I totally agree. The details do not make sense. I presume Emmis feels, perhaps, that a sale of the Alden shares to Emmis would have made it that much harder for the remaining preferred holders to get a one third interest, to control any potential restructuring of the remaining preferred, and that the direct that separated from the board was consciously trying to sabotage Emmis's efforts to buy back the preferred stock, in the interest of helping the preferred holders he represented, instead of the entire shareholder base.
The intrigue grows. It's unfortunate to have a deal to buy 1 million preferred shares fall through. That would have been, and would still be, huge!
I would not be surprised if Alden got a better offer from another party who is willing to hold the preferred or re-negotiate for a higher price. There is certainly enough value for the preferred holder to get substantially more than what Emmis is offering.
My guess, ultimately, is that Seigelbaum revealed the NATURE of the financial backing Emmis had (Zell at $35 M), and when Alden realized how much the backing was, it decided to hold out for more money.
Seigelbaum had a fiduciary duty to ME, and all the other shareholders, to not betray our management's diligent efforts to reduce financial claims that exist ahead of the common equity, and build shareholder value. If he didn't like the fact that the preferred holder he represented would have considerably less of an ability to create a "lock up" group, in the future, that doesn't permit him to go blabbing to Alden, to get them to back away for the DIRECTOR'S own self interest...or the entity that got him on the board. That's a conflict of interest, and a betrayal of fiduciary responsibility.
If the preferred holder that Seigelbaum represents doesn't want Alden to sell back its shares to Emmis, it should have been buying the stock itself, in the open market or otherwise.
Let us HOPE that the esteemed Mr. Seigelbaum did not also break faith, and tell the fund he represents (Zazove) that Emmis was in the process of looking to buy back preferred stock...before the company announced it in a press release.
I'm surprised they let him resign from the board...and didn't fire him outright.
Of course, I would look forward to hearing Seigelbaum's side of the story. Honest mistake? I doubt it. What would he be doing talking to Alden on his own in the first place. Was he authorized to? If it was an honest mistake, wouldn't he have issued a statement, right off the bat, apologizing?