Unfortunately lawyers almost always tell you to be quiet, even when you should be talking. So in this case listening to legal advice might have screwed them over, ultimately.

There's no reason Sam and the board can't come to a mutual agreement that indemnifies the board from liability if they publicly exonerate Sam.

Yes, that's a possibility. But: Sam may not be the only party that has standing and Sam can only negotiate for his own damage and board liability, not for other parties.