HoldCo Opportunities Fund V, L.P. v. Arthur G, Angulo

COURT OF CHANCERY
OF THE
STATE OF DELAWARE
MORGAN T. ZURN LEONARD L. WILLIAMS JUSTICE CENTER
VICE CHANCELLOR 500 N. KING STREET, SUITE 11400
WILMINGTON, DELAWARE 19801-3734

January 26, 2026

Gregory V. Varallo, Esquire Kevin R. Shannon, Esquire
Bernstein Litowitz Berger & Potter Anderson & Corroon LLP
Grossmann LLP 1313 North Market Street
500 Delaware Avenue, Suite 901 Hercules Plaza, 6th Floor
Wilmington, Delaware 19801 Wilmington, Delaware 19801

Rudolf Koch, Esquire
Richards, Layton & Finger, P.A.
920 North King Street
Wilmington, Delaware 19801

RE: HoldCo Opportunities Fund V, L.P. v. Arthur G. Angulo, et al.,
Civil Action No. 2025-1360-MTZ

Dear Counsel:

As you know, on January 23, 2026, I entered an order denying the plaintiff’s
highly expedited motion for a temporary restraining order enjoining the closing of
a stock-for-stock merger (the “Merger”) between defendants Fifth Third Bancorp
(“Fifth Third”) and Comerica Incorporated (“Comerica,” and together with Fifth
Third and certain Comerica fiduciaries, “Defendants”). 1 That order promised my
explanation would follow before the Merger’s scheduled closing date of February
1. 2 This is that explanation.

1
See Docket item (“D.I.”) 75; D.I. 95. Citations in the form of “POB __” refer to
Plaintiff’s Opening Brief in Support of Emergency Motion for a Temporary Restraining
Order, available at D.I. 75. Citations in the form of “DAB __” refer to Defendants’
Corrected Answering Brief in Opposition to Plaintiff’s Emergency Motion for Temporary
Restraining Order, available at D.I. 86. Citations in the form of “PRB __” refer to
Plaintiff’s Reply Brief in Further Support of Emergency Motion for a Temporary
Restraining Order, available at D.I. 88.
2
D.I. 95; see D.I. 65.
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I. BACKGROUND

Plaintiff HoldCo Opportunities Fund V, L.P. (“HoldCo”) is a Comerica
stockholder and an activist. In July 2025, HoldCo began agitating for a Comerica
sale. That summer, it published a presentation calling for the Comerica CEO’s
termination, pushing the Comerica board to consider a sale, and identifying three
acquirors that “[m]a[d]e [s]ense” to HoldCo—including Fifth Third. 3 HoldCo
pitched Fifth Third as the acquiror that could offer the highest premium. 4

In September 2025, Comerica started a sale process. Of the four potential
buyers Comerica’s financial advisor surveyed, 5 Comerica engaged with two of
them: Fifth Third and “Financial Institution A.”6 Financial Institution A initially
proposed an all-stock merger valuing Comerica between $78 and $82 per share. 7
After Comerica indicated the proposal “was unlikely to be attractive” to the
Comerica board, Financial Institution A submitted a revised proposal, conditioned
on exclusivity, valuing Comerica between $80 and $84 per share. 8 The Comerica
board concluded Financial Institution A’s proposals were “insufficient to grant
exclusivity” and “unlikely to be more attractive” than offers by other parties. 9 The
Comerica board told Financial Institution A it would review their discussions. 10
Financial Institution A did not return with another bid.

Meanwhile, Fifth Third’s initial verbal proposal valued Comerica between
$84 and $87 per share.11 This was already higher than both of Financial Institution
3
D.I. 86 Ex. 3 at 29.
4
Id. at 31, 33, 35.
5
See D.I. 86 Ex. 4 at 8–9.
6
D.I. 86 Ex. 1 [hereinafter “Proxy”] at 75–77; D.I. 43 Ex. B [hereinafter “Proxy Supp.”]
at 4–7. The other two potential buyers announced acquisitions of other targets on
September 8 and October 27. See DAB at 6 & n.15.
7
D.I. 86 Ex. 7 at -0145; Proxy Supp. at 5.
8
D.I. 86 Ex. 7 at -0145; Proxy Supp. at 5.
9
D.I. 86 Ex. 7 at -0146–47.
10
Id. at -0146; Proxy Supp. at 6.
11
D.I. 86 Ex. 10 at -0149; Proxy Supp. at 6.
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A’s proposals. Comerica pushed for more, and told Fifth Third “the offer price
would need to be increased in order for the [b]oard to be supportive.” 12 Fifth
Third’s formal offer, delivered as a written indication of interest, proposed an
exchange ratio of 1.8663 to 1.9097 shares of Fifth Third for each share of
Comerica; this valued Comerica at $86 to $88 per share at the time. 13 Based on the
results of its due diligence, Fifth Third’s final offer proposed an exchange ratio of
1.8663. 14 Comerica’s financial advisor “expected the transaction to be clearly fair”
to stockholders. 15

Throughout the process, both Financial Institution A and Fifth Third “raised
the possibility of a transitional post-closing” role for Comerica’s CEO. 16 Fifth
Third’s final offer proposed post-closing roles for Comerica’s CEO and three
Comerica directors. 17

On October 5, 2025, Comerica entered into a merger agreement (the
“Merger Agreement”) with Fifth Third. 18 The Merger Agreement contemplates a
stock-for-stock merger that offered Comerica stockholders a 20% premium to
Comerica’s 10-day volume-weighted average price at the time of announcement. 19
The Merger would create the ninth-largest bank in the United States. 20

