If they exercised options at $0.7, they'd still have to pay that amount per share and would lose it if the stock went to 0.
So, $175k options excercised represents an investment of 122.5k from private funds. Still 20% below market, but not a bad sign. They could have let the options expire unexercised if they'd see the pps go lower than $0.7 in the future.
Yes I realize that, but they are shareholders. They want they PPS to rise, they will get rich. Shareholder options for employees is directly tied to positive employee performance.