EXHIBIT 10.1
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C#: 15334
L#: 15333
Amendment No. 04
To Security Agreement
This MASTER SECURITY AGREEMENT AMENDMENT is made as of September 26, 2001,
and is annexed to and made a part of the MASTER SECURITY AGREEMENT DATED AS OF
SEPTEMBER 27, 1999 (the "Agreement") between KEY Equipment Finance, a Division
of KEY Corporate Capital Inc., as lender, and PRESSTEK, INC., as Borrower.
Unless OTHERWISE specified herein, all capitalized terms shall have the meanings
ascribed to them in the Agreement.
1. The terms of this Amendment replace and supercede in their entirety the
terms of all prior Financial Covenant addenda and amendments to the
Agreement, as well as all amendments to such addenda (if any), including
without limitation the Financial Covenants Addenda dated as of September
27, 1999.
2. This Amendment is effective from and after September 26, 2001.
3. TOTAL FUNDED DEBT TO EBITDA RATIO: Borrower shall maintain a ratio of Total
Funded Debt to EBITDA of not greater than 2.5 to 1; calculated for the
period of the previous four financial quarters as at the end of each fiscal
quarter.
4. MINIMUM LIQUIDITY: Borrower shall maintain a minimum liquidity of not less
that $2,500,000 as cash or cash equivalents.
5. FIXED CHARGE COVERAGE: Borrower shall maintain a minimum Fixed charge
Coverage of 1.25 to 1, measured at the end of each fiscal quarter.
6. CALCULATION: Unless otherwise noted, the financial covenants contained
herein shall be computed based on the consolidated financial statements of
Presstek, Inc. and subsidiaries.
7. COMPLIANCE. Borrower shall, within thirty (30) days of the end of each
fiscal quarter end of Borrower, provide Lender with a certificate (a
"Compliance Certificate") representing that Borrower is in full compliance
with the foregoing financial covenants and setting forth the calculations
used by Borrower to reach its conclusion. The Compliance Certificate shall
be signed by Borrower's chief financial officer or, if Borrower does not
have a chief financial officer, such other officer or employee of Borrower
who performs the duties typically undertaken by a chief financial officer.
DEFINITIONS:
a) "EBITDA" means, calculated for the period of the previous four fiscal
quarters, the net earnings of Borrower plus the aggregate amounts deducted
in determining such net income in respect of interest expenses, taxes,
depreciation and amortization; but not, however, giving effect to
extraordinary losses or gains in calculating net income.
b) "TOTAL FUNDED DEBT" means, the sum, without duplication for a Borrower and/
or any of its subsidiaries of (1) all indebtedness for borrowed money,
whether maturing in less than or more than one year, plus (2) all bonds,
notes, debentures or similar debt instruments plus (3) all capitalized
lease obligations plus (4) the present value of all basic rental
obligations under any synthetic lease plus, (5) indebtedness of a second
person secured by a lien on any property owned by a first person, whether
or not such indebtedness has been assumed plus (6) the full outstanding
balance of trade receivables sold with full or limited recourse, provided
that if THE structure of any receivables sales program provides for
"over-collateralization", the outstanding balance of the trade receivables
attributable to the "over-collateralization" may be excluded plus (7) the
stated value, or liquidation value, if higher, of all redeemable stock or
such person.
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Form No.: 99-508.501 Page 1 of 2
c) Fixed Charge means, Net income after taxes, and exclusive of extraordinary
gains, gains on asset sales, and other income, plus depreciation and
amortization, plus interest expense, plus lease expense, less dividends,
and distributions; divided by interest expense, plus current maturities of
long-term debt and current maturities of capital leases, plus lease
expenses, plus preferred stock dividends, plus Capital Expenditures
(calculated for the preceding twelve-month period).
d) Calculation of Fixed Charge - actual Capital Expenditures for the quarters
ended 12/ 31/ 2000 and 3/ 37/ 2001 shall be replaced with $1,500,000.
EXCEPT AS EXPRESSLY MODIFIED HEREBY, ALL OF THE TERMS, COVENANTS AND
CONDITIONS OF THE AGREEMENT SHALL REMAIN IN FULL FORCE AND EFFECT AND ARE IN ALL
RESPECTS HEREBY RATIFIED AND AFFIRMED.
IN WITNESS WHEREOF, Lender and Borrower have executed this Amendment as of
the date first written above.
Lender: Borrower:
Key Equipment Finance, a Division of PRESSTEK, INC.
Key Corporate Capital Inc.
By: /s/ Xxxxxx X. Xxxxxxxx /s/ Xxxx Xxxxxx
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Name: Name: Xxxx Xxxxxx
Title: Title: Vice President and
Chief Financial Officer
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Form No.: 99-508.501 Page 2 of 2
