercial paper,
maturing not more than one year from the date of issue, or corporate demand
notes, in each case (unless issued by a Bank or its holding company) rated at
least A-l by Standard & Poor’s Ratings Group or P-l by Moody’s Investors
Service, Inc., (c) any deposit account, certificate of deposit (or time deposits
represented by such certificates of deposit) or banker’s acceptance,

 

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maturing not more than one year after such time, or overnight Federal Funds
transactions that are issued or sold by any Bank or its holding company or by a
commercial banking institution that is a member of the Federal Reserve System
and has a combined capital and surplus and undivided profits of not less than
$500,000,000 and (d) any repurchase agreement entered into with any Bank (or
other commercial banking institution of the stature referred to in clause (c))
which (i) is secured by a fully perfected security interest in any obligation of
the type described in any of clauses (a) through (c) and (ii) has a market value
at the time such repurchase agreement is entered into of not less than 100% of
the repurchase obligation of such Bank (or other commercial banking institution)
thereunder.

 

Termination Date means the earlier to occur of (a) April 1, 2005, as such stated
date may be extended from time to time pursuant to Section 2.6; or (b) such
other date on which the Commitments terminate pursuant to Section 6 or 12.”

 

(b)                                 Section 1 is further amended by (i) deleting
the definitions of “Capital Expenditures” “Computation Period”, “Fixed Charge
Coverage Ratio”, “Non-Use Fee Rate” and “Total Debt to EBITDA Ratio” and (ii)
inserting a new definition of “Notice Date” in the appropriate alphabetical
order to read as follows:

 

“Notice Date – see Section 2.6.”

 

(c)                                  Section 2 is amended by adding a new
Section 2.6 to read as follows:

 

“2.6                         Modification of Termination Date. The Banks agree
that, unless (a) the Agent, on behalf of the Banks, delivers to the Company, or
(b) the Company delivers to the Agent, a written non-renewal notice by
December 15, of any year (the “Notice Date”), commencing December 15, 2004, then
the stated Termination Date shall automatically be extended by a period of 364
days; provided, however, that any such extension shall only become effective
upon the execution and delivery by the Company, the Agent and the Banks of an
amendment to this Agreement in the form provided by Agent, such form to be
delivered to Company by no later than the relevant Notice Date, and the
satisfaction of all conditions precedent set forth in such amendment.”

 

(d)                                 Section 5.1 is amended in its entirety to
read as follows:

 

“5.1                         Intentionally deleted.”

 

(e)                                  Sections 10.6.1, 10.6.2, and 10.6.3 are
amended their respective entireties to read as follows:

 

“10.6.1        Minimum EBITDA.  Not permit the Company’s EBITDA for any Fiscal
Quarter to be less than $150,000.00.

 

10.6.2              Intentionally deleted.

 

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10.6.3              Intentionally deleted.”

 

(f)                                    The Pricing Schedule attached to the
Original Agreement is amended in its entirety to conform to the form of Pricing
Schedule (Amended/April, 2004) attached hereto.

 

(g)                                 Exhibit B attached to the Original Agreement
is amended in its entirety to conform to the form of Exhibit B (Amended/April,
2004) attached hereto.

 

3.                                       Conditions to Effectiveness.  This
Amendment shall become effective on the date (the “Effective Date”) when, and
only when, the Agent shall have received:

 

(a)                                  Counterparts of this Amendment executed by
the Company and the Lender Parties; and

 

(b)                                 a Certificate of Good Standing for the
Company of recent date issued by the Secretary of State of the state of
Company’s incorporation and each other state required by the Agent.

 

4.                                       Representations and Warranties.  To
induce the Lender Parties to enter into this Amendment, the Company represents
and warrants to the Lender Parties as follows:

 

(a)                                  The execution, delivery and performance by
the Company of this Amendment and any other documents to be executed and/or
delivered by the Company in connection herewith have been duly authorized by all
necessary corporate action, do not require any approval or consent of, or any
registration, qualification or filing with, any government agency or authority
or any approval or consent of any other person (including, without limitation,
any stockholder), do not and will not conflict with, result in any violation of
or constitute any default under, any provision of the Company’s articles of
incorporation or bylaws, any agreement binding on or applicable to the Company
or any of the Company’s property, or any law or governmental regulation or court
decree or order, binding upon or applicable to the Company or of any of the
Company’s property and will not result in the creation or imposition of any
security interest or other lien or encumbrance in or on any of its property
pursuant to the provisions of any agreement applicable to the Company or any of
the Company’s property except pursuant to the Loan Documents;

 

(b)                                 The representations and warranties contained
in the Original Agreement are true and correct as of the date hereof as though
made on that date except to the extent that such representations and warranties
relate solely to an earlier date;

 

(c)                                  No events have taken place and no
circumstances exist at the date hereof which would give the Company the right to
assert a defense, offset or counterclaim to any claim by any Lender Party for
payment of any obligation (monetary or otherwise) of Company under the Amended
and Restated Credit Agreement, any Note, or any other Loan Document or any other
document or instrument executed in connection therewith and all Hedging
Obligations owed to any Lender Party, in each case howsoever created,

 

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arising or evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, or due or to become due; and

 

(d)                                 The Original Agreement as amended by this
Amendment and the other Loan Documents to which the Company is a party remain in
full force and effect and are the legal, valid and binding obligations of the
Company and are enforceable in accordance with their respective terms, subject
to limitations as to enforceability which might result from bankruptcy,
insolvency, moratorium and other similar laws affecting creditors’ rights
generally and subject to limitations on the availability of equitable remedies.

