Full Opinion

COURT OF CHANCERY OF THE STATE OF DELAWARE DAVID HUME, IV COURT OF CHANCERY COURTHOUSE MAGISTRATE IN CHANCERY 34 THE CIRCLE GEORGETOWN, DE 19947 October 1, 2026 David L. Finger (#2556) Sean A. Meluney (#5514) Finger & Slanina, LLC Matthew D. Beebe (#5980) 1201 N. Orange St., 7th floor Meluney Alleman & Spence, LLC Wilmington, DE 19801-1186 1143 Savannah Rd., Suite 3-A Lewes, DE 19958 RE: Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp. C.A. No. 2025-1011-DH Dear Counsel: This letter decision resolves Defendants’ Nissim Black’s and Hava Nation Corp.’s motion to dismiss Plaintiff Lawrence Pinczower’s Complaint. Pinczower asserts eleven direct and derivative claims arising from his involvement with Hava Nation. For the reasons explained below, I recommend that the motion be denied as to Counts V and VI and granted as to all other counts. I. FACTUAL BACKGROUND1 1 I draw the following facts from Plaintiff’s Verified Complaint (“Compl.”), Docket Item (“D.I.”) 1, as well as the Employment Agreement (“Emp. Agrmt.”), attached as Exhibit N thereto; Defendant Nissim Black’s Waiver (“Waiver”), attached as Exhibits K and K2 thereto; Plaintiff Lawrence Pinczower’s Indemnity Agreement (“Indem. Agrmt.”), attached as Exhibit L thereto; and non-party Neil Shaw’s Email (“Shaw Email”), attached as Exhibit M thereto. I take all adequately alleged facts as true for the purpose of this Motion to Dismiss. I refer to the parties’ briefing as follows: Defendants Nissim Black’s and Hava Nation Corp.’s Opening Brief in Support of their Motion to Dismiss Plaintiff’s Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 2 of 48 Hava Nation Corp. (“Hava Nation” or the “Company”) is a Delaware corporation formed to develop and market a whiskey brand called “Hava.”2 The origins of the Hava brand date to 2021, when Nissim Black conducted a small-batch test run of the product after producing a music video titled “The Hava Song.”3 Before Plaintiff Lawrence Pinczower’s involvement with Hava Nation, four individuals played key roles in the Company: Black; Neil Shaw, Hava Nation’s seed investor and former co-director; Yehoshua Werth, its operations manager and blend master; and then-General Counsel Steven Sabel.4 Black, Werth, and Sabel worked together to develop the business plan for Hava Nation.5 The plan contemplated an initial launch of 20,000 triple-blend whiskey bottles and the importation of approximately 5,000 bottles of selected Scottish whiskey.6 Verified Complaint (“DOB”), D.I. 19; Plaintiff’s Answering Brief in Opposition to Defendants’ Motion to Dismiss (“PAB”), D.I. 21; Defendants Nissim Black’s and Hava Nation Corp.’s Reply Brief in Support of their Motion to Dismiss Plaintiff’s Verified Complaint (“DRB”), D.I. 22; and Defendants’ Motion to Dismiss Transcript (“MTD Tr.”), D.I. 28. 2 Compl. ¶¶ 11, 17, 29. 3 Id. ¶ 30. 4 Id. ¶¶ 27–28; DOB p. 3. 5 Compl. ¶ 28. 6 Id. ¶ 29. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 3 of 48 Before March 12, 2025, Black and Shaw requested that Pinczower prepare various legal documents for Shaw’s review, including a memorandum of understanding (the “MOU”), a founder’s agreement, employment agreements for Black, Sabel, and Werth, and an employee stock option plan (the “ESOP”).7 Shaw approved these documents.8 On March 14, Shaw invested $1.2 million in Hava Nation.9 Soon thereafter, between late March and late April, Black made twenty separate withdrawals or transfers from the Company’s account.10 Shaw estimated the transactions at approximately $150,000, although the Complaint elsewhere alleges an amount between approximately $128,000 and $150,000.11 Once discovered, Shaw proposed reducing Black’s holdings by 5,000 shares to offset the amount Shaw believed Black had withdrawn.12 Instead, on April 24, Black executed a $100,000 loan agreement 7 Id. ¶ 26. 8 Id. ¶ 31. 9 Id. ¶ 31. 10 Id. ¶¶ 2, 21, 32. 11 Id. 12 Id. ¶ 33. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 4 of 48 with Hava Nation that required ten equal monthly payments beginning in June 2025.13 Around this time, Shaw sought to terminate Sabel and contacted Pinczower to assist with Sabel’s termination.14 Shaw simultaneously invited Pinczower to replace Sabel as Hava Nation’s general counsel, and Black approved Pinczower’s appointment.15 Pinczower advised Shaw that he would wait to formally join Hava Nation until Sabel’s employment ended to avoid overlap between the two General Counsel positions.16 Pinczower also requested documentation from Black and Shaw confirming their consent to his representation and eventual onboarding.17 On May 9, 2025, Black executed a waiver and consent letter permitting Pinczower to assist Shaw with Sabel’s termination and afterward join Hava Nation.18 Five days later, Shaw introduced Pinczower during a Company meeting and informally welcomed him to Hava Nation.19 By May 19 Pinczower had provided 13 Id. ¶ 34. 