Date: Wed , 16 September 2020
Source: Bloomberg Quint
Authors: Eric Newcomer
Shares of Kodak rose sharply by 60% shortly after the start of trading in New York, after an independent legal review found that while there were flaws in how Eastman Kodak issued stock option grants to its CEO just before revealing a major development that sent its stock soaring, no illegality was involved.
The review by the law firm Akin Gump Strauss Hauer & Feld, commissioned by a special Kodak board committee, found that Kodak’s general counsel failed to warn the company’s board that the timing of the grants for Executive Chairman and CEO Jim Continenza could look bad regardless of whether the grants were determined to be legal. Continenza and other senior Kodak executives were awarded the grants the day before the potential loan was announced that it had been awarded $765 million to manufacture pharmaceutical materials as part of a Covid-19 government loan program.
“The manner in which the options grants were awarded was sub-optimal in a number of respects,” the lawyers at Akin Gump Strauss Hauer & Feld LLP wrote in the report released Tuesday evening. The lawyers determined that Kodak’s conduct didn’t violate the law, although the situation remains under investigation by U.S. securities regulators and Congress.
Separately, Kodak said it planned to review and implement the committee’s recommended measures, which include amending Continenza’s share grants and reconsidering the board’s composition.
The photography giant of yesteryear, Kodak was trading at less than $3 before the surprise move into Covid-19 pharmaceuticals in late July drove the stock price to as high as $60. In the resulting scandal, the federal agency that awarded the loan placed it on hold pending the investigations. Kodak’s stock closed at $6.23 on Tuesday, before spiking on Wednesday.
The company’s report addressed a number of legal quandaries facing Kodak. It said stock transactions by Continenza and another board member, Philippe Katz, didn’t constitute insider trading because the company’s general counsel had said at the time that the government loan was at “a highly uncertain stage.”
Kodak said it will consider beefing up the company’s legal team, in addition to revising the grants and reassessing the boardroom makeup. “Kodak is committed to the highest levels of governance and transparency, and it is clear from the review’s findings that we need to take action to strengthen our practices, policies and procedures,” Continenza said in a statement.
Keyword : sterlinghousetrust.com, Sterling House Trust, SHT
Sterling House Trust is a private trust with a difference. It offers its members an exclusive and reliable platform to access unique opportunities and lifestyle services reserved for the select few. With its team of professional managers Sterling House Trust constantly scans the markets and collaborate with reliable global partners to create a portfolio of carefully curated programmes for its members. Members can access these programmes according to their individual needs, interest and financial capacity. Sterling House Trust is headquartered in Auckland, New Zealand, and has operations based in London, UK.
The Sterling House Trust platform was established with the objective of providing its members, secure access to opportunities across a range of global locations, sectors and services.
Our unique Platform was established within the framework of a trust so that the trust would have oversight and governance over the range of services and its quality. Member protection is a core principle and drive in all that we do. Our trustees ensures that the interests and quality of service provided by the Platform are always maintained at the highest standards.
The trust and its trustees provide robust oversight and is constantly on the move to identify and shortlist select opportunities in the international markets. Likewise, we apply the same stringent standards in identifying and selecting providers and professional partners to join our Platform.
The Sterling House Trust Platform utilises our international footfall and relationships to provide our members with access to a range of international opportunities via our global network which covers a broad range of sectors including:
Asset protection, international property ownership and management, alternative and direct ownership, estate planning, banking services, foreign exchange, card services, alternative investment and lifestyle services.
New Zealand Head Office
62 Wilson St,
London EC2A 2BU,