The electrical schematic below is from a Studebaker but it's typical of most others. When the OD is energized there is a throttle switch that will disengage the OD at WOT...kinda like the passing gear in an auto trans. The switch kills the power to the OD solenoid and momentarily shorts out the ignition coil to unload the solenoid pawl so it can drop out.

The OD can be engaged in gears other than 3rd as long as the road speed is sufficient (see governor in pic). Makes it a theoretic 6-speed.