EX-99.1 EMPLOYMENT AGREEMENT SUSAN A MCLAUGHLIN

Exhibit 99.1

EMPLOYMENT AGREEMENT

     AGREEMENT (the “Agreement”) dated this January 24, 2005 made by and between Presstek, Inc., a Delaware corporation, its parents, subsidiaries, divisions, and affiliated entities, successors and assigns (the “Employer”), and Susan A. McLaughlin (the “Employee”).

     WHEREAS, both the Employer and the Employee wish for the Employee to be employed by Employer in capacity of Senior Vice President of Presstek, Inc. and President of ABD International, Inc.;

     NOW, THEREFORE, in consideration of the promises hereafter contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto AGREE as follows:

     1.  Definitions . For the purposes of this Agreement, the following terms shall have the following respective meanings. All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Plan.

          “ Person ” shall mean any individual, corporation, partnership (limited or general), limited liability company, association, trust, joint venture, unincorporated organization or any similar entity or otherwise.

          “ Restricted Shares ” shall initially mean all of the Shares being purchased by the Grantee on the Grant Date pursuant to Section 7(b)(2) hereof; provided that Shares shall no longer be Restricted Shares and shall become Vested Shares with respect to five thousand (5,000) of the Shares on the first anniversary of the Grant Date, five thousand (5,000) of the Shares on the second anniversary of the Grant Date, and five thousand (5,000) of the Shares on the third anniversary of the Grant Date. Notwithstanding the foregoing, as of the effective date of any Change of Control, one hundred percent (100%) of the total number of the Shares shall no longer be Restricted Shares and shall become Vested Shares provided that the Employee is employed by the Employer, or its successor, on the effective date of such Change of Control.

          “ Termination Event ” shall mean the termination of the Employee’s employment (i) by the Employer with or without Cause or (ii) by the Employee for any reason whatsoever.

          “ Vested Shares ” shall mean all Shares which are not Restricted Shares.

     2.  Consideration. In consideration for the Employee’s execution of this Agreement, the Employer agrees that the Employee shall become employed by the Employer as set forth in this Agreement, the Employee shall be permitted access to the Employer’s confidential information and trade secrets and the Employee shall be eligible to receive post-Term Severance Payments (Section 16) or the Change in Control payment

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(Section 19) as set forth in this Agreement (subject to her compliance with Sections 17 and 18 of this Agreement). The Employee understands, acknowledges and agrees that the Employee would not receive the consideration specified in this Section 2, except for the Employee’s execution of this Agreement and the fulfillment of the promises contained herein.

     3.  Employment. Commencing as of a date to be mutually determined by the Employee and the Employer, but in no event later than February 1, 2005 (the “Start Date”), the Employee shall be employed as Senior Vice President of Presstek, Inc. and President of ABD International, Inc. through the Term of, and in accordance with the terms of, this Agreement. The Employee shall render executive, general management, financial, policy and other management services to the Employer of the type customarily performed by persons situated in similar executive and management capacities. The Employee shall perform such other related duties as the Chief Executive Officer and Board of Directors of the Employer may from time to time reasonably direct.

     4.  Employment Term. “Term,” as used in this Agreement, shall refer to the Term of this Agreement as defined in this Section. The Term of the employment under this Agreement shall commence as of the date specified in Section 3 and shall initially end three (3) years thereafter, on the day preceding the third anniversary of the initial term, unless terminated sooner in accordance with the provisions hereof. The Term of employment under this Agreement shall, at the expiration of the initial Term and on each anniversary thereafter (commencing with the third anniversary), be automatically extended for an additional year unless the Employer or the Employee gives written notice to the other, at least 90 days prior to such anniversary date, that she or it does not concur in such extension. If neither party gives notice of non-concurrence in such extension, the Term will be automatically extended for an additional year, unless terminated sooner in accordance with the provisions hereof.

     5.  Compensation. The Employer agrees to pay the Employee during the Term of this Agreement an annual base salary equal to TWO HUNDRED AND FIFTY THOUSAND U.S. DOLLARS AND ZERO CENTS ($250,000.00) with the salary to be reviewed annually during the Term of this Agreement by the Chief Executive Officer of the Employer. The base salary of the Employee shall not be decreased at any time during the Term of this Agreement from the amount then in effect, unless the Employee otherwise agrees in writing. The salary shall be payable to the Employee in accordance with the Employer’s payroll system, as determined by the Employer, but not less frequently than monthly. All payments and benefits in this Agreement shall be subject to all applicable federal, state and local withholding, payroll and other taxes.

