KODK Eastman Kodak Co.

Risks

• If Kodak is not able to successfully implement its business plans, or experiences implementation delays in cost structure reduction, Kodak’s consolidated results of operations, financial position and liquidity could be negatively affected.
• If Kodak cannot successfully manage and complete the divestiture of the Flexographic Packaging Division, the Company’s strategic objectives and financial condition could be adversely impacted, as well as Kodak’s ability to meet debt obligations including compliance with debt covenants and other commitments as they become due.
• The ability to generate positive operating cash flows will be necessary for Kodak to continue to operate its business.
• Continued investment, capital needs, restructuring payments, dividends and servicing the Company’s debt require a significant amount of cash and it may not be able to generate sufficient cash to fund these activities, which could adversely affect its business, operating results and financial condition.
• Kodak’s inability to effectively complete and manage strategic transactions could adversely impact its business performance, including its financial results.
• If Kodak is unable to successfully develop, fund and commercialize products in certain businesses upon which it is focused or do so within an acceptable timeframe, its financial performance could be adversely affected.
• Kodak may pursue acquisitions or combinations which could fail or present unanticipated problems for its business in the future, which would adversely affect its ability to realize the anticipated benefits of those transactions or increase the price it would be required to pay.
• Due to the nature of the products it sells and Kodak’s worldwide distribution, Kodak is exposed to fluctuations in foreign currency exchange rates, interest rates and commodity costs which may adversely impact its results of operations and financial position.
• Weakness or worsening of global economic conditions could adversely affect Kodak’s financial performance and liquidity.
• If Kodak is unable to successfully develop or commercialize new products or do so in a timely manner, its business, financial position and operating results may suffer.
• If Kodak’s commercialization and manufacturing processes fail to prevent issues with product reliability, yield and quality, its product launch plans may be delayed, its financial results may be adversely impacted, and its reputation may be harmed.
• If the reputation of Kodak or its brand erodes significantly, it could have a material impact on its financial results.
• The competitive pressures it faces could harm Kodak’s revenue, gross margins, cash flow and market share.
• An inability to provide competitive financing arrangements to Kodak’s customers or extension of credit to customers whose creditworthiness deteriorates could adversely impact its revenue, profitability and financial position.
• The loss of one or more of Kodak’s key personnel, or its failure to attract and retain other highly qualified personnel in the future, could harm its business.
• If Kodak cannot effectively anticipate technology trends and develop and market new products to respond to changing customer preferences, its revenue, earnings and cash flow could be adversely affected.
• Kodak makes sizeable investments in new products and services that may not achieve expected returns.
• Business disruptions could seriously harm Kodak’s future revenue and financial condition and increase its costs and expenses.
• Kodak could be adversely impacted by a security breach, through cyber-attack, cyber intrusion, insider threats or otherwise, or other significant disruption of its IT networks and related systems or of those it operates for certain of its customers.
• Failure to comply with anti-corruption laws and regulations, anti-money laundering laws and regulations, economic and trade sanctions, and similar laws could have a materially adverse effect on Kodak’s reputation, results of operations or financial condition, or have other adverse consequences.
• Failure to comply with privacy, data protection and cyber security laws and regulations could have a materially adverse effect on Kodak’s reputation, results of operations or financial condition.
• Kodak’s future pension and other postretirement benefit plan costs and required level of contributions could be unfavorably impacted by changes in actuarial assumptions, market performance of plan assets and obligations imposed by legislation or pension authorities which could adversely affect its financial position, results of operations, and cash flow.
• Kodak may be required to recognize impairments in the value of its goodwill and/or other long-lived assets which could adversely affect its results of operations.
• Kodak’s businesses experience seasonality of sales. Therefore, lower demand for Kodak’s products or increases in costs during periods which are expected to be at peak in seasonality may have a pronounced negative effect on its results of operations.
• If Kodak fails to manage distribution of its products and services properly, its revenue, gross margins and earnings could be adversely impacted.
• Kodak’s future results could be harmed if it is unsuccessful in its sales in emerging markets.
• Kodak is subject to environmental laws and regulations and failure to comply with such laws and regulations or liabilities imposed as a result of such laws and regulations could have an adverse effect on its business, results of operations and financial condition.
• Kodak’s business, financial position, results of operations, cash flows and reputation may be negatively impacted by legal matters.
• There can be no assurance the Company will be able to comply with the terms of its various credit facilities.
• The combination of covenant requirements in the Term Credit Agreement and Kodak’s on-going investment in growth businesses, a decline in Strategic Other Business or an accelerated decline in its Planned Declining Business or continuing softness and volatility of global economic conditions and foreign currency exchange rates, could make it difficult for the Company to satisfy the leverage covenants under the Term Credit Agreement on an on-going basis.
• We may require additional capital funding and such capital may not be available to us and/or may be limited.
• The current non-investment grade status and Kodak’s financial condition may adversely impact Kodak’s commercial operations, increase its liquidity requirements and increase the cost of refinancing opportunities. It may not have adequate liquidity to post required amounts of additional collateral.
• The availability of borrowings and letters of credit under the ABL Credit Agreement is limited by the amount of various types of assets and, under certain circumstances, the administrative agent under the ABL Credit Agreement will have greater control over Kodak’s cash.
• The Company’s substantial monetary obligations require a portion of its cash flow be used to pay interest, dividends and fund other obligations rather than be invested in the business and could adversely affect its ability to fund its operations.
• The conversion of the Company’s Series A Preferred Stock into shares of the Company’s common stock may dilute the value for the current holders of the Company’s common stock.
• The holders of the Company’s Series A Preferred Stock own a large portion of the voting power of the Company’s outstanding securities and have the right to nominate two members to the Company’s Board. As a result, these holders may influence the composition of the Board and future actions taken by the Board.
• The Company has registered the resale of a large portion of its outstanding securities. The resale of the Company’s common stock, or the perception that such resale may occur, may adversely affect the price of its common stock.
• The resale of a significant portion of the Company’s securities registered for resale could result in a change of control of the Company and the loss of favorable tax attributes.
• The Company’s stock price has been and may continue to be volatile.
• The market price of the Company’s common stock may be affected by the volatility of blockchain and cryptocurrency markets.