Document:

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                                                                   EXHIBIT 10.1

                         AMENDMENT AND MODIFICATION OF
                   REVOLVING LINE OF CREDIT PROMISSORY NOTE,
                LOAN AGREEMENT AND REAFFIRMATION OF GUARANTIES

         This Amendment and Modification of Revolving Line of Credit Promissory
Note, Loan Agreement and Reaffirmation of Guaranties ("Amendment") is made
effective the 31st day of December, 2003 ("Effective Date") by and among WSI
Industries, Inc., a Minnesota corporation, having an address of 18151
Territorial Road, Osseo, MN 55369 ("Borrower"), Taurus Numeric Tool, Inc.,
having an address of 18151 Territorial Road, Osseo, MN 55369 and WSI Rochester,
Inc., having an address of 18151 Territorial Road, Osseo, MN 55369 (jointly
"Guarantor") and Excel Bank Minnesota, a Minnesota banking corporation, having
an address of 5050 France Avenue South, Edina, Minnesota 55410 ("Bank").

         WHEREAS, on or about December 4, 2002, (the "Loan Date") Borrower
executed a Revolving Line of Credit Promissory Note in favor of the Bank in the
original principal amount of One Million and 00/100 ($1,000,000.00) Dollars
("Note"); and

         WHEREAS, on or about the Loan Date, Borrower and the Bank executed
that certain Loan Agreement ("Loan Agreement") which Loan Agreement, among
other things, described the terms and conditions under which the Borrower would
borrow money from and repay the money to the Bank; and

         WHEREAS, to secure the sums due and payable to the Bank pursuant to
the Note and the Loan Agreement, Borrower also executed that certain Security
Agreement, also dated as of the Loan Date, whereby the Bank took a security
interest in all assets of Borrower ("Security Agreement); and

         WHEREAS, to further secure the sums due and payable to the Bank
pursuant to the Note and the Loan Agreement, to perform the covenants and
conditions thereof and of certain documents executed in conjunction therewith,
each Guarantor executed an unconditional and unlimited guaranty ("Guaranty"),
also dated as of the Loan Date, whereby each Guarantor unconditionally
guaranteed the Borrower's performance of the Note and the Loan Agreement and
the other loan documents executed therewith; and

         WHEREAS, the Note, the Loan Agreement, the Security Agreement and all
of the documents executed in conjunction therewith are sometimes jointly
referred to herein as the "Loan Documents"; and

         WHEREAS, the Borrower has requested that the Bank amend and extend the
maturity date of the Note and modify the terms of the Note and the Loan
Agreement; and

         WHEREAS, the Bank and the Borrower and each Guarantor desire that the
Note and the Loan Agreement be amended and modified as hereinafter described
and each Guarantor wishes to acknowledge and reaffirm the terms and conditions
of such Guarantor's Guaranty.

         NOW, THEREFORE, in consideration of the above recitals, and in
consideration of credit given or to be given by the Bank to the Borrower and
for other good and valuable consideration, all of which consideration is hereby
acknowledged, the parties hereto agree as follows:

1.       Each of the above recitals is true and correct and is incorporated
         herein by this reference.

2.       The Note is hereby amended, modified and extended as follows:

         On and after the Effective Date hereof the Note shall bear interest at
         the variable rate of equal to the Base Rate of interest as established
         by Excel Bank Minnesota of Edina, Minnesota from time to time ("Base
         Rate"). On the Effective Date hereof the Base Rate is four (4.00%)
         percent and the initial rate of interest under the Note as of the
         Effective Date is four (4.00%) percent. If the Base Rate is no longer
         established or is otherwise no longer available the holder of this
         Note may substitute a reasonably equivalent index to substitute for
         the Base Rate. The rate of interest hereunder shall change when, if,
         and as often as the Base Rate changes.

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         The principal and interest due pursuant to the Note shall be repaid as
         follows: In monthly payments of all accrued interest on the sums
         actually advanced thereunder commencing on January 1, 2004 and
         continuing monthly thereafter on the 1st day of each and every month
         until December 31, 2004 ("Maturity Date"), at which time the entire
         remaining balance due under the Note, including all principal and
         accrued but unpaid interest, shall be due and payable in full.

