Kodak 2012 Annual Report Download

Download and view the complete annual report

Please find the complete 2012 Kodak annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 202

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191
  • 192
  • 193
  • 194
  • 195
  • 196
  • 197
  • 198
  • 199
  • 200
  • 201
  • 202

EASTMAN KODAK CO
FORM 10-K
(Annual Report)
Filed 03/11/13 for the Period Ending 12/31/12
Address 343 STATE ST
ROCHESTER, NY 14650-0910
Telephone 7167244000
CIK 0000031235
Symbol EKDKQ
SIC Code 3861 - Photographic Equipment and Supplies
Industry Printing Services
Sector Services
Fiscal Year 12/31
http://www.edgar-online.com
© Copyright 2013, EDGAR Online, Inc. All Rights Reserved.
Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use.

Table of contents

  • Page 1
    EASTMAN KODAK CO FORM 10-K (Annual Report) Filed 03/11/13 for the Period Ending 12/31/12 Address Telephone CIK Symbol SIC Code Industry Sector Fiscal Year 343 STATE ST ROCHESTER, NY 14650-0910 7167244000 0000031235 EKDKQ 3861 - Photographic Equipment and Supplies Printing Services Services 12/31 ...

  • Page 2
    ... Commission File Number 1-87 EASTMAN KODAK COMPANY (Exact name of registrant as specified in its charter) NEW JERSEY (State of incorporation) 16-0417150 (IRS Employer Identification No.) 343 STATE STREET, ROCHESTER, NEW YORK (Address of principal executive offices) 14650 (Zip Code) Registrant...

  • Page 3
    ... is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes 1 No  The aggregate market value of the voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, as of the last business day of the registrant's most recently...

  • Page 4
    ... Statement of Financial Position Consolidated Statement of Equity (Deficit) Consolidated Statement of Cash Flows Notes to Financial Statements Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Item 9A. Controls and Procedures Item 9B. Other Information Part...

  • Page 5
    ... commercial imaging business. Kodak will be centered on commercial, packaging and functional printing solutions, and enterprise services' markets in which Kodak offers customers advanced technologies that give them a competitive edge. Kodak also offers leading products and services in entertainment...

  • Page 6
    ... due and payable. REPORTABLE SEGMENTS Effective September 30, 2012, Kodak changed its segment reporting structure to three reportable segments: the Graphics, Entertainment and Commercial Films Segment, the Digital Printing and Enterprise Segment, and the Personalized and Document Imaging Segment...

  • Page 7
    ... film products through the end of 2014 or 2015. DIGITAL PRINTING AND ENTERPRISE ("DP&E") SEGMENT DP&E serves a variety of customers in the creative, in-plant, data center, consumer printing, commercial printing, packaging, newspaper and digital service bureau market segments with a range of software...

  • Page 8
    ..., event imaging solutions and consumer film. Net sales for Personalized Imaging accounted for 28%, 25%, and 22% of total consolidated revenue for the years ended December 31, 2012, 2011, and 2010, respectively. Document Imaging: Document Imaging includes document scanning products and services and...

  • Page 9
    ... and development. Research and development expenditures for Kodak's three reportable segments were as follows: (in millions) For the Year Ended December 31, 2012 2011 2010 Graphics, Entertainment and Commercial Films Digital Printing and Enterprise Personalized and Document Imaging All Other...

  • Page 10
    ... The actual number of employees may be greater because some individuals work part time. AVAILABLE INFORMATION Kodak files many reports with the Securities and Exchange Commission ("SEC") (www.sec.gov), including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form...

  • Page 11
    ... may harm the perception of us among customers, suppliers and service providers. A number of factors could influence the Company's ability to successfully raise cash through business and asset sales, including the approval of the Bankruptcy Court and the Unsecured Creditors Committee under chapter...

  • Page 12
    ... such event, we are not able to secure alternative financing, our ability to successfully emerge from bankruptcy could be adversely affected. Conditions to conversion into the exit facility include Bankruptcy Court approval of a plan of reorganization by September 15, 2013, with an effective date no...

  • Page 13
    ... future need to contribute cash or assets to the Company's plans in excess of currently estimated contributions and benefit payments and could have an adverse effect on the Company's consolidated results of operations, financial position or liquidity. The Kodak Limited Pension Plan in the United...

  • Page 14
    ... any time. If KPP demands payment of this amount, Kodak Limited does not have available cash to pay it without drawing on intercompany loans to other Company subsidiaries. Kodak Limited is the largest creditor and sole equity owner of Kodak International Finance Limited, a subsidiary that currently...

  • Page 15
    ... and develop improvements the Company's current technology to address changing customer preferences, this could adversely affect the Company's revenue, earnings and cash flow. Due to changes in technology and customer preferences, the market for traditional film and paper products and services is...

  • Page 16
    ...revenues, profitability and financial position. The competitive environment in which we operate may require us to facilitate financing to our customers in order to win a contract. Customer financing arrangements may cover all or a portion of the purchase price for the Company's products and services...

  • Page 17
    ... net assets at the date of the acquisition. We test goodwill for impairment annually or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Additionally, the Company's other long-lived assets are evaluated...

  • Page 18
    ... laws; difficulties in collecting accounts receivable; limitations or restrictions on the repatriation of cash; reduced or limited protection of intellectual property rights; managing research and development teams in geographically disparate locations, including Canada, Israel, Japan, China...

  • Page 19
    ... Kingdom and Canada. Products in the P&DI segment are manufactured in the United States in Rochester, New York and Windsor, Colorado. Manufacturing facilities outside the United States are located in China, Brazil, United Kingdom, India and Russia. Properties within a country may be shared by all...

  • Page 20
    ... the Board of Directors (Board), the Company's Savings and Investment Plan (SIP) Committee and certain former and current executives of the Company. The suits have been consolidated into a single action brought under the Employee Retirement Income Security Act (ERISA), styled as In re Eastman Kodak...

  • Page 21
    ... Technology Inc., filed June 18, 2012, United States Bankruptcy Court for the Southern District of New York as an Adversary Proceeding (12-01720). In the Matter of Certain Electronic Devices for Capturing and Transmitting Images, and Components Thereof, involving Eastman Kodak Company v. Apple...

  • Page 22
    Table of Contents ITEM 4. MINE SAFTETY DISCLOSURES None. 19

  • Page 23
    ... of the Board, Chief Executive Officer President Interim Chief Financial Officer Chief Accounting Officer and Corporate Controller General Counsel, Secretary, and Chief Administrative Officer Senior Vice President 2012 2002 2003 2006 2012 2009 2012 2008 2012 2011 2005 2012 2012 2009 2012 2010 All...

  • Page 24
    ... Board of Trustees of the George Eastman House International Museum of Photography and Film. An American citizen born in Spain, Perez studied electronic engineering, marketing, and business in Spain and France. In 2009, he received an honorary doctorate degree from the University of Rochester. Laura...

  • Page 25
    ... From 2000 to 2004, Sheller advised Kodak's European, African & Middle Eastern Region businesses on commercial legal issues. He returned to Kodak's Rochester headquarters in 2004 to assume business development and operating roles in Kodak's Health Care Information Systems business. From 2005 to 2011...

