Emmis Communications Corp.'s (NASDAQ:EMMS) so-called locked-up holders continue to hold up a four-month-old buyout proposal that has already been delayed twice. Yet it's no longer certain whom these locked-up holders are holding up.

Is it Jeff Smulyan (pictured), the radio broadcaster's founder, chairman, president and CEO, who aborted an earlier attempt to take Emmis private in 2006? Or is it the company's common stockholders, who have seen their Emmis holdings fall from a high of $24.49 per share in September 2005 to a low of 24 cents in July 2009? Might it even be themselves?

With Emmis common stock trading near $2 as locked-up holders repel a proposed takeout price of $2.40, this much is certain: All company constituents are playig an extremely treacherous game.

Granted, Emmis' long-suffering common stockholders could gain a quick 20% or so should the take-private proposal obtain the approval it needs at a special shareholders meeting slated for Aug. 13. But that's not to say they will, considering meetings previously scheduled for the same purpose on Aug. 3 (when the premium would have been 50%) and on Aug. 6 (when it would have been 17%) were postponed for reasons officially attributed to a lack of quorum.

That attribution was, basically, a face-saving artifice. What it did was buy time so that Emmis' take-private faction, a group including New York-based hedge fund Alden Global Capital, in addition to Smulyan, could extend negotiations with Emmis' locked-up holders, a collection of hedge funds with 38.3% of the preferred stock.

The locked-up holders entered into their lock-up agreement on July 9. And they did so with knowledge that amendments essential to Emmis' take-private transaction would require approval from holders of a majority of common shares and, more importantly, at least two-thirds of preferred shares.

Their acting in concert against the take-private proposal has Smulyan and Alden about 5 percentage points short of clearing the hurdle for preferred shares. What the locked-up holders ostensibly dislike are take-private terms that would replace Emmis' preferred shares with new bonds valued at 60 cents for every $1 of the shares' liquidation preference. The new bonds would also offer a 12% payment-in-kind dividend.

The terms strike many as reasonable, especially because in late 2008, a liquidity-challenged Emmis suspended preferred-stock interest payments that paid 6.25% in cash. So it may be the locked-up holders aren't holding out because of frustration with takeout terms but, rather, because they can.

In doing so, however, they're toying with a company founder who has already demonstrated a willingness to walk from private ownership. And if he walks again, it may not just be common stockholders who get hosed as their holdings retreat to the less-than-$1 per share range they saw as recently as March.

It could also be preferred stockholders -- including locked-up holders -- who see a complete evaporation of the 133% premium implied by the 180-day trading range for preferred shares leading up to Smulyan's second take-private proposal.