Comerica and Fifth Third agreed to reciprocal commitments to the Merger
with fiduciary outs. Before the stockholder vote, both were bound to a no-shop
provision. 21 But each could engage with unsolicited bona fide written acquisition

12
D.I. 86 Ex. 10 at -0149; Proxy Supp. at 6.
13
D.I. 86 Ex. 10 at -0150; Proxy Supp. at 6.
14
Proxy Supp. at 8.
15
D.I. 86 Ex. 13 at -0082; Proxy Supp. at 10.
16
Proxy Supp. at 5, 6.
17
D.I. 86 Ex. 11 at -0129; Proxy Supp. at 7.
18
See D.I. 86 Ex. 17 [hereinafter “Merger Agreement”].
19
Merger Agreement § 1.4; D.I. 86 Ex. 16 at -0047.
20
See D.I. 87 Ex. 30 at 4; D.I. 4 Ex. 4; D.I. 4 Ex. 5; D.I. 4 Ex. 6.
21
Merger Agreement § 7.13(a).
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proposals if the board concluded, in good faith and with legal and financial advice,
that failing to do so would violate their fiduciary duties. 22 Both companies were
bound to a force-the-vote provision obligating a prompt vote and a
recommendation in favor of the Merger Agreement. 23 But if either board
determined before the vote, in good faith and with legal and financial advice, that
recommending or continuing to recommend the Merger would violate their
fiduciary duties, that company could submit the Merger without recommendation
and explain to its stockholders the reasons why. 24 If the stockholders of either
company voted against the Merger, both companies were bound to use reasonable
best efforts to renegotiate. 25

Comerica and Fifth Third agreed to reciprocal termination rights tracking
their commitments and fiduciary outs. 26 If one company changed its
recommendation to stockholders, the other could terminate the Merger
Agreement. 27 If one company breaches the Merger Agreement, the other can
terminate it. 28

Comerica and Fifth Third also agreed to a $500 million termination fee—
roughly 4.7% of the deal’s equity value 29—tracking their commitments and
fiduciary outs. If one company pursues an alternative deal and the other company
terminates the agreement, the pursuing company must pay that fee.30 The pursuing
company would also owe the fee if it changed its recommendation statement, and
the other company terminated on that basis. 31 The pursuing company would owe

22
Id.
23
Id. § 7.3.
24
Id.
25
Id. § 7.16.
26
Id. §§9.1(a)–(f).
27
Id. §§ 9.1(e), (f).
28
Id. §§ 9.1(d).
29
D.I. 46 [hereinafter “Am. Compl.”] ¶¶ 9, 92, 96.
30
Merger Agreement §§ 9.2(b), (c).
31
Id. §§ 9.2(b)(ii), (c)(ii).
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the fee if it received a bona fide acquisition proposal, its stockholders did not
approve the Merger or the other company terminated for breach, and the pursuing
company agreed to a different deal within twelve months of termination. 32

Comerica and Fifth Third agreed to a one-year outside date, meaning they
had until October 5, 2026, to close.33 During that year, Comerica and Fifth Third
were obligated to “use their reasonable best efforts” to secure stockholder
approval, file the requisite disclosures, and secure approval from banking
regulators. 34

After the Merger was announced, HoldCo touted it as “a rare win for Bank
Activists” and “a successful model.”35 It internally characterized the Merger
Agreement’s reciprocal no-shop provision, fiduciary out, and termination
provisions as “[m]arket,” noting the same provisions governed recent bank
mergers. 36

Comerica and Fifth Third filed their joint Form S-4 Registration Statement
on November 5. 37 Then HoldCo reversed course. On November 17, HoldCo
published a presentation assailing the Merger. 38 On November 21, it sued to enjoin
it, including on the grounds that Comerica did not disclose that HoldCo’s activism
led to the premium Merger. 39

HoldCo claimed Comerica’s fiduciaries disseminated a materially
misleading and deficient Registration Statement, and sought to enjoin Comerica’s

32
Id. §§ 9.2(b)(i), (c)(i).
33
Id. § 9.1(c).
34
Id. §§ 7.4, 8.1, 8.2, 8.3.
35
D.I. 87 Ex. 23 at 6.
36
D.I. 87 Ex. 33 at -1780.
37
See Proxy.
38
See D.I. 87 Ex. 24.
39
D.I. 1 at [Proposed] Order Granting Plaintiff’s Motion for Preliminary Injunction ¶ 2.
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stockholder vote until Comerica provided supplemental disclosures. 40 HoldCo also
claimed Comerica’s fiduciaries responded to HoldCo’s threats by entering into a
transaction with a buyer who would retain the CEO, locked up by unenforceable
deal protection provisions and in breach of their fiduciary duties. 41 HoldCo
contends the force-the-vote provision, the no-shop and fiduciary out, the
mandatory renegotiation provision, the one-year outside date, and the 4.7%
termination fee locked Comerica into the Fifth Third deal for a year without the
right to terminate it for a better deal. HoldCo sought to enjoin closing the
Merger—but not the stockholder vote—until Defendants redrafted the Merger
Agreement to relax its deal protection provisions. 42 HoldCo also brought an aiding
and abetting claim against Fifth Third. 43

On November 25, I granted expedition and bifurcated the proceedings. 44
We planned to hold a preliminary injunction hearing on HoldCo’s disclosure claim
on January 2, 2026, and a preliminary injunction hearing on its deal protection
claim on February 23. 45 The scheduling order instructed Defendants to provide
written notice fifteen days before the Merger’s scheduled closing date. 46

