(Dow Jones Newswires) A judge on Friday approved changes to Eastman Kodak Co.'s bankruptcy financing that gives the company more flexibility of time and money as it continues its pursuit of a Chapter 11 exit plan that would keep it viable.
Judge Allan L. Gropper of the U.S. Bankruptcy Court in Manhattan approved the changes at a quick hearing Friday, also allowing the company to file some of the paperwork describing the changes confidentially.
The financing, from a group of the company's second-lien lenders including Silver Point Capital LP and Contrarian Capital Management LLC, is an amendment to their $843.7 million loan approved by Judge Gropper in January. Many of the terms are undisclosed.
Judge Gropper's approvals Friday essentially allowed Kodak to pay the lenders fees related to the changes, which include lowering the amount of cash Kodak must generate from selling off its non-commercial imaging businesses to $600 million.
The changes also give Kodak greater flexibility in converting the loan to the exit financing it would need to emerge from bankruptcy. The company hopes to have a plan confirmed by the court by the end of June and to be out of Chapter 11 by the middle of September.
"It's an important day," said Akin Gump Strauss Hauer & Feld LLP's Michael S. Stamer, a lawyer for the lenders. Mr. Stamer also said that discussions on a reorganization plan--who will own Kodak when it comes out of bankruptcy, how creditors will be paid back and how it will move forward as a company--have already begun. The changes also call for Kodak and the lenders, along with the company's official committee of unsecured creditors, to work together in selecting members of the reorganized company's board of directors.
While the company hasn't yet filed an official reorganization plan, Kodak has laid out the backbone of a proposal by selling a trove of digital patents for $527 million and securing the second-lien lenders' financing.