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Kodak Realigns, Former HP Exec to Lead New Commercial Printing Business

Press release from the issuing company

ROCHESTER, N.Y.--Aug. 21, 2003-- Eastman Kodak Company announced that it has realigned its operations and leadership team to accelerate growth in commercial and consumer imaging markets. These changes are part of the company's broader strategy for growth that will be detailed on Sept. 25, when Kodak holds a previously scheduled investors meeting in New York City. The company is now organized under several primary operations: Commercial Printing; Display & Components; Health Imaging; Digital & Film Imaging Systems; and Commercial Imaging. "We have implemented a structure and leadership team that will unlock the potential of our existing operations and build entirely new businesses that will position us for growth," said Daniel A. Carp, Kodak's Chairman and CEO. "We will continue to invest in the most attractive areas of the business, and we will aggressively and intelligently manage our mature operations for long-term customer satisfaction, for market share, and for cash." All of the operating businesses will report to Antonio M. Perez, Kodak's President and Chief Operating Officer. Robert H. Brust, Chief Financial Officer, James C. Stoffel, Chief Technical Officer, Michael P. Morley, Chief Administrative Officer, along with Perez, will continue to report to Carp. Commercial Printing James Langley, a former senior executive at Hewlett-Packard Company, has joined Kodak effective immediately as President, Commercial Printing, a new business which will include Kodak's Encad subsidiary and its NexPress and Kodak Polychrome Graphics joint ventures. The Commercial Printing business also includes an initiative to enter the digital asset management market and publishing services, which involves managing the distribution and output of digital assets, such as images. Philip Gerskovich, currently Chief Strategy Officer and General Manager, Software & Digital Services Business, in Kodak's Digital & Applied Imaging operation, will lead this initiative. Langley, 53, spent 30 years at HP--all in the printing and publishing arenas--rising to the position of Vice President, Commercial Printing. He established HP's Vancouver Printer Division and managed its entry into the commercial printing market. Langley holds a B.S. in mechanical engineering from the University of California at Berkeley and an M.S. in mechanical engineering and computer science from Stanford University. "Digitally-driven commercial printing is a large and growing market, and is a core part of our long-term vision to drive revenue and earnings growth," Perez said. "Kodak has the assets and competencies to be a leader in this market, with our portfolio of intellectual property of printing technologies, our Encad subsidiary, and our NexPress and Kodak Polychrome joint ventures. These will be the foundation of Kodak's on-demand color printing and network publishing efforts." The creation of the Commercial Printing business is part of the transformation of Kodak from its historical roots in consumer film to a company with a more balanced and diversified portfolio of businesses. Display & Components Willy C. Shih, Senior Vice President, Eastman Kodak Company, will become President, Display & Components. This includes products built on Kodak's Organic Light-Emitting Diode (OLED) technology and other display technologies, as well as its Image Sensor Solutions (ISS) businesses. ISS designs, manufactures and sells charge-coupled devices (CCDs) for digital cameras. Shih will also maintain his responsibilities as President, Digital & Applied Imaging products and services (D&AI), on an interim basis. D&AI manufactures the popular EasyShare digital photography system, inkjet paper and provides online imaging services through its Ofoto subsidiary. Shih, who built D&AI into nearly a $1 billion operation in a five-year period, will lead the efforts to grow a sizable new business in electronic displays based on Kodak's pioneering technology position in organic electroluminesence. Health Imaging Dan Kerpelman will continue in his role as President, Health Imaging, and Senior Vice President, Eastman Kodak Company. Kerpelman, who joined Kodak in 2002 after 17 years at General Electric Company, has been responsible for driving revenue and earnings growth. He recently engineered the planned acquisition of PracticeWorks, Inc., a leading provider of dental practice management software. Digital & Film Imaging Systems Bernard Masson, currently President of the Kodak Display Group, and Senior Vice President, Eastman Kodak Company, will become President, Digital & Film Imaging Systems. Masson will oversee D&AI, Entertainment Imaging (EI) products and services, and Consumer & Professional Imaging products and services (C&PI). Reporting to Masson will be Matthias Freund, Acting President, C&PI, and Vice President, Eastman Kodak Company; Eric G. Rodli, President, EI, and Senior Vice President, Eastman Kodak Company; and Shih on an interim basis. As previously announced, Karen Smith-Pilkington will report to Freund as Business Operations Manager, C&PI, and Senior Vice President, Eastman Kodak Company. Digital & Film Imaging includes emerging operations, such as Ofoto's online imaging services and Kodak's initiatives in the mobile imaging market; and established operations, such as digital still cameras, inkjet paper, digital minilabs, kiosks and thermal printers and media. Kodak's motion picture, professional and consumer film products and consumer photofinishing services will continue to generate a significant amount of cash to fund emerging business opportunities throughout the company. "Consumer, professional and entertainment imaging products and services are other key components of our long-term vision," Perez said. "Our film products, which will become a smaller part of our business over time, will continue to enjoy widespread use, particularly in emerging markets, and will generate significant cash as our new digital businesses continue to grow at a fast pace. Bernard's history of building businesses makes him the right person to lead this organization." Prior to joining Kodak last year, Masson was President of the Consumer Printer Division of Lexmark International. Under his leadership, Lexmark's share of the consumer printer market moved from 1% to 20%. Rodli, who will continue in his current role at EI, has been responsible for several major product introductions, including the new Vision2 motion-picture film as well as a new digital services business for the entertainment industry. Rodli recently led the planned acquisition of LaserPacific Media Corporation, a leading post-production company based in Hollywood, California. Kodak expects that this structure will enable the company to more effectively manage opportunities that span various product lines. Commercial Imaging Carl A. Marchetto will continue in his current role as President, Commercial Imaging, and Senior Vice President, Eastman Kodak Company. Commercial Imaging will now include Commercial & Government Systems products and services; Document Imaging products and services; Services & Support; and Optics. Marchetto has been instrumental in managing the company's NexPress joint venture, and has extended Kodak's long-standing relationship with NASA, including work on the James Webb Space Telescope. Additionally, the company announced that Carl E. Gustin Jr., Chief Marketing Officer and Senior Vice President, will report to Carp as the person responsible for brand management and to Perez as CMO. "As we diversify our business and build our capabilities for enabling the convergence of images and information, we will continue to structure the company to take advantage of major growth opportunities," Carp said. "We will pursue select opportunities in each of these markets to extend our participation in the $385 billion infoimaging market."