I believe there were Illustra engineers who exercised options shortly after the Informix acquisition at the end of 1995 (at $36/share) but either couldn't immediately sell shares or choose not to thinking the stock value would go up. They owed taxes on their gains (about $30/share) but shortly thereafter the stock crashed leaving the shares worth less then the taxes owed. The stock only continued to decline in value after Informix restated earnings and the extent of their channel stuffing became known.

https://www.edn.com/toxic-accounting

https://en.wikipedia.org/wiki/Informix_Corporation#Phil_Whit...

That really sucks. I hope your friend is doing better now. :(