The Ademi Firm is investigating Blackbox (Nasdaq: BLBX) for possible breaches of fiduciary duty and other violations of law in its transaction with REalloys.
In the reverse merger transaction, Blackbox’s and REalloys’ stockholders will own approximately 7.3% and 92.7%, respectively, of the combined company’s shares of common stock expected to be outstanding upon closing of the Merger, based on REalloys’ initial valuation of $400 million. Blackbox’s stockholders of record prior to closing will receive Contingent Value Rights entitling them to certain net proceeds from the potential sale of Blackbox’s current fintech operations within 24 months post-Merger. Blackbox insiders will receive substantial benefits as part of change of control arrangements.
The transaction agreement unreasonably limits competing transactions for Blackbox by imposing a significant penalty if Blackbox accepts a competing bid. We are investigating the conduct of the Blackbox board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.