October 1, 2009
Presstek, Inc.
10 Glenville Street
Greenwich, Connecticut
06831
|
|
Re:
|
Forbearance and Amendment
Agreement
|
Ladies and Gentlemen:
Reference is hereby made to the
Amended and Restated Credit Agreement, dated as of November 5, 2004
(as amended and in effect from time to time, the " Credit
Agreement "), among Presstek, Inc. (the “ Borrower
”), Lasertel Inc., Precision Lithograining Corp., Precision
Acquisition Corp., SDK Realty Corp., ABD International, Inc.,
Presstek Capital Corp., Presstek Overseas Corp., ABD Canada
Holdings, Inc., Presstek New York, Inc. (collectively, the “
Guarantors ” and, together with the Borrower, the
“ Obligors ”), the various lending institutions
party thereto (collectively, the " Lenders "), and RBS
Citizens, National Association (“ Citizens ”),
as Administrative Agent for the Lenders (in such capacity, the "
Administrative Agent "). All capitalized terms used herein
without definition shall have the meanings assigned to such terms
in the Credit Agreement.
Each Obligor acknowledges and agrees
that certain Events of Default now exist and are continuing under
the Loan Documents. Each Obligor also acknowledges and agrees that,
as a result of the foregoing, the Administrative Agent or the
Requisite Lenders may, if the Administrative Agent or the Requisite
Lenders elect in their sole discretion to do so, proceed to enforce
at any time on or after the date hereof any of their rights and
remedies under the Loan Documents or at law or in equity,
including, without limitation, the rights and remedies set forth in
Section 9.2 of the Credit Agreement. Notwithstanding the foregoing,
the Obligors have each now requested that the Lenders forbear from
enforcing their rights and remedies under the Loan Documents for
the time period and on the conditions set forth herein.
In response to such request, the
Administrative Agent and the Lenders have agreed to forbear from
enforcing such rights and remedies until the Forbearance
Termination Date (as hereinafter defined) upon the following terms
and conditions:
|
|
Section 1.
|
Ratification of Existing
Agreements.
|
All of the Obligors’
indebtedness, liabilities and obligations to the Lenders as
evidenced by or otherwise arising under the Loan Documents are, by
the Obligors’ execution of this Agreement, ratified and
confirmed in all respects. In addition, by the execution of this
Agreement, each Obligor represents, warrants and agrees that (a) as
of October 1, 2009, the aggregate outstanding principal amount of
the Term Loans is $834,000; (b) as of October 1, 2009, the
aggregate outstanding principal amount of the Revolving Loans is
$26,362,428.93 (including an outstanding Letter of Credit in the
stated amount of $1,250,000); and (c) to its knowledge, none of the
Obligors has any defense, counterclaim, right of set-off, or right
of recoupment of any kind to or with respect to its obligation to
pay, as and when due and payable
pursuant to the Loan Documents, the
Term Loans and Revolving Loans, accrued and unpaid interest
thereon, and all of the other Obligations.
|
|
Section 2.
|
Representations and
Warranties.
|
All the representations and
warranties made by the Obligors in the Loan Documents are true and
correct on the date hereof as if made on and as of the date hereof,
except to the extent that any of such representations and
warranties relate by their terms to a prior date.
|
|
Section 3.
|
Forbearance
Conditions.
|
Subject to the terms and conditions
set forth herein, the Administrative Agent and Lenders agree to
forbear from exercising their rights and remedies under the Loan
Documents, including without limitation, commencing legal action to
enforce the agreements and obligations of the Obligors under the
Loan Documents, until the date (the “ Forbearance
Termination Date ”) which is the earliest to occur of (a)
the occurrence or continuance after the date hereof of any Event of
Default other than the Events of Default listed on Schedule
1 attached hereto (the Events of Default listed on Schedule
1 being referred to herein as “ Specified Defaults
”); (b) the failure of any Obligor to comply with any term or
condition set forth in this Agreement; (c) the occurrence after the
date hereof of any event or circumstance that has, or could be
reasonably expected to have, a Material Adverse Effect; (d) any
Obligor or any Affiliate of any Obligor shall commence any
litigation or other proceeding against the Administrative Agent or
any Lender or any Affiliate of the Administrative Agent or any
Lender in connection with any of the transactions contemplated by
any of the Loan Documents (which term shall include without
limitation this Agreement); (e) the failure of actual cash flow, as
projected in the projections to be delivered by the Borrower
pursuant to Section 5.3 (as added to the Credit Agreement hereby),
for any month, commencing with the month ended September 30, 2009,
to be at least eighty percent (80%) of the amount of cash flow
projected for such month by such projections; and (f)
November 30, 2009, provided that the date set forth in this clause
(f) shall be automatically extended to December 15, 2009 without
any further action of the parties hereto upon the Borrower’s
payment to the Administrative Agent, in immediately available
funds, for the pro rata accounts of each of the Lenders in
accordance with the aggregate amount of Obligations owed to each of
them, of $20,000. On and after the Forbearance Termination Date,
the Administrative Agent in its sole and absolute discretion (or as
directed by the Requisite Lenders in their sole and absolute
discretion) may proceed to enforce any or all of its and the
Lenders’ rights under or in respect of the Loan Documents and
applicable law.
|
|
Section 4.
|
Conditions
Precedent.
|
The forbearance obligations of the
Lenders hereunder shall be subject to the satisfaction on or before
the date hereof of the following conditions precedent (the date
that such conditions are satisfied being referred to herein as the
“ Forbearance Effective Date ”):
(a) This
Agreement shall be executed by each of the Obligors, each of the
Lenders and the Administrative Agent.
(b) No
Event of Default (other than the Specified Defaults) shall have
occurred and be continuing as of the date hereof.
(c) The
Borrower shall have paid to the Administrative Agent, in
immediately available funds, for the pro rata accounts of the
Lenders in accordance with the aggregate amount of Obligations owed
to each of them, $125,000 of the Forbearance Fee due i