What I have witnessed in past buy out deals/mergers etc is that, typically, unexcercised options are allowed to excercise, explicitly as part of the deal.

Yes, I think you're right. I think the TSX regulations allow for a brief period after an announcement of a deal for any options that were held up under blackout to be extended and purchased.

Besides if he knew there was a deal in the works he couldn't have bought them. So that wasn't it.