More findings below:

The acquisition of >20% of securities is a take-over bid and must be issued to all securities holders of the corporation. This is required under NI 62-104.

But, there is a "Private Agreement" exemption to the take-over bid rules (s. 4.2), where if purchases are made from 5 or fewer people, the formal bid requirements do not apply. There are additional restrictions, but the main point follows.

The purchase price for securities cannot exceed 115% of the market price. That is a pretty effective bar essentially neutering an insider's ability to privately sell their stake for a profit. I think would be a major factor as to why these insiders should not tolerate a continued lowering of the stock price. I think that is a fairly strong answer to the chatter previously about whether it was a conspiracy/tolerated as a way to obtain more shares for cheap.

On the other hand, if an insider wanted out, and they are willing to accept the market price to get there, then this might be the mechanism by which they would do it.

Source: https://www.asc.ca/-/media/ASC-Documents-part-1/Regulatory-Instruments/2018/10/5236930-v1-62-104-MI-Consolidation-Eff-May-9-2016.ashx