Arielle Patrick, a spokesperson for Kodak, declined to answer questions about why the directors were granted stock options in May.
On the same day that Kodak alerted local media to its about to be announced deal with the Trump administration, the compensation committee of the company’s board of directors voted to award Mr. Continenza of 1.75 million stock options allowing him to buy stocks at prices ranging from $ 3.03 to $ 12.
As of Wednesday morning, Kodak shares had climbed to $ 60 each. They have since fallen back to around $ 24, which means the stock options give Mr. Continenza the right to buy shares at a significant discount.
Mr. Continenza may exercise some options immediately, but not all.
Ms. Patrick said that the rapid increase in the value of Mr. Continenza’s new stock options “is just paper. Mr. Continenza has not received any product and has no intention of selling. “
She added that Kodak’s board of directors granted the options to Mr. Continenza because when the company issued a type of debt last year that converts to equity, the value of the shares and options of the leader management has been diluted.
She said Kodak received shareholder approval in May to issue additional shares, and that the compensation committee approved the options “at the first meeting of this committee since the annual meeting of shareholders,” which was the Monday July 27.
She declined to say why Kodak did not wait for the White House announcement to grant options.
The increase in Kodak shares this week also transformed some stock options Mr. Continenza received when he became managing director. They had effectively been worthless due to the low price of Kodak’s stock. This week, their value has risen to around $ 59 million, Reuters reported.