Kodak 2009 Annual Report Download - page 114

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(11) Each quarter is calculated as a discrete period and the sum of the four quarters may not equal the full year amount. The
Company's diluted net earnings (loss) per share in the above table may include the effect of convertible debt instruments.
NOTE 26: CONDENSED CONSOLIDATING FINANCIAL INFORMATION
On September 29, 2009, the Company issued to Kohlberg Kravis & Company L.P. and certain of its affiliates (1) $300 million
aggregate principal amount of 10.5% Senior Secured Notes due 2017 (“Senior Secured Notes”), and (2) detachable warrants to
purchase 40 million shares of the Company’s common stock at an exercise price of $5.50 per share (the “Warrants”), subject to
adjustment based on certain anti-dilution protections. The warrants are exercisable at the holder’s option at any time, in whole or in
part, until September 29, 2017.
The Company’s Senior Secured Notes are fully and unconditionally guaranteed on a senior secured basis by each of the Company’s
existing and future direct or indirect 100% owned domestic subsidiaries (“Guarantor Subsidiaries”), jointly and severally.
The condensed consolidating financial information presented below reflects information regarding Eastman Kodak Company
(“Parent”), the issuer of the Senior Secured Notes, the Guarantor Subsidiaries and all other subsidiaries (“Non-Guarantor
Subsidiaries”). This basis of presentation is not intended to present our financial condition, results of operations or cash flows for any
purpose other than to comply with the specific requirements for subsidiary guarantor reporting. The condensed consolidating
information is prepared following the same accounting policies as applied to the Company’s consolidated financial statements except
that the individual parent and combined subsidiaries’ accounts follow the equity method of accounting.
The following reflects the condensed consolidating Statement of Operations for the year ended December 31, 2009:
(in millions) Parent
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries
Consolidating
Adjustments Consolidated
Net sales $ 4,196 $ 250 $ 4,861 $ (1,701) $ 7,606
Cost of goods sold 3,451 219 3,869 (1,701) 5,838
Gross profit 745 31 992 - 1,768
Selling, general and administrative expenses 683 48 571 - 1,302
Research and development costs 300 8 48 - 356
Restructuring costs, rationalization and other 109 13 104 - 226
Other operating expenses (income), net (92) 8 (4) - (88)
(Loss) earnings from continuing operations
before interest expense, other income
(charges), net and income taxes (255) (46) 273 - (28)
Interest expense 103 - 16 - 119
Other income (charges), net 19 4 7 - 30
Other intercompany income (charges), net 61 - (61) - -
Equity in undistributed earnings of
subsidiaries 125 34 - (159) -
(Loss) earnings from continuing operations
before income taxes (153) (8) 203 (159) (117)
Provision for income taxes 70 - 45 - 115
(Loss) earnings from continuing operations (223) (8) 158 (159) (232)
Earnings (loss) from discontinued operations,
net of income taxes 7 (2) 12 - 17
Extraordinary item, net of tax 6 - - - 6
Net (loss) earnings (210) (10) 170 (159) (209)
Less: Net income attributable to
noncontrolling interests - - (1) - (1)
Net (loss) earnings attributable to
Eastman Kodak Company $ (210) $ (10) $ 169 $ (159) $ (210)