Kodak stock soars after review finds no insider trading

Although the review found no signs of Kodak breaking the law, it did find the company mishandled stock options granted to its CEO in the days leading up to the loan deal being signed.

Kodak shares were up about 36% Wednesday afternoon.

The investigation's findings were released in an 88-page report on Tuesday from law firm Akin Gump Strauss Hauer & Feld, which the committee hired to conduct a probe of Kodak's stock events "leading up to and immediately following" the July announcement of a $765 million federal loan for the production of drug ingredients — part of an effort to reduce America's dependence on foreign drug makers.

In the trading days that followed the announcement, shares surged as much as 2,757% with heavy trading volume. Kodak CEO Jim Continenza and other Kodak executives fell under scrutiny for receiving stock options the day before the loan's announcement on July 27.

The review by Akin Gump concluded insider-trading laws were not violated, noting Kodak executives were informed by the general counsel that the application process for the loan was "at a highly uncertain stage."

However, the report did find Kodak at fault for the early disclosure of the government loan a day before it was officially announced, but not in violation of the laws.

Meanwhile, the deal itself has since been put on hold by the US International Development Finance Corporation while the Securities and Exchange Commission investigates how the government deal came to be and its wild stock ride.

Kodak said on Tuesday it plans to implement the measures and recommendations detailed in the committee's report.

"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," Kodak said in a statement.