3.       The following sections of the Loan Agreement are hereby amended and
         modified as described below (all capitalized terms have the meanings
         given to them in the Loan Agreement):

         Section 5.08 MINIMUM NET WORTH. So long as the Note shall remain
         unpaid or the Bank shall have any Commitment hereunder, the Borrower
         will maintain, during and at the end of each fiscal quarter end, Net
         Worth at an amount not less than Six Million Six Hundred Fifty
         Thousand and 00/100 ($6,650,000.00) Dollars.

         Section 5.09 RATIO OF DEBT TO TANGIBLE NET WORTH. So long as the Note
         shall remain unpaid or the Bank shall have any Commitment hereunder,
         the ratio of the Borrower's Debt to Tangible Net Worth shall not
         exceed 1 to 1 measured at the end of each fiscal quarter end basis.

         Section 5.10 RATIO OF CURRENT ASSETS TO CURRENT LIABILITIES. The
         Borrower shall maintain, for each fiscal quarter end that the Note
         remains outstanding or the Bank shall have any Commitment hereunder,
         the ratio of its Current Assets to its Current Liabilities added to
         its outstanding debt under the Note at not less than 1.9 to 1.

4.       Borrower hereby acknowledges and reaffirms each and every
         representation, warranty, term, covenant and condition of the Loan
         Documents. Borrower further acknowledges and agrees that the Loan
         Documents (as hereby amended and modified) are fully enforceable
         against Borrower and that Borrower has no defense, right of offset or
         otherwise to preclude enforcement of the Loan Documents, as hereby
         amended and modified, by the Bank against Borrower.

5.       The Security Agreement shall continue to secure all sums owing to the
         Bank by the Borrower pursuant to the terms and conditions of the Note
         and the Loan Agreement, together with all interest thereon, in
         accordance with the terms and conditions of the Note and all other
         sums due and owing or to become due and owing pursuant to the terms
         and conditions of this Amendment, the Loan Agreement, the Security
         Agreement and the Note, including but not necessarily limited to any
         further or additional extensions or renewals thereof.

6.       Borrower and each Guarantor acknowledge that the principal balance
         remaining unpaid on the Note as of the Effective Date hereof is -zero-
         ($0.00) Dollars.

7.       Each Guarantor hereby acknowledges, ratifies and reaffirms each and
         every term, covenant, agreement, provision, and condition of their
         respective Guaranty and any collateral security documents securing
         such guaranty, including but not limited to the security agreement
         dated of even date with the Guaranty ("Collateral Security
         Documents"), and the Loan Documents and hereby acknowledges and agrees
         that the Guaranty guarantees to the Bank the repayment of all sums due
         and owing to the Bank pursuant to the terms, conditions and covenants
         of the Note and the performance of the terms and covenants of the
         balance of the Loan Documents. Each Guarantor hereby affirms and
         agrees that each such Guaranty is unconditional and unlimited and that
         such Guaranty along with the Collateral Security Documents related
         thereto are fully enforceable against such Guarantor. Each Guarantor
         hereby further affirms and agrees and that such Guarantor has no
         defense, right of offset, claim, cause of action or otherwise to
         preclude the absolute and immediate enforcement of the Guaranty and/or
         the Collateral Security Documents supporting such Guaranty by the
         Bank.

8.       On or before the execution hereof, Borrower shall pay to the Bank, the
         Bank's costs including its reasonable attorneys' fees, incurred in
         drafting this Amendment and related documents, if any.

9.       Except as herein specifically modified, amended or extended, all terms
         and conditions of the Loan Documents shall otherwise remain unchanged
         and in full force and effect.

10.      Notwithstanding anything to the contrary herein, this Amendment or any
         failure by the Bank to exercise any of its rights upon an event of
         default under the Loan Documents or the Guaranty or the Collateral
         Security Documents, whether prior to or subsequent to the effective
         date of this Amendment, shall not be deemed a waiver of the Bank's

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         available remedies under the Loan Documents, the Guaranty, or the
         Collateral Security Documents or any amendments thereof, or any other
         documents executed in conjunction therewith or incident thereto.

11.      All the terms of this Amendment shall be binding upon and inure to the
         benefit of and be enforceable by the successors and assigns of the
         parties hereto, to the extent assignment is permitted pursuant to the
         Loan Documents or the Guaranty.

12.      This Amendment is being executed in and is intended to be performed in
         the State of Minnesota and shall be construed and enforced in
         accordance with the laws of such state.

13.      This Amendment contains the entire agreement between the parties with
         respect to the covenants and promises contemplated herein and may be
         amended only in a writing signed by each of the parties hereto.

