Delaware Court of Chancery: Restrictive Covenants Unenforceable, Motion to Dismiss Granted

IN THE COURT OF CHAN CERY OF THE STATE O F DELAWARE BluSk y Re stora tio n Co ntra ctor s, LLC, Plain tiff, v. John Da vid R obbins an d Chri stophe r J. Popw ell, Defe nda nt s.)))))))))))))) C.A. No. 20 25 - 0726 - DH REP ORT Report: Mar ch 4, 2026 Date S ubm itte d: Ja nuary 12, 2026 John T. Mira glia, Brian M. Ro stocki, REED SMI TH LLP, Wilm ingto n, Dela ware; Adam M assaro, REED S MITH LLP, Denver, Colorado; Attor ney s for Plaint iff BluSk y Res tor ation C ont ract ors, LLC. Aaron R. Sim s, Ryan M. Crow ley, POTTER AN DERSON & CORROON LLP, Wilm ingto n, De lawa re; T imot hy K. Ga rre tt, Hu nter K. Yoc hes, BASS, BERR Y & SIMS P LC, Nash ville, Tenne ss ee; Attorne y s for Defe ndant s John Da vid Robb ins and Ch ristoph er J. Popw ell.

2 HUME, IV, M. The par tie s’ squa bble is a clas sