Full Opinion

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE GEORGIA SECURITY SOLUTIONS, LLC f/k/a CONTROLBYNET, LLC, Plaintiff, v. C.A. No. 2025-0798-JTL NEWCBN, LLC, SECURITY SERVICES ACQUISITION SUB CORP., and SECURITY SERVICES HOLDINGS LLC, Defendants. MEMORANDUM OPINION REGARDING MOTION TO DISMISS Date Submitted: April 7, 2026 Date Decided: August 3, 2026 Timothy R. Dudderar, Ryan M. Ellingson, POTTER ANDERSON & CORROON LLP, Wilmington, Delaware; Attorneys for Plaintiff Georgia Security Solutions, LLC f/k/a ControlByNet, LLC. Christopher B. Chuff, Tyler R. Wilson, TROUTMAN PEPPER LOCKE LLP, Wilmington, Delaware; Attorneys for Defendants NewCBN, LLC, Security Services Acquisition Sub Corp., and Security Services Holdings LLC. LASTER, V.C. An electronic security solutions company (the “Seller”) sold its video monitoring business to a security services provider (the “Buyer”) under a membership interest purchase agreement. The agreement included a contingent right to an earnout payment of up to $6 million. The earnout payment scaled with recurring revenue measured over a specified period. The agreement included several covenants restricting the Buyer’s actions during the earnout period. Those covenants covered employee retention and goodwill. Another covenant prohibited the Buyer from taking action with the intent or primary effect of thwarting the earnout. The agreement also prescribed a dispute resolution mechanism for the earnout calculation involving an independent accountant. After the transaction closed, the Buyer sidelined the Seller’s founder, who maintained most of the key customer relationships. The Buyer also reassigned key personnel to non-sales roles, put novice accountants in charge of the company’s accounting, and hired new employees with no industry experience. Those changes led to widespread problems. At the end of the earnout period, the Buyer reported recurring revenue that fell just short of the threshold for an earnout payment. The Seller asked for documents to verify the recurring revenue calculation. The Buyer produced some documents but objected to others. For several months, the parties tried to resolve their disputes. Eventually, the Seller sued. The Seller claims that the Buyer breached express and implied terms of the agreement. The Seller alleges that the Buyer computed recurring revenue incorrectly, withheld documents improperly, and breached earnout covenants. The Buyer moved to dismiss the complaint under Rules 12(b)(1) and 12(b)(3). The Buyer claims the independent accountant mechanism functions as an arbitration provision and requires that the independent accountant resolve the Seller’s claims. That mechanism instead calls for an expert determination under which the accountant decides issues within its technical remit. The court must answer foundational legal questions and any claims falling outside the accountant’s purview. The Seller’s disputes are mainly for this court to decide. Once the court has resolved them, the accountant can apply those rulings to calculate recurring revenue and the amount of any earnout payment. On that basis, the Rule 12(b)(1) and (b)(3) motions are denied. The Buyer also moved to dismiss the Seller’s claims under Rule 12(b)(6). That motion is granted as to the implied covenant claim and certain breach of contract theories. The motion is otherwise denied. I. FACTUAL BACKGROUND The facts are drawn from the complaint and the documents it incorporates by reference.1 At this procedural stage, the court must credit the complaint’s well-pled allegations and draw all reasonable inferences in the plaintiff’s favor. 1 Citations in the form “Compl. ¶ ___” refer to paragraphs of the complaint. Dkt. 1. Citations in the form “Ex. ___ at ___” refer to exhibits to the complaint. Id. 2 A. The Sale The Seller is Georgia Security Solutions LLC, which operated a security services and remote video monitoring business under the name ControlByNet. Ryan Strange was its founder, managing member, and President. The Buyer is Security Services Holdings LLC. It provides customized security solutions nationwide. The Buyer agreed to acquire the ControlByNet business. To facilitate the sale, the Seller contributed assets and interests to a newly formed entity, NewCBN, LLC (the “Company”). Under a membership interest purchase agreement dated August 15, 2022 (the “Agreement”), The Seller sold membership interests in the Company to the Buyer.2 In return, the Seller received around $13 million at closing, rollover equity in the Buyer valued at around $2 million, and a contingent right to an earnout payment of up to $6 million. Citations