Eh, it could be a multitude of reasons. It could be that they just had a bad contract. Even if there is a morality clause, how that morality clause is enacted may be dependent on actual charges being filed.

It is possible they had a reasonable concern about the situation, but it wasn't drastic enough for them to legally terminate the contract. Wanting to save face in this scenario isn't exactly too hard to imagine considering their demographics.

Or it could be that it was simply cheaper to pay the rest of the contract than it would to arbitrate in court. Or they may have feared themselves being further implicated during a proceeding if someone at twitch enabled or tried to cover it up.

Really, it could be just about anything.