I have attached the text of this morning's memo to Kodak employees from CEO Antonio Perez. I'll point out one thing that the memo says and one thing that it doesn't.

First, note that at the start of the 6th paragraph, Mr. Perez mentions that he "will take a direct oversight role" in operating what will likely end up as Kodak's only meaningful business unit. Just what the company needs - the Butcher of State Street in an operating role. Since Perez joined the company in 2005, nearly every metric has been straight down, culminating in the cliff-fall of bankruptcy last January.

Second, with 1,000 more layoffs, Kodak will have eliminated 3,700 jobs this year alone. Every time another round of mass firings is announced, I keep hoping that CEO Perez will be among the missing. Alas, not yet.

Here's the text:

September 10, 2012

Dear Colleagues,

We recently shared with you the strategic next steps we are taking toward emergence from Chapter 11 based on a three-business structure:

Kodak will emerge as a company focused on commercial, packaging, and functional printing solutions and enterprise services. This business builds on our legacy as a worldwide innovator in digital imaging and materials science technologies to offer differentiated products and services for growing markets; and our Document Imaging and Personalized Imaging businesses, both well-established businesses that are now in the process of being sold.

Our immediate task now is to make the organizational changes that reflect this three-business structure and to ensure they are appropriately scaled with a lean management structure.

As we prepare to separate the Personalized Imaging and Document Imaging businesses from the company, we know that our current cost structure is not appropriately sized for the business that remains, as it was designed for a larger, more diversified set of businesses. Therefore, we need to make the adjustments now to ensure that our corporate structure is appropriately consolidated and scaled to enable Kodak to emerge as a competitive and profitable company.

As one of the first steps in the process of creating a sustainable cost structure for the emerging Kodak, while operating our business for the benefit of our customers and positioning our Personalized Imaging and Document Imaging businesses for successful sales, we are reorganizing our senior management team. Under the new management structure:

I will take a direct oversight role for the Commercial, Packaging & Functional Printing Solutions and Enterprise Services business, which primarily has two component parts: Digital Printing & Enterprise, led by Doug Edwards, and Graphics, Entertainment and Commercial Films, led by Brad Kruchten. Doug and Brad are both proven and talented executives - with the skill required to tightly manage our key business lines and the vision required to build their future.

As a result of our efforts to ensure that this business has a leaner structure, we have determined that Phil Faraci will leave the company. I have discussed with you previously Phil's critical role in contributing to the transformation of our company during his tenure as Chief Operating Officer. Phil was invaluable in helping to lead the commercial team in the weeks following our Chapter 11 filing by successfully reassuring key customers and suppliers of our continued commitment to our relationship. He has personally been a good friend and colleague. I brought Phil to Kodak in 2004 and have valued his support and commitment ever since. He is an original thinker and passionate and hard-working manager. However, Phil and I believe that management alignment with our new structure must prevail.

Ann McCorvey has decided to leave the company. Replacing Ann as CFO on an interim basis will be Becky Roof. A managing director of AlixPartners, Becky has served in similar capacities for other companies that have successfully emerged from Chapter 11 restructurings, and she has deep experience in scaling overhead costs, implementing cost reduction programs, managing liquidity and raising capital, and executing asset sales - all critical areas on which Kodak must focus as we conclude our restructuring.

I thank Ann for her leadership of the Finance organization and the critical financial advice she has provided to me and to our Board of Directors. Her counsel and financial management skills have benefitted the entire Kodak organization, and she has played an important role in putting us firmly on the path to successful emergence.

We are also putting in place the leadership necessary to execute effective and successful sales of both the Document Imaging and Personalized Imaging businesses. These are complex businesses that require specific skills in terms of engaging with potential buyers while at the same time ensuring that current operations continue without disruption and customers continue to receive the superior service and products they expect from us.

Laura Quatela will assume the additional role of President, Personalized Imaging, and lead that business through its sale. As Laura focuses her energies on Personalized Imaging, I am confident that she will bring to bear in this role the same sound instincts, analytical skill, and deep engagement with and respect for our employees that she demonstrated across Kodak as Chief Operating Officer.

Dolores Kruchten, President, Document Imaging, will oversee the business that she has successfully led for many years and guide the sales process for the company.

In addition to Becky Roof, our other function heads are Patrick Sheller, General Counsel, Secretary & Chief Administrative Officer; Terry Taber, Chief Technology Officer; and Chris Payne, who will lead Corporate Strategy.

The regional structure is largely unchanged, with the leaders of our worldwide operations continuing to report to me.

We announced in a press release today our headcount reductions for the year. We are continuing to analyze resource requirements of each business, with an understanding that further reductions will be needed. Decisions about employee assignments will be based on that work. For many employees, this process will not take long - several weeks at most; for others, we may not be able to make decisions until 2013. I want all employees to know, however, that I understand you want information as quickly as possible, and providing it to you is a top priority for the business leaders and the HR team... and for me.

As always, thank you for your continued hard work and commitment.



(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).