in the form “OB at ___” refer to the Buyer’s Opening Brief. Dkt. 9. Citations in the form “AB at ___” refer to the Seller’s Answering Brief. Dkt. 16. Citations in the form “RB at ___” refer to the Buyer’s Reply Brief. Dkt. 20. I do not believe that this decision addresses any issues sua sponte. It does strive to present a thorough discussion of the legal issues the parties raised, and in doing so both uses different language and cites some different authorities than the parties. See Kamen v. Kemper Fin. Servs., Inc., 500 U.S. 90, 99 (1991) (“When an issue or claim is properly before the court, the court is not limited to the particular legal theories advanced by the parties, but rather retains the independent power to identify and apply the proper construction of governing law.”). 2 See Ex. 1 (cited as “MIPA”). 3 The Agreement tied the earnout to “Recurring Revenue,” defined as the Company’s revenue during the “trailing twelve (12) month period through December 31, 2023,” determined in accordance with GAAP, and subject to specific exclusions and anti-diversion language. The “Earnout Period” ran from the first business day after closing to December 31, 2023. Because closing took place on August 15, 2022, the Earnout Period was longer than the trailing-twelve-month period used in the definition of Recurring Revenue (the “Recurring Revenue Period”). The Agreement specified that Recurring Revenue needed to exceed $2.6 million to trigger an earnout payment (the “Earnout Threshold”). The Agreement identified additional Recurring Revenue targets that could increase the amount of the payment.3 To receive the maximum earnout payment of $6 million, Recurring Revenue had to exceed $4.55 million. When the parties executed the Agreement, Recurring Revenue was projected to exceed $3.5 million and yield an earnout of $4.4 million. B. The Covenants The Agreement included covenants that constrained the Buyer during the Earnout Period. First, the Buyer committed to “refrain from taking any action which is intended to prevent, or, taking into account the best interests of Buyer and its equity 3 See id. at § 2.6(b). 4 holders, the primary effect of which is to prevent, the realization of the achievement of the Earnout Payment” (the “Negative Covenant”).4 Second, “without limiting the business judgment of the Buyer, but acting in good faith,” the Buyer committed to “cause the Company to use its commercially reasonable best efforts” to “retain and keep available” its employees’ services, “preserve the goodwill” with customers, suppliers, and other business relations, and “maintain an appropriate level of working capital” for the business (the “Reasonable Efforts Covenant”).5 The parties agreed that Strange would remain as President under a five-year employment agreement. Strange was personally responsible for 80% of the Company’s customer relationships, which were key to Recurring Revenue. The Buyer assured Strange that he would have executive control and full access to financial data. C. The Buyer’s Conduct During The Earnout Period Shortly after closing, the Buyer’s CEO lowered the Company’s annual recurring revenue goal from $3 million to $2.6 million—the same level as the Earnout Threshold. When the Buyer’s CEO made this change, the Company expected to generate at least $3 million in recurring revenue and $2.6 million was already committed under customer contracts. 4 Id. 5 Id. 5 Within three months of closing, the Buyer removed Strange from his role as President and gave him the title of “Founder.” As part of the change, the Buyer eliminated Strange’s authority over sales, marketing, operations, and technology. The Buyer also forced Strange to hand off his customer relationships to less experienced staff. Strange asked the Buyer for a gradual transition, but the Buyer refused. Next, the Buyer hired a new General Manager and a new Vice President of Sales. The Buyer also brought on an outside business consultant. None of them had industry experience. The Vice President of Sales failed to produce any sales in 2023 and was terminated just after the Earnout Period ended. In first quarter 2023, the Buyer delayed or cancelled new projects that the Company had planned to launch. The Buyer also assigned novice accountants to manage the Company’s accounting function. The Company soon experienced accounting and billing problems. All of the Company’s regular customers received blank invoices. The Buyer forgave some outstanding amounts and never billed for others. Some customers relationships ended. The Buyer also deferred revenue for no legitimate business reason from the second half of 2023 (within the Earnout Period) to January 2024 (after the Earnout Period). In mid-2023, the Buyer reassigned, terminated, or underpaid key customer support personnel. Those practices degraded the Company’s customer service and caused some customers to go elsewhere. 