         IN WITNESS WHEREOF, the parties have executed this Amendment on the
day and year first above written.

                                        BORROWER:

                                        WSI INDUSTRIES, INC., a Minnesota
                                        corporation

                                        By: /s/ Michael J. Pudil
                                            -----------------------------------

                                        Its: President
                                             ----------------------------------

                                        GUARANTOR:

                                        TAURUS NUMERIC TOOL, INC., a
                                        Minnesota corporation

                                        By: /s/ Michael J. Pudil
                                            -----------------------------------

                                        Its: President
                                             ----------------------------------

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                                        WSI ROCHESTER, INC., a Minnesota
                                        corporation

                                        By: /s/ Michael J. Pudil
                                            -----------------------------------

                                        Its: President
                                             ----------------------------------

                                        EXCEL BANK MINNESOTA, a Minnesota
                                        banking corporation,

                                        By: /s/ Natalia Armitage
                                            -----------------------------------

                                        Its: Vice President
                                             ----------------------------------

                                      16<PAGE>

                                                                 Exhibit 10.2.3

                      DELPHAX TECHNOLOGIES CANADA LIMITED.
                       THIRD AMENDMENT TO CREDIT AGREEMENT

         This Third Amendment to Credit Agreement (herein, the "Amendment") is
entered into as of August 31, 2003, by and among Delphax Technologies Canada
Limited, f/k/a Check Technology Canada Ltd., an Ontario corporation (the
"Borrower"), Delphax Technologies Inc., f/k/a Check Technology Corporation, a
Minnesota corporation (the "Parent"), as Parent and as a Guarantor (the Parent,
together with all Domestic Subsidiaries in existence from time to time being
hereinafter referred to collectively as the "Guarantors" and each such entity
individually as a "Guarantor"), and Harris Trust and Savings Bank ("HTSB"), as
Administrative Agent for the Lenders (in such capacity, the "Administrative
Agent"), and Bank of Montreal ("BMO"), as sole Lender.

                             PRELIMINARY STATEMENTS

         A. Borrower and HTSB heretofore entered into that certain Credit
Agreement dated as of December 20, 2001 by and among the Borrower, the Parent,
and HTSB as sole Lender and as Administrative Agent, as amended by that certain
First Amendment to Credit Agreement dated as of December 18, 2002, as further
amended by that certain Second Amendment to Credit Agreement dated as of August
11, 2003 (as so amended, the "Credit Agreement"). All capitalized terms used
herein without definition shall have the same meanings herein as such terms have
in the Credit Agreement.

         B. Pursuant to that certain Assignment and Acceptance dated effective
as of August 31, 2003, by and between HTSB, as assignor, and BMO, as assignee,
pursuant to which HTSB as the prior Lender under the Credit Agreement assigned
all of its rights, titles, interests and obligations as a Lender to BMO. Unless
stated otherwise herein, all references to the "Lenders" shall be deemed to be
references to BMO in its capacity as sole Lender, together with any of its
successors or assigns.

         C. The parties intend to amend the Credit Agreement in certain
respects, in accordance with the terms and conditions described herein.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:

Section  1. Amendments.

         Subject to the satisfaction of the conditions precedent set forth in
Section 3 below, the Credit Agreement shall be and hereby is amended as follows:

         1.1. The first sentence of Section 3.1 of the Credit Agreement is
hereby amended by inserting the following proviso at the end of such sentence:

"; provided, that for so long as Bank of Montreal is the sole Lender under the
Credit Agreement, all such payments of principal, interest, fees and other
Obligations payable to the Lenders shall be made by the Borrower directly to
Bank of Montreal instead of the Administrative Agent, with such payments to be
made by no later than 12:00 Noon (Chicago time) on the due date thereof at such
location as Bank of Montreal may from time to time designate to the Borrower
(for clarity, the Borrower shall continue to

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pay to the Administrative Agent fees, reimbursements and other Obligations owed
to the Administrative Agent for the Administrative Agent's own account)"

         1.2.    The second sentence of Section 3.1 of the Credit Agreement is
hereby amended by deleting the words "by the Administrative Agent".

Section  2. Conditions Precedent.

         This Amendment shall become effective as of the date first above
written upon the satisfaction of all of the following conditions precedent:

         2.1.    The parties hereto shall have executed and delivered this
Amendment to the Administrative Agent.

         2.2.    Legal matters incident to the execution and delivery of this
Amendment and the other documents delivered in connection herewith shall be
satisfactory to the Administrative Agent and its counsel.

