Fiduciary Duties and Disclosure Obligations in Proxy and Tender Contests for Corporate Control

This article will examine the fiduciary duties and disclosure obligations present in proxy and tender contests for corporate control. While the thrust of the discussion will be centered on the obligations of boards of directors and management, the roles of other participants in the process will also be surveyed. Although several of the relevant principles can be definitively set forth, it bears emphasis that a number of troublesome issues remain unresolved. At the same time, due to the complexities and breadth of the subjects involved, certain issues will receive more extensive treatment than others. The article will address relevant fiduciary and disclosure concepts in the context of battles for corporate control in the following manner. Initially, the responsibilities of financial and other intermediaries will be discussed. Thereafter, the article will present an overview of the general fiduciary and disclosure obligations of boards of directors and management. Subsequently, commentators' perceptions of the duties of target management in the tender offer setting will be presented. Finally, the article will analyze particularly relevant recent judicial decisions regarding the fiduciary duties and disclosure obligations of boards of directors and management in proxy and tender offer contests