6 In fall 2023, the Buyer asked Strange to resign. When he declined, the Buyer shifted Strange to a consulting role and told employees not to talk to him. After the Earnout Period ended, the Buyer’s conduct changed. The Buyer renewed its commitment to customer support and pursued commercial contracts. D. The Dispute Resolution Procedure The Agreement required that the Buyer send the Seller a written notice within sixty days after the end of the Earnout Period (the “Notice of Achievement”). The notice had to specify the amount of Recurring Revenue and the amount of any earnout payment.6 After receiving the Notice of Achievement, the Seller could ask for “all records and work papers to the extent used in computing the Earnout Payment (or to the extent reasonably necessary to verify any payment owed . . . if any)” (the “Information Right”).7 If the Seller wanted to dispute the Recurring Revenue calculation or the amount of the earnout payment, then the Seller had to deliver a written notice to the Buyer identifying all points of disagreement (the “Dispute Notice”).8 The Agreement defined each point of disagreement as an “Item of Dispute.”9 6 Id. § 2.6(c). 7 Id. §§ 2.6(d)–(e). 8 Id. § 2.6(f). 9 Id. 7 The parties had ninety days to try to resolve the Items of Dispute. After ninety days, the Agreement called for the parties to submit open Items of Dispute to an independent accountant (the “Independent Accountant Procedure”).10 The Agreement charged the independent accountant with resolving each Item of Dispute. The resolution could not fall outside the range created by the parties’ submissions (the “Collar”). The Agreement described the Independent Accountant Procedure as the parties’ “sole recourse in the event of a dispute in respect of [the earnout]” (the “Sole Recourse Clause”).11 The independent accountant’s determination was “deemed to be an arbitration award.”12 E. The Parties’ Dispute On February 28, 2024, the Buyer sent a Notice of Achievement to the Seller. The notice reported Recurring Revenue of $2,436,639 and an earnout payment of $0. Based on the definition of Recurring Revenue, the Buyer only included the preceding twelve months of revenue in the calculation. The Buyer excluded revenue generated between closing and the start of 2023. On March 20, 2024, the Seller sent the Buyer a Dispute Notice. The Seller also exercised its Information Right. On April 5, 2024, the Buyer agreed to produce a 10 Id. § 2.6(h). 11 Id. 12 Id. 8 limited set of documents but objected to providing others. The Seller insisted on its right to the documents it had requested. On May 28, 2024, the Buyer produced documents from a sample of eleven customer accounts. Based on these documents, the Seller identified at least $215,000 in Recurring Revenue that the Buyer failed to count. On June 25, 2024, the Seller invoked the Independent Accountant Procedure. From July through October 2024, the parties discussed their disputes. Ultimately, the Buyer offered an upward adjustment to Recurring Revenue of $34,136. The revised figure of $2,470,775 still fell below the Earnout Threshold. F. This Litigation On July 10, 2025, the Seller filed suit. The complaint contains three counts: • Count I asserts that the Buyer calculated the Earnout Payment incorrectly and failed to comply with the Information Right. The Seller seeks a decree of specific performance enforcing those provisions. • Count II asserts that the Buyer breached the implied covenant of good faith and fair dealing. • Count III seeks a declaratory judgment that the Buyer failed to comply with the Information Right, breached the Reasonable Efforts Covenant, failed to calculate Recurring Revenue properly, and failed to satisfy its payment obligations. The Buyer moved to dismiss the complaint for lack of subject matter jurisdiction under Rule 12(b)(1), improper venue under Rule 12(b)(3), and failure to state a claim on which relief can be granted under Rule 12(b)(6). II. JURISDICTION AND VENUE The Buyer argues for dismissal either for lack of subject matter jurisdiction under Rule 12(b)(1) or improper venue under Rule 12(b)(3). Those motions present 9 three distinct questions: whether this court possesses subject matter jurisdiction, whether the Independent Accountant Procedure calls for arbitration or expert determination, and what is the scope of the independent accountant’s remit. A. Subject Matter