  • Page 26
    ... paid during 2011 or 2012. $0.82 $0.31 $0.58 $0.25 $0.23 $0.15 $0.18 $0.18 $5.85 $3.81 $3.44 $1.63 $2.90 $2.75 $0.54 $0.62 Dividends may be restricted under Kodak's debt agreements. Refer to Note 11, "Short-Term Borrowings and Long-Term Debt," in the Notes to Financial Statements. PERFORMANCE...

  • Page 27
    ... in conjunction with Kodak's consolidated financial statements and related notes set forth in Part IV, Item 15, "Exhibits and Financial Statement Schedules," and in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," of this Annual Report on Form...

  • Page 28
    ...commercial imaging businesses; Graphics, Entertainment and Commercial Films and Digital Printing and Enterprise Services. In order to focus on its most valuable business lines, Kodak exited its digital capture and devices business, including digital cameras, pocket video cameras, and digital picture...

  • Page 29
    ... BSSG reporting unit, was transferred to the Personalized and Document Imaging segment. Workflow software which was part of BSSG was transferred to the Graphics, Entertainment and Commercial Films segment. Enterprise Services and Solutions which was part of BSSG is included in the Digital Printing...

  • Page 30
    .... For the 2012 annual goodwill test for all reporting units except for Document Imaging, Entertainment Imaging and Commercial Films and the Graphics reporting units, Kodak did not utilize the market approach due to LTM EBIT and EBITDA results being negative. Kodak ultimately gave 100% weighting...

  • Page 31
    ...in the future if market or interest rate environments deteriorate, expected future cash flows decrease or if reporting unit carrying values change materially compared with changes in respective fair values. Kodak's long-lived assets other than goodwill are evaluated for impairment whenever events or...

  • Page 32
    ... assumption annually. To facilitate this review, every three years, or when market conditions change materially, Kodak's larger plans will undertake asset allocation or asset and liability modeling studies. The weighted average EROA for major U.S. and non-U.S. defined benefit pension plans used to...

  • Page 33
    ...Accounting Policies," in the Notes to Financial Statements in Item 8. KODAK OPERATING MODEL AND REPORTING STRUCTURE Effective September 30, 2012, Kodak changed its segment reporting structure to three reportable segments: the Graphics, Entertainment and Commercial Films Segment, the Digital Printing...

  • Page 34
    ... entertainment imaging products and services; aerial and industrial film products; and film for the production of printed circuit boards. Digital Printing and Enterprise Segment ("DP&E"): The Digital Printing and Enterprise Segment serves a variety of customers in the creative, in-plant, data center...

  • Page 35
    ... Currency Impact 2010 Graphics, Entertainment and Commercial Films Inside the U.S. Outside the U.S. Total Graphics, Entertainment and Commercial Films Digital Printing and Enterprise Inside the U.S. Outside the U.S. Total Digital Printing and Enterprise Personalized and Document Imaging Inside the...

  • Page 36
    ...), Net, Reorganization Items, Net, and Income Taxes by Reportable Segment (in millions) 2012 For the Year Ended December 31, Change 2011 Change 2010 Graphics, Entertainment and Commercial Films Digital Printing and Enterprise Personalized and Document Imaging Total Restructuring costs and other...

  • Page 37
    ... December 31, % of % Change 2011 Sales % Change 2010 % of (dollars in millions) 2012 Sales % of Sales Net sales Cost of sales Gross profit Selling, general and administrative expenses Research and development costs Restructuring costs and other Other operating (income) expenses, net Loss from...

  • Page 38
    ... 2011 and 2010, respectively. There were no significant non-recurring intellectual property licensing agreements in 2012. See revenue discussion above regarding agreements related to the monetization of certain of the Company's intellectual property assets, including the sale of its digital imaging...

  • Page 39
    ... Consolidated Statement of Financial Position as of December 31, 2012, (2) a benefit as a result of Kodak reaching a settlement with a taxing authority in a location outside the U.S. during the year ended December 31, 2012, (3) a benefit as a result of the U.S Internal Revenue Service federal audit...

  • Page 40
    ...business, Kodak Gallery, and other miscellaneous businesses. For details, refer to Note 25, "Discontinued Operations" for additional information. GRAPHICS, ENTERTAINMENT AND COMMERCIAL FILMS For the Year Ended December 31, % of % Change 2011 Sales % Change 2010 % of (dollars in millions) 2012 Sales...

  • Page 41
    ... actions. DIGITAL PRINTING AND ENTERPRISE For the Year Ended December 31, % of % Change 2011 Sales % Change 2010 % of (dollars in millions) 2012 Sales % of Sales Total net sales Cost of sales Gross profit Selling, general and administrative expenses Research and development costs Loss from...

  • Page 42
    ..., Change vs. 2011 Amount 2010 Change vs. 2010 Volume Price/Mix Foreign Exchange Manufacturing and Other Costs Total net sales Gross profit margin Revenues Current Year $ 1,098 -3% 16% -3pp 15% n/a -1% -2pp 2% 1pp n/a -2pp The decrease in the Digital Printing and Enterprise Segment net sales...

  • Page 43
    ... 31, Change vs. 2011 Amount 2010 Change vs. 2010 Volume Price/ Mix Foreign Exchange Manufacturing and Other Costs Total net sales Gross profit margin Revenues Current Year $1,799 26% -32% -23pp -2% n/a -31% -21pp 1% 0pp n/a -2pp The Personalized and Document Imaging Segment revenue decline...

  • Page 44
    ... charges of $271 million recorded in 2012 included $93 million applicable to the Digital Printing and Enterprise Segment, $20 million applicable to the Graphics, Entertainment and Commercial Films Segment, $24 million applicable to the Personalized and Document Imaging Segment, and $108 million that...

  • Page 45
    ... as cash used for a business acquisition in the prior year of $27 million and the funding of a restricted cash account of $22 million in the prior year. Partially offsetting these cash improvements was a decrease in proceeds from the sales of businesses/assets of $63 million. Financing Activities...

  • Page 46
    ...starting in 2013, its Consumer Inkjet business will solely consist of selling ink to its installed printer base. One of the objectives of the Bankruptcy Filing is to resolve certain legacy liabilities that require significant uses of cash. During 2012 and 2011, Kodak made contributions (funded plans...

  • Page 47
    ... million of the Junior DIP Facility loans upon emergence from chapter 11 into permanent exit financing with a five year term, provided that Kodak meets certain conditions and milestones, including Bankruptcy Court approval of a reorganization plan by September 15, 2013 with an effective date of no...

  • Page 48
    ... not expected to affect Kodak's ability to divest of non-core assets. Refer to Note 11, "Short-Term Borrowings and Long-Term Debt," in the Notes to Financial Statements for further discussion of long-term debt, related maturities and interest rates as of December 31, 2012 and December 31, 2011. 44

  • Page 49
    ... the Junior DIP Facility are not reflected in the table above. Refer to Note 11, "Short-Term Borrowings and Long-Term Debt," in the Notes to Financial Statements. Purchase obligations include agreements related to raw materials, supplies, production and administrative services, as well as marketing...

