Kodak 2010 Annual Report Download - page 41

39
Contractual Obligations
The impact that contractual obligations are expected to have on the Company's cash flow in future periods is as follows:
As of December 31, 2010
(in millions)
Total
2011
2012
2013
2014
2015
2016+
Long-term debt (1)
$ 1,363
$ 50
$ 50
$ 350
$ -
$ -
$ 913
Interest payments on debt
600
100
100
97
78
78
147
Operating lease obligations
292
75
66
45
27
21
58
Purchase obligations (2)
717
340
271
40
18
16
32
Total (3) (4) (5) (6)
$ 2,972
$ 565
$ 487
$ 532
$ 123
$ 115
$ 1,150
(1) Represents the maturity values of the Company's long-term debt obligations. See Note 8, "Short-Term Borrowings and Long-
Term Debt," in the Notes to Financial Statements.
(2) Purchase obligations include agreements related to raw materials, supplies, production and administrative services, as well as
marketing and advertising, that are enforceable and legally binding on the Company and that specify all significant terms,
including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate
timing of the transaction. Purchase obligations exclude agreements that are cancelable without penalty. The terms of these
agreements cover the next one to eleven years.
(3) Due to uncertainty regarding the completion of tax audits and possible outcomes, the remaining estimate of the timing of
payments related to uncertain tax positions and interest cannot be made. See Note 15, “Income Taxes,” in the Notes to
Financial Statements for additional information regarding the Company’s uncertain tax positions.
(4) Kodak Limited, a wholly owned subsidiary of the Company, has agreed with the Trustees of the Kodak Pension Plan of the
United Kingdom (the “Plan” or “KPP”) to make certain contributions to the Plan. Under the terms of this agreement, Kodak
Limited is obligated to pay a minimum amount of $50 million to the KPP in each of the years 2011 through 2014, and a
minimum amount of $90 million to the KPP in each of the years 2015 through 2022. The payment amounts for the years 2015
through 2022 could be lower, and the payment amounts for 2011 through 2022 could be higher by up to $5 million per year,
based on the exchange rate between the U.S. dollar and British pound. The minimum amounts do not include certain potential
contributions which could be required if Kodak Limited received a cash tax benefit as a result of the minimum contributed
amount. These amounts of future contributions have not been included in the table above, as in total they are dependent on
the funded status of the KPP as it fluctuates over the term of the agreement.
(5) In addition to the pension contributions related to the KPP noted in (4) above, funding requirements for the Company's other
major defined benefit retirement plans and other postretirement benefit plans have not been determined, therefore, they have
not been included. In 2010, the Company made contributions to its major defined benefit retirement plans and benefit
payments for its other postretirement benefit plans including the KPP of $112 million ($22 million relating to its U.S. defined
benefit plans) and $159 million ($154 million relating to its U.S. other postretirement benefits plan), respectively. The Company
expects to contribute approximately $110 million ($21 million relating to its U.S. defined benefit plans) and $133 million ($127
million relating to its U.S. other postretirement benefits plan), respectively, to its defined benefit plans and other postretirement
benefit plans in 2011, including KPP contributions noted in (4) above.
(6) Because their future cash outflows are uncertain, the other long-term liabilities presented in Note 9, “Other Long-Term
Liabilities,” in the Notes to Financial Statements are excluded from this table.
Off-Balance Sheet Arrangements
The Company guarantees debt and other obligations of certain customers. The debt and other obligations are primarily due to banks
and leasing companies in connection with financing of customers' purchases of equipment and product from the Company. At
December 31, 2010, the maximum potential amount of future payments (undiscounted) that the Company could be required to make
under these customer-related guarantees was $47 million and the carrying amount of the liability related to these customer
guarantees was not material.
The customer financing agreements and related guarantees, which mature between 2011 and 2016, typically have a term of 90 days
for product and short-term equipment financing arrangements, and up to five years for long-term equipment financing arrangements.
These guarantees would require payment from the Company only in the event of default on payment by the respective debtor. In
some cases, particularly for guarantees related to equipment financing, the Company has collateral or recourse provisions to recover
and sell the equipment to reduce any losses that might be incurred in connection with the guarantees. However, any proceeds
received from the liquidation of these assets may not cover the maximum potential loss under these guarantees.