Section 3.  Representations.

         In order to induce the Administrative Agent and BMO to execute and
deliver this Amendment, each of the Parent and the Borrower hereby represents to
the Administrative Agent and the Lenders that as of the date hereof, and after
giving effect to this Amendment, (a) this Amendment constitutes the legal, valid
and binding obligations of each of the Borrower and the Parent, enforceable in
accordance with its terms, (b) the representations and warranties set forth in
Section 6 of the Credit Agreement are and shall be and remain true and correct
(except that the representations contained in Section 6.5 shall be deemed to
refer to the most recent financial statements of the Parent and the Subsidiaries
delivered to the Lenders), and (c) no Default or Event of Default has occurred
and is continuing under the Credit Agreement or shall result after giving effect
to this Amendment.

Section 4.  Miscellaneous.

         4.1.    The Borrower and the Parent have heretofore or concurrently
herewith executed and delivered to the Lenders the Security Agreements, the
Pledge Agreement and certain other Collateral Documents. The Borrower and the
Parent hereby acknowledge and agree that the Liens created and provided for by
the Collateral Documents continue to secure, among other things, the Obligations
arising under the Credit Agreement as amended hereby; and the Collateral
Documents and the rights and remedies of the Lenders thereunder, the obligations
of the Borrower and the Parent thereunder, and the Liens created and provided
for thereunder remain in full force and effect and shall not be affected,
impaired or discharged hereby. Nothing herein contained shall in any manner
affect or impair the priority of the liens and security interests created and
provided for by the Collateral Documents as to the indebtedness which would be
secured thereby prior to giving effect to this Amendment. Without limiting the
foregoing, the Parent confirms that its guaranty set forth in Section 12 of the
Credit Agreement, and all of the obligations of the Parent thereunder, remain in
full force and effect.

         4.2.    Except as specifically amended herein, the Credit Agreement and
the other Loan Documents are hereby ratified and confirmed and shall continue in
full force and effect in accordance with their terms. Reference to this specific
Amendment need not be made in the Credit Agreement,

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the Notes, the Loan Documents, or any other instrument or document executed in
connection therewith, or in any certificate, letter or communication issued or
made pursuant to or with respect to the Credit Agreement, any reference in any
of such items to the Credit Agreement being sufficient to refer to the Credit
Agreement as amended hereby.

         4.3.    The Borrower agrees to pay on demand all reasonable costs and
expenses of the Administrative Agent in connection with the negotiation,
preparation, execution and delivery of this Amendment and the other instruments
and documents contemplated hereby, including the reasonable fees and expenses of
counsel for the Administrative Agent.

         4.4.    This Amendment may be executed in any number of counterparts,
and by the different parties on different counterpart signature pages, all of
which taken together shall constitute one and the same agreement. Any of the
hereto may execute this Amendment by signing any such counterpart and each of
parties such counterparts shall for all purposes be deemed to be an original. A
facsimile copy of this Amendment and signatures thereon shall be considered for
all purposes as originals.

         4.5.    This Amendment shall be governed by the internal laws of the
State of Illinois.

                           [Signature Page to Follow]

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         This Amendment is entered into as of the date and year first above
written.

                                       DELPHAX TECHNOLOGIES CANADA LIMITED
                                          (f/k/a Check Technology Canada Ltd.),
                                          as Borrower

                                       By
                                          Name  /s/Robert M. Barniskis
                                                ----------------------
                                                    Robert M. Barniskis
                                          Title Chief Financial Officer

                                       DELPHAX TECHNOLOGIES INC. (f/k/a Check
                                          Technology Corporation), as Parent
                                          and as a Guarantor

                                       By
                                          Name  /s/Robert M. Barniskis
                                                ----------------------
                                                    Robert M. Barniskis
                                          Title Chief Financial Officer

                                       HARRIS TRUST AND SAVINGS BANK, in its
                                          individual capacity as Administrative
                                          Agent

                                       By
                                          Name  /s/Andrew T. Claar
                                                -------------------
                                                    Andrew T. Claar
                                          Title Vice President

                                       BANK OF MONTREAL, in its
                                          individual capacity as sole Lender

                                       By
                                          Name  /s/Richard A. Garcia
                                                --------------------
                                                    Richard A. Garcia
                                          Title Director

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