Opinion ID: 1952721
Heading Depth: 1
Heading Rank: 12

Heading: NCS Financial Improvement

Text: NCS's operating performance was improving by early 2002. As NCS's performance improved, the NCS directors began to believe that it might be possible for NCS to enter into a transaction that would provide some recovery for NCS stockholders' equity. In March 2002, NCS decided to form an independent committee of board members who were neither NCS employees nor major NCS stockholders (the Independent Committee). The NCS board thought this was necessary because, due to NCS's precarious financial condition, it felt that fiduciary duties were owed to the enterprise as a whole rather than solely to NCS stockholders. Sells and Osborne were selected as the members of the committee, and given authority to consider and negotiate possible transactions for NCS. The entire four member NCS board, however, retained authority to approve any transaction. The Independent Committee retained the same legal and financial counsel as the NCS board. The Independent Committee met for the first time on May 14, 2002. At that meeting Pollack suggested that NCS seek a stalking-horse merger partner to obtain the highest possible value in any transaction. The Independent Committee agreed with the suggestion.