FARGO ELECTRONICS INC
EXHIBIT 10.35
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<DESCRIPTION>EXHIBIT 10.35
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<BR></FONT><FONT SIZE=2><B>AMENDMENT No.&nbsp;2<BR>  TO<BR>  CREDIT AGREEMENT    <BR>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=2><B>This Amendment No.&nbsp;2 to Credit Agreement</B></FONT><FONT SIZE=2>, dated as of February&nbsp;14, 2002 (the "Amendment"), among
FARGO ELECTRONICS,&nbsp;INC., a Delaware corporation ("</FONT><FONT SIZE=2><I>Company</I></FONT><FONT SIZE=2>"), the financial institutions that are or may from time to time become parties hereto
(together with their respective successors and assigns, the "</FONT><FONT SIZE=2><I>Banks</I></FONT><FONT SIZE=2>"), LASALLE BANK NATIONAL ASSOCIATION (in its individual capacity,
"</FONT><FONT SIZE=2><I>LaSalle</I></FONT><FONT SIZE=2>"), 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 Credit Agreement dated as of September&nbsp;15, 2000, as amended by that certain Amendment No.&nbsp;1 to Credit Agreement and Waiver, dated as of April&nbsp;20,
2001, among the Company, LaSalle, in its capacities as Agent, Issuing Bank, and as a Bank, and the other Banks (as so amended, the "Original Agreement"). </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ke1733_recitals_"> </A>
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<BR></FONT><FONT SIZE=2><B>RECITALS:    <BR>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A.
The Company has requested that the Lender Parties amend certain</FONT><FONT SIZE=2><I> Sections </I></FONT><FONT SIZE=2>of the Original Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B.&nbsp;&nbsp;&nbsp;&nbsp;Subject
to the terms and conditions of this Amendment, the Lender Parties will agree to the foregoing request of the Company. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>NOW, THEREFORE,</B></FONT><FONT SIZE=2> the parties agree as follows: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Defined Terms.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Amendment.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;The Original Agreement is hereby amended as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;The
definitions of "</FONT><FONT SIZE=2><I>EBITDA</I></FONT><FONT SIZE=2>" "</FONT><FONT SIZE=2><I>Fixed Charge Coverage Ratio</I></FONT><FONT SIZE=2>,"
"</FONT><FONT SIZE=2><I>Interest Expense,</I></FONT><FONT SIZE=2>" "</FONT><FONT SIZE=2><I>Termination Date</I></FONT><FONT SIZE=2>" and "</FONT><FONT SIZE=2><I>Total Debt To EBITDA
Ratio</I></FONT><FONT SIZE=2>" appearing in </FONT><FONT SIZE=2><I>Section&nbsp;1</I></FONT><FONT SIZE=2> are respectively amended in their entireties to read as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>EBITDA</I></FONT><FONT SIZE=2> means, for any period, Consolidated Net Income for such period, </FONT><FONT SIZE=2><I>plus</I></FONT><FONT SIZE=2>, to the
extent deducted in determining such Consolidated Net Income, Interest Expense, income tax expense, depreciation and amortization. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Fixed Charge Coverage Ratio</I></FONT><FONT SIZE=2> means, for any Computation Period, the ratio of
(a)&nbsp;</FONT><FONT SIZE=2><B>Adjusted</B></FONT><FONT SIZE=2> EBITDA </FONT><FONT SIZE=2><I>to</I></FONT><FONT SIZE=2> (b)&nbsp;the sum for such period of (i)&nbsp;Interest Expense </FONT> <FONT SIZE=2><I>plus</I></FONT><FONT SIZE=2>
(ii)&nbsp;required payments of principal of Debt (including required payments of principal of the Term Loan but excluding required payments of
principal of the Revolving Loans whether such Revolving Loan principal payments were made before or after the 'Effective Date' of the First Amendment). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Interest Expense</I></FONT><FONT SIZE=2> means, for any period, the consolidated interest expense of the Company and its Subsidiaries for such period (including
all imputed interest on Capital Leases and synthetic leases) and all commitment fees, letter of credit fees, agency fees, facility fees, balance deficiency fees and similar fees or expenses incurred
in connection with the borrowing of money other than the Extension Fee. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Termination Date</I></FONT><FONT SIZE=2> means the earlier to occur of (a)&nbsp;April&nbsp;1, 2003, or (b)&nbsp;such other date on which the Commitments