On December 17, Comerica filed a Form 8-K containing supplemental
disclosures. 47 HoldCo conceded those disclosures mooted its disclosure claim,48

40
D.I. 1 at Verified Stockholder Class Action Complaint for Injunctive Relief and
Damages [hereinafter “Compl.”] ¶¶ 67–75; 113–17.
41
Id. ¶¶ 76–93.
42
D.I. 1 at [Proposed] Order Granting Plaintiff’s Motion for Preliminary Injunction ¶ 2
(seeking to enjoin “the stockholder vote on the proposed merger . . . for a period of at
least 10 calendar days after all omitted material facts identified in Plaintiff’s motion are
disclosed” and “closing the Merger [] for a period of at least 45 calendar days after
Defendants amend the Merger Agreement to eliminate the challenged deal-protection
provisions”).
43
Compl. ¶¶ 122–24.
44
D.I. 26; D.I. 29.
45
D.I. 31.
46
Id. ¶ 3.
47
See Proxy Supp.
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and filed an amended complaint dropping that claim on December 22. 49 The case
marched forward.

On January 8, 2026, the Comerica defendants advised that on January 6, its
stockholders and Fifth Third’s stockholders had approved the Merger. 50 It was
approved by 99.7% of the Fifth Third votes cast and 97% of the Comerica votes
cast, representing 73% of Comerica’s outstanding stock. 51 No topping bid had
emerged. 52

On January 13, Fifth Third advised that the Merger had received regulatory
approval earlier that day, that “all material conditions to closing under the Merger
Agreement” were expected to be satisfied by the end of January 2026,” and that the
Merger was set to close on February 1. 53

On January 14, HoldCo filed an emergency motion for a temporary
restraining order enjoining the February 1 closing. 54 The parties briefed the motion

48
See D.I. 43 (“Defendant Comerica Incorporated filed a Form 8-K . . . that contains
extensive supplemental disclosures which moot Plaintiff’s request for an order enjoining
the stockholder vote due to disclosure failures.”).
49
See Am. Compl.
50
D.I. 53 at 1–2.
51
Id.
52
Id.
53
D.I. 65 at 2.
54
D.I. 75. HoldCo opened with outrage, asserting the February 1 closing date is a
“maneuver[] to short-circuit discovery” into its Unocal claim, including into a newly
identified potential issue particular to Comerica’s CEO. POB 1–2, 14. But the Merger
Agreement required Comerica and Fifth Third to “use [] reasonable best efforts” to
schedule a stockholder vote “as soon as reasonably practicable,” and to close the Merger
on the “first [] business day of the month” after all conditions are satisfied. Merger
Agreement §§ 7.3, 1.2. I hope HoldCo simply overlooked these provisions in the heat of
the moment, and that this was not dirty pool. But see infra n.98.
One way to read HoldCo’s motion is as an ask to enjoin a merger so that HoldCo
can obtain more discovery to support its claim to enjoin that merger. But HoldCo must
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by January 16, and I denied it on January 23 with a promise to explain myself
before February 1. 55

II. ANALYSIS

A TRO is an “extraordinary remedy that should not be issued in the absence
of a clear showing of imminent irreparable harm to the moving party.” 56 It is “not
granted lightly.” 57 To obtain a TRO, the movant must show: (i) the existence of a
colorable claim; (ii) the threat of imminent and irreparable harm if relief is not
granted; and (iii) that the balance of hardships favors the movant. 58 Here, HoldCo
must show that the Merger Agreement’s deal protection provisions are colorably
illegal or inequitable; and that closing a premium deal approved by Comerica’s
stockholders, in the absence of any other bidder, would irreparably harm those
stockholders rather than benefit them. HoldCo fails to clear that high hurdle.

A. The Merits

HoldCo contends the Merger Agreement “locks up Comerica for a year: the
Comerica Board cannot terminate the Merger Agreement to accept a superior
proposal” unilaterally, for free, before the one-year outside date. 59 HoldCo asserts

meet its burden with what it has now. I have assessed HoldCo’s request for relief based
on what HoldCo has shown, not what it would like to explore if given the chance.
55
See D.I. 75; D.I. 86; D.I. 88; D.I. 95. I thank the parties for their admirable quick
work.
56
Trilogy Portfolio Co., LLC v. Brookfield Real Est. Fin. P’rs, LLC, 2012 WL 120201, at
*6 (Del. Ch. Jan. 13, 2012) (citing Baxter Pharm. Prods., Inc. v. ESI Lederle Inc., 1999
WL 160148, at *4 (Del. Ch. Mar. 11, 1999)); Mody v. Aldrich, 2025 WL 3048948, at *2
(Del. Ch. Oct. 31, 2025); In re COVID-Related Restrictions on Religious Servs., 285
A.3d 1205, 1227 (Del. Ch. 2022).
57
Mody, 2025 WL 3048948, at *2 (citation omitted).
58
See, e.g., Sherwood v. Ngon, 2011 WL 6355209, at *6 (Del. Ch. Dec. 20, 2011); ACE
Ltd. v. Cap. Re Corp., 747 A.2d 95, 102 (Del. Ch. 1999).
59
POB 1.
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the deal protections are illegal under 8 Del. C. § 141(a) and Omnicare,60 as per se
invalid constraints on the Comerica board’s authority, and unreasonable under
Unocal, 61 in that they forced upon stockholders a deal that entrenched Comerica
fiduciaries in Fifth Third roles.

