Opinion ID: 6350020
Heading Depth: 2
Heading Rank: 4

Heading: The Resolution Committee.

Text: From March 2020 through May 2020, the Outside Directors participated in Board meetings, approved minutes, voted on resolutions, and approved other corporate actions. When the Outside Directors learned of Stream’s financial difficulties, they concluded that the only path forward was to negotiate a resolution with the Company’s secured creditors and the Equity Investors. In April 2020, the Outside Directors revisited the restructuring discussions with the Rajan brothers. Raja initially participated in the discussions, but his presence generated tension. It became clear that the Outside Directors would have to attempt to broker a resolution. On May 4, 2020, during a meeting of the Board, Gola proposed three resolutions for consideration. Two of Gola’s resolutions, and an alternative to Gola’s third resolution, were adopted. Only Gola’s second resolution is relevant to the appeal. It proposed the creation of the Resolution Committee with Gola and Gollop as its members. The Resolution Committee would have “the full power and authority of the full Board of 7 In the proceedings before the Court of Chancery, Stream and the Rajan brothers challenged whether the Outside Directors were validly appointed. However, on appeal, Stream does not challenge the Court of Chancery’s finding that the Outside Directors were either appointed validly, or in the alternative, that they were de facto directors. Therefore, we do not discuss the facts regarding the appointment of the Outside Directors. 7 Directors to resolve any existing or future debt defaults or claims, and any existing or future litigation, or threats thereof, on behalf of [Stream], without further action being required from the Board of Directors or any executive of the [C]ompany.” 8 The Rajan brothers abstained from the vote; however, the three directors who voted in favor constituted a majority of a quorum, and the motion carried.