"They may also have sold some shares to raise capital in order to convert some options. If they believe the price is going to rise. They will pay less tax in the future by converting at the lower price as the gain after conversion is considered capital gain, and gain before conversion is income. ( I believe)"

Interesting thought, but I don't believe that they are taxed as you mention. you're right in that the difference between the conversion price and the option price is included in income but my understanding is the employee can claim a tax deduction equal to one-half of the ‘option benefit’. So in essence it taxes the gains similar to capital gains.