This is only because he exercised option but did not sell

People want to avoid paying regular income tax, so they exericse option, but want to hold it for 12 months and pay long term capital tax. But if stock drop, they get crushed.

Whenever you exercise stock option, best is to sell at least the part of the stock that can cover the tax.

RSU does this automatically now (default selection in most company's RSU plan). 

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