Businesses in New York can pursue bankruptcies when they lose their financial moorings and lack the ability to carry on without protection. Companies of different types seek bankruptcy protection in New York and elsewhere in any given year. On Aug. 20, the U.S. Bankruptcy Court approved Kodak’s plan to emerge from bankruptcy proceedings and the judicial oversight of its company’s operations. The approval of the plan paves the pathway for Kodak to operate as a significantly smaller company that focuses on commercial and packaging printing. The company hopes to exit bankruptcy on Sept. 3.
Gone after the bankruptcy process is the company’s once iconic camera-making business, which made the Kodak name famous more than 100 years ago. Founded in 1880 by George Eastman, Kodak popularized photography in the United States and across the world. In addition, Kodak has terminated employees, closed offices and plants and downsized its operations dramatically.
Kodak was forced to file bankruptcy in 2012 because of the company’s growing debt, increased competition and the continuing growing in the use of digital cameras. Approval of the plan by the bankruptcy judge will result in the loss of retirement and health benefits for many former Kodak employees. At the same time, Kodak stockholders will recoup pennies on the dollar when it comes to their investments. The company’s creditors have received similar partial payments on their debts.
A Chapter 11 bankruptcy permits a business to reorganize its operations and restructure its debt. A bankruptcy attorney may be able to assist a business in pursuing this type of bankruptcy, which permits a business to emerge from the proceedings and carry on operating in some fashion like Kodak may be able to.
Source: ABC News, “Judge Approves Kodak Plan to Exit Bankruptcy“, Bree Fowler , August 20, 2013by