  • Page 50
    ..., which mature between 2013 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 Kodak only in the event of default on payment by the...

  • Page 51
    ..." as that term is defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning Kodak's plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures, liquidity, financing needs, business 47

  • Page 52
    ... sales. Silver forward contracts are used to mitigate Kodak's risk to fluctuating silver prices. Kodak's exposure to changes in interest rates results from its investing and borrowing activities used to meet its liquidity needs. Long-term debt is generally used to finance long-term investments...

  • Page 53
    ...and marketable securities as they mature and are renewed at current market rates. The extent of this risk is not predictable because of the variability of future interest rates and business financing requirements. Using a sensitivity analysis based on estimated fair value of short-term and long-term...

  • Page 54
    ... Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained...

  • Page 55
    ... of Contents EASTMAN KODAK COMPANY (DEBTOR-IN-POSSESSION) CONSOLIDATED STATEMENT OF OPERATIONS (in millions, except per share data) For the Year Ended December 31, 2012 2011 2010 Net sales Products Services Licensing & royalties (Note 18) Total net sales Cost of sales Products Services Total cost...

  • Page 56
    ... Pension and other postretirement benefit plan obligation activity, net of tax of $146, $71 and $19 for the years ended December 31, 2012, 2011 and 2010, respectively Total comprehensive loss, net of tax The accompanying notes are an integral part of these consolidated financial statements...

  • Page 57
    ... OF FINANCIAL POSITION (in millions, except share and per share data) As of December 31, 2012 2011 ASSETS CURRENT ASSETS Cash and cash equivalents Receivables, net Inventories, net Deferred income taxes Other current assets Total current assets Property, plant and equipment, net Goodwill Other long...

  • Page 58
    ... of Contents EASTMAN KODAK COMPANY (DEBTOR-IN-POSSESSION) CONSOLIDATED STATEMENT OF EQUITY (DEFICIT) (in millions, except share and per share data) Eastman Kodak Company Shareholders Accumulated Additional Other Retained Comprehensive Treasury Paid In Capital Earnings (Loss) Income Stock Common...

  • Page 59
    ... of Contents EASTMAN KODAK COMPANY (DEBTOR-IN-POSSESSION) CONSOLIDATED STATEMENT OF EQUITY (DEFICIT) Cont'd. (in millions, except share and per share data) Eastman Kodak Company Shareholders Accumulated Additional Other Retained Comprehensive Treasury Paid In Capital Earnings (Loss) Income Stock...

  • Page 60
    ... of Contents EASTMAN KODAK COMPANY (DEBTOR-IN-POSSESSION) CONSOLIDATED STATEMENT OF EQUITY (DEFICIT) Cont'd. (in millions, except share and per share data) Eastman Kodak Company Shareholders Accumulated Additional Other Comprehensive Treasury Paid In Capital Retained Earnings (Loss) Income Stock...

  • Page 61
    ... 31, 2012 2011 2010 Cash flows from operating activities: Net loss Adjustments to reconcile to net cash provided by operating activities: Loss from discontinued operations, net of income taxes Depreciation and amortization Gain on sales of businesses/assets Loss on early extinguishment of debt, net...

  • Page 62
    Table of Contents EASTMAN KODAK COMPANY (DEBTOR-IN-POSSESSION) CONSOLIDATED STATEMENT OF CASH FLOWS (Continued) SUPPLEMENTAL CASH FLOW INFORMATION (in millions) For the Year Ended December 31, 2012 2011 2010 Cash paid for interest and income taxes was: Interest, net of portion capitalized of $1 as ...

  • Page 63
    ...) NOTES TO FINANCIAL STATEMENTS NOTE 1: BANKRUPTCY PROCEEDINGS On January 19, 2012 (the "Petition Date"), Eastman Kodak Company and its U.S. subsidiaries (collectively, the "Debtors") filed voluntary petitions for relief (the "Bankruptcy Filing") under chapter 11 of the United States Bankruptcy Code...

  • Page 64
    ... million of the Junior DIP Facility loans upon emergence from chapter 11 into permanent exit financing with a five year term, provided that Kodak meets certain conditions and milestones, including Bankruptcy Court approval of a reorganization plan by September 15, 2013 with an effective date of no...

  • Page 65
    ... Gallery on-line photo services business for $23.8 million to Shutterfly, Inc. Approximately 75% of the net proceeds from the sale were used to repay term debt under the DIP Credit Agreement. On August 23, 2012, Kodak announced the decision to initiate sale processes for its Personalized Imaging...

  • Page 66
    ... income benefits to current and future Retirees after December 31, 2012 (other than COBRA continuation coverage of medical and/or dental benefits or conversion coverage as required by the plans or applicable law), and the Retiree Committee will set up a trust or account from which some limited...

  • Page 67
    ... lives were adjusted for these assets. As a result, Kodak revised the useful lives of certain existing production machinery and equipment, and manufacturing-related buildings effective January 1, 2011. These assets, many of which were previously set to fully depreciate by 2012 to 2013, were changed...

  • Page 68
    Table of Contents 2017. This change in useful lives reflects Kodak's current estimate of future periods to be benefited from the use of the property, plant, and equipment. The effect of this change in estimate for the year ended December 31, 2011 was a reduction in depreciation expense of $38 ...

  • Page 69
    ... value of a reporting unit involves the use of significant estimates and assumptions. Refer to Note 8, "Goodwill and Other Intangible Assets." REVENUE Kodak's revenue transactions include sales of the following: products; equipment; software; services; integrated solutions; and intellectual property...

  • Page 70
    ... from maintenance and unspecified upgrades or updates on a whenand-if-available basis is recognized over the contract period. At the time revenue is recognized, Kodak also records reductions to revenue for customer incentive programs. Such incentive programs include cash and volume discounts, price...

  • Page 71
    ...31, 2012, 2011, and 2010, respectively. SHIPPING AND HANDLING COSTS Amounts charged to customers and costs incurred by Kodak related to shipping and handling are included in net sales and cost of sales, respectively. IMPAIRMENT OF LONG-LIVED ASSETS Kodak reviews the carrying values of its long-lived...

  • Page 72
    .... Kodak's diluted (loss) earnings per share excludes the effect of these convertible securities, as they were antidilutive for all periods presented. Refer to Note 11, "Short-Term Borrowings and Long-Term Debt." RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS In September 2011, the Financial Accounting...

  • Page 73
    ... of this update are effective prospectively for deconsolidation events occurring during fiscal years, and interim periods within those years, beginning on or after June 15, 2012 (January 1, 2013 for Kodak). Adoption of this guidance will not impact Kodak's Consolidated Financial Statements. NOTE...

  • Page 74
    ... cash payments. Such deductions represent rebates owed to customers and are included in Other current liabilities as of December 31, 2011 and Other current liabilities and Liabilities subject to compromise as of December 31, 2012 in the accompanying Consolidated Statement of Financial Position. NOTE...

  • Page 75
    ... BSSG reporting unit, was transferred to the Personalized and Document Imaging segment. Workflow software which was part of BSSG was transferred to the Graphics, Entertainment and Commercial Films segment. Enterprise Services and Solutions which was part of BSSG is included in the Digital Printing...