     Participation in discretionary bonuses, retirement and other employee benefit plans and fringe benefits shall, if any, not reduce the salary payable to the Employee under this Section 5.

     6.  Discretionary Bonuses. During the Term of this Agreement, the Employee may be entitled to receive an annual cash bonus of up to 40% of the Employee’s then annual base salary, based on the Employee’s contribution to the

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accomplishment of key annual corporate objectives mutually determined by the Employee and the Employer. The determination of whether to pay a discretionary bonus, and the amount of the bonus, if any, shall be made by the Employer in its sole and absolute discretion. During the Term of this Agreement, the Employee also may be entitled to participate in any incentive compensation and bonus programs authorized and declared by the Board of Directors or Compensation Committee of the Employer for the benefit of the Employer’s executives. The determination of whether the Employee is eligible to participate in any such incentive compensation and bonus programs, and the amount of incentive compensation and bonus paid, if any, shall be made solely by the Employer. No other compensation provided for in this Agreement shall be deemed a substitute for the Employee’s right to participate in such incentive compensation or bonus programs when and as declared.

     7.  Retirement and Employee Benefit Plans; Fringe Benefits; Equity or Securities Compensation. (a) Subject to the long-term compensation plan(s) that, subsequent to the execution of this Agreement, may be developed by the Compensation Committee of the Board of Directors of Presstek, Inc. (the “Committee”), the Employee shall receive compensation under terms and conditions as shall so be determined by the Committee at its sole and unfettered discretion.

          (b) In addition to such other compensation as may be set out in this Agreement, Employee shall receive the following Equity Compensation:

(1) Subject to the terms and conditions of the Employer’s 2003 Stock Option and Incentive Plan (the “ Plan ”), the Employee shall be granted, on the date Employee actually commences employment with Employer (the “Grant Date”), options to purchase one hundred fifty five thousand (155,000) shares of common stock of the Employer at a price per share equal to the fair market value of the shares on the Grant Date. Fifty thousand (50,000) of such options shall be immediately exercisable on the Grant Date and the remaining one hundred five thousand (105,000) of such options shall become exercisable as to thirty five thousand (35,000) shares on each of the first, second and third anniversaries of the Grant Date; and

(2) Subject to the terms and conditions of the Plan, the Employer hereby sells and issues to the Employee fifteen thousand (15,000) shares of common stock, par value $0.01 per share (“ Common Stock ”), of the Employer (subject to the provisions below, the “ Shares ”), on the Grant Date for a per share price of $0.01 (the “Purchase Price”), subject to the terms and conditions set forth herein and in the Plan. Such Shares shall initially be “Restricted Shares.” The Employee agrees to the provisions set forth herein and in the Plan and acknowledges that each such provision is a material condition of this Agreement.

     8.  Repurchase of Restricted Shares .

          (a) Upon the occurrence of a Termination Event for any reason, the Employee shall forthwith sell to the Employer for the Purchase Price (the “Repurchase”) all such Restricted Shares owned by, or otherwise in the possession of, the Employee on the effective date of the Termination Event.

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          (b) Without limitation of any other provision of this Agreement or other rights, in the event that the Employee is required to sell Restricted Shares pursuant to the provisions of this Section 8 and in the further event that such Employee refuses or for any reason fails to deliver forthwith to the Employer such Restricted Shares the certificate or certificates evidencing such Restricted Shares together with a related stock power, the Employer may determine that such Restricted Shares shall at such time be deemed to have been sold, assigned, transferred and conveyed to the Employer, the Employee shall have no further rights thereto, and the Employer shall record such transfer in its stock transfer book or in any appropriate manner.

     9.  Restrictions on Transfer of Restricted Shares . (a) None of the Restricted Shares held by the Employee shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed of or encumbered, whether voluntarily or by operation of law, unless such transfer is in compliance with all applicable securities laws (including, without limitation, the Act), and such disposition is in accordance with the terms and conditions of this Section 9. In connection with any transfer of Restricted Shares, the Employer may require the transferor to provide at the transferor’s own expense an opinion of counsel, satisfactory to the Employer, that such transfer is in compliance with all applicable foreign, federal and state securities laws (including, without limitation, the Act). Any attempted disposition of Restricted Shares not in accordance with the terms and conditions of this Section 9 shall be null and void, and the Employer shall not reflect on its records any change in record ownership of any Restricted Shares as a result of any such transfer, shall otherwise refuse to recognize any such transfer and shall not in any way give effect to any such transfer of any Restricted Shares. Subject to the foregoing general provisions, Restricted Shares may be transferred pursuant to the following specific terms and conditions:

