Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Court Approves Sale of Kodak's Digital Patents, Eastman Business Park Utilities
Author: Joel R. Glucksman
Date: January 25, 2013
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2013: The Year Kodak emerges from Bankruptcy Protection?
The Eastman Kodak Co. is a step closer to emerging from Chapter 11 bankruptcy protection in mid-2013 after a U.S. court approved the long-awaited sale of its digital imaging patents.
United States Bankruptcy Judge Allan Gropper approved the $527 million purchase of Eastman Kodak Co.’s digital imaging patent portfolio, which will set the company up to meet its goal to exit bankruptcy protection this year. Although the company expressed its disappointment at the final amount of the sale, it does put Kodak in line to accept $830 million in financing from bondholders, the agreement of which was contingent on the sale of its patent portfolio for at least $500 million. The photography pioneer had initially anticipated its patent portfolio would sell for roughly $2 billion.
In addition to the finalization of this sale, the company also entered into another purchasing agreement with Recycled Energy Development, which will purchase and convert the utility infrastructure of Eastman Business Park. The Illinois-based group plans to convert the industrial park’s coal-fired power plant to natural gas, and pay Kodak roughly $8.5 million for the utility assets.
“With the court’s approval of the sale of our digital imaging patent portfolio, we have achieved one of Kodak’s key restructuring objectives, while positioning our Commercial Imaging business for further growth and success, and enabling Kodak to repay a substantial amount of its initial lending,” Kodak officials said in a statement. “We also welcome the court’s approval of the sale of Eastman Business Park’s utilities to Recycled Energy Development, which marks a major step in the park’s revitalization and provides stability for the park and its tenant companies.”
The company said it plans to use some of the proceeds from its patent sale to repay creditors and emerge from proceedings more quickly. Kodak filed for protection under bankruptcy law one year ago, and the road to exit bankruptcy court has been an arduous one for the company.
If you face bankruptcy issues in your business or would like more information on the topic above, please call me, Joel Glucksman, at 201.806.3386.
- Practices: Bankruptcy & Creditors' Rights, Patents, Corporate Transactions & Business, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
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