> Short answer: greed. They didn’t want to give up any shares. To pay for the tax they owed between strike price and current market value Greed by the taxman.

> Short answer: greed. They didn’t want to give up any shares. To pay for the tax they owed between strike price and current market value Greed by the taxman. It would be a non-issue if the tax authorities collected the tax at the point those shares are converted to something else, or used as collateral to a loan. But to tax them without any ability for the employee to extract value from them - especially relevant for privately listed companies with glacially illiquid stock - is abhorrent. But instead the taxman has to always be the first to eat the pie. Even if that pie never turned into anything real. In the UK it is horrid- share options of any meaningful value are taxed at ~%63 (including all hidden National Insurance taxes) and it could be years before you can cash your shares, if at all.