Jurisdiction The Buyer seeks dismissal under Rule 12(b)(1) on the theory that the Independent Accountant Procedure calls for arbitration and that this court therefore lacks subject matter jurisdiction over the Seller’s claims. Parties technically cannot establish or foreclose subject matter jurisdiction through private ordering.13 Count I asserts an ongoing failure to honor the Information Right and comply with the Independent Accountant Procedure and seeks specific performance as a remedy. That claim supports the existence of equitable jurisdiction, and the court can adjudicate the related legal claims under the clean-up doctrine. B. Does The Independent Accountant Procedure Call For Arbitration Or Expert Determination? The parties disagree over whether the Independent Accountant Procedure calls for arbitration or expert determination. The Buyer argues that the procedure calls for arbitration and moves for dismissal under Rule 12(b)(3) in favor of that private venue. 13 Kroll v. City of Wilm., 2023 WL 6012795, at *14 (Del. Ch. Sept. 15, 2023) (“Subject matter jurisdiction concerns this court’s powers, not the parties’ rights. Therefore, parties may not waive the existence or non-existence of subject matter jurisdiction.”). 10 An arbitration provision does not deprive a court of subject matter jurisdiction; it is a special type of forum-selection clause. Rule 12(b)(3) therefore supplies the preferred procedural vehicle for invoking an arbitration provision at the outset of a case, although Delaware courts have also analyzed the issue under Rule 12(b)(1).14 Because the Buyer invoked the procedure at the outset, the court analyzes the request through Rule 12(b)(3).15 The procedural label does not change the substance of the inquiry. Principles of contract law dictate the result.16 When interpreting a contract, “the role of a court is to effectuate the parties’ intent.”17 Absent ambiguity, the court “will give priority to the parties’ intentions as reflected in the four corners of the agreement, construing the agreement as a whole 14 See Gandhi-Kapoor v. Hone Cap. LLC, 307 A.3d 328, 343–45 (Del. Ch. 2023); see also id. at 345 (“Rule 12(b)(1) can be used to ask a court to abstain from exercising the subject matter jurisdiction that it possesses, and the presence of an arbitration provision or forum selection clause provides a generally persuasive reason for abstention.”). 15 Id. at 343 (explaining that because Rule 12(b)(3) can only be raised at the outset of the case, Delaware courts have embraced Rule 12(b)(1) motions to enforce the parties’ bargain to litigate elsewhere later in the case). 16Id. at 344 (“Properly understood, an arbitration provision does not deprive a court of subject matter jurisdiction. An arbitration provision is a special type of forum selection clause. By agreeing to arbitrate, the parties commit contractually to litigate their dispute in a private forum. A court can—and generally will—enforce the arbitration agreement, but that outcome flows from principles of contract law, not the absence of subject matter jurisdiction.”). 17 Lorillard Tobacco Co. v. Am. Legacy Found., 903 A.2d 728, 739 (Del. 2006). 11 and giving effect to all its provisions.”18 “Unless there is ambiguity, Delaware courts interpret contract terms according to their plain, ordinary meaning.”19 “Contract language is not ambiguous merely because the parties dispute what it means.”20 “To be ambiguous, a disputed contract term must be fairly or reasonably susceptible to more than one meaning.”21 “Delaware courts will not destroy or twist [contract] language under the guise of construing it.”22 “If a writing is plain and clear on its face, i.e., its language conveys an unmistakable meaning, the writing itself is the sole source for gaining an understanding of intent.”23 “In upholding the intentions of the parties, a court must construe the agreement as a whole, giving effect to all provisions therein.”24 “[T]he meaning which arises from a particular portion of an agreement cannot control the meaning of the 18 In re Viking Pump, Inc., 148 A.3d 633, 648 (Del. 2016) (citations omitted). 19 Alta Berkeley VI C.V. v. Omneon, Inc., 41 A.3d 381, 385 (Del. 2012) (citations omitted). 20 Alta Berkeley, 41 A.3d at 385; accord Manti Hldgs., LLC v. Authentix Acq. Co., Inc., 261 A.3d 1199, 1208 (Del. 2021) (“The parties’ steadfast disagreement over interpretation will not, alone, render the contract ambiguous.” (internal quotation marks omitted)). 21 Alta Berkeley, 41 A.3d at 385; see Rhone-Poulenc Basic Chems. Co. v. Am. Motorists Ins. Co., 616 A.2d 1192, 1195 (Del. 1992). 22 Rhone-Poulenc, 616 A.2d at 1195. 