The federal government is halting a $765 million loan to Eastman Kodak Company (NYSE: KODK) for its generic drug-making foray until the company is cleared of insider trading allegations.

"On July 28, we signed a Letter of Interest with Eastman Kodak.

Securities and Exchange Commission related to its disclosure of the loan on July 27, which caused the company’s shares to surge 25% the same day.

The chief executive was granted options on 1.75 million shares, a day before the loan was disclosed, a quarter of which were vested on the day the loan was granted.