On September 30, 2011, Vice Chancellor Noble issued an opinion in In re OPENLANE, Inc. Shareholders Litigation that reiterated the permissibility of using a “sign and consent” structure for obtaining stockholder approval of a merger. The OPENLANE decision is also noteworthy as Vice Chancellor Noble declined to grant injunctive relief despite the fact that many of the efforts typically undertaken by a target company’s board of directors in a sale process were not utilized in the transaction at issue.
OPENLANE demonstrates that the restrictions against a fully locked-up merger set forth in the 2003 Omnicare2 decision do not bar stockholders from locking up a transaction through written consents immediately after the execution of a merger agreement. The OPENLANE decision further confirms that a board can satisfy its Revlon duties under appropriate circumstances even when its actions do not conform to customary practices in the change of control context.
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