Kodak 2011 Annual Report Download - page 18

be required to expend resources to develop products and technology internally, we may be at a competitive disadvantage or we may be adversely affected
by negative market perceptions, any of which may have an adverse effect on the Company’s revenue, gross margins and profitability. In addition,
unpredictability surrounding the timing of such transactions could adversely affect the Company’s financial results.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
The Company's worldwide headquarters is located in Rochester, New York.
Operations of the CDG segment are located in Rochester, New York; Atlanta, Georgia; Emeryville, California; San Diego, California; China; and
Singapore. Many of CDG’s businesses rely on manufacturing assets, company-owned or through relationships with design and manufacturing partners,
which are located close to end markets and/or supplier networks.
Products in the GCG segment are manufactured in the United States, primarily in Rochester, New York; Dayton, Ohio; Columbus, Georgia; and
Weatherford, Oklahoma. Key manufacturing facilities outside the United States, either company-owned or through relationships with manufacturing
partners, are located in the United Kingdom, Germany, Bulgaria, Mexico, China, and Japan.
The FPEG segment of Kodak’s business is centered in Rochester, New York, where film and photographic chemicals and related materials are
manufactured. A manufacturing facility in the United Kingdom produces photographic paper. Additional manufacturing facilities supporting the business
are located in Windsor, Colorado; China; Mexico; India; Brazil; and Russia. Entertainment Imaging has business operations in Hollywood, California and
Rochester, New York.
Properties within a country may be shared by all segments operating within that country.
Regional distribution centers are located in various places within and outside of the United States. The Company owns or leases administrative, research
and development, manufacturing, marketing, and processing facilities in various parts of the world. The leases are for various periods and are generally
renewable.
ITEM 3. LEGAL PROCEEDINGS
On January 19, 2012, Eastman Kodak Company (the "Company") and its U.S. subsidiaries (the "Filing Subsidiaries," and together with the Company, the
"Debtors") filed voluntary petitions for relief (the "Bankruptcy Filing") under chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code") in
the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court") case number 12-10202. The Company's foreign
subsidiaries (collectively, the "Non-Filing Entities") were not part of the Bankruptcy Filing. The Debtors will continue to operate their businesses as
"debtors-in-possession" under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the
orders of the Bankruptcy Court. The Non-Filing Entities will continue to operate in the ordinary course of business. On January 20, 2012, the Company
and Kodak Canada Inc. (the "Canadian Borrower" and, together with the Company, the "Borrowers") entered into a Debtor-in-
Possession Credit Agreement
(the "DIP Credit Agreement"). As a result of the Bankruptcy, much of the pending litigation against the Debtors is stayed. Subject to certain exceptions
and approval by the Bankruptcy Court, no party can take further actions to recover pre-petition claims against the Company. Refer to Note 1, “Chapter 11
Filing,” in the Notes to the Consolidated Financial Statements for additional information.
Subsequent to the Company’s chapter 11 filing, a number of suits were filed in federal court in the Western District of New York, as putative class action
suits, against the current and certain former members of the Board of Directors, the Company’s Savings and Investment Plan (SIP) Committee and certain
former and current executives of the Company. None of these actions are reasonably possible to result in a material loss to the Company. The suits are
filed under the Employee Retirement Income Security Act (ERISA). The allegations concern the decline in the Company’s stock price and its alleged
resulting impact on SIP and on the Company’s Employee Stock Ownership Plan. Also following the chapter 11 filing, a suit was filed in federal court in
the Southern District of New York against the Chief Executive Officer, the President and Chief Operating Officer and the Chief Financial Officer, as a
putative class action suit under the federal securities laws, claiming that certain of the Company statements in early 2011 were too optimistic. Suits of this
nature are not uncommon for companies in chapter 11. On behalf of all defendants in these cases, the Company believes that the suits are without merit and
will vigorously defend them. Although the nature of litigation is inherently unpredictable, the Company reasonably expects none of these cases,
individually or in the aggregate, to have a material impact upon the Company.
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