TRADOS Inc. (Trados) (defendant) obtained financing from venture capitalists in exchange for preferred stock and control of the board of directors. Despite this, Trados did not do well enough financially to justify the venture capitalists’ additional investment. Rather, the venture capitalists sought to sell their interests in Trados. Trados was not able to obtain outside funding, either. The Trados board adopted a management incentive plan (MIP) that was structured so that once an offered sale price for Trados exceeded the venture capitalists’ liquidation preference, compensation to the preferred stockholders would increase substantially at the expense of common stockholders. The MIP provided that such compensation would be awarded to preferred stockholders even if common stockholders received nothing. SDL plc (SDL) offered $60 million for Trados. The preferred stockholders’ liquidation preference was $57.9 million. The Trados board approved the transaction without adopting a special committee to review it. The preferred stockholders received $52.2 million. The common stockholders received nothing. Without the MIP in place, the common stockholders would have received $2.1 million. Marc Christen (plaintiff), a common stockholder, brought suit in the Delaware Court of Chancery, alleging a breach of the Trados board’s fiduciary duty. At trial, the preferred stockholders presented testimony indicating that the board would not have been able to generate value for the common stockholders’ shares without a merger of some kind.