Kodak's Pension Wind-Down to Repay Lenders Amid Debt Woes.

Eastman Kodak's surplus pension fund will help the company repay its debt, primarily to Kennedy Lewis Investment Management, its top lender. The company has amended its term loan agreement since 2023 to earmark pension wind-down proceeds for lender repayment. Kodak has raised concerns about its survival, but this development may alleviate some financial pressure.

Eastman Kodak Company (KODK) has announced that its surplus pension fund will be used to help repay debt, particularly to Kennedy Lewis Investment Management, its largest lender. This move comes as the company has amended its term loan agreement since 2023 to designate pension wind-down proceeds for lender repayment. The company has expressed concerns about its survival, but this development may alleviate some financial pressure.

According to the company's latest 10-Q filing [1], Eastman Kodak reported modestly lower revenue and a swing to net losses in 2025. Total revenue for the quarter ended June 30, 2025 was $263 million versus $267 million a year earlier, with gross profit of $51 million versus $58 million. Kodak recorded a net loss of $26 million for the quarter (basic EPS $(0.36)) and a six-month net loss of $33 million (six-month EPS $(0.48)), compared with six-month earnings of $58 million a year earlier. The balance sheet shows constrained near-term liquidity and heightened short-term obligations.

The company's liquidity position has been a concern, with cash and cash equivalents at $155 million, and short-term borrowings and current portion of long-term debt increasing to $479 million. Total current liabilities rose to $729 million from $261 million at year-end, raising substantial doubt about its ability to continue as a going concern.

Eastman Kodak's plans depend on proceeds from the KRIP settlement and on converting, redeeming, extending, or refinancing Series B preferred stock and Term Loans. Other notable items disclosed include a $17 million impairment on an investment in Wildcat Discovery, Series B preferred carrying value $99 million, and Series C $123 million (Series C was exchanged for common shares on August 8, 2025). The company also reported $20 million of other charges in Q2 and approximately $89 million of unrecognized revenue from unsatisfied performance obligations.

The use of the pension fund to repay debt is a significant development that could help Eastman Kodak manage its financial obligations. However, the company's ongoing struggles with liquidity and debt levels will continue to be closely watched by investors and financial professionals.

References:
[1] https://www.stocktitan.net/sec-filings/KODK/10-q-eastman-kodak-company-quarterly-earnings-report-bff6f39e67af.html