Brad did the right thing.
Had he tried to prevent the involuntary sale it would have been insider trading.
I have studied similar cases and as I see it he will not go to jail for this, even if it technically was an insider sale.
All he probably could say was: "You are making a mistake!"
This whole thing comes down to one thing, and that is the decline in the stock price from October 15 till now.
Musclepharm has presumably improved financially over the last couple of months, but that is private information that the lender got no clue about. So, the lender did the right thing as well.
Most likely most of what was owed has been paid now (with 30 to 50% margin requirement)....unless this was disciplinary from ANB bank implicitly disapproving Brad in charge or the proxy sent out. Elements of the plan might have been considered being too expansive and dilutive, and thus prolonging shareholder resentment towards the stock, as well as draining cash liquidity too much in case the executives resign.
Banks are only interested in one thing and that is risk management. Musclepharm's board and it's executives on the other hand like to push things to the limit. Employee stock repurchase might be a good idea, but it might cost too much to administer, be too dilutive for further stock appreciation and too dilutive for executive stock holdings as well.
I'm not saying anything is good or bad....just that the board and the executives owe the World to have a better dialogue with institutional investors and creditors and come up with solutions that serve everybody's interests.