  • Page 76
    ... $60 million for the years ended December 31, 2012, 2011, and 2010, respectively. Estimated future amortization expense related to purchased intangible assets as of December 31, 2012 was as follows (in millions): 2013 2014 2015 2016 2017 2018+ Total NOTE 9: OTHER LONG-TERM ASSETS (in millions) As of...

  • Page 77
    ...Financial Position, and therefore, have been aggregated in accordance with Regulation S-X. NOTE 11: SHORT-TERM BORROWINGS AND LONG-TERM DEBT SHORT-TERM BORROWINGS AND CURRENT PORTION OF LONG-TERM DEBT Kodak's current portion of long-term debt was $699 million and $152 million as of December 31, 2012...

  • Page 78
    ... of Operations. No portion of the carrying value of Kodak's debt was considered Liabilities subject to compromise in the Statement of Financial Position as of December 31, 2011, as the Debtors filed for chapter 11 bankruptcy protection on January 19, 2012. The amounts shown as Liabilities subject...

  • Page 79
    ... ability to convert the Junior DIP Facility into an up to $654 million exit facility with an additional five year term provided that Kodak meets certain conditions and milestones, including Bankruptcy Court approval of a plan of reorganization by September 15, 2013, with an effective date no later...

  • Page 80
    ..., 2011, to the security agreement, dated March 5, 2010, entered into with Bank of New York Mellon as second lien collateral agent. The carrying value of the assets pledged as collateral at December 31, 2012 was approximately $1 billion. The 2019 Senior Secured Notes are the Company's senior secured...

  • Page 81
    ... 5, 2010. Wilmington Trust, National Association replaced and succeeded Bank of New York Mellon as Trustee and second-lien collateral agent on January XX, 2012. The carrying value of the assets pledged as collateral at December 31, 2012 was approximately $1 billion. The 2018 Senior Secured Notes are...

  • Page 82
    ...Mellon as Trustee on January 24, 2012. The Bankruptcy Filing constituted an event of default under the 2017 Convertible Notes. The creditors are, however, stayed from taking any action as a result of the default under Section 362 of the Bankruptcy Code. SENIOR NOTES DUE 2013 On October 10, 2003, the...

  • Page 83
    ... 2012 in the accompanying Consolidated Statement of Financial Position. The Company is currently implementing a Corrective Action Program required by the Resource Conservation and Recovery Act ("RCRA") at Eastman Business Park (formerly known as Kodak Park) in Rochester, NY. The Company is currently...

  • Page 84
    ... cash and investment in trust amounts are recorded within Other long-term assets in the Consolidated Statement of Financial Position. In March 2012, Kodak sold a property in Mexico for approximately $41 million and leased back the property for a one-year term. The pre-tax gain on the property sale...

  • Page 85
    ... 2013 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 Kodak only in the event of default on payment by the respective customer...

  • Page 86
    ... change in Kodak's deferred revenue balance in relation to these extended warranty and maintenance arrangements, which is reflected in Other current liabilities in the accompanying Consolidated Statement of Financial Position, was as follows: (in millions) Deferred revenue as of December 31, 2010...

  • Page 87
    ... during the year ended December 31, 2012. Fair values of long-term borrowings are determined by reference to quoted market prices, if available, or by pricing models based on the value of related cash flows discounted at current market interest rates. The carrying values of cash and cash equivalents...

  • Page 88
    ... against asset positions with the same counterparty. In addition, the Company has provided credit support through letters of credit or as part of secured arrangements under the DIP Credit Agreement for its derivative contract obligations. At December 31, 2012, Kodak had open derivative contracts in...

  • Page 89
    ... to derivatives reported in the Consolidated Statement of Operations are shown in the following tables: Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) For the Year Ended December 31, 2012 2011 2010 Derivatives in Cash Flow Hedging...

  • Page 90
    ... 619 (4) Refer to Note 8 "Goodwill and Other Intangible Assets," in the Notes to Financial Statements. In the fourth quarter of 2012, Kodak received cash proceeds of approximately $35 million associated with the termination of a supply arrangement. In December 2003, Kodak sold a property in France...

  • Page 91
    ..., net (Benefit) provision for income taxes $ (546) 1 35 - (129) 23 350 (11) 20 $ (257) $ (245) 1 393 - 41 20 (57) (149) 4 $ 8 $ (149) 1 - 217 131 10 (98) 3 (5) $ 110 In March 2011, Kodak filed a Request for Competent Authority Assistance with the United States Internal Revenue Service (IRS). The...

  • Page 92
    ... millions) As of December 31, 2012 2011 Deferred tax assets Pension and postretirement obligations Allowed Claims Restructuring programs Foreign tax credit Inventories Investment tax credit Employee deferred compensation Depreciation Research and development costs Tax loss carryforwards Other Total...

  • Page 93
    ... (liabilities) are reported in the following components within the Consolidated Statement of Financial Position: (in millions) As of December 31, 2012 2011 Deferred income taxes (current) Other long-term assets Accrued income taxes Other long-term liabilities Net deferred tax assets $ 75 470...

  • Page 94
    ... income and other taxes and the recognition of a $16 million tax benefit. During 2011, Kodak agreed to terms with the U.S. Internal Revenue Service and settled the federal audits for calendar years 2001 through 2005. For these years, Kodak originally recorded federal and related state liabilities...

  • Page 95
    ... (NOL Rights Agreement) designed to preserve stockholder value and tax assets. The Company's ability to use its tax attributes to offset tax on U.S. taxable income would be substantially limited if there were an "ownership change" as defined under Section 382 of the U.S. Internal Revenue Code. In...

  • Page 96
    ... in Pension and other postretirement liabilities and Other long-term assets in the Consolidated Statement of Financial Position, and $2 million for amounts reclassified as Liabilities subject to compromise. Kodak expects to utilize the majority of the December 31, 2012 accrual balance in 2013. 2010...

  • Page 97
    ... to the Graphics, Entertainment and Commercial Films Segment, $1 million applicable to the Digital Printing and Enterprise Segment, $7 million applicable to the Personalized and Document Imaging Segment, and $60 million that was applicable to manufacturing/service, research and development, and...

  • Page 98
    ...term lease payments, will be paid over periods throughout 2013 and beyond. NOTE 20: RETIREMENT PLANS Substantially all U.S. employees are covered by a noncontributory defined benefit plan, the Kodak Retirement Income Plan ("KRIP"), which is funded by the Company contributions to an irrevocable trust...

  • Page 99
    ... in the Consolidated Statement of Financial Position for all major funded and unfunded U.S. and Non-U.S. defined benefit plans were as follows: As of December 31, 2012 Non-U.S. U.S. 2011 Non-U.S. (in millions) U.S. Other long-term assests Other current liabilities Pension and other postretirement...

  • Page 100
    ...$(1,689) Changes in plan assets and benefit obligations recognized in other comprehensive income (loss) for all major funded and unfunded U.S. and Non-U.S. defined benefit plans follows: 2012 (in millions) U.S. Non-U.S. U.S. 2011 Non-U.S. Newly established loss Newly established prior service cost...

