Press Release:

Kodak and HP Announce Plans to Dissolve Phogenix Joint Venture

ROCHESTER, N.Y., May 14, 2003

Eastman Kodak Company and HP today announced the decision to dissolve their Phogenix joint venture. HP and Kodak established Phogenix as a joint venture three years ago to develop digital inkjet photofinishing mini-labs for use at retail.

In a joint statement, Matthias Freund, Chairman of the Phogenix Board of Directors and Chief Operating Officer of Kodak's Consumer Imaging Products and Services business, and Mary Peery, Member of the Phogenix Board of Directors and Senior Vice President of HP's Digital Imaging & Publishing business, said, "Both HP and Kodak believe the technology being developed by Phogenix continues to offer a viable solution for on-site digital photo processing. However, based on the anticipated return on invested capital for the parent companies, each company has separately decided to focus its own investments on other opportunities."

Both companies agreed it was in the best interests of potential customers, employees and investors to terminate operations at this time, before any mini-labs were installed on a commercial basis. "We appreciate all the time, effort and energy of the joint venture and its people to date, whose work has proven to demonstrate the long-term promise of digital photofinishing," Freund and Peery said.

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