With every last bit of the Kodak that photographers know and love slowly fading into the oblivion that houses 3.5” floppies and the X-Files, more news almost always seems to be bad news. With Kodak needing a serious restructuring, what the management has decided is that further debt is necessary.
Here are a couple of excerpts from the press release:
ROCHESTER, N.Y., November 12 — Eastman Kodak Company announced today that it has entered into a commitment letter to secure $793 million in Junior Debtor-in-Possession Financing with Centerbridge Partners, L.P., GSO Capital Partners LP, UBS and JPMorgan Chase & Co. to provide the company with additional case financing and establishes the ability to convert a substantial part of the facility into exit financing, enhancing its liquidity and securing a major component of the company’s exit capital structure. This financing is a key element in the steps to enable the company to successfully execute its remaining reorganization objectives and emerge from Chapter 11 in the first half of 2013.
The commitment letter also contains provisions allowing for the conversion of up to $567 million of the loans into exit financing provided that Kodak meets certain conditions including the consummation of a Plan of Reorganization by September 30, 2013, the resolution of all of Kodak’s UK pension obligations and the completion of all or a portion of the sales of Kodak’s Document Imaging and Personalized Imaging businesses.
The financing is subject to completion of definitive financing documentation and Bankruptcy Court approval at a hearing in December which will be scheduled in the near future.
The company is set to receive $793M from a slew of banks, however there is a stipulation that the company make at least a half a billion on their patent sales, which thus far has not been a successful venture.
As the company tries to step out of the ashes of the last decade, they have been shedding all of their founding branches like there is no tomorrow. Hopefully this last-ditch effort truly is the last one. We’ll have to wait and see.
In the meantime, we have some questions out to a contact at the company and will update you guys as we hear back. Additionally, if you have any further questions vocalize them in the comments and we will try to get them addressed as we can. More to come.
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