Remember that if Frasier exercises the options, the cash to pay for them flows into IDLM's coffers.
Who cares if the money goes to IDLM? Most of the money flowing into the company goes right out the other side paying the salaries of these incompetent idiots. Do you really want the company doing a private offering of shares at prices lower than the stock price today anyway in order to keep paying their already insane salaries?