23 City Inv. Co. Liquid. Tr. v. Cont’l Cas. Co., 624 A.2d 1191, 1198 (Del. 1993). 24 E.I. du Pont de Nemours & Co., Inc. v. Shell Oil Co., 498 A.2d 1108, 1113 (Del. 1985). 12 entire agreement where such inference runs counter to the agreement’s overall scheme or plan.”25 “[A] court interpreting any contractual provision . . . must give effect to all terms of the instrument, must read the instrument as a whole, and, if possible, reconcile all the provisions of the instrument.”26 The Delaware Supreme Court has also instructed that “[t]he basic business relationship between parties must be understood to give sensible life to any contract.”27 A reasonable reading therefore must be “situated in the commercial context between the parties.”28 The Buyer and Seller disagree on two points: (1) whether the Independent Accountant Procedure provides for arbitration or expert determination and (2) whether the disputes at issue in this litigation are reserved for the independent accountant. On the first issue, the Buyer argues the Independent Accountant Procedure calls for arbitration. The Seller says it calls for expert determination. If the Buyer is right, then doctrines of substantive and procedural arbitrability kick in.29 If the Seller is right, the body of law governing arbitration is irrelevant.30 25 Id. 26 Elliott Assocs., L.P. v. Avatex Corp., 715 A.2d 843, 854 (Del. 1998). 27 Chi. Bridge & Iron Co. N.V. v. Westinghouse Elec. Co. LLC, 166 A.3d 912, 927 (Del. 2017). 28 Id. at 926–27. 29 Penton Bus. Media Hldgs., LLC v. Informa PLC, 252 A.3d 445, 454 (Del. Ch. 2018). 30 Id. 13 Because arbitration brings with it unique legal doctrines, a court must determine at the outset whether the parties have opted for arbitration. To answer that question, the Delaware Supreme Court has adopted an analytical framework proposed by the New York City Bar Committee on International Commercial Disputes.31 The test turns primarily on the degree of authority delegated to the decision-maker.32 Parties can create dispute resolution mechanisms that “fall along a spectrum.”33 Arbitration sits at one end; expert determination sits at the other. “A provision more likely calls for an arbitration if it include[s] procedural rules affording each side the opportunity to present their case and empowers the decisionmaker” with the “authority to decide all legal and factual issues necessary to resolve the matter, analogous to the powers of a judge in a judicial proceeding.”34 “It more likely calls for an expert determination when it contemplates a more informal procedure 31 Terrell v. Kiromic Biopharma, Inc., 297 A.3d 610, 618 (Del. 2023) (citing N.Y.C. Bar Comm. on Int’l Commercial Arbitration, Purchase Price Adjustment Clauses and Expert Determinations: Legal Issues, Practical Problems and Suggested Improvements (2013)). 32 ArchKey Intermediate Hldgs. Inc. v. Mona, 302 A.3d 975, 994 (Del. Ch. 2023). 33 Id. at 989. 34 Monica v. Delta Data Software, Inc., 2026 WL 370756, at *13 (citations omitted). 14 and empowers the decisionmaker to determine only a disputed factual issue that requires specialized knowledge” and “usually concern[s] an issue of valuation.”35 Parties can also craft mechanisms that fall in between. A common dispute resolution mechanism in transaction agreements is an accountant true-up. 36 It involves relatively standard steps: • The buyer has a defined period of time to prepare a statement to be used to adjust an economic term, like the purchase price. • The buyer sends a proposed statement to the seller. • The seller has a defined period to review the statement and raise objections. • If the seller does not object, then the statement is used to adjust the economic term. • If the seller objects, then the seller submits a written response detailing its objections. • The parties engage in negotiations for a set period. • The parties submit any remaining disputes to an independent accountant. • The parties give the independent accountant opening and rebuttal submissions with supporting documents. • The accountant resolves the disputes. • The accountant’s determination is final and binding.37 35 Id. 36 ArchKey, 302 A.3d at 989. 