The indoor-farming company AppHarvest's first two years as a public company have gone dismally, with losses totaling $375 million and the stock price falling to 35 cents.

So this might seem like an odd time for the board to vote to give itself a nice raise and to dole out nearly $2.5 million in special bonuses for four senior executives. The special-payout program unveiled in July by Morehead, Kentucky-based AppHarvest isn't unusual—companies on the ropes often do this, saying it prevents a hemorrhaging of talent—but the negative headlines it generated across that state should serve as cautionary tale for companies trying to navigate treacherous times with minimal reputational damage.

Shareholders and other stakeholders have become somewhat inured to executive pay packages in the tens of millions of dollars, but they start to get cranky when they see the pay roll in for top brass at a time when other constituencies are suffering.