1. Illegality Under Section 141 and Omnicare

I begin with illegality. Under Delaware law, contracts “purport[ing] to
require a board to act or not act in such a fashion as to limit the exercise of
fiduciary duties” are “invalid and unenforceable.” 62 In the merger context, a board
may not “disable[] itself from exercising its own fiduciary obligations at a time
when the board’s own judgment is most important, i.e., receipt of a subsequent
superior offer.” 63 For example, “[d]irectors cannot be precluded by the terms of an
overly restrictive ‘no-shop’ provision from all consideration of possible better
transactions.” 64 Boards are required to bargain for effective fiduciary out clauses
permitting them to discharge their managerial authority in fidelity to
stockholders. 65 When managerial authority is preserved, the Court will decline to
craft a per se rule “that the contract is invalid simply because it delimited the range
of discretion the directors otherwise had under the law to act.”66

60
8 Del. C. § 141(a); Omnicare, Inc. v. NCS Healthcare, Inc., 818 A.2d 914, 936 (Del.
2003).
61
Unocal Corp. v. Mesa Petroleum Co., 493 A.2d 946, 957 (Del. 1985).
62
Paramount Commc’ns Inc. v. QVC Network Inc., 637 A.2d 34, 51 (Del. 1994) (citing
Wilmington Tr. v. Coulter, 200 A.2d 441, 452–54 (Del. 1964)).
63
Omnicare, 818 A.2d at 938; see also ACE Ltd., 747 A.2d at 105 (“[A] suitor cannot
importune a target board into entering into a deal that effectively prevents the emergence
of a more valuable transaction or that disables the target board from exercising its
fiduciary responsibilities.”).
64
Cirrus Hldg. Co. Ltd. v. Cirrus Indus., Inc., 794 A.2d 1191, 1207 (Del. Ch. 2001)
(citing Revlon, Inc. v. MacAndrews & Forbes Hldgs., Inc., 506 A.2d 173, 184 (Del.
1986), and McMillan v. Intercargo Corp., 768 A.2d 492, 502 (Del. Ch. 2000)).
65
See Omnicare, 818 A.2d at 937–38.
66
Sample v. Morgan, 914 A.2d 647, 672 & n.79 (Del. Ch. 2007).
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HoldCo’s illegality argument mostly relies on the fact that if Comerica
pursues a better deal, the right to terminate belongs to Fifth Third, not Comerica,
and Comerica has to pay a termination fee. HoldCo complains that “Comerica
cannot unilaterally terminate the Merger Agreement until October 5, 2026,” and
that this structure impermissibly ties the board’s hands. 67 This argument overlooks
both the terms of the Merger Agreement, and Delaware law.

The Merger Agreement’s deal protection provisions are symmetrical. If
Fifth Third changed its recommendation and pursued a better deal, the right to
terminate belongs to Comerica, not Fifth Third. 68 If Fifth Third pursues a better
deal, and Comerica terminates, Fifth Third would owe the termination fee. 69
Before bringing this lawsuit, HoldCo documented this symmetrical structure, noted
it appeared in recent bank mergers, and concluded the very provisions it now
challenges as “draconian” 70 were “[m]arket.” 71

And this Court has already explained that a fiduciary out need not be
coupled with a termination right, or be free of a break fee, to give the board the
necessary freedom to exercise its fiduciary duties. Energy Partners, Ltd. v. Stone
Energy Corp. held a fiduciary out can enable a board to exercise its fiduciary
duties even where the other party holds the right to terminate and receive the break
fee. 72 Energy Partners considered whether that structure in a merger agreement
between parties called EPL and Stone, coupled with a seemingly contradictory
provision precluding EPL from taking any action to “materially impair”

67
Am. Compl. ¶ 94; see also POB at 9–11 (“Comerica could not unilaterally terminate
the Merger Agreement until October 5, 2026.”).
68
Merger Agreement § 9.1(e).
69
Id. §§ 9.1(e); 9.2(c)(ii).
70
POB 9.
71
D.I. 87 Ex. 33 at -1780 (noting that in seven of nine bank mergers reviewed, “the
parties can terminate if (1) both parties consent, (2) it is required by a governmental
entity, (3) the other party breaches its duties, or (4) the other party’s Board does not
advise its shareholders to accept the proposal”).
72
2006 WL 2947483, at *13–14, *16 (Del. Ch. Oct. 11, 2006).
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consummation of the merger, was per se invalid under Omnicare, QVC, and
Quickturn. 73 The EPL-Stone merger agreement provided:

Stone, but not EPL, may terminate the merger if EPL, in reference to a
“Third Party Acquisition Proposal,” changes its recommendation for
the Stone Merger. The term Third Party Acquisition Proposal is
defined under Section 10.1(i) as “an inquiry, offer or proposal” that is
“conditioned upon the termination” of the Stone Merger Agreement
and “abandonment” of the Stone Merger and in which the third party
would acquire 30 percent or more of EPL. Finally, the Stone Merger
Agreement provides that if EPL’s stockholders do not approve the
Stone Merger in response to a Third Party Acquisition Proposal, EPL
must pay Stone a $25.6 million termination fee.74

