Kodak C.E.O. Got Stock Options Day Before News of Loan Sent Stock Soaring

At the beginning of this week, the Eastman Kodak Company handed its chief executive 1.75 million stock options.

It was the type of compensation decision that generally wouldn’t attract much notice, except for one thing: The day after the stock options were granted, the White House announced that the company would receive a $765 million federal loan to produce ingredients to make pharmaceuticals in the United States.

The news of the deal caused Kodak’s shares to soar more than 1,000 percent. Within 48 hours of the options grants, their value had ballooned, at least on paper, to about $50 million.

The government loan is part of a broader federal effort to increase the country’s ability to respond to the coronavirus and future pandemics.

The options grant to Kodak’s executive chairman and chief executive officer, Jim Continenza, is the latest example of executives and board members at companies receiving such federal support to benefit from extraordinarily good timing. A number of those companies are involved in the hunt for vaccines and treatments for Covid-19.

Insiders at Vaxart, for example, received stock options shortly before the California biotech company announced in June that its potential coronavirus vaccine was being tested in a program organized by a federal agency, causing its shares to instantly double.

A Kodak spokeswoman declined to comment on the timing of the stock-options grants and emphasized that the value of the options could change before Mr. Continenza uses them to buy Kodak shares.

Kodak, best known for its iconic camera and film business, has been struggling for years to reinvent itself. The company emerged from bankruptcy

Keep reading this article on The New York Times Business.

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