Calypso Wireless (fka CLYW)

[Cougar6]

I did a quick review of my corporate law and I believe that Diac (if he is as clever as I think he is) will ensure that the final settlement is within the limits authorized by the board since the burden of proof falls on him to show that the action was within the scope of management's authority. Otherwise, the settlement is invalid as the act of the manager in signing it and attempting to bind the company to it is beyond his authority, or ulta vires, if you prefer the Latin legal-eeze.

The board can always ratify the ulta vires action of management, but if the terms are worse I doubt they would.

Of course, this assumes that management is going to send the board a copy of the settlement or if Dave is going to have to sue to see it.