terminate pursuant to </FONT><FONT SIZE=2><I>Section&nbsp;6</I></FONT><FONT SIZE=2> or </FONT><FONT SIZE=2><I>12</I></FONT><FONT SIZE=2>. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Total Debt to EBITDA Ratio</I></FONT><FONT SIZE=2> means, as of the last day of any Fiscal Quarter, the ratio of (i)&nbsp;Total Debt as of such day to
(ii)&nbsp;</FONT><FONT SIZE=2><B>Adjusted</B></FONT><FONT SIZE=2> EBITDA for the Computation Period ending on such day." </FONT></P>

</UL>
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<P ALIGN="CENTER"><FONT SIZE=2>1</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;1</I></FONT><FONT SIZE=2> is further amended by adding new definitions of "</FONT><FONT SIZE=2><I>Adjusted
EBITDA</I></FONT><FONT SIZE=2>" and "</FONT><FONT SIZE=2><I>Extension Fee</I></FONT><FONT SIZE=2>" to respectively read as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><I>Adjusted EBITDA</I></FONT><FONT SIZE=2> means, for any period, Consolidated Net Income for such period,</FONT><FONT SIZE=2><I> plus</I></FONT><FONT SIZE=2>, to
the extent deducted in determining such Consolidated Net Income, Interest Expense, income tax expense, depreciation, amortization, and up to $1,500,000 in expenses incurred by the Company with respect
to the acquisition of the Company by Zebra Technologies,&nbsp;Inc. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Extension Fee</I></FONT><FONT SIZE=2> shall have the meaning given such term in </FONT><FONT SIZE=2><I>Section&nbsp;5.5</I></FONT><FONT SIZE=2>." </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;5</I></FONT><FONT SIZE=2> is amended by adding a new </FONT><FONT SIZE=2><I>Section&nbsp;5.5</I></FONT><FONT SIZE=2> to read as
follows: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;"</FONT><FONT
SIZE=2><B><I>5.5 Extension Fee</I></B></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;The Company agrees to pay an Extension Fee (the "Extension Fee") to the Agent for the account of each
Bank in the installment amounts set forth on the dates shown in the following table; </FONT><FONT SIZE=2><I>provided</I></FONT><FONT SIZE=2>, </FONT><FONT SIZE=2><I>that</I></FONT><FONT SIZE=2>, no
such installment shall be due and payable if the the Commitments have been terminated, the Loans have been paid in full and all Letters of Credit returned undrawn prior to the date on which such
installment is due: </FONT></P>
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<TR VALIGN="BOTTOM">
<TH WIDTH="55%" ALIGN="CENTER"><FONT SIZE=1><B>Extension&nbsp;Fee&nbsp;Installment<BR>
Due&nbsp;Date</B></FONT><HR NOSHADE></TH>
<TH WIDTH="12%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH COLSPAN=2 ALIGN="CENTER"><FONT SIZE=1><B>Extension&nbsp;Fee&nbsp;Installment<BR>
Amount</B></FONT><HR NOSHADE></TH>
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<TD WIDTH="55%"><FONT SIZE=2>February&nbsp;14,&nbsp;2002</FONT></TD>
<TD WIDTH="12%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="27%" ALIGN="RIGHT"><FONT SIZE=2>50,000.00</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="55%"><FONT SIZE=2>July 31, 2002</FONT></TD>
<TD WIDTH="12%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="27%" ALIGN="RIGHT"><FONT SIZE=2>25,000.00</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="55%"><FONT SIZE=2>October 31, 2002</FONT></TD>
<TD WIDTH="12%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="4%"><FONT SIZE=2>$</FONT></TD>
<TD WIDTH="27%" ALIGN="RIGHT"><FONT SIZE=2>25,000.00</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>"</FONT></TD>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;6.3</I></FONT><FONT SIZE=2> is amended in its entirety to read as follows: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>"6.3 All Prepayments.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Each voluntary partial prepayment shall be in a principal amount of $100,000.00 or a higher integral
multiple of $25,000.00. Any partial prepayment of a Group of Eurodollar Loans shall be subject to the proviso to </FONT><FONT SIZE=2><I>Section&nbsp;2.2.3(a)</I></FONT><FONT SIZE=2>. Any prepayment