 

5.                                       Reference to and Effect on the Loan
Documents.

 

(a)                                  From and after the date of this Amendment,
each reference in the Original Agreement to “this Agreement”, “hereunder”,
“hereof”, “herein” or words of like import referring to the Original Agreement,
and each reference to the “Agreement”, “thereunder”, “thereof”, “therein” or
words of like import referring to the Original Agreement in any other Loan
Document shall mean and be a reference to the Original Agreement as amended
hereby.

 

(b)                                 The execution, delivery and effectiveness of
this Amendment shall not operate as a waiver of any right, power or remedy of
the any Lender Party under the Original Agreement or any other Loan Document,
nor constitute a waiver of any provision of the Original Agreement or any such
other Loan Document.

 

6.                                      Costs, Expenses and Taxes.  The Company
agrees to pay on demand all reasonable costs and expenses of the Lender Parties
in connection with the preparation, reproduction, execution and delivery of this
Amendment and the other documents to be delivered hereunder or thereunder,
including their reasonable attorneys’ fees and legal expenses.  In addition, the
Company shall pay any and all stamp and other taxes and fees payable or
determined to be payable in connection with the execution and delivery, filing
or recording of this Amendment and the other instruments and documents to be
delivered hereunder, and agrees to save the Lender Parties harmless from and
against any and all liabilities with respect to, or resulting from, any delay in
the Company’s paying or omission to pay, such taxes or fees.

 

7.                                      Governing Law.  This Amendment shall be
governed by and construed in accordance with the laws of the State of Minnesota.

 

8.                                      Headings.  Section headings in this
Amendment are included herein for convenience of reference only and shall not
constitute a part of this Amendment for any other purpose.

 

9.                                      Counterparts.  This Amendment may be
executed in separate counterparts and by separate parties in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same Amendment.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized as of the date first
written above.

 

 

FARGO ELECTRONICS, INC.

 

 

 

By:

/s/ Paul Stephenson

 

 

Its:

Chief Financial Officer

 

 

 

 

 

Subscribed and sworn to before me

 

this 1st day of April, 2004.

 

 

 

/s/ Vicki Lynn Bonadurer

 

 

Notary Public

 

 

 

 

 

 

LASALLE BANK NATIONAL ASSOCIATION, as
Agent, Issuing Bank and as the sole Bank

 

 

 

By:

/s/ John Gatzlaff

 

 

Its:

Senior Vice President

 

 

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EXHIBIT A TO FIRST AMENDMENT

 

PRICING SCHEDULE (Amended/April, 2004)

 

On and after April 1, 2004, the Eurodollar Margin, the Base Rate Margin and the
LC Fee Rate shall be equal to the applicable rate per annum set forth in the
table below:

 

Eurodollar
Margin

 

Base Rate
Margin

 

LC Fee
Rate

 

1.50

%

0.00

%

1.50

%

 

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EXHIBIT B TO FIRST AMENDMENT

 

Form of Compliance Certificate (Amended/April, 2004)

 

To:                                                                             
LaSalle Bank National Association, as Agent

 

Please refer to the Amended and Restated Credit Agreement dated as of
December 18, 2002 (as amended or otherwise modified from time to time, the
“Credit Agreement”) among Fargo Electronics, Inc. (the “Company”), various
financial institutions and LaSalle Bank National Association, as agent.  Terms
used but not otherwise defined herein are used herein as defined in the Credit
Agreement.

 

3.                                      
I                                            Reports.  Enclosed herewith is a
copy of the [annual audited/quarterly/monthly] report of the Company as at
                       ,          (the “Computation Date”), which report fairly
presents in all material respects the financial condition and results of
operations [(subject to the absence of footnotes and to normal year-end
adjustments)] of the Company as of the Computation Date and has been prepared in
accordance with GAAP consistently applied.

 

4.                                      
II                                        Financial Tests.  The Company hereby
certifies and warrants to you that the following is a true and correct
computation as at the Computation Date of the following ratios and/or financial
restrictions contained in the Credit Agreement:

 

  A.                              Section 10.6.1 - Minimum EBITDA (computed for
the Fiscal Quarter ending on the Computation Date)

 

1.

Consolidated Net Income

 

$

 

2.

Plus:

Interest Expense

 

$

 

 

 

Income tax expense

 

$

 

 

 

Depreciation

 

$

 

 

 

Amortization

 

$

 

3.

Total of (1) plus (2) (EBITDA)

 

$

 

 

 

 

 

 

Minimum required

 

$

150,000.00

 

 

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The Company further certifies to you that no Event of Default or Unmatured Event
of Default has occurred and is continuing.

 

IN WITNESS WHEREOF, the Company has caused this Certificate to be executed and
delivered by its duly authorized officer on                       ,         .

 

 

Fargo Electronics, Inc.

 

 

 

By

 

 

 

Title

 

 

 

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