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

  	
  %

  






 

















 


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

  	
   

  
							



 

















 


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