of a Eurodollar Loan on a day other than the last day of an Interest Period therefor shall include interest on the principal amount being repaid and shall be subject to </FONT> <FONT SIZE=2><I>Section&nbsp;8.4</I></FONT><FONT SIZE=2>. All prepayments
of the Term Loan shall be applied first to the next installment due, and, after such application, the remaining
amount of such prepayment shall be applied to the remaining installments in the inverse order of their maturities." </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;10.6.1</I></FONT><FONT SIZE=2> is amended in its entirety to read as follows: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>"10.6.1 Fixed Charge Coverage Ratio.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Not permit the Fixed Charge Coverage Ratio for any Computation Period to be less than
2.00 to 1.00" </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;10.6.2</I></FONT><FONT SIZE=2> is amended in its entirety to read as follows: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>"10.6.2 Total Debt to Adjusted EBITDA Ratio.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Not permit the Total Debt to Adjusted EBITDA Ratio as of the last day of any
Computation Period to exceed 2.00 to 1.00." </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Section&nbsp;10.6.4</I></FONT><FONT SIZE=2> is amended in its entirety to read as follows: </FONT></P>

<UL>
<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>"10.6.4 Adjusted EBITDA.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;Not permit Adjusted EBITDA for the three consecutive months ending on the last day of any Fiscal
Quarter to be less than $1,700,000.00" </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;The
Pricing Schedule attached to the Original Agreement is amended to conform to the Pricing Schedule (Amended, February, 2002) attached hereto. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Schedule&nbsp;3.1
attached to the Original Agreement is amended to conform to Schedule&nbsp;3.1 Term Loan Installments (Amended, February, 2002) attached hereto. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;The
Form of Compliance Certificate, attached to the Original Agreement as Exhibit&nbsp;B, is amended to conform to the Form of Compliance Certificate (Amended,
February, 2002) attached hereto. </FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Conditions to Effectiveness.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;This Amendment shall become effective on the date (the "Effective Date") when,
and only when, the Agent shall have received: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Counterparts
of this Amendment executed by the Company and the Lender Parties; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;(i)&nbsp;a
current schedule signed by a Designated Person describing all of the Company's and its Subsidiaries' United States patents and patent applications; and
(ii)&nbsp;an amendment to the Notice of Security Interest most recently filed in the United States Patent and Trademark Office conforming such filing to the scheduled patent and publicly available
patent applications, each of which shall be in form and substance satisfactory to the Agent; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;the
first installment of the Extension Fee, in the amount of $50,000, payable to the Agent in immediately available funds for pro rata distribution to the Banks; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;Such
other documents or other items as the Agent or any other Lender Party may reasonably request. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Representations and Warranties.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;To induce the Lender Parties to enter into this Amendment, the Company
represents and warrants to the Lender Parties as follows: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;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; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;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; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;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 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, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;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. </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.
