June 26, 2013 11:05am PT by Carolyn Giardina
Kodak Bankruptcy: Film Manufacturer to Begin Reorganization Voting Process
Following several rulings in bankruptcy court on Tuesday, Kodak -- which filed for Chapter 11 bankruptcy protection in early 2012 -- will begin the voting process on its plan of reorganization.
The company said it expects to emerge from bankruptcy by mid to late September.
On Tuesday, a U.S. bankruptcy court determined that the Kodak’s disclosure statement contains the information necessary to enable creditors to vote on the company's plan of reorganization.
It also approved a backstop commitment agreement and rights offering, as well as an agreement with J.P. Morgan Chase, Barclays Bank and Bank of America Merrill Lynch to arrange new exit financing and post-emergence facilities of up to $895 million.
Said Antonio M. Perez, Kodak’s chairman and CEO, in a released statement: "With the approval of our disclosure statement, we look forward to seeking creditor votes for our plan of reorganization. An equity commitment from the backstop firms is a strong vote of confidence in Kodak’s plan of reorganization and in the work we have undertaken during our restructuring.
"The combination of the rights offering and the agreement to arrange new financing is extremely important as it enables us to repay the secured creditors; provides the company with a strong, stable capital structure; signals market and creditor confidence in post-emergence Kodak; and demonstrates our ability to generate value for our stakeholders by capitalizing on our leadership in the large and growing markets of commercial digital printing, packaging and functional printing.”
Kodak's situation is, of course, one that could impact industries that continue to rely on film, including production, exhibition and archiving.
This week, Europe’s exhibition community is gathered for CineEurope, where the uncertain future of film was discussed.
More than 75 percent of the world's cinema screens have been converted to digital projection. According to the International Union of Cinemas’ annual report, released this week at CineEurope, roughly 78 percent of screens in UNIC territories had gone digital the end of 2012. But a worry is that the timetable for the reminder of the transition might be out the hands of studios and exhibition.