Eastman Kodak said this week that problems with internal controls allowed five former executives to sell roughly $5.1 million worth of stock options in July, the same month a highly scrutinized federal loan announcement sent the company’s stock price soaring more than 2,100 percent.
The company learned of the deficiencies in the controls used to protect its assets, David Bullwinkle, Kodak’s chief financial officer, said in a Tuesday earnings call. The lack of proper controls allowed for the unauthorized issuance of common stock when previously forfeited stock options were exercised by the former executives in July, the CFO added.
Kodak’s third-quarter regulatory filing shows the former executives exercising roughly 300,000 stock options. The company bore $5.1 million in compensation expenses in relation to the faulty sale of the options.