14 Id. ¶ 35. 15 Id. ¶ 35. 16 Id. ¶ 36. 17 Id. 18 Id. ¶ 37. 19 Id. ¶ 41. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 5 of 48 Shaw with a draft employment agreement (the “Employment Agreement”), to which Shaw replied: “Thanks. Works for me, including 4a. I suggest dating the PDF Monday, May 19 and I’ll sign on that date.”20 But Shaw did not sign it. Pinczower alleges that his employment therefore became effective on May 19.21 On May 23, Shaw executed an indemnification letter in Pinczower’s favor concerning Sabel’s termination and Pinczower’s onboarding.22 Under the Employment Agreement, Pinczower was to receive, among other things, a $100,000 annual net salary, $15,300 in Social Security tax payments, 5,000 immediately vested common shares, 5,000 stock options, up to $7,000 in benefits, severance rights, and a $6,250 signing bonus for his prior legal services.23 For what the Complaint describes as a “ministerial convenience,” Pinczower initially directed that his shares be registered in the name of his Delaware holding company, NPH LLC.24 20 Id. ¶¶ 42; Ex. M. 21 Id. ¶¶ 39, 42. 22 Id. ¶ 38. 23 Id. ¶¶ 43–44. 24 Id. ¶ 9. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 6 of 48 On May 29, 2025, Sabel’s offboarding concluded through a General Release Agreement between Sabel and Shaw on behalf of Hava Nation.25 During this period, Pinczower performed various general counsel duties, including attending Company meetings, preparing minutes, negotiating contracts, conducting legal research, communicating with outside counsel, and acting as a liaison among Shaw, Black, and Werth.26 Pinczower notified the Company of the trademark on May 21 and discussed it at a Company meeting later that day.27 To address the potential trademark issue, Pinczower proposed an alternative brand, “Seven Shepherds,” vetted the name, and reserved relevant domain names.28 On June 4, 2025, Shaw sought to replace Black with Pinczower as Hava Nation’s Chief Executive Officer (“CEO”) and invited Pinczower to join the Company’s board of directors.29 Shaw verbally offered Pinczower an additional 9,700 shares, equal to 10% of the then-issued 97,000 shares, and additional cash 25 Id. ¶ 42. 26 Id. ¶¶ 45–49. 27 Id. 28 Id. ¶ 51. 29 Id. ¶ 53. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 7 of 48 compensation in an undetermined amount.30 By June 5, Pinczower had begun acting in the CEO role.31 On June 9, 2025, Shaw wrote to Black and Pinczower confirming his desire for Pinczower to replace Black as CEO, the award of an additional 9,700 shares to Pinczower, and anticipated additional cash compensation.32 During a recorded Company meeting later that day, Pinczower was formally introduced as Hava Nation’s new CEO.33 Black did not object to the change or the additional equity and, according to Pinczower, later expressed approval of the transition because it would allow Black to focus on the Company’s branding and marketing efforts.34 Two days later, Shaw attempted to terminate Pinczower.35 Pinczower alleges that Shaw attempted to do so in retaliation for Shaw’s unsuccessful effort to obtain shareholder control of Hava Nation.36 Shaw also informed Black that he intended to withdraw the approximately $960,000 remaining from his original investment, 30 Id. ¶ 54. 31 Id. ¶ 55. 32 Id. ¶ 56. 33 Id. ¶¶ 46, 57. 34 Id. ¶ 57. 35 Id. 36 Id. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 8 of 48 purportedly because he and Pinczower could not agree on the full scope of Pinczower’s compensation as CEO.37 Black later told Pinczower, both orally and in writing, that Shaw had acted unilaterally, and that Black had not consented to Pinczower’s termination.38 Pinczower thereafter made several demands for payment.39 On June 12, 2025, he sent Shaw a $50,000 invoice for legal services rendered in connection with Sabel’s termination.40 On June 15, Pinczower sent Shaw an initial demand for amounts due under the Employment Agreement.41 On June 17, he expanded that demand to seek the full amount allegedly due under his Employment Agreement.42 Also on June 17, Pinczower purported to impose an equitable lien on Sabel’s 5,000 stock options based on unpaid legal fees arising from Sabel’s termination.43 On June 22, Pinczower sent Shaw another demand letter asserting that Shaw’s 40,000 shares 37 Id. 38 Id. ¶ 61. 