37 A. Vincent Biemans & Gerald M. Hansen, M&A Disputes: A Professional Guide to Accounting Arbitrations 19–20 (2017) (hereinafter M&A Disputes). M&A Disputes is a monograph about how Accountant True-Up Mechanisms work. Although the book makes clear that an Accountant True-Up Mechanism is its own 15 In general, an accountant true-up is “a beefed-up expert determination, not a slimmed down legal arbitration.”38 That characterization typically remains apt even when a provision uses the word “arbitration” or calls the accountant an “arbitrator.”39 An agreement could designate an accountant to serve as an arbitrator if it delegated judge-like authority to decide factual and legal issues, for example, by specifying an arbitral organization and its governing rules. Conversely, isolated references to an “arbitrator” or “arbitration” will not expand an expert’s narrow charge.40 The Agreement tracks the steps in an accountant true-up. The Buyer must submit a Notice of Achievement.41 The Seller has sixty days to respond with a Dispute unique animal, the authors refer to the mechanism as an “accountant arbitration.” That usage is confusing, and this decision eschews it. 38 ArchKey, 302 A.3d at 995 (stating that to shift an accountant true-up mechanism into the arbitral side of the spectrum, “the provision needs to do more” than make a stray reference to arbitration, such as by “specifying a sponsoring arbitral organization and designating a set of arbitral rules.”). 39 See id. at 992 (“[D]rafters sometimes complicate matters by using a term like ‘arbitrator’ or ‘arbitration’ rather than ‘expert’ or ‘expert determination. Regardless of what language the provision uses, the dispute resolution process before the independent accountant and the issues at play are typically the same.” (cleaned up)); see also id. at 993 (“Under the authority test, using the word ‘arbitrator’ or ‘arbitration’ provides a signal about what the parties intended, but it is not dispositive.”). 40 Id. 41 See MIPA § 2.6(c). 16 Notice.42 The parties must negotiate over any Items of Dispute.43 Any unresolved items go to the independent accountant, whose determination is “final, conclusive and binding.”44 Several other signals point to an expert determination. The first is choosing an accountant as the decisionmaker. “That choice strongly suggests an intent to rely on the independent accountant’s subject matter expertise, which is consistent with an accountant true-up mechanism and inconsistent with legal arbitration.”45 The second is the absence of any reference to an arbitration organization or procedural rules, which are defining characteristics of arbitration provisions.46 Instead, the Agreement opts for an accounting firm and uses the Collar to place strict limits on the firm’s 42 See id. § 2.6(f). 43 See id. § 2.6(g). 44 Id. § 2.6(h). 45 ArchKey, 302 A.3d at 996 (cleaned up). 46 Ray Beyond Corp. v. Trimaran Fund Mgmt., L.L.C., 2019 WL 366614, at *7 (Del. Ch. Jan. 29, 2019) (“Arbitration provisions typically include procedural rules affording each party the opportunity to present its case; indeed, this is viewed as a ‘defining characteristic’ of arbitration provisions.” (citation omitted)). 17 determinations.47 A final signal is that the disputes are to be resolved without a hearing.48 The statement that the accountant’s decision is enforceable as an arbitration award points in the opposite direction and deserves weight. But “labels are not dispositive,”49 and an arbitration label does not change what the accountant was empowered to decide. Nothing else in the Independent Accountant Procedure suggests arbitration.50 The Buyer itself acknowledges the provision “is more akin to an expert determination than an arbitration provision.”51 Reading the provision as a whole, the Independent Accountant Procedure calls for an expert determination. 47 See MIPA § 2.6(h) (establishing the Collar); id. § 2.6(b)(ii) (setting a $6 million ceiling for the Earnout Payment). 48 ArchKey, 302 A.3d at 996 (“A legal arbitration generally involves one or more hearings at which evidence is presented . . . . An expert determination need not involve a hearing.”). 49 LG Land, LLC v. Dreamers Finders Hldgs., LLC, 2026 WL 939223, at *5 (Apr. 7, 2026) (quoting Paul v. Rockpoint Gp., LLC, 2024 WL 89643, at *10 (Del. Ch. Jan. 9, 2024)). 50 See Conlon v. CGI Mfg. Hldgs. LLC, 2026 WL 1831266, at *9 (Del. Super. June 15, 2026) (holding that a “provision that states that the decision is enforceable as an arbitration award” does not transform an expert determination provision into an arbitration provision without additional signals that the parties clearly intended to do so). 51 OB at 21. 