Energy Partners observed EPL had the power to change its recommendation
to hew to its fiduciary obligations; Stone’s “remedy” for EPL’s changed
recommendation was termination and receipt of the termination fee. 75 EPL could
develop a topping bid and change its recommendation, teeing up Stone’s
termination and receipt of the fee. 76 Then the Court concluded the prohibition on
material impairment should not be read to inconsistently prohibit EPL from
exploring and negotiating a better deal.77 The Court concluded “EPL’s board,
consistent with its fiduciary obligations, could investigate or pursue the Third Party
Acquisition Proposal and potentially recommend against the Stone Merger.” 78
Energy Partners observed that structure reflected the parties’ intention to preserve

73
Id. at *10; see Omnicare, 818 A.2d at 936–38; QVC, 637 A.2d at 51; Quickturn Design
Sys., Inc. v. Shapiro, 721 A.2d 1281, 1291–92 (Del. 1998).
74
2006 WL 2947483, at *3 (internal citations omitted).
75
Id. at *14.
76
See id.
77
Id. (“Taken together, these provisions are internally consistent with the plain reading of
the Stone Merger Agreement[, which indicates] that . . . EPL’s board, consistent with its
fiduciary obligations, could investigate or pursue the Third Party Acquisition Proposal
and potentially recommend against the Stone Merger.”).
78
Id.
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the directors’ ability to exercise their fiduciary duties, 79 and rejected the argument
that EPL’s lack of a termination right was motivated by Stone’s desire for deal
certainty. 80 It concluded the merger agreement permitted exploration of third party
proposals, eliminating any basis for a per se invalidity challenge. 81

Energy Partners is dispositive of HoldCo’s argument that Comerica’s
fiduciary out is illegal because it is not accompanied by a termination right.
Delaware law has already determined that a fiduciary out that allows a merger
party to engage with an unsolicited proposal and change its recommendation
enables that party’s board to fulfill its fiduciary duties, even if the other party holds
the right to terminate and is entitled to a fee. 82

The other terms HoldCo criticizes do not change that conclusion. The
termination fee is not oppressive.83 The costs of breach or Fifth Third’s
termination are factors Comerica’s board could consider in its business judgment. 84

79
Id. at *16.
80
See id. at *15.
81
Id. at *16. The Energy Partners merger agreement was actually “unilateral,” to use
HoldCo’s phrase. Either Stone or EPL could terminate the agreement if Stone accepted a
superior proposal; only Stone could terminate if EPL changed its recommendation. Id. at
*14.
See id. at *14–16; cf. In re Complete Genomics, Inc. S’holder Litig., C.A. No. 7888-
82

VCL, at 4, 10–11 (Del. Ch. Nov. 9, 2012) (TRANSCRIPT).
83
The reciprocal $500 million termination fee amounts to approximately 4.7% of the
Merger’s equity value. See Am. Compl. ¶¶ 9, 92, 96. That size is not unreasonable; this
Court has upheld fees of similar sizes. See, e.g., Dent v. Ramtron Int’l Corp., 2014 WL
2931180, at *9 (Del. Ch. June 30, 2014) (“At 4.5% of the transaction’s equity value, it is
highly unlikely that the termination fee here was unreasonably high.” (citations omitted));
In re Answers Corp. S’holder Litig., 2012 WL 1253072, at *8 & n.50 (Del. Ch. Apr. 11,
2012) (upholding a 4.4% termination fee); In re Topps Co. S’holders Litig., 926 A.2d 58,
86 (Del. Ch. 2007) (upholding a 4.3% termination fee).
84
See, e.g., Frederick Hsu Living Tr. v. ODN Hldg. Corp., 2017 WL 1437308, at *24
(Del. Ch. Apr. 14, 2017) (“Even with an iron-clad contractual obligation, there remains
room for fiduciary discretion because of the doctrine of efficient breach.”); In re
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That leaves only HoldCo’s criticism that Comerica and Fifth Third agreed to
an outside date a year after signing. That alone does not make their symmetrical
deal commitments, fiduciary outs, and termination rights illegal. Before the
stockholder vote, when those provisions do the most work and the board’s
judgment is most important, the challenged provisions permitted Comerica’s board
to exercise its fiduciary duties by entertaining superior proposals and submitting
the Merger to stockholders without a recommendation and with an explanation.
The one-year outside date does not strip the board of its managerial authority to
decide if the Merger is best for stockholders: it defines how long the board must
work to close the highly regulated Merger once stockholders approve it. 85

HoldCo invokes Omnicare, 86 Quickturn,87 and ACE Ltd. 88 Those cases are
readily distinguishable. In Omnicare, a set of tripartite defense measures made it
“mathematically impossible” and “realistically unattainable” for “any other
proposal to succeed, no matter how superior the proposal.” 89 They turned the
stockholder vote into a fait accompli. 90 And they “preclude[d] the consideration of
any superior transaction.” 91 In Quickturn, a delayed redemption provision
“restrict[ed] the board’s power in an area of fundamental importance to the

Essendant, Inc. S’holder Litig., 2019 WL 7290944, at *13–14 (Del. Ch. Dec. 30, 2019);
Wagner v. BRP Grp., Inc., 316 A.3d 826, 860 (Del. Ch. 2024).
85
Cf. Orman v. Cullman, 2004 WL 2348395, at *8 (Del. Ch. Oct. 20, 2004) (explaining
an 18-month lock-up period, where “it was this deal or nothing, at least for that period of
time . . . hardly seems unreasonable, given the absence of other deal protection devices in
this particular transaction and given the buyer’s understandable concern about transaction
costs and market uncertainties”).
86
818 A.2d at 936–38.
87
721 A.2d at 1291–92.
88
747 A.2d at 107.
89
818 A.2d at 936 (citing Unitrin, Inc. v. Am. Gen. Corp., 651 A.2d 1361, 1388–89 (Del.
1995), and Carmody v. Toll Bros., Inc., 723 A.2d 1180, 1195 (Del. Ch. 1998) (citations
omitted)).
90
Id.
91
Id. (emphasis added).
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shareholders—negotiating a possible sale of the corporation.” 92 It operated to
preclude a newly elected board “from completely discharging its fundamental
management duties to the corporation and its stockholders for six months.”93 In
ACE Ltd., this Court questioned the validity of a no-talk and fiduciary out clause
that would effectively strip the board of its ability to “entertain and consider a
superior proposal.” 94

