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ROCHESTER, N.Y. \u2013 Kodak is warning investors that the end may soon be near as it scrambles to find ways to pay a $500 million loan that\u2019s coming due.\u00a0 Kodak has been a staple in Rochester for more than 130 years and this is one of its most dire financial situations it\u2019s ever been in.\u00a0 The company plans to find some cash by eliminating its pension plan.\u00a0<\/p>\n
News10NBC Investigative Reporter Jennifer Lewke spoke with the CEO of Brighton Securities about the dismal news:<\/p>\n
George Conboy, CEO of Brighton Securities:<\/strong>\u00a0 Kodak reported a going-concern note on their financial statements and that is something that is required by auditors when they consider that there is any kind of substantial doubt about a company\u2019s ability to continuing as a going concern.\u00a0 In plain English, to stay in business.\u00a0 It\u2019s a good news-bad news thing, it\u2019s always bad news to see that on your financial statement, the good news is that Kodak, by terminating its pension plan, will get about half a billion dollars in cash, they can use that to pay down debt.\u00a0<\/p>\n Jennifer Lewke, News10NBC:<\/strong>\u00a0 I guess I hear about eliminating the pension plan though and I think about all of the people who might be benefiting from that plan in our community specifically.<\/p>\n George Conboy:<\/strong>\u00a0 It\u2019s actually a good deal Jenn and here\u2019s why, the people who are getting so much a month as a pension (payment) are going to continue to get that and what\u2019s better about the termination is this, instead of a company that may be weak, may be losing money, that may have a hard time making payments in the future, what Kodak will do with the money from terminating it will #1, required by federal law, pay a bunch of insurance companies to guarantee the pension of all the retirees. So, the good news is if you\u2019re a Kodak retiree your pension and future will be guaranteed by some insurance companies and not by Kodak.\u00a0<\/p>\n Jennifer Lewke:\u00a0 <\/strong>\u00a0So then, eliminating the pension fund just means moving forward they don\u2019t offer that to any future employees?<\/p>\n George Conboy:\u00a0 <\/strong>\u00a0That\u2019s correct, Kodak won\u2019t have a pension plan for future people but anyone receiving a pension, not only will you keep getting it but in my opinion, it will be a safer bet that you will always get that pension as you\u2019re entitled.\u00a0<\/p>\n Jennifer Lewke:<\/strong>\u00a0 Maybe this is too direct but it\u2019s sort of like Kodak is this nostalgic company in our community but I have to wonder whether you even suggest to people that they continue to invest in it?<\/p>\n Geoge Conboy:<\/strong>\u00a0 So, Jenn\u2026 you\u2019re known for being very direct, that is a very direct question.\u00a0 No, Kodak as an investment, it\u2019s a speculative thing.\u00a0 Now, if you want to speculate, you want to take some chances and take some risks Kodak might be right for some people but for the average person it\u2019s not the kind of investment we think would be something that the average person would put under their pillow and go to sleep at night.\u00a0<\/p>\n In a statement, a spokesperson for Kodak says, \u201cKodak is confident it will be able to pay off a significant portion of its term loan well before it comes due\u2026 and amend, extend or refinance it remaining debt and\/or preferred stock obligations.\u201d<\/p>\n