18 C. What Disputes Does The Independent Accountant Procedure Cover? Because the Independent Accountant Procedure is an expert determination, the court must interpret the Agreement to determine what authority the independent accountant possesses.52 The parties disagree over: • Whether the Buyer breached the Negative Covenant; • Whether the Buyer breached the Reasonable Efforts Covenant; • Whether the Buyer breached the Information Right; • Whether the correct measurement period is the Recurring Revenue Period or the Earnout Period; and • Whether the Buyer included all qualifying income in its Recurring Revenue calculation. The Agreement calls for the independent accountant to address unresolved Items of Dispute.53 It defines those items as “items of disagreement related to the Earnout Payment.”54 The Earnout Payment turns on Recurring Revenue.55 The Collar limits the independent accountant’s resolution of Items of Dispute.56 Under the plain language of those provisions, the independent accountant can address “items of disagreement related to the Earnout Payment.” That phrase might 52 Terrell, 297 A.3d at 617. 53 See MIPA § 2.6(h). 54 See id. § 2.6(f). 55 See id. § 2.6(b). 56 Id. §2.6(h) (providing that determination “shall not be less than the lowest or greater than the greatest amount . . . submitted by the Parties[.]”). 19 initially seem broad, but it is anchored to the Earnout Payment. That payment in turn involves a limited calculation based on Recurring Revenue. The independent accountant can determine how much Recurring Revenue there was, including resolving disputes over GAAP and deciding whether particular revenue was properly excluded, deferred, diverted, or forgiven. The independent accountant can also interpret terms closely tied to the calculation task, but its authority goes no further.57 A court must decide what measuring period the Agreement requires and whether the Buyer complied with the Information Right or breached the earnout covenants. Once the court has made those determinations, the independent accountant can resolve the technical accounting issues and calculate Recurring Revenue. 57 Paul, 2024 WL 89643, at *11–12 (explaining that the accounting expert’s grant of authority did not encompass major legal issues like contract interpretation); ArchKey, 302 A.3d at 997–98 (holding that accountants may interpret terms closely tied to their calculation task, but it does not make accountants plenary adjudicators of covenant breaches or equitable remedies); AM Buyer, LLC v. Argosy Inv. P’rs IV, L.P., 2024 WL 4024980, at *12 (Del. Super. Sept. 3, 2024), aff’d, 345 A.3d 958 (Del. July 23, 2025) (TABLE) (holding that an accountant could resolve a books-and- records issue as an input to determining the earnout amount but emphasized that the remedy was for the specific purpose of resolving the earnout dispute and “not for any legal purpose.”); cf. Belknap Hldgs., LLC v. Midwest Prototyping, LLC, 2024 WL 4441958, at *6 (Del. Super. Oct. 8, 2024) (“The more closely related the term or provision is to the expert’s area of expertise, the more likely it is that an expert can interpret the term without judicial assistance.”(citation omitted)); see also Knight Broadband LLC v. Knight, 2022 WL 1788855, at *16–17 (Del. Super. June 2, 2022) (distinguishing between a dispute that implicated contract interpretation as properly before the court versus one that hinged on an accounting issue and was reserved for the accounting expert). 20 Based on the Sole Recourse Clause, the Buyer argues any dispute connected to the earnout must go to the independent accountant, including the Seller’s breach of contract claims. The Sole Recourse Clause provides that “the Parties’ sole recourse in the event of a dispute in respect of [the earnout], including any failure to pay the Earnout Payment, shall be limited to the provisions of [the earnout].”58 Well-settled principles of contract interpretation require a court to “read the instrument as a whole” and “reconcile all provisions of the instrument.” 59 The Sole Recourse Clause does not say that the parties’ sole recourse is to the Independent Accountant Procedure. Instead, it limits the parties’ recourse to the rights and remedies available in the sections of the Agreement governing the earnout. For example, the earnout section contains a provision that exculpates the Buyer and its affiliates for certain types of damages.60 The Buyer’s reading of the Sole Recourse Clause fails to give effect to that provision.61 The Collar already constrains the independent accountant’s determinations, so the Exculpation Provision would have no work to do because the accountant could not award damages anyway. 58 See MIPA § 2.6(h). 59 Elliott Assocs., L.P. v. Avatex Corp., 715 A.2d 843, 854 (Del. 1998). 60 See MIPA § 2.6(k). 61 E.I. du Pont de Nemours & Co., Inc. v. Shell Oil Co., 498 A.2d 1108, 1113 (Del. 1985). 