Document Security Systems, Inc. Announces Debt Reduction and Refinancing

Strengthens Financial Position with Conversion and Refinancing of $2.9 Million of Short Term Debt


ROCHESTER, N.Y., Dec. 15  /PRNewswire-FirstCall/ -- Document Security Systems, Inc. (NYSE Amex: DMC; "DSS"), a world leader in the development and manufacturing of optical deterrent and authentication technologies that secure electronic data and help prevent counterfeiting and brand fraud from the use of desktop scanners and copiers in the market, is pleased to announce that it has reached several agreements that significantly reduce and extend the Company's near term debt obligations.

The Company converted $2,000,000 of short-term debt due under a $3,000,000 Credit Facility into equity and extended the availability of the remaining $1,000,000 under the Credit Facility to January 4, 2012.

In addition, the Company entered into two new debt agreements aggregating $925,000, of which $350,000 is convertible into up to 218,750 common shares, with maturities between 30 to 36 months and interest rates between 8% and 10%, the proceeds of which were used to pay in full the $900,000 Secured Promissory Note with Baum Capital Investments Inc. associated with the Company's acquisition in 2008 of its DPI Secuprint printing division.

Robert Fagenson, Non-Executive Chairman of the Board stated: "These transactions significantly improve our financial position and reconfirms the confidence that our creditors have in our business.  Not only have we eliminated nearly all of our short-term debt, we have been able to enter into new agreements with far more favorable terms that include lower interest costs, extended maturities, and greater financial flexibility and cash flow management.  Entering 2010, not only are we excited about the market opportunities that lay before us, we also expect that our strengthened financial position will allow us to continue the significant progress we made throughout 2009."

About Document Security Systems, Inc

Document Security Systems is a world leader in the development and manufacturing of optical deterrent technologies that help prevent counterfeiting and brand fraud from the use of the most advanced scanners, copiers and imaging systems in the market. The company's patented and patent-pending technologies protect valuable documents and printed products from counterfeiters and identity thieves. Document Security Systems' customers, which include international governments, major corporations and world financial institutions, use its covert and overt technologies to protect a number of applications including, but not limited to, currency, vital records, brand protection, ID Cards, internet commerce, passports and gift certificates. Document Security Systems' strategy is to become the world's leading producer of cutting-edge security technologies for paper, plastic and electronically generated printed assets.

More information about Document Security Systems, Inc. and its products and services can be found at http://www.documentsecurity.com/, http://www.plasticprintingprofessionals.com/, http://www.legalstore.com/, http://www.protectedpaper.com/, and http://www.dpirochester.com/.

Safe Harbor Statement

This release contains forward-looking statements regarding expectations for future financial performance, which involve uncertainty and risk. It is possible the Company's future financial performance may differ from expectations due to a variety of factors including, but not limited to, changes in economic and business conditions in the world, increased competitive activity, achieving sales levels to fulfill revenue expectations, consolidation among its competitors and customers, technology advancements, unexpected costs and charges, adequate funding for plans, changes in interest and foreign exchange rates, regulatory and other approvals and failure to implement all plans, for whatever reason. It is not possible to foresee or identify all such factors. Any forward-looking statements in this report are based on current conditions; expected future developments and other factors it believes are appropriate in the circumstances. Prospective investors are cautioned that such statements are not a guarantee of future performance and actual results or developments may differ materially from those projected. The Company makes no commitment to update any forward-looking statement included herein, or disclose any facts, events or circumstances that may affect the accuracy of any forward-looking statement.

  For information contact:
  Contact: Jody Janson
  Company: Document Security Systems, Inc.
  Title: Shareholder Relations
  Voice: 585-232-5440
  Email: 

DATASOURCE: Document Security Systems, Inc.



CONTACT:  Jody Janson, Document Security Systems, Inc., Shareholder

Relations, [phone], 



Web Site:  http://www.documentsecurity.com/ 

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