The Comerica board did not “tie its own hands for a year” as HoldCo
alleges. 95 Before the vote, nothing about the Merger was a fait accompli or a
mathematical certainty. Nothing prevented Comerica’s board from considering,
negotiating, or pursuing alternative transactions if it believed, in good faith, that
failing to do so would be inconsistent with its fiduciary duties. Comerica and Fifth
Third “agreed to mutually reciprocal provisions to protect the deal from
interference.” 96 Our Supreme Court has recognized that reciprocal deal protection
provisions, “drafted to protect both [parties] in the event the merger [is] not
consummated, [are] an integral part of the merits of the transaction.” 97

2. Inequity Under Unocal

HoldCo also asserts the Merger, locked up by its suite of deal protections,
constitutes an unreasonable defensive measure. HoldCo presents an entrenchment
theory based on Comerica’s CEO securing a post-closing transitional role, and
three Comerica directors joining Fifth Third’s board. 98 It asserts Defendants

92
721 A.2d at 1291–92 (emphasis added).
93
Id. at 1292.
94
747 A.2d at 107 (emphasis added).
95
See Am. Compl. ¶ 103.
96
DAB 17.
97
Brazen v. Bell Atlantic Corp., 695 A.2d 43, 50 (Del. 1997); see also Orman, 2004 WL
2348395, at *7.
98
See POB 21; D.I. 86 Ex. 11. HoldCo’s amended complaint fixated on the length of and
compensation for the CEO’s post-closing role. See Am. Compl. ¶¶ 79–83. The Comerica
defendants advised HoldCo and the Court that HoldCo’s allegations were factually false.
See D.I. 53 at 2–3. HoldCo’s TRO is mute on that issue. See POB 16–21; PRB 2–9.
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rushed into and locked up a transaction—with Fifth Third as a “white knight”—
that “will prevent Comerica stockholders from ever having the chance to vote on a
new director slate if the Merger closes.”99 HoldCo again relies on the one-year
outside date and Comerica’s fiduciary out coupled to Fifth Third’s termination
right. 100

Unocal enhanced scrutiny “was conceived of as a method to police the
inherent conflict present when a board resolves to oppose a takeover bid.” 101 As
our Supreme Court observed, “[w]hen a board addresses a pending takeover bid,”
there is an “omnipresent specter that a board may be acting primarily in its own
interests, rather than those of the corporation and its shareholders.” 102 To assuage
that concern, the Unocal framework asks whether a defensive measure is
preclusive or coercive, and “within a range of reasonableness.”103 The challenged
provisions here readily pass muster under that framework: they did not
unreasonably preclude an alternative bid or coerce the vote.

As an initial matter, I doubt this transaction was defensive. HoldCo’s
alleged proxy threat pushed for a sale, with Fifth Third as the buyer it thought
could offer the most value. Defendants observe that even if the decision to sell
was in response to that alleged threat, the decision “was not defensive at all, it was
entirely concordant.” 104 And after the Merger, a majority of Comerica’s eleven

This heightens my concern that HoldCo and its counsel have taken excessive liberties
with the facts. See supra n.54; see also supra nn.70–71 and accompanying text.
99
POB 21.
100
See Am. Compl. ¶ 121 (“The Challenged Provisions are ‘draconian,’ since they . . .
coerce Comerica stockholders to approve the Merger, since their failure to do so would
leave the Company in limbo for a full year.”).
101
In re Edgio, Inc. S’holders Litig., 2023 WL 3167648, at *7 (Del. Ch. May 1, 2023)
(citing Unocal, 493 A.2d at 954–55).
102
Unocal, 493 A.2d at 954.
103
Unitrin, 651 A.2d at 1387–88 (quoting QVC, 637 A.2d at 45–46).
104
DAB 37; see In re TriQuint Semiconductor, Inc. S’holders Litig., 2014 WL 2700964,
at *2 (Del. Ch. June 13, 2014) (“In order to entrench itself from a potential proxy contest
by Starboard, the TriQuint board purportedly agreed to merge with RFMD—a company
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directors will lose their seats, and HoldCo will obtain stock in the post-closing
entity; it can launch another proxy contest. 105

But even assuming the sale was defensive because Fifth Third was willing to
retain some Comerica top brass, HoldCo cannot show the deal protections were
preclusive or coercive. A defensive measure is preclusive “when its operation
precludes an acquisition of the company,” 106 or makes “a successful proxy contest .
. . ‘mathematically impossible’ or ‘realistically unattainable.’” 107 An alternative
transaction was not unattainable here. The Merger Agreement’s fiduciary out left
Comerica’s board free to pursue proposals other than Fifth Third’s. And the
termination fee was not unreasonable. Put differently, there was a realistic and
attainable path for a higher bid.