21 The Information Right and the Earnout Covenants provide additional examples of provisions beyond the independent accountant’s ken. Routing disputes over those provisions to the independent accountant would render them toothless. The independent accountant cannot order specific performance to enforce the Information Right or craft a damages remedy for covenant breaches. The Agreement contemplates that a court will resolve those disputes.62 The Buyer cites Stillfront to support its reading of the Sole Recourse Clause.63 There, a merger agreement referred any disputes over the earnout amount to an independent accountant who was referred to as an arbitrator.64 When the buyer refused to pay anything, the seller sued. In the litigation, both sides operated “under 62 On specific performance and equitable remedies, see, e.g., MIPA § 7.16(d) (stating that if “any of the Parties breaches . . . any covenant in this Agreement . . . for which the Parties hereto acknowledge that money damages may be an inadequate remedy . . . the non-breaching party shall have the right and remedy to seek . . . specific performance of the Covenants or injunctive relief against any act which would violate the Covenants . . .”); see also id. § 7.12 (stating that “the Parties shall each have and retain all . . . rights and remedies . . . including, without limitation, any actions for specific performance and/or injunctive relief or other equitable relief to enforce or prevent any violations of the provisions of this Agreement.”). On forum and venue, see, e.g., id. §§ 7.16(a)–(b) (providing exclusive jurisdiction to the Delaware Court of Chancery for “any action or proceeding arising out of or relating to this Agreement . . .” and a waiver of objection to venue); id. § 7.16(e) (stating that the “Parties intend to . . . confer jurisdiction to enforce the Covenants upon the courts of any jurisdiction within the geographical scope of such Covenants (and not just the courts located in Delaware)” provided that “the enforcement of any breach . . . shall take place in the jurisdiction where such breach . . . took place.”). 63 Fortis Advisors LLC v. Stillfront Midco AB, — A.3d —, 2026 WL 406073 (Del. Feb. 13, 2026). 64 Id. at *2–3. 22 the assumption that [the provision] was an arbitration provision and not one calling for an expert determination.”65 The Court of Chancery sent all of the parties’ claims to the independent accountant. On appeal, the seller changed course and argued that the dispute resolution provision “call[ed] for a narrow accounting-based expert determination.”66 The Delaware Supreme Court held the seller to the arbitration- based arguments it made to the Court of Chancery and affirmed.67 In this case, the Seller has argued from the outset that the Independent Accountant Procedure calls for an expert determination, and the Buyer has come close to conceding the point.68 Nothing like Stillfront happened in this case. Stillfront also turned on particular contract language that is absent here. The merger agreement provided that if the buyer breached the earnout covenants by acting in bad faith to reduce the earnout, then the seller would receive the maximum earnout amount.69 The Delaware Supreme Court held that because the accountant was tasked with calculating the earnout amount, it made sense for the accountant to 65 Id. at *5–6. 66 Id. at *5. 67 Id. at *6 (“Fortis was emphatic that the parties agreed to submit the earnout dispute to arbitration. At oral argument on Stillfront’s motion to compel arbitration in the Court of Chancery, Fortis’s counsel repeatedly referred to § 2.14 as an arbitration provision . . .”). 68 OB at 21 (“[W]hile Section 2.6 outlines a provision that is more akin to an expert determination than an arbitration provision . . .”). 69 Stillfront, 2026 WL 406073, at *3. 23 act as arbitrator and calculate the remedy for a bad faith breach.70 Whether that argument would have carried the day without the seller’s concession is an open question. In any event, the Agreement does not contain anything resembling that remedial mechanism. The Agreement does cap the Earnout Payment, but does not link the capped amount to a covenant breach.71 The Agreement also does not specify a remedy for breach of the Information Right. A court must address those issues.72 In terms of the parties’ disputes, the court must decide whether the Buyer breached the Reasonable Efforts Covenant or the Negative Covenant. The court must decide whether the Buyer breached the Information Right. The court must decide whether the correct measurement period was the Recurring Revenue Period or the Earnout Period. Once those issues are resolved, the independent accountant can determine whether the Buyer included all qualifying income in the Recurring Revenue calculation. The motion to send the Seller’s c