Oct. 10 (Bloomberg) -- Eastman Kodak Co., the bankrupt photography pioneer, reached a deal to resolve a $1.2 billion liability stemming from retiree benefits that it will terminate at the end of the year.
The agreement between Kodak and a committee representing retirees will give the committee a $7.5 million cash payment, a $635 million unsecured claim in Kodak’s bankruptcy case and an additional claim of $15 million, Kodak said today in a statement.
The Rochester, New York-based company said the move “will pose challenges for retirees.”
Kodak’s retiree benefits program covers medical, dental, life insurance and survivor income benefits, Kodak said. Kodak will terminate the benefits as of Dec. 31. Kodak’s U.S. benefits liability exceeded $1.2 billion as of Dec. 31, 2011, according to the statement.
The bankruptcy case is In re Eastman Kodak Co., 12-10202, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
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