</FONT><FONT SIZE=2><B><I>Reference to and Effect on the Loan Documents.</I></B></FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;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. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;The
execution, delivery and effectiveness of this Amendment shall not operate as a waiver, except as expressly provided in </FONT> <FONT SIZE=2><I>Section&nbsp;10</I></FONT><FONT SIZE=2> hereof, 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. </FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Costs, Expenses and Taxes.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Governing Law</I></B></FONT><FONT SIZE=2>.&nbsp;&nbsp;&nbsp;&nbsp;This Amendment shall be governed by and construed in accordance with the laws of the State of
Minnesota. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Headings.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B><I>Counterparts.</I></B></FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>

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<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><B>IN WITNESS WHEREOF,</B></FONT><FONT SIZE=2> the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as
of the date first written above. </FONT></P>

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&nbsp;</FONT></TD>
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FARGO ELECTRONICS,&nbsp;INC.</FONT></TD>
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&nbsp;</FONT></TD>
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By:</FONT></TD>
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/s/ Jeffrey D. Upin</FONT><HR NOSHADE></TD>
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<TD WIDTH="5%"><FONT SIZE=2>Its:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="44%"><FONT SIZE=2>Vice&nbsp;President&nbsp;and&nbsp;General&nbsp;Counsel</FONT><HR NOSHADE></TD>
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Subscribed and sworn to before me this 14th day of February, 2002.</FONT></TD>
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&nbsp;</FONT></TD>
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&nbsp;</FONT></TD>
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<TD WIDTH="47%" VALIGN="TOP"><FONT SIZE=2><BR>
/s/ Maria Rotz</FONT><HR NOSHADE><FONT SIZE=2> Notary Public</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="44%" VALIGN="TOP"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
LASALLE BANK NATIONAL ASSOCIATION, as<BR>
Agent, Issuing Bank and as a Bank</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="44%"><FONT SIZE=2><BR>
/s/ Ann Pifer</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>Its:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="44%"><FONT SIZE=2>First Vice President</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD COLSPAN=3><FONT SIZE=2><BR>
HARRIS TRUST AND SAVINGS BANK, as a Bank</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2><BR>
By:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="44%"><FONT SIZE=2><BR>
/s/ Andrew T. Claar</FONT><HR NOSHADE></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="47%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="5%"><FONT SIZE=2>Its:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="44%"><FONT SIZE=2>Vice President</FONT><HR NOSHADE></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<A NAME="page_ke1733_1_6"> </A>
<P ALIGN="RIGHT"><FONT SIZE=2><A
NAME="ke1733_schedule_3.1"> </A>
<A NAME="toc_ke1733_3"> </A>
<BR></FONT><FONT SIZE=2><B>Schedule 3.1    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ke1733_term_loan_installments_(amended_february,_2002)"> </A>
<A NAME="toc_ke1733_4"> </A>
<BR></FONT><FONT SIZE=2><B>Term Loan Installments<BR>  (Amended February, 2002)    <BR>  </B></FONT></P>

<!-- User-specified TAGGED TABLE -->
<TABLE WIDTH="76%" BORDER=0 CELLSPACING=0 CELLPADDING=0>
<TR VALIGN="BOTTOM">
<TH WIDTH="31%" ALIGN="CENTER"><FONT SIZE=1><B>Date</B></FONT><HR NOSHADE></TH>
<TH WIDTH="3%"><FONT SIZE=1>&nbsp;</FONT></TH>
<TH WIDTH="66%" ALIGN="CENTER"><FONT SIZE=1><B>Principal Installment Amount</B></FONT><HR NOSHADE></TH>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>March&nbsp;31, 2002</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>$1,000,000.00</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>June&nbsp;30, 2002</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>$1,000,000.00</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>September&nbsp;30, 2002</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>$1,000,000.00</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>December&nbsp;31, 2002</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>$1,000,000.00</FONT></TD>
</TR>
<TR BGCOLOR="#CCEEFF" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>March&nbsp;31, 2003</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>$1,000,000.00</FONT></TD>
</TR>
<TR BGCOLOR="White" VALIGN="TOP">
<TD WIDTH="31%"><FONT SIZE=2>Termination Date</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="66%"><FONT SIZE=2>Entire Term Loan Principal Amount Outstanding on such date</FONT></TD>
</TR>
</TABLE>
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<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<BR>
<P><br><A NAME="02STP1703_2">QuickLinks</A><br></P><!-- TOC_BEGIN -->
<FONT SIZE=2><A HREF="#toc_ke1733_1">AMENDMENT No. 2 TO CREDIT AGREEMENT</A></FONT><BR>
<FONT SIZE=2><A HREF="#toc_ke1733_2">RECITALS</A></FONT><BR>
<UL>
<FONT SIZE=2><A HREF="#toc_ke1733_3">Schedule 3.1</A></FONT><BR>
</UL>
<FONT SIZE=2><A HREF="#toc_ke1733_4">Term Loan Installments (Amended February, 2002)</A></FONT><BR>

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