Nor were the deal terms coercive. A defensive measure is coercive “when it
operates to force management’s preferred alternative upon the stockholders,” 108 or
“caus[es] the stockholders to vote in favor of the proposed transaction for some
reason other than the merits of that transaction.” 109 HoldCo has not seriously
argued the Comerica vote was forced upon stockholders. 110 Comerica stockholders
had a meaningful ability to vote down the Merger. There were no voting
agreements, no naked-no-vote fee, and no other arrangements that locked up the
vote.

with which it had been considering a transaction for quite some time—in a deal that
Starboard supported. These facts do not support a colorable [Unocal] claim . . . .”).
105
See Merger Agreement § 1.4; Proxy Supp. at 7.
106
In re Gaylord Container Corp. S’holders Litig., 753 A.2d 462, 480 (Del. Ch. 2000)
(citing Unitrin, 651 A.2d at 1387).
107
Toll Bros., 723 A.2d at 1195 (quoting Unitrin, 651 A.2d at 1389).
108
Gaylord, 753 A.2d at 480 (citing Unitrin, 651 A.2d at 1387); see also Versata Enters.,
Inc. v. Selectica, Inc., 5 A.3d 586, 601 (Del. 2010) (“A coercive response is one that is
aimed at cramming down on its shareholders a management-sponsored alternative.”
(internal quotation marks and citations omitted)).
109
Willaims v. Geier, 671 A.2d 1368, 1382–83 (Del. Ch. 1996).
110
D.I. 29 at 45, 47 (observing HoldCo “does not allege the deal protections are
structurally coercive”).
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In In re Complete Genomics, Inc. Shareholder Litigation, this Court rejected
a Unocal challenge to a deal involving substantially similar deal protections, and
more: a termination fee amounting to 4.8% of the deal’s equity value; no
termination right for the target to accept a superior proposal; limitations on the
target board’s ability to change its recommendation; and a tender and support
agreement committing 17.7% of the company’s shares to accept the deal. 111 There,
as here, the plaintiffs argued the merger agreement violated Unocal “because the
[target] board [could not] terminate the merger agreement to accept a superior
proposal.” 112 The Court disagreed.

Complete Genomics reinforces the principle that “[i]f stockholders can reject
the transaction and maintain the status quo, then the transaction is not coercive.” 113
And “[i]f all that defendants have done is to create an option for shareholders, then
it can hardly be thought to have breached a duty.”114 Here, the Comerica board
gave stockholders an option. Comerica’s stockholders were free to take the merits
of that option—including the termination fee, the absence of a termination out, and
the window of time that might be needed to close a large regulated merger—into
consideration, and vote for or against it. And because a no vote alone would not
trigger payment of the termination fee, 115 stockholders could “freely choose the
status quo without penalty.” 116

111
C.A. No. 7888-VCL, at 4, 10–11, 13–14 (Del. Ch. Nov. 9, 2012) (TRANSCRIPT).
112
Id. at 12.
113
Id. at 13–14; see also id. (“There may be negative consequences to continuing with the
status quo, but neither the existence of those negative consequences nor accurate
disclosures about them constitutes wrongful coercion.”).
Id. at 14 (quoting AC Acq. Corp. v. Anderson, Clayton & Co., 519 A.2d 103, 113 (Del.
114

Ch. 1986)).
115
See Merger Agreement § 9.2(b).
116
Complete Genomics, C.A. No. 7888-VCL, at 14–15; see also Brazen, 695 A.2d at 49–
50 (finding that a termination fee was not coercive even when payment of the fee would
be triggered upon a failure to obtain stockholder approval, given “the reciprocal
termination fee provisions . . . were an integral part of the merits of the transaction”).
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Because the challenged provisions did not unreasonably limit the Comerica
board’s ability to pursue an alternative bidder or rob the stockholder vote of its
effectiveness, they did not bind Comerica to Fifth Third in a way that supports a
colorable entrenchment theory.

HoldCo also sees entrenchment in the Merger price. 117 Again, in the
absence of oppressive deal protection measures or a coerced or uninformed vote, I
struggle to see how the price could be entrenching. Having acquitted the deal
protections of inequitable wrong, I will address the price issue in the context of
imminent irreparable harm.

I recognize the colorability standard is not an exacting one. 118 But the merits
of HoldCo’s claims turn on unambiguous contractual language and dispositive
authority. HoldCo has failed to raise a colorable claim warranting injunctive relief.

B. Imminent Irreparable Harm

Imminent and irreparable harm is the “sine qua non for this form of
relief.” 119 Before this Court will enjoin a merger in equity, the movant must
“demonstrate harm for which she has no adequate remedy at law.” 120 “The alleged
harm must be imminent and genuine, as opposed to speculative.” 121

HoldCo asserts the Merger Agreement’s deal protections chased away
would-be topping bidders, depriving Comerica stockholders of the unique
opportunity to sell for more value. 122 But HoldCo has not raised a colorable claim

117
POB 20–21.
See CBOT Hldgs., Inc. v. Chi. Bd. Options Exch., Inc., 2007 WL 2296356, at *3 (Del.
118

Ch. Aug. 3, 2007).
CapStack Nashville 3 LLC v. MACC Venture P’rs, 2018 WL 3949274, at *3 (Del. Ch.
119

Aug. 16, 2018) (internal quotation marks and citation omitted).
120
In re Smurfit-Stone Container Corp. S’holder Litig., 2011 WL 2028076, at *25 (Del.
Ch. May 20, 2011).
121
In re Inergy L.P., 2010 WL 4273197, at *17 (Del. Ch. Oct. 29, 2010) (citing Aquila,
Inc. v. Quanta Servs., Inc., 805 A.2d 196, 208 (Del. Ch. 2002)).
122
POB 22; PRB 17.
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that the challenged provisions had that effect. HoldCo’s allegations about a “fire-
sale price” 123 can be addressed after closing.