          (b)  Transfers Upon Death . Upon the death of the Employee, Restricted Shares may be transferred by will or by the laws of descent and distribution; provided that all such Restricted Shares at the time of such death shall be subject to the Repurchase. Notwithstanding the foregoing, upon the death of the Employee, all Restricted Shares shall be and remain subject to Section 9 and the Employee’s estate, executors, administrators, personal representatives, heirs, legatees and distributees shall be obligated to convey such Restricted Shares to the Employer or its assigns under the terms contemplated thereby.

     10.  Legends . Any certificate(s) representing the Shares shall carry substantially the following legends:

     “The shares of stock represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Act”), or the applicable securities laws of any state. The shares may not be sold, pledged or otherwise transferred without an effective registration statement for such shares under the Act and such state laws,

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or an available exemption therefrom, or an opinion of counsel satisfactory to the Company to the effect that such registration is not required.”

     “The transferability of this certificate and the shares of stock represented hereby are subject to the restrictions, terms and conditions (including repurchase rights, rights of first refusal and restrictions against transfers) contained in a certain Restricted Stock Agreement, as amended from time to time, between the Company and the holder of this certificate (a copy of which is available at the offices of the Company for examination).”

     11.  Escrow . In order to carry out the provisions of Sections 8 and 9 of this Agreement more effectively, the Employer shall hold the Restricted Shares in escrow together with separate stock powers executed by the Employee in blank. The Employer shall not transfer the Restricted Shares on the basis of such stock power except as provided in this Agreement. At such time as any Restricted Shares become Vested Shares, the Employer shall, at the written request of the Employee, deliver to the Employee a certificate representing such Vested Shares with the balance of the Restricted Shares to be held in escrow pursuant to this Section 11 .

     12.  Withholding Taxes . The Employee acknowledges and agrees that the Employer has the right to deduct from payments of any kind otherwise due to the Employee, or from the Restricted Shares held pursuant to Section 11 hereof, any federal, state or local taxes of any kind required by law to be withheld with respect to the purchase of the Restricted Shares by the Employee. In furtherance of the foregoing the Employee agrees to elect, in accordance with Section 83(b) of the Internal Revenue Code of 1986, as amended, to recognize ordinary income in the year of acquisition of the Restricted Shares, and to pay to the Employer all withholding taxes shown as due on his or her Section 83(b) election form, or otherwise ultimately determined to be due with respect to such election, based on the excess, if any, of the fair market value of such Restricted Shares as of the date of the purchase of such Shares by the Employee over the purchase price paid for such Restricted Shares.

     13.  Miscellaneous Provisions .

          (a)  Administration . All questions of interpretation concerning this grant of Restricted Shares shall be determined by the Committee. All determinations by the Committee shall be final and binding upon all persons having an interest in the Restricted Shares.

          (b)  Record Owner; Dividends . The Employee, during the duration of this Agreement, shall be considered the record owners of and shall be entitled to vote the Restricted Shares. The Employee shall be entitled to receive all dividends and any other

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distributions declared on the Restricted Shares; provided , however , that the Employer is under no duty to declare any such dividends or to make any such distribution.

          (c)  Equitable Relief . The parties hereto agree and declare that legal remedies are inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

          (d)  Change and Modifications . This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Employer and the Employee.

     In addition to the foregoing consideration, and subject to the eligibility requirements that may be applicable, the Employee may be entitled to participate during the Term in any plan or arrangement of the Employer relating to stock options, stock restricted stock, purchases, pension, thrift, or profit sharing benefits, or other benefits under qualified or non-qualified deferred compensation plans, group life insurance, medical coverage, education or any other employee benefits that the Employer, at its sole and unfettered discretion, may adopt or make available for the benefit of the Employee.

     The Employee may also be entitled during the Term of this Agreement to any standard fringe benefits which may be or become available by the Employer for the benefit of the Employee during the Term of this Agreement, and to the payment or reimbursement of reasonable expenses for attending annual and periodic meetings of trade associations, and any other benefits which are commensurate with the duties and responsibilities to be performed by the Employee under this Agreement.

