Douglas M. Chertok v. OnSolve LLC

── Douglas M. Chertok v. OnSolve LLC ── Court: Court of Chancery of Delaware Date: April 13, 2026 Category: General IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE DOUGLAS M. CHERTOK and ) SDTC ADVISORS LLC, a New ) York limited liability company, ) ) Plaintiffs, ) ) v. ) C.A. No. 2020-0417-PAF ) ONSOLVE, LLC, a Delaware limited ) liability company ) (fka EMERGENCY ) COMMUNICATIONS NETWORK, ) LLC; successor to SWN ) COMMUNICATIONS, INC., ) a Delaware corporation), ) ) Defendant. ) POST-TRIAL MEMORANDUM OPINION Date Submitted: June 9, 2025 Date Decided: April 13, 2026 Kelly A. Green, Jason Z. Miller, SMITH, KATZENSTEIN & JENKINS LLP, Wilmington, Delaware; Douglas Chertok, Fort Lauderdale, Florida; Attorneys for Plaintiffs Douglas M. Chertok and SDTC Advisors LLC Paul J. Lockwood, Lauren N. Rosenello, SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, Wilmington, Delaware; Attorneys for Defendant OnSolve, LLC FIORAVANTI, Vice Chancellor  A corporation conditioned payment of merger consideration on stockholders executing and returning a number of documents, including one containing a release of claims. A common stockholder who had chosen not to comply later sued the corporation, asserting claims for breach of the certificate of incorporation and for unjust enrichment. The corporation withdrew the conditions after the stockholder filed suit, but contended that it was not required to pay prejudgment interest. The stockholder, on the other hand, maintained that he was not only entitled to interest, but also to damages exceeding the per share consideration provided for in the merger agreement. In this post-trial opinion, the court concludes that the corporation breached the certificate of incorporation by conditioning payment of the merger consideration on the execution of a release agreement. The stockholder’s damages are no greater than his share of the merger consideration as calculated under the terms of the merger agreement. Having prevailed on his breach of contract claim, the stockholder is entitled to prejudgment interest as a matter of right. In the exercise of the court’s discretion, interest will be calculated at the legal rate in effect when payment became due and will not be compounded. I. BACKGROUND These are the facts as the court finds them after trial. 1 A. Factual Background 1. The Parties and the Company’s capital structure SDTC Advisors LLC (“SDTC”) is a New York limited liability company. 2 Douglas Chertok (together with SDTC, the “Plaintiffs”) is the founder, managing member, and 50% owner of SDTC. 3 The other 50% owner was Tony Schmitz, who is not a party to this action and served as SDTC’s chief executive officer (“CEO”). 4 SWN Communications Inc. (“SWN” or the “Company”) is a Delaware corporation. 5 Schmitz was also SWN’s CEO. 6 Prior to the merger giving rise to this action, the Company’s Certificate of Incorporation (the “Certificate”) 7 1 Other factual findings are contained in the analysis of the claims. Trial exhibits are cited as “JX,” and references to the docket are cited as “Dkt.,” with each followed by the docket number and the relevant section, page, paragraph, or exhibit. The Amended Complaint in this action (Dkt. 76) will be cited as “Am. Compl.” Citations to the trial transcript (Dkt. 78) are in the form “Tr.” Citations to the transcript of post-trial oral argument (Dkt. 99) are in the form of “Post-Trial Arg.” Unless otherwise indicated, citations to the parties’ briefs are to post-trial briefs. 2 JX 1 (hereinafter “Warrant”) at 6; JX 2; JX 3; Tr. 6:10−14, 8:9−11. 3 Chertok is an attorney, admitted to practice law in New York. He was admitted pro hac vic