And the facts on the ground do not support HoldCo’s theory of imminent
and irreparable harm. There has not been another serious and motivated bidder in
the process since Financial Institution A, whose last proposal was bested by Fifth
Third’s. 124 Of the four potential acquirors identified by Comerica’s financial
advisor, two had taken up alternative transactions before HoldCo’s pursuit to
enjoin the Merger. 125 HoldCo itself identified only three potential acquirors that
“[m]a[d]e [s]ense,” and predicted Fifth Third could offer the highest premium of
those three. 126 Fifth Third delivered.

HoldCo’s assertion about would-be topping bidders rests on speculation.
Speculation cannot supply a cognizable harm warranting a TRO. 127 As this Court
noted in In re Synthes, Inc. Shareholder Litigation, courts should be reluctant to
question a board’s decision to bargain for deal protection devices based on
hypothetical harms—i.e., the harm that “some unexpected bidder will emerge from
an unexplored and overlooked dusty corner of our well-scoured capital markets,”
or that “some party that has already had a chance to make a real bid without having
to hurdle any deal protection barrier at all will somehow come to a different
realization of the company’s value.” 128

And while HoldCo complains of a potential “one-year standoff” until the
outside date, there was no cognizable harm in giving Comerica and Fifth Third
123
POB 20–21.
124
See Proxy Supp. at 5–6.
125
See DAB 6 & n.15.
126
D.I. 86 Ex. 3 at 29, 31, 33, 35.
127
See Norberg v. Young’s Mkt. Co., 1989 WL 155462, at *5 (Del. Ch. Dec. 19, 1989)
(“[T]he abstract possibility of a higher offer cannot serve as a predicate for finding
plaintiff’s harm to be irreparable.”); Roseton OL, LLC v. Dynegy Hldgs. Inc., 2011 WL
3275965, at *17 (Del. Ch. July 29, 2011) (“Potential harm that may occur in the future,
however, does not constitute imminent and irreparable injury for the purposes of a TRO
or preliminary injunction.” (citation omitted)).
128
50 A.3d 1022, 1049 (Del. Ch. 2012).
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time to merge in a highly regulated sector. As it turns out, they did not need much
time: the Merger is now days away from closing. The outside date presents no
harm to Comerica stockholders.

HoldCo has not shown it, or Comerica stockholders similarly situated to it,
will be harmed—let alone suffer imminent irreparable harm—absent a TRO.

C. Balance of the Equities

Against this backdrop, I cannot conclude the risk of enjoining the Merger
would outweigh the benefit, particularly “when judged from the standpoint of the
[Comerica] stockholders.” 129 In the merger context, this Court is “particularly
reticent . . . to enjoin a transaction that affords stockholders a premium in the
absence of a competing offer.” 130 That is especially true “where no rival bidder
has emerged to complain that it was not given a fair opportunity to bid, and where
there is no reason to believe that stockholders are not adequately informed or
[were] coerced into accepting the transaction if they do not find it favorable.” 131

Enjoining a premium merger on the eve of closing will introduce substantial
delay and uncertainty. While HoldCo mourns a topping bid that never appeared,
an injunction may very well deprive stockholders of Fifth Third’s certain premium

129
In re Dollar Thrifty S’holder Litig., 14 A.3d 573, 617 (Del. Ch. 2010).
130
Koehler v. NetSpend Hldgs. Inc., 2013 WL 2181518, at *22 (Del. Ch. May 21, 2013);
Kohls v. Duthie, 765 A.2d 1274, 1289 (Del. Ch. 2000) (“This court is understandably
cautious when the issuance of an injunction would deprive . . . shareholders of the
benefits of [a] merger transaction without offering them any realistic prospect of a
superior alternative, or for that matter, any alternative.” (internal quotation marks and
citation omitted)); In re Netsmart Techs., Inc. S’holders Litig., 924 A.2d 171, 208 (Del.
Ch. 2007) (“[W]hen this Court is asked to enjoin a transaction and another higher-priced
alternative is not immediately available, it has been appropriately modest about playing
games with other people’s money.”); In re OPENLANE, Inc., 2011 WL 4599662, at *10
n.53 (Del. Ch. Sept. 30, 2011) (“Enjoining a merger when no superior offer has emerged
is a perilous endeavor because there is always the possibility that the existing deal will
vanish, denying the opportunity to accept any transaction.”).
131
C & J Energy Servs., Inc. v. City of Miami Gen. Empls.’ & Sanitation Empls.’ Ret. Tr.,
107 A.2d 1049, 1072–73 (Del. 2014).
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that they chose to accept. HoldCo’s suggestion that Comerica stockholders would
“benefit from the delay” finds no basis in logic or the record. 132 An injunction will
not make a higher offer or a different buyer appear. At this juncture, as Defendants
point out, “the real risk of irreparable harm is not from the consummation of the
merger—it is from this motion itself.” 133

III. CONCLUSION

HoldCo’s motion for a TRO is denied.

Sincerely,

/s/ Morgan T. Zurn

Vice Chancellor

MTZ/ms

cc: All Counsel of Record, via File & ServeXpress

132
PRB 12–13.
133
DAB 3.