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Kodak receives and accepts new financing offer

November 30, 2012

OEM offered improved interim and exit financing of $830 million in loans to steer company out of Chapter 11.

What They Think reports that Kodak has accepted an improved offer of financing from the Steering Committee of the Second Lien Noteholders Committee, with the company to receive loans totalling $830 million (€638 million), an improvement on the $793 million (€609.5 million) bondholder deal previously announced by Kodak in November.

The Steering Committee reportedly comprises of 10 institutional investors that each hold “secured notes of the company”, with all other holders of the notes being able to participate in the new financing.

New money term loans of $455 million (€350 million) are included in the financing, along with “term loans of up to $375 million (€288 million) issued to holders of senior secured notes participating in the new money loans in a dollar-for-dollar exchange for amounts outstanding under the company’s pre-petition second lien notes”.

It is also noted that the financing will be on the condition that Kodak successfully sells its digital patent portfolio for at least $500 million (€384 million), which the company had originally planned to do in an auction in August, but postponed in September thought to be a result of receiving unexpectedly low bids.

Commenting on the improved financing, Antonio M. Perez, CEO of Kodak said: “As we continue to progress toward successful emergence, we remain focused on doing what is best for the company’s creditors and other stakeholders, including our customers, suppliers, and employees. We are pleased that these existing creditors have come forward with a new proposal that offers better terms and enables Kodak to further accelerate its momentum to emergence in the first half of 2013.

“The improved financing commitment provides a longer maturity, lower fees and pricing, and greater liquidity than our previously announced commitment. This is a vote of confidence in the future of our company. We are particularly pleased that the financing allows for participation by all of our pre-petition second lien noteholders in a manner that is cost-effective for the company.”

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