     The Employer fully reserves its rights to change, modify or discontinue any of its stock purchase, retirement, employee benefit or other fringe benefit plans at any time during the Term of this Agreement in its sole and absolute discretion, and in accordance with applicable law.

     14.  Standards. The Employee shall perform her duties and responsibilities under this Agreement in accordance with such reasonable standards as are established from time to time by the Chief Executive Officer of Presstek, Inc, in his sole and absolute discretion.

     15.  Voluntary Absences; Vacations. The Employee shall be entitled to an annual paid vacation during the Term of this Agreement of four (4) weeks per year or such longer periods to which the Employee may be entitled as an employee of the Employer. The timing of paid vacations shall be scheduled in a reasonable manner by the Employee.

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16. Termination of Employment.

     (a) (i) The Employer may terminate the Employee’s employment at any time, but any termination by the Employer other than termination for Cause (as defined in Section 16(a)(iii) below) shall not prejudice the Employee’s right to receive compensation and other benefits under this Agreement, except as otherwise stated in this Agreement. In the event of a termination for Cause, the Employee shall have no right to receive compensation or other benefits, including payment of legal fees and expenses incurred, for any period after termination for Cause or if the Employee terminates her employment for any reason in violation of Section 16 (b) of this Agreement, except as otherwise required by law. Should the Employee so terminate her employment in violation of Section 16 (b) of this Agreement, Employee shall not be entitled to any independent benefits due the Employee under any employee benefit plan in which the Employee is then a participant, except as may be required by applicable law or as may be provided in the related benefit plan.

       (ii) In the event that the Employee’s employment ceases by reason of the Employer’s termination of the Employee’s employment during the Term other than for Cause, or if either party provides the other party with written notice of the party’s non-concurrence in the automatic extension of the Term, as set forth in Section 4 of this Agreement, the Employer shall be obligated concurrently with the termination of such employment, in lieu and replacement of the Employee’s entitlement to any compensation and other benefits under this Agreement pursuant to Section 16(a)(i), to make severance payments to the Employee in an aggregate amount that is equal to the Employee’s then current annual base salary for a period of one (1) year (collectively, the “Severance Payments”). The Severance Payments shall be paid after termination of employment in equal monthly installments according to the Employer’s normal payroll practices then in effect. However, if the Employer’s termination of the Employee’s employment without Cause occurs in connection with, or within one and one-half (1 1/2) years after, a “Change in Control” as defined in Section 19(b) hereof, the amount payable to the Employee shall be exclusively determined under Section 19(a) as limited by Section 19(c) hereof, and the Employer shall not be required to make the payments set forth in this Section. Should the Employer terminate the Employment of the Employee for any reason except for Cause, the Severance Payments under this Section 16(a)(ii) shall not be reduced by any compensation which the Employee may receive for other employment with another employer after termination of her employment with the Employer. Notwithstanding anything stated herein to the contrary, and for purposes of clarity, should the Employer terminate the Employment of the Employee for Cause, or should the Employee terminate her employment for any reason in violation of Section 16 (b) of this Agreement, the Employee shall not be entitled to receive Severance Payments. In addition, should the employment of the Employee terminate for any reason but by termination for Cause or by termination of the employment by the Employee in violation of Section 16 (b) of this Agreement, the Employee shall be entitled to have all existing retirement or employee benefits of the type referred to in Section 7(a) hereof continue for the remainder of the Term when the Agreement is terminated, except as otherwise required by law or provided in the related retirement or other employee benefit plans or agreements. Notwithstanding the foregoing, the Employer shall have no obligation to make any contributions to any

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retirement plan applicable to the Employee after the date the Employee ceases to be employed by the Employer except as may be required by such applicable plan. In the event of a retirement plan, the Employee shall be entitled to contributions made by the Employer to the retirement plan on the Employee’s behalf prior to the date of the Employee’s termination, which have vested and for which the Employee is otherwise eligible in accordance with the written terms of the official plan documents governing any applicable retirement plan. The Employer shall have no obligation to make the Severance Payments set forth in this Section unless the Employee fully complies with her obligations under this Agreement, including, but not limited to, her obligations under Sections 17 and 18 of this Agreement.

       (iii) References in this Agreement to “termination for Cause” shall mean termination on account of acts or omissions of the Employee which constitute Cause as defined below. Any determination with respect to a termination for Cause shall require the approval of the Board of Directors of the Employer. “Cause” shall mean any of the following: