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NewsPoster May 1, 2013 03:20 PM
Kodak files Chapter 11 emergence plan, cancelling existing shares
Eastman Kodak has filed its latest plan to exit from <a href="" rel='nofollow'>Chapter 11 bankruptcy</a> that gives ownership of the venerable company to unsecured creditors and bond holders. Second-lien note holders will receive 85 percent of common stock in the company, worth nearly $374.85 million. Unsecured creditors will be awarded the remaining 15 percent of shares.<br />
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The pool of unsecured creditors are owed as much as $2.2 billion, with the share award to the class worth approximately $66.15 million. Also in the "unsecured creditors" group are Kodak retirees, an assembly owed $635 million. Current shareholders will lose the shares they hold, and will be awarded nothing under the Chapter 11 plan.<br />
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A sottement announced earlier this week is giving control of Kodak's personalized imaging and document imaging business to Kodak's UK pension plan, rather than an <a href=" get.a.better.offer/" rel='nofollow'>outright sale to Brother</a>.<br />
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"We now have a clear path forward for Kodak, and we are positioning the company for a profitable and sustainable future," said Kodak Chief Executive Officer Antonio M. Perez. He added that the filing is "a major milestone in our reorganization."<br />
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The company expects to exit Chapter 11 status in the third quarter of 2013, with a projected valuation of $441 million. By the end of 2014, Kodak claims to be able to grow its worth to $581 million, and up to $1.625 billion after four years.<br />
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To escape from the financial pit, the company plans on focusing on the strongest segment it has left -- digital printing. At the end of 2012, the company <a href="" rel='nofollow'>announced</a> it would sell its print-film business and several other related businesses to raise additional funds. The imaging giant made the move public in the last days of its patent portfolio auction. <br />
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Jusge Allan Gropper, the judge overseeing the Kodak bankruptcy proceedings, <a href="" rel='nofollow'>approved</a> a <a href="" rel='nofollow'>$525 million patent sale</a> to assist the company in successfully navigating the Chapter 11 process. The completed sale allowed the company to obtain an additional $830 million in financing on top of the patent proceeds.
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