  • Page 101
    ... plans included: For the Year Ended December 31, 2012 2011 Non-U.S. U.S. Non-U.S. U.S. 2010 Non-U.S. (in millions) U.S. Major defined benefit plans: Service cost Interest cost Expected return on plan assets Amortization of: Prior service cost Actuarial loss Pension (income) expense before special...

  • Page 102
    ... in Kodak's defined benefit plan assets. Kodak's weighted-average asset allocations for its major U.S. defined benefit pension plans, by asset category, are as follows: Asset Category As of December 31, 2012 2011 2012 Target Equity securities Debt securities Real estate Cash Global balanced asset...

  • Page 103
    Table of Contents Kodak's weighted-average asset allocations for its major non-U.S. defined benefit pension plans, by asset category are as follows: Asset Category As of December 31, 2012 2011 2012 Target Equity securities Debt securities Real estate Cash Global balance asset allocation funds Other...

  • Page 104
    ...(in millions) Cash and cash equivalents Equity Securities Debt Securities: Government Bonds Inflation-Linked Bonds Investment Grade Bonds Global High Yield & Emerging Market Debt Other: Absolute Return Real Estate Private Equity Insurance Contracts Global Balanced Asset Allocation Funds Derivatives...

  • Page 105
    ...(in millions) Cash and cash equivalents Equity Securities Debt Securities: Government Bonds Inflation-Linked Bonds Investment Grade Bonds Global High Yield & Emerging Market Debt Other: Absolute Return Real Estate Private Equity Insurance Contracts Global Balanced Asset Allocation Funds Derivatives...

  • Page 106
    ... positions, which have readily available market prices. For investments with lagged pricing, Kodak used the available net asset values, and also considered expected return, subsequent cash flows and material events. For all of Kodak's major defined benefit pension plans, investment managers...

  • Page 107
    ... benefit pension plans (in millions): U.S. Net Realized and Balance at January 1, 2012 Unrealized Gains/(Losses) Net Purchases and Sales Net Transfer Into/(Out of) Level 3 Balance at December 31, 2012 Equity Securities Government Bonds Inflation-Linked Bonds Global High Yield & Emerging Market Debt...

  • Page 108
    ... 3 assets of Kodak's major Non-U.S. defined benefit pension plans (in millions): Net Realized and Balance at January 1, 2012 Unrealized Gains/(Losses) Net Purchases and Sales Net Transfer Into/(Out of) Level 3 Balance at December 31, 2012 Equity Securities Government Bonds Inflation-Linked Bonds...

  • Page 109
    ... - (134) - (2) $ 1,294 $(1,294) Amounts recognized in the Consolidated Statement of Financial Position for Kodak's U.S. and Canada plans consisted of: (in millions) As of December 31, 2012 2011 Other current liabilities Pension and other postretirement liabilities 105 $ (23) (114) $(137) $ (122...

  • Page 110
    ...loss) for Kodak's U.S. and Canada plans consisted of: (in millions) As of December 31, 2012 2011 Prior service credit Net actuarial loss $ 1,118 (73) $ 1,045 $ 751 (492) $ 259 Changes in benefit obligations recognized in Other comprehensive income (loss) for Kodak's U.S. and Canada plans were as...

  • Page 111
    ...on total service and interest cost Effect on postretirement benefit obligation $ - 8 $ - (7) Kodak expects to make $23 million of benefit payments for its unfunded other postretirement benefit plans in 2013. The following other postretirement benefits, which reflect expected future service, are...

  • Page 112
    ...31, 2014. This share reserve may be increased by: shares that are forfeited pursuant to awards made under the 2000 and 2005 Plans; shares retained for payment of tax withholding; shares delivered for payment or satisfaction of tax withholding; shares reacquired on the open market using cash proceeds...

  • Page 113
    ... was below the weighted-average exercise price of options. There were no option exercises during 2010, 2011 or 2012. The fair value of each option award is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. Expected...

  • Page 114
    ... acquisition was immaterial to Kodak's financial position as of December 31, 2011, and its results of operations and cash flows for the year ended December 31, 2011. The relief plates business is part of Kodak's Graphics, Entertainment and Commercial Films segment. NOTE 25: DISCONTINUED OPERATIONS...

  • Page 115
    ... Printing, Enterprise Services & Solutions, and Consumer Inkjet Systems. On September 28, 2012, Kodak announced a plan, starting in 2013, to focus its Consumer Inkjet business solely on the sale of ink to its installed printer base. Personalized and Document Imaging: The Personalized and Document...

  • Page 116
    ... (in millions) 2012 As of December 31, 2011 2010 Segment total assets: Graphics, Entertainment and Commercial Films Digital Printing and Enterprise Personalized and Document Imaging Total of reportable segments Cash and marketable securities Net deferred income tax assets All other/corporate...

  • Page 117
    Table of Contents (in millions) 2012 As of December 31, 2011 2010 Property, plant and equipment, net located in: The United States Europe, Middle East and Africa Asia Pacific Canada and Latin America Foreign countries total Consolidated total 113 $425 $125 104 39 $268 $693 $554 $158 143 40 $341 $...

  • Page 118
    ... Non-Filing Entities have not been eliminated in the Debtors' financial statements. DEBTORS' STATEMENT OF OPERATIONS (in millions) For the Year Ended December 31, 2012 Net sales Products Services Licensing & royalties Total net sales Cost of sales Products Services Total cost of sales Gross profit...

  • Page 119
    ... gain from investment, net of tax of $0 for the year ended December 31, 2012 Currency translation adjustments Pension and other postretirement benefit plan obligation activity, net of tax of $255 for the year ended December 31, 2012 Total comprehensive loss, net of tax DEBTORS' STATEMENT OF RETAINED...

  • Page 120
    ... and equipment, net of accumulated depreciation of $3,294 Goodwill Investment in non-filing entities Other long-term assets TOTAL ASSETS LIABILITIES AND EQUITY (DEFICIT) Current Liabilities Accounts payable, trade Short-term borrowings and current portion of long-term debt Accrued income and other...

  • Page 121
    ...from sales of businesses/assets Marketable securities-sales Marketable securities-purchases Net cash used in continuing operations Net cash provided by discontinued operations Net cash provided by investing activities Cash flows from financing activities: Proceeds from DIP credit agreement Repayment...

  • Page 122
    ... (in millions, except per share data) 4th Qtr. 3rd Qtr. 2nd Qtr. 1st Qtr. 2012 Net sales from continuing operations Gross profit from continuing operations Loss from continuing operations Loss from discontinued operations (9) Net loss attributable to Eastman Kodak Company Basic and diluted net...

  • Page 123
    ...in the Notes to Financial Statements for a discussion regarding loss from discontinued operations. (2) (3) (4) (5) (6) (7) (8) (9) Corporate components of pension and OPEB include interest cost, expected return on plan assets, amortization of actuarial gains and losses, and special termination...

  • Page 124
    ... operations Graphics, Entertainment and Commercial Films Digital Printing and Enterprise Personalized and Document Imaging All Other Research and development costs Depreciation Taxes (excludes payroll, sales and excise taxes) Wages, salaries and employee benefits Employees as of year end -in...

  • Page 125
    ... in 2012, $82 million in 2011, $838 million in 2010, $435 million in 2009, and $227 million in 2008. (2) (3) (4) (5) (6) (7) Corporate components of pension and OPEB include cost, expected return on plan assets, amortization of actuarial gains and losses, and special termination benefits...

  • Page 126
    ...because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of Kodak's internal control over financial reporting as of December 31, 2012. In making this assessment, management used the criteria set forth by...

  • Page 127
    ...internal control over financial reporting that occurred during Kodak's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, Kodak's internal control over financial reporting. ITEM 9B. OTHER INFORMATION None. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS...

  • Page 128
    ... financial statements: Report of independent registered public accounting firm Consolidated statement of operations Consolidated statement of comprehensive (loss) income Consolidated statement of financial position Consolidated statement of equity (deficit) Consolidated statement of cash flows Notes...

  • Page 129
    ...the undersigned, thereunto duly authorized. EASTMAN KODAK COMPANY (Registrant) By: /s/ Antonio M. Perez Antonio M. Perez Chairman & Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the...

  • Page 130
    ... Of Period Charges to Earnings and Equity Amounts Written Off Balance at End of Period (in millions) Year ended December 31, 2012 Deducted in the Statement of Financial Position: From Current Receivables: Reserve for doubtful accounts Reserve for loss on returns and allowances Total From Deferred...

  • Page 131
    ...York, as Trustee. (Incorporated by reference to the Eastman Kodak Company Current Report on Form 8-K for the date October 10, 2003 as filed on October 10, 2003, Exhibit 4.) (4.2) Form of the 7.25% Senior Notes due 2013. (Incorporated by reference to the Eastman Kodak Company Current Report on Form...

  • Page 132
    ... Current Report on Form 8-K for the date March 15, 2011, as filed on March 31, 2011, Exhibit 4.1.) (4.12) Rights Agreement, dated as of August 1, 2011, between Eastman Kodak Company and Computershare Trust Company, N.A., which includes the form of Certificate of Designations of Series A Junior...

  • Page 133
    ...reference to the Eastman Kodak Company Annual Report on Form 10-K for the fiscal year ended December 31, 2008, Exhibit 10.2.) (10.3) Eastman Kodak Company Non-Employee Director Annual Compensation Program. The equity portion of the retainer became effective December 11, 2007; the cash portion of the...

  • Page 134
    ...Leadership Stock Program under the 2005 Omnibus Long-Term Compensation Plan. (Incorporated by reference to the Eastman Kodak Company Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2008, Exhibit 10.) (10.6) Administrative Guide for the 2010 Performance Stock Unit Program under...

  • Page 135
    ... for the 2004-2005 Performance Cycle of the Leadership Program under Article 12 of the 2000 Omnibus Long-Term Compensation Plan, as amended January 1, 2009. (Incorporated by reference to the Eastman Kodak Company Annual Report on Form 10-K for the fiscal year ended December 31, 2008, Exhibit 10.19...

  • Page 136
    ... Plan dated October 11, 2010. (Incorporated by reference to the Eastman Kodak Company Annual Report on Form 10-K for the fiscal year ended December 31, 2010, Exhibit 10.) (10.23) Asset Purchase Agreement between Eastman Kodak Company and Onex Healthcare Holdings, Inc., dated as of January 9, 2007...

  • Page 137
    ... the 2005 Omnibus Long-Term Compensation Plan (Hold Until Retirement Provision). (Incorporated by reference to the Eastman Kodak Company Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2009.) (10.27) Administrative Guide for the 2011 Performance Stock Unit Program under...

  • Page 138
    ...6, 2013, to the Debtor-in-Possession Credit Agreement dated as of January 20, 2012 (as heretofore amended, supplemented or otherwise modified, the " Credit Agreement" ) among Eastman Kodak Company (the " Company "), a Debtor and Debtor-in-Possession under Chapter 11 of the Bankruptcy Code, and Kodak...

  • Page 139
    ... a counterpart hereof prior to 5:00 p.m., New York City time, on February 4, 2013, an amendment fee in an amount equal to 0.125% of (i) in the case of a Revolving Lender, such Lender's Revolving Credit Commitment and (ii) in the case of a Term Lender, the outstanding principal amount of such Lender...

  • Page 140
    IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. EASTMAN KODAK COMPANY By Name: Title: KODAK CANADA INC. By Name: Title: [US SUBSIDIARY GUARANTORS] By Name: Title:

  • Page 141
    CITICORP NORTH AMERICA, INC. as Agent By Name: Title: REQUIRED REVOLVING LENDERS: [SIGNATURE PAGES TO COME] By Name: Title: REQUIRED TERM LENDERS: [SIGNATURE PAGES TO COME] By Name: Title: 2

  • Page 142
    Exhibit 10.30 PATENT SALE AGREEMENT between EASTMAN KODAK COMPANY and INTELLECTUAL VENTURES FUND 83 LLC dated as of December 18, 2012

  • Page 143
    ... Section 5.14 Section 5.15 Section 5.16 Section 5.17 Bankruptcy Court Approval Pre-Closing Access Conduct of Business Commercially Reasonable Efforts; Further Assurances Certain Regulatory Matters Intercompany Agreements Ancillary Agreements Taxes and Other Fees Confidentiality Public Disclosure Non...

  • Page 144
    ...Indemnification Reliance Remedies; Injunctive Relief; No Recourse Expenses Schedules Governing Law No Presumption No Set-off, Deduction or Counterclaim Severability Bulk Sales Law No Third Party Beneficiaries Entire Agreement Headings Counterparts; Electronic Signatures -ii41 42 42 43 44 44 44 45 46...

  • Page 145
    No table of contents entries found. -iii-

  • Page 146
    ...commencing their Chapter 11 bankruptcy cases (the " Bankruptcy Cases "); and W HEREAS , on July 5, 2012, the Bankruptcy Court entered an order (the " Conditional Sale Order "), among other things, authorizing Kodak and its affiliated debtors-in-possession to sell the Assigned Assets, free and clear...

  • Page 147
    ... in each case such Person will be deemed an Affiliate only so long as such Control exists. " Aggregate Transaction Value " means the sum of the License Fees plus the Closing Amount. " Agreement " has the meaning set forth in the preamble. " Alternative Transaction " means the sale, transfer or other...

  • Page 148
    ...'s sales of products or services prior to January 1, 2013 if Closing occurs before December 31, 2012 or prior April 1, 2013 if Closing occurs after December 31, 2012, or (ii) any Scheduled Agreement, other than any such agreement listed on Schedule 1.1(b) , that is rejected by Kodak, which Kodak...

  • Page 149
    ... Rules " means the United States Federal Rules of Bankruptcy Procedure and the Local Bankruptcy Rules for the U.S. Bankruptcy Court for the Southern District of New York. " Bid Account " has the meaning set forth in the Clarifying Order. " Bidco DC/KISS Patent License Agreement " has the meaning set...

  • Page 150
    ...entity, or (c) the power to appoint a majority of directors or other management authority of such entity or otherwise effectively direct the affairs of the entity, whether by agreement, ownership of shares, securities or equity interests or otherwise. " Deposit " has the meaning set forth in Section...

  • Page 151
    ... under the Bankruptcy Rules, may be filed relating to such order shall not cause such order to not be a Final Order. " Final Sale Hearing " has the meaning set forth in the Conditional Sale Order. " Final Sale Order " means an order of the Bankruptcy Court that includes the express (x) findings of...

  • Page 152
    ... Agreement, dated as of the date hereof, among FlashPoint, Kodak, Buyer and Apple Inc. " FlashPoint Supplemental Settlement Agreement " means the Stock Transfer and Release Agreement, dated as of the date hereof, between FlashPoint and Kodak. " FlashPoint Settlement Amount " has the meaning set...

  • Page 153
    ... Transmitting Images, and Components Thereof, Inv. No. 337-TA-831 (Feb. 27, 2012) and Mobile Telephones and Wireless Communication Devices Featuring Digital Cameras, and Components Thereof, Inv. No. 337-TA-703 (Feb. 23, 2010). " Joinder Agreement " has the meaning set forth in Section 8.3 . " Kodak...

  • Page 154
    ... of Kodak's Knowledge any and all dates relevant to the prosecution or maintenance of the Assigned Patents, including information relating to deadlines, payments and filings for the Assigned Patents, and the names, business, business addresses, business email addresses, and business phone numbers of...

  • Page 155
    ...-bankruptcy Law), in each case, (x) solely to the extent such releases, licenses, immunities, covenants not to assert and similar rights of a counter-party exist as of Closing or are provided for in a Scheduled Agreement as of Closing, and (y) where such Scheduled Agreement is not rejected by Kodak...

  • Page 156
    ... such product or service. " Rejected Agreement " means any Scheduled Agreement that is rejected by Kodak. " Releasees " has the meaning set forth in Section 5.15 . " Releasors " has the meaning set forth in Section 5.15 . " Representative " means, as to any Person, the directors, officers, employees...

  • Page 157
    ...has the meaning set forth in the Conditional Sale Order. " Successful Bidder " has the meaning set forth in the Conditional Sale Order. " Supplemental Non-Disclosure Agreements " means the Supplemental Agreements, dated as of October 25, 2012, between Kodak and each of Buyer and Buyer's Designee (as...

  • Page 158
    ... of Patents . On the terms and subject to the conditions set forth herein, at Closing, Kodak will assign, convey, sell and transfer to Buyer (and, to the extent Buyer identifies a Designee in accordance with Section 8.3 of this Agreement, such Designee), and Buyer (and its Designee, as applicable...

  • Page 159
    ... of the Assigned Patents, (y) Buyer (and its Designee, as applicable) shall not assume any financial or financial reporting covenants or obligations imposed upon Kodak under the agreements set forth on Schedule 1.1(h) and (z) if any expansion, extension or renewal after Closing of, or any grant of...

  • Page 160
    .... ARTICLE III PURCHASE PRICE; CLOSING Section 3.1 Purchase Price . In consideration for the sale, assignment, transfer and conveyance of the Assigned Assets to Buyer (and its Designee, as applicable), at the Closing, Buyer (and its Designee, as applicable) will pay to Kodak cash in an amount equal...

  • Page 161
    ... In the event that Buyer is not named the Successful Bidder, the Deposit shall be returned to Buyer pursuant to the terms of the Clarifying Order. (b) Until such time as Kodak first becomes entitled to withdraw or be paid the Deposit pursuant to the terms of the Escrow Agreement, the Bid Account and...

  • Page 162
    ... as Exhibit C and dated as of the Closing Date, pursuant to which Buyer (and its Designee, as applicable) assumes the Assumed Liabilities (each an " Assumption Agreement "), duly executed by Kodak; (vi) a counterpart of the applicable license agreement for each of the Persons set forth on Schedule...

  • Page 163
    ... the Bankruptcy Court, (B) a copy of the docket in the Bankruptcy Cases as of the Closing Date, (C) a copy of the docket in any case related to any appeal from the Final Sale Order as of the Closing Date, and (D) a duly executed and acknowledged certificate from Kodak, in substantially the form set...

  • Page 164
    ... Sale Order by the Bankruptcy Court, no consent, approval, waiver, authorization or novation is required to be obtained by Kodak from, and, no notice or filing is required to be given by Kodak to or made by Kodak with, any Person in connection with the execution, delivery and performance by Kodak...

  • Page 165
    ... delivered at Closing, will, upon the entry of the Final Sale Order, constitute the valid and legally binding obligations of Kodak, enforceable against Kodak in accordance with their respective terms. (e) Assigned Patents . In each case, except as specifically disclosed in the Electronic Data Room...

  • Page 166
    ... to use, right to transfer, or exclusive ownership of the Assigned Patents. (vi) Except as set forth on Schedule 4.1(e)(vi) , each of the registrations for the Assigned Patents is currently in good standing and subsisting. All fees and charges payable to governmental patent offices, maintenance fees...

  • Page 167
    ...makes the following representations and warranties to Kodak: (a) Organization and Power . Buyer is a limited liability company duly organized, validly existing and in good standing under the Laws of the State of Delaware. Buyer has all requisite corporate power and authority to carry on its business...

  • Page 168
    ... (B) enforceable in accordance with its terms against Buyer, and, to the knowledge of Buyer, each of the other parties thereto, in each case, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors...

  • Page 169
    ... (as applicable), in the Joinder Agreement, none of Kodak, Buyer, Buyer's Designee (as applicable) or any other Person makes any other express or implied representation or warranty to the others. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AND EXCEPT AS SET FORTH IN SECTION 4.1 , THE ASSIGNED...

  • Page 170
    ... Sale Order. Buyer and Buyer's Designee (as applicable), shall not, without the prior written consent of Kodak, file, join in, or otherwise support or encourage in any manner whatsoever any motion or other pleading relating to the sale of the Assigned Assets hereunder. In the event that an appeal...

  • Page 171
    ... a part of the Closing Amount; or (e) agree in writing, seek authority from the Bankruptcy Court, or fail to use reasonable best efforts to contest the action of any other party to obtain authority from the Bankruptcy Court to take any of the foregoing actions. Section 5.4 Commercially Reasonable...

  • Page 172
    ..., (y) reimburse to Kodak for any employee time spent away from such employee's ordinary duties at a rate of $300/hour, increased each year starting in 2014 by the U.S. Consumer Price Index for the immediately preceding year and (z) indemnify and hold Kodak (except, in the case of Kodak, with respect...

  • Page 173
    ...) or counsel designated by Buyer (or Buyer's Designee, as applicable) at locations within the United States to be designated by Buyer (or Buyer's Designee, as applicable) copies (which may be electronic copies) of the Patent Documents existing as of the Closing Date in Kodak's possession and (ii...

  • Page 174
    ...from the United States Federal Trade Commission, the United States Department of Justice or any other Governmental Entity regarding the Transaction and, subject to applicable Law, consult with the other with respect to such communication, and (iii) keep the other reasonably apprised of the status of...

  • Page 175
    ... the Bankruptcy Code (including the Final Sale Order). Section 5.6 Intercompany Agreements . On or prior to the Closing, Kodak shall use commercially reasonable efforts to amend, modify or terminate and to cause its Affiliates to amend, modify or terminate any Intercompany Contract, in each case as...

  • Page 176
    ...each other and take all commercially reasonable steps to legitimately obtain a reduction or elimination of, or credit for, any Transfer Taxes arising from the Transaction, including with respect to delivery location. (b) Each payment made by Buyer (or its Designee, as applicable) to Kodak under this...

  • Page 177
    ...times after Closing, each of Buyer and Buyer's Designee, as applicable, will, and will cause its Affiliates and Representatives to, (i) treat as confidential and safeguard any and all information, knowledge or data relating to the business of Kodak and its Affiliates that has become or becomes known...

  • Page 178
    ...all times after Closing, Kodak will, and will cause its Affiliates and Representatives to, (i) treat as confidential and safeguard any and all information, knowledge or data relating to (x) the Assigned Patents or (y) the business of Buyer and its Affiliates that has become or becomes known to Kodak...

  • Page 179
    ... the date of this Agreement until the date the Bankruptcy Court enters the Final Sale Order, Buyer shall not, and shall cause its Affiliates not to, without the prior consent of Kodak, either directly or indirectly solicit or entice away or cause to be solicited or enticed away any employee of Kodak...

  • Page 180
    ... prior to the sale, conveyance, transfer, assignment and delivery to Buyer (and its Designee, as applicable) of the Assigned Assets, Kodak shall (a) license the Assigned Patents pursuant to the applicable Bidco DC/KISS Patent License Agreements to each of the respective licensees set forth in each...

  • Page 181
    ... by Kodak) (the released and discharged party and, as applicable, its respective former, current and future equity holders, controlling persons, directors, trustees, officers, employees, estate, Affiliates, representatives, attorneys, advisors, agents, members, managers, general and limited partners...

  • Page 182
    ...all amounts actually incurred; provided that Buyer shall, promptly at the Closing, deliver an updated statement setting forth in reasonable detail such Expenses as Buyer has incurred in the interim. Kodak shall have the right to review the detail supporting any statement provided hereunder or any of...

  • Page 183
    ...and (ii) representations and warranties given as of a specific date need be true only as of such date), in the case of each of clauses (i) and (ii), in all material respects. Kodak will have delivered to Buyer a certificate of an authorized officer of Kodak to the effect that the condition specified...

  • Page 184
    ... to Closing as follows: (a) by mutual written agreement of Buyer and Kodak; (b) by either party, at any time prior to the entry of the Final Sale Order, upon or following the date that a Final Order of the Bankruptcy Court or any court with appellate jurisdiction therefrom shall be entered vacating...

  • Page 185
    ... the filing of the Supplemental Sale Motion, provided , that either party shall have the right to terminate this Agreement pursuant to this Section 7.1 (d) only for so long as the Final Sale Order has not thereafter been entered by the Bankruptcy Court; (e) by Kodak, if all conditions to Closing set...

  • Page 186
    ... courier service, to the party at the address set forth below, or such other address as may be designated in writing hereafter, in the same manner, by such party or if sent by facsimile, sent to the facsimile number set forth below: If to Kodak: Eastman Kodak Company 343 State Street Rochester, New...

  • Page 187
    ... have been given and received effective as of (a) in the case of personal delivery, on the date of such delivery, (b) in the case of a nationally recognized, overnight courier service, on the business day following dispatch, or (c) in the case of a facsimile, on the date of transmission if the party...

  • Page 188
    ... if applicable) contained in this Agreement shall survive Closing, and neither Kodak nor Buyer (or Buyer's Designee if applicable) shall have liability to the other party after Closing for any breach of any such covenant, agreement, representation or warranty. Except as set forth in the immediately...

  • Page 189
    ... law or in equity pursuant to this Agreement. (b) Notwithstanding anything that may be expressed or implied in this Agreement, or any document or instrument delivered in connection herewith, except as set forth under the Funding Commitment, by its acceptance of the benefits of this Agreement, Kodak...

  • Page 190
    ..., directors, trustees, officers, employees, advisors, agents, Affiliates, members, managers, general or limited partners, successors or assignees of Buyer (and Buyer's Designee, if applicable) or any former, current or future equity holder, controlling person, director, trustee, officer, employee...

  • Page 191
    ... pay such amount under this Section 8.8(b) , Buyer shall have an Administrative Expense Claim against Kodak and its bankruptcy estate for such unpaid amount as set forth in the Conditional Sale Order. (c) Buyer shall use commercially reasonable efforts to inform Kodak in writing promptly of each One...

  • Page 192
    ...of the Final Sale Order, each party waives compliance by the other party with any applicable bulk sales Law. Section 8.15 No Third Party Beneficiaries . Nothing in this Agreement, express or implied, is intended to, and shall not, confer upon any Person other than Buyer, Buyer's Designee, Kodak, the...

  • Page 193
    ...heading references herein are for convenience purposes only, do not constitute a part of this Agreement and will not be deemed to limit or affect any of the provisions hereof. Section 8.18 Counterparts; Electronic Signatures . This Agreement may be executed in one or more counterparts, each of which...

  • Page 194
    IN WITNESS WHEREOF , the Parties have duly executed this Agreement as of the date first above written. EASTMAN KODAK COMPANY Name: Title: - 49 INTELLECTUAL VENTURES FUND 83 LLC Name: Title:

  • Page 195
    ...2012 2011 Year Ended December 31 2010 2009 2008 Loss from continuing operations before provision for income taxes Adjustments: Undistributed (earnings) loss of equity... is considered a reasonable approximation of the interest factor. * Earnings for the year ended December 31, 2012 were inadequate to ...

  • Page 196
    ... Eastman Kodak Sarl Kodak Brasileira Comercio de Produtos para Imagem e Servicos Ltda Kodak Nederland B.V Kodak (Hong Kong) Limited Kodak (Taiwan) Limited Kodak IL Ltd Kodak (China) Limited Kodak (Shanghai) International Trading Co. Ltd Kodak (China) Investment Company Ltd. Kodak Electronic Products...

  • Page 197
    ...) Sdn.Bhd. Eastman Kodak International Capital Company, Inc. Kodak de Mexico S.A. de C.V. Kodak Mexicana, S.A. de C.V. Kodak A/S Kodak SA/NV Kodak Norge A/S Kodak Societe Anonyme Kodak (Thailand) Limited Kodak GmbH Kodak Kft. Kodak Oy Kodak S.p.A. Kodak Portuguesa Limited Kodak, S.A. Kodak Nordic AB...

  • Page 198
    ...-57729) of Eastman Kodak Company of our report dated March 11, 2013 relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Annual Report on Form 10-K. /s/ PricewaterhouseCoopers LLP Rochester, New...

  • Page 199
    ... omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in...

  • Page 200
    ... omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in...

  • Page 201
    ... In connection with the Annual Report of Eastman Kodak Company (the "Company") on Form 10-K for the period ended December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Antonio M. Perez, Chairman and Chief Executive Officer of the Company, certify...

  • Page 202
    ...2002 In connection with the Annual Report of Eastman Kodak Company (the "Company") on Form 10-K for the period ended December 31, 2012 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Rebecca A. Roof, Chief Financial Officer of the Company, certify, pursuant...