39 Id. ¶ 60 40 Id. 41 Id. 42 Id. 43 Id. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 9 of 48 would be subject to an equitable lien for unpaid legal fees and amounts allegedly due under Pinczower’s Employment Agreement.44 Meanwhile, Black failed to make the payments required under his April 24 loan agreement.45 Pinczower alleges that the loan went into default in June 2025, accelerating the outstanding balance.46 On June 24, 2025, approximately $960,000 was transferred out of Hava Nation accounts without first satisfying the amounts Pinczower claimed were owed to him for legal fees, salary, bonus, severance, expenses, and other obligations.47 Pinczower alleges that Black participated in or acquiesced in the transfer and personally received an undisclosed portion of the funds.48 Shaw thereafter exited the Company.49 Following Shaw’s exit, Pinczower resubmitted to Black the payment demands he had previously made to Shaw and demanded that Black update Hava Nation’s 44 Id. 45 Id. ¶ 34. 46 Id. 47 Id. ¶ 59. 48 Id. ¶¶ 2, 69–70. 49 Id. ¶¶ 15, 62. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 10 of 48 capitalization records to recognize Pinczower’s claimed equity interests.50 Pinczower contends that through the enforcement of his asserted equitable liens against Shaw’s shares and stock obtained from the Employment Agreement, he became Hava Nation’s majority shareholder as of June 24.51 On June 26, 2025, Pinczower filed a petition with the United States Patent and Trademark Office (“USPTO”) seeking cancellation of the pre-existing Hava trademark registration.52 Pinczower alleges that this work fell outside the scope of the services contemplated by his Employment Agreement.53 On July 25, the USPTO cancelled the pre-existing Hava registration, and Pinczower later sought $24,525 from Hava Nation for those services, alleging that the Company benefited from the cancellation.54 Pinczower continued to assert rights concerning payment, equity, and capitalization tables against Hava Nation and Black.55 His asserted liens ultimately 50 Id. ¶ 62. 51 Id. ¶¶ 18, 80. 52 Id. ¶ 66. 53 Id. ¶ 66. 54 Id. ¶¶ 67–68. 55 Id. ¶¶ 52, 59–65. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 11 of 48 encompassed Sabel’s 5,000 options, Shaw’s 40,000 shares, and Black’s shares.56 On July 19, 2025, Pinczower served Black with a demand letter.57 Five days later, Pinczower issued Black a final notice of lien and termination warning, providing Black with what Pinczower characterized as a final 24-hour opportunity to cure.58 On July 25, 2025, claiming authority as Hava Nation’s majority shareholder, Pinczower purported to terminate Black’s employment, remove him from the board of directors, dismiss him as an officer, impose a lien on Black’s shares, and invoke share-forfeiture provisions.59 Pinczower thereafter updated the Company’s capitalization tables to reflect Black’s termination, the asserted lien against Black’s shares, and the equity interests Pinczower claims should be registered in his personal name.60 Despite his purported termination, Black continued to hold himself out as Hava Nation’s CEO, director, and majority stockholder.61 Pinczower further alleges that Black engaged with the Company’s Scottish whiskey supplier in violation of the 56 Id. ¶ 52, 65, 81. 57 Id. ¶ 63. 58 Id. ¶¶ 19, 64. 59 Id. ¶¶ 19–21, 65. 60 Id. ¶¶ 65, 80–82. 61 Id. ¶ 23. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 12 of 48 twelve-month non-compete provision in Black’s employment agreement.62 Although Pinczower contends that Black’s termination became effective at 5:01 p.m. on July 25, written confirmation of the termination was sent to Black on August 4, 2025.63 Black continued to dispute Pinczower’s claimed share ownership and corporate authority, while Pinczower maintained that he was Hava Nation’s sole lawful director.64 Pinczower brings eleven direct and derivative claims against Black and Hava Nation.65 Pinczower premises his derivative claims against Black on Black’s alleged misuse of Company funds, participation in the June 24 defunding, failure to repay the $100,000 Loan Agreement, and violation of his post-termination non-compete.66 Pinczower claims that this conduct constitutes breach of fiduciary duty, an unlawful distribution under 8 Del. C. § 174, and breach of the loan agreement, and warrants imposing a constructive trust or equitable lien over the allegedly diverted funds.67 62 Id. 63 Id. ¶ 21. 64 Id. ¶¶ 22–24, 83. 65 Id. ¶¶ 69–88. 66 Id. ¶¶ 69–70, 76–78. 67 Id. ¶¶ 69–70, 76–77. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 13 of 48 Pinczower premises his direct claims against Hava Nation principally on the alleged validity and breach of his Employment Agreement.68 He claims that Hava Nation assented to and ratified the Employment Agreement through the parties’ writings and conduct, but later breached the agreement by failing to pay his compensation, issue his shares and options, and properly terminate his employment.69 In the alternative, Pinczower seeks recovery under theories of promissory estoppel and quantum meruit for the benefits Hava Nation allegedly received from his services.70 He also seeks declaratory and injunctive relief recognizing his claimed equity interests and corporate positions.71 Counts I and II assert derivative claims against Black arising from his alleged misuse and diversion of Company funds.72 Counts III and IV seek a declaration that the Employment Agreement is valid and enforceable and assert breach of that agreement, respectively.73 Counts V and VI plead promissory estoppel and quantum 68 Id. ¶¶ 72–73. 69 Id. ¶¶ 72–73. 70 Id. ¶¶ 74–75. 71 Id. ¶¶ 72, 79–88. 72 Id. ¶¶ 69–70. 73 Id. ¶¶ 72–73. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 14 of 48 meruit in the alternative.74 Counts VII through IX assert derivative claims seeking a constructive trust or equitable lien over allegedly diverted Company assets, enforcement of Black’s loan agreement with Hava Nation, and enforcement of the non-compete provision in Black’s employment agreement, respectively.75 Finally, Counts X and XI seek declaratory and injunctive relief concerning Pinczower’s claimed equity interests and rights as a Hava Nation stockholder, officer, and director.76 Defendants moved to dismiss the Complaint in its entirety.77 They contend that Pinczower’s derivative claims fail because he did not initially comply with Rule 23.1, lacks stockholder standing, and independently fails to plead those claims adequately.78 They separately seek dismissal of the direct claims premised on the Employment Agreement and contend that, if the remaining claims are dismissed, the Court lacks subject matter jurisdiction over Counts V and VI.79 74 Id. ¶¶ 74–75. 75 Id. ¶¶ 76–78. 76 Id. ¶¶ 79–88. 77 D.I. 13. 78 DOB pp. 20–24; 33–48; DRB pp. 1–3. 79 DOB pp. 24–30, 48–51; DRB p. 30. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 15 of 48 II. ANALYSIS A. Pinczower Properly Cured the Rule 23.1 Procedural Defects. When Pinczower sued, he did so pro se and without the affidavit required by Court of Chancery Rule 23.1. After oral argument, however, Pinczower was given 20 days to obtain Delaware counsel for his derivative claims and file the Rule 23.1 affidavit.80 Pinczower cured these procedural defects when he filed a Rule 23.1(b) affidavit on July 2, and his counsel entered an appearance on July 6.81 B. Pinczower Failed to Effect Proper Service on Black. Pinczower made four attempts to serve Black, who was then in Israel: in person, by email, through WhatsApp, and by registered mail. None effected service. “In considering a 12(b)(2) motion, the court employs a two-step analysis: the court must first determine that service of process is authorized by statute and then must determine that the exercise of jurisdiction over the nonresident defendant comports with traditional due process notions of fair play and substantial justice.” Sustainability Partners LLC v. Jacobs, 2020 WL 3119034, at *5 (Del. Ch. Jun. 11, 2020) (citation modified). “When a defendant moves to dismiss a complaint pursuant to Court of Chancery Rule 12(b)(2), the plaintiff bears the burden of 80 MTD Tr. 50:13–22. 81 D.I. 26; 27. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 16 of 48 showing a basis for the court’s exercise of jurisdiction over the defendant.” Ryan v. Gifford, 935 A.2d 258, 285 (Del. Ch. 2007) (citing Werner v. Miller Tech. Mgmt., L.P., 831 A.2d 318 (Del. Ch. 2003)). In ruling on a Rule 12(b)(2) motion where no evidentiary hearing has yet occurred, “plaintiffs need only make a prima facie showing of personal jurisdiction and the record is construed in the light most favorable to the plaintiff.” Ryan v. Gifford, 935 A.2d 258, 285 (Del. Ch. 2007) (citation modified). Similarly, Court of Chancery Rule 12(b)(5) requires that personal jurisdiction be acquired through proper service of process. Shurr v. Mun. City of Newark, Del., 2004 WL 332508, at *1 (D. Del. Jan. 28, 2004). Actual notice by a defendant without service of process will not suffice. Id. Thus, under Court of Chancery Rules 12(b)(2) and (5), “where a plaintiff has failed to obtain personal jurisdiction over each of the defendants through proper service of process, the case must be dismissed.” Id. at *2. When service of process requires the transmission of judicial documents abroad, the Hague Service Convention applies. Daskin v. Knowles, 193 A.3d 717, 723 (Del. 2018). Article 5 of the Hague Service Convention (“Article 5”) provides for service through the destination state’s Central Authority, which serves the documents or arranges for their service by a method prescribed by the destination Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 17 of 48 state’s internal law or, unless incompatible with that law, by a particular method requested by the applicant. Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, art. 5, Nov. 15, 1965, 20 U.S.T. 361 [hereinafter Hague Service Convention]. Article 10 of the Hague Service Convention (“Article 10”) provides additional channels of transmission where the destination state does not object, including transmission through postal channels under Article 10(a) and certain forms of direct service through judicial officers, officials, or other competent persons under Articles 10(b) and (c). Id. at art. 10. Israel has declared that, for purposes of Articles 10(b) and (c), it will effect service only through its Directorate of Courts and only upon an application emanating from a judicial authority or the diplomatic or consular representation of a Contracting State. See Israel – Declarations and Reservations, Hague Service Conference on Private International Law, https://www.hcch.net/en/notifications/?csid=405&disp=resdn (last visited Oct. 1, 2026). Delaware law separately governs the permissible methods of service. Court of Chancery Rule 4(d) permits personal service on an individual by delivering process personally, leaving process at the individual’s dwelling with an appropriate resident, delivering process to an authorized agent, or serving process pursuant to a Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 18 of 48 Court order directing another or additional mode of service. 10 Del. C. § 3104(d) similarly provides that extraterritorial service, when reasonably calculated to give actual notice, may be made: (1) By personal delivery in the manner prescribed for service within [Delaware]. (2) In the manner provided or prescribed by the law of the [destination state]. . . . (3) By any form of mail addressed to the person to be served and requiring a signed receipt. (4) As directed by a court. 10 Del. C. § 3104(d). Pinczower attempts to serve Black by email and WhatsApp did not comply with these requirements. Neither method is authorized by Section 3104(d) absent a court order permitting an alternative mode of service, and Pinczower never sought or obtained such an order. Accordingly, Pinczower’s unilateral electronic transmissions did not effect service of process.82 Pinczower’s attempted in-person service was likewise insufficient. Court of Chancery Rule 4(c)(1) provides that “[s]ervice of process means service of both the 82 In Plaintiff’s Answering Brief, Plaintiff relies on three cases to support his assertion that service was effectuated via email and WhatsApp: FTC v. PCCare247, Inc., 2013 WL 841037, at *4–5 (S.D.N.Y. Mar. 7, 2013); Rio Properties, Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1015–18 (9th Cir. 2002); and Kumar v. Alhunaif, 2023 WL 8527671, at *4–5 (S.D.N.Y. Dec. 8, 2023). Those cases do not support Plaintiff’s position. In each, the party seeking to effectuate service first sought leave to employ an alternative method of service – a step Plaintiff did not take here. Indeed, Rio explained that “a plaintiff may not generally resort to email service on [their] own initiative,” and distinguished itself from WAWA, Inc. v. Christensen, 1999 WL 557936, at *1 (E.D.Pa. July 29, 1999), where the plaintiff attempted service by email without first obtaining a court order. Rio, 284 F.3d at 1018. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 19 of 48 summons and the complaint” and requires that “[t]he summons and complaint . . . be served together.” Ct. Ch. R. 4(c)(1). When Pinczower delivered the Complaint to Black on September 8, 2025, no summons had been issued. Pinczower acknowledges as much in his PAB and does not characterize the September 8 delivery as formal completion of service.83 Thus, regardless of whether personal delivery otherwise complied with the Hague Convention or Section 3104, the September 8 delivery did not effect service because Pinczower did not serve Black with a summons. Pinczower also attempted service by registered mail. Article 10(a) permits service through postal channels where the destination state has not objected and the otherwise-applicable law authorizes service by mail. See Water Splash, Inc. v. Menon, 581 U.S. 271, 284 (2017) (holding that Article 10(a) encompasses service by mail when the receiving state has not objected and service by mail is authorized under otherwise-applicable law). Israel has objected to Article 10(a) only with respect to documents addressed to the State of Israel, its political subdivisions, agencies, authorities, and instrumentalities, as well as certain government officials or agents. See Israel – Declarations and Reservations, Hague Service Conference 83 PAB p. 34. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 20 of 48 on Private International Law, https://www.hcch.net/en/notifications/?csid=405&disp=resdn (last visited Oct. 1, 2026). Because Black is a private individual, Israel’s limited objection does not preclude service through postal channels in this case. Delaware law permits extraterritorial service “[b]y any form of mail addressed to the person to be served and requiring a signed receipt.” 10 Del. C. § 3104(d)(3). Pinczower represents that he sent the summons and Complaint to Black by registered mail, and return receipt requested.84 But he has produced no return receipt, proof of delivery, or other evidence that the mailing arrived. Cf. VanGorder v. VanGorder, 2026 WL 1758693, at *4 (Del. June 17, 2026) (reversing dismissal for insufficient service where certified mail was delivered and signed for by an agent and the trial court nevertheless required proof that the defendant personally received the mailing). Unlike VanGorder, the record here contains no evidence that Pinczower’s mailing was ever delivered. Accordingly, Pinczower has not established that his attempt at service by registered mail effectuated service on Black. Pinczower separately argues that service on Hava Nation’s registered agent constituted valid statutory service on Black under 10 Del. C. § 3114.85 Pinczower’s 84 Id. 85 Id. pp. 33–34. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 21 of 48 reliance on Section 3114, however, is misplaced. Section 3114(a) provides that a nonresident who accepts directorship or serves as a director of a Delaware corporation is deemed to have consented to the corporation’s registered agent acting as the director’s agent for service of process. 10 Del. C. § 3114(a). That consent extends to actions involving the corporation in which the director is a necessary or proper party and actions against the director for violations of duties owed in that capacity. Id. To effect service under Section 3114, however, process must be served on the corporation’s registered agent, and the Register in Chancery must then mail copies of the process to the corporation’s principal place of business and the director’s or officer’s residence or last-known address. See 10 Del. C. § 3114(c); ATO Enterprises of Delaware, LLC v. Cabrera, 2022 WL 2678613, at *4 n.45 (Del. Ch. July 12, 2022). Although Pinczower properly served Hava Nation through its registered agent, he did so under Section 3104.86 Service on Hava Nation as a corporate defendant under Section 3104 does not, without more, constitute service on Black through Hava Nation’s registered agent under Section 3114. Indeed, Sections 3104 and 3114 are “so different insofar as their function and purpose” that they cannot be 86 See D.I. 9; D.I. 14 p. 3 (requesting that service be effectuated “pursuant to 9 [sic] Del. C. sec. 3104”). Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 22 of 48 read as pertaining to the same subject matter. Tabas v. Crosby, 444 A.2d 250, 255 (Del. Ch. 1982). Here, the record does not reflect compliance with the procedure prescribed by Section 3114(c), including the required mailing by the Register in Chancery. Accordingly, Pinczower cannot rely on his service of Hava Nation under Section 3104 to establish service on Black under Section 3114, and the claims against Black are dismissed for insufficient service of process. But setting aside Pinczower’s procedural failings, his arguments fail on the merits of the Motion to Dismiss. C. The Employment Agreement Did Not Become Binding. It is well settled that under Court of Chancery Rule 12(b)(6) the complaint will be dismissed where the plaintiff would not be entitled to recovery “under any reasonably conceivable set of circumstances . . . susceptible of proof.” Cent. Mort. Co. v. Morgan Stanley Mortg. Cap. Hldgs., 27 A.3d 531, 535-36 (Del. 2011). While the Court must accept all well-pleaded allegations as true, id., it need not “accept conclusory allegations unsupported by specific facts . . . or draw unreasonable inferences in favor of the non-moving party.” Price v. E.I. DuPont de Nemours & Co., Inc., 26 A.3d 162, 166 (Del. 2011), overruled on other grounds by Ramsey v. Ga. S. Univ. Advanced Dev. Ctr., 189 A.3d 1255, 1277 (Del. 2018). The Court need Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 23 of 48 not “accept every strained interpretation of the allegations proposed by the plaintiff.” Malpiede v. Townson, 780 A.2d 1075, 1083 (Del. 2001). Taken together, Section 327 of Title 8 of the Delaware Code and Court of Chancery Rule 23.1 prescribe the two minimal requirements that must be met by a plaintiff seeking to initiate a derivative action: (1) that the plaintiff be a stockholder of the corporation at the time he commences the suit and (2) that the plaintiff continue to maintain their status as shareholder throughout litigation. Parfi Hldg. AB v. Mirror Image Internet, Inc., 954 A.2d 911, 935 (Del. Ch. 2008) (internal citations omitted). Pinczower claims that he is a Hava Nation stockholder through his Employment Agreement,87 under which he was set to receive 5,000 shares of Hava Nation common stock, to be vested immediately upon execution of the agreement, and options to purchase an additional 5,000 shares.88 As a preliminary matter of 87 Compl. ¶¶ 9, 18, 43, 60, 80–82. The Complaint also appears to premise Pinczower’s stockholder status on purported equitable liens against shares held by Shaw, Black, and Sabel. See Compl. ¶ 80 (alleging that Pinczower became the “majority shareholder (by way of equitable lien against Shaw’s shares)”). Defendants challenged that theory in their Opening Brief. DOB pp. 30–33. In response, Pinczower clarifies that his invocation of equitable liens “concerns the remedy available after liability is established.” PAB p. 32. I therefore do not consider the purported liens as an independent basis for Pinczower’s stockholder status. 88 Emp. Agrmt. § 4(a). Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 24 of 48 timing, even if the Employment Agreement had become binding on May 19, 2025, as Pinczower alleges, Black’s March-April withdrawals precede that date.89 Pinczower therefore lacks standing under Section 327 to pursue a derivative claim based on those withdrawals. Accordingly, Pinczower’s standing to pursue derivative claims based on later conduct turns on whether the Employment Agreement became binding. 1. Texas Law Governs the Formation Issue for Purposes of the Motion. The Employment Agreement provides that it “shall be governed and interpreted in accordance with Texas law.”90 Because the existence of an enforceable Employment Agreement is itself disputed, however, I do not rely on that provision to determine the law governing contract formation. Instead, because Pinczower applies Texas law and Defendants, while reserving the choice-of-law issue, assume for purposes of the Motion to Dismiss that Texas law applies, I assume without deciding that Texas law governs Pinczower’s contract claims.91 Under Texas law, a valid contract requires “(1) an offer; (2) acceptance in strict compliance with the terms of the offer; (3) a meeting of the minds; (4) each 89 Compl. ¶¶ 31, 42–43. 90 Emp. Agrmt. § 19. 91 PAB p. 25; DOB p. 24 n.2. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 25 of 48 party’s consent to the terms; and (5) execution and delivery of the contract with the intent that it be mutual and binding.” Levetz v. Sutton, 404 S.W.3d 798, 803 (Tex. App. 2013) (citing Cessna Aircraft Co. v. Aircraft Network, L.L.C., 213 S.W.3d 455, 465 (Tex. App. 2006)). And “where an offer prescribes the time and manner of acceptance, those terms must ordinarily be complied with to create a contract.” Padilla v. LaFrance, 907 S.W.2d 454, 460 (Tex. 1995). Mostly, mutual assent to a written contract is evidenced by the parties’ signatures and delivery with the intent to bind, but neither is essential to contract formation. Baylor Univ. v. Sonnichsen, 221 S.W.3d 632, 635 (Tex. 2007); Phillips v. Carlton Energy Grp., LLC, 475 S.W.3d 265, 277 (Tex. 2015). Thus, “[a] contract need not be signed to be ‘executed’ unless the parties explicitly require signatures as a condition of mutual assent.” Mid-Continent Cas. Co. v. Global Enercom Mgmt. Inc., 323 S.W.3d 151, 157 (Tex. 2010) (citations omitted). Whether a signature is required therefore turns on the parties’ intent. If the parties unconditionally assent to the terms of an agreement, the absence of a signature does not prevent contract formation; but if they intend that the agreement be signed before becoming binding, no contract arises until that condition occurs. Simmons & Simmons Constr. Co. v. Rea, 286 S.W.2d 415, 418 (Tex. 1955). Whether the parties intended formal execution as a prerequisite to contract formation is ordinarily a question of fact, Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 26 of 48 although in appropriate circumstances that issue may be resolved as a matter of law. Foreca, S.A. v. GRD Dev. Co., Inc., 758 S.W.2d 744, 746 (Tex. 1988); Scaife v. Associated Air Ctr., Inc., 100 F.3d 406, 410–11 (5th Cir. 1996). In determining whether the parties intended a written agreement to be binding before formal execution, the Texas Supreme Court has looked at the circumstances identified in Section 27 of the Restatement (Second) of Contracts. Foreca, S.A. v. GRD Dev. Co., Inc., 758 S.W.2d 744, 746 n.2 (Tex. 1988). Those circumstances include: the extent to which express agreement has been reached on all the terms to be included; whether the contract is of a type usually put in writing; whether it needs a formal writing for its full expression; whether it has few or many details; whether the amount involved is large or small; whether it is a common or unusual contract; whether a standard form of contract is widely used in similar transactions; and whether either party takes any action in preparation for performance during the negotiations. Restatement (Second) Of Contracts § 27 cmt. c (A.L.I. 1981). a. The /s/ Notation Does Not Establish Execution of the Employment Agreement. Pinczower first argues that the Employment Agreement was executed because its signature page contains typed /s/ notations above the signature line for both Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 27 of 48 Pinczower and Shaw.92 Below is an image of the Employment Agreement’s signature page.93 Pinczower alleges that this represents the signed version: Notably, the Employment Agreement expressly calls for execution by “actual or facsimile signature.”94 Pinczower claims that the /s/ notation constitutes an electronic signature under the Texas Uniform Electronic Transactions Act and that an electronic signature satisfies the Employment Agreement’s requirement of an 92 PAB pp. 14 n.16, 25. 93 Compl. Ex. N at 16. 94 Emp. Agrmt. § 17. Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 28 of 48 “actual or facsimile signature.”95 I need not decide whether an electronic signature constitutes an “actual” signature under the Employment Agreement because Pinczower’s argument fails at an earlier step. Texas defines an “electronic signature” as “an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.” TEX. BUS. & COM. CODE § 322.002(8). Thus, the mere presence of an electronic symbol on a document does not establish that it is the identified person’s electronic signature. Instead, the symbol must have been executed or adopted by that person with the intent to sign the record. Section 322.009 similarly provides that an electronic signature is attributable to a person “if it was the act of the person,” which may be shown in any manner. Id. § 322.009(a). The effect of an attributed signature is determined from “the context and surrounding circumstances at the time of its creation, execution, or adoption.” Id. § 322.009(b). Pinczower concedes that he was the one who placed the /s/ notation above Shaw’s signature block.96 Shaw therefore did not place the notation himself. 95 PAB pp. 14 n.18, 25; Emp. Agrmt. § 17. 96 MTD Tr. 42:17–21 (“With regards to Your Honor’s specific question as to the existence of the /s/ for the signatures, that was typed in by plaintiff on both the plaintiff’s side as well as the company’s side and was ratified, once again, by Mr. Shaw.”). Lawrence E. Pinczower v. Nissim Black and Hava Nation Corp., C.A. No. 2025-1011-DH October 1, 2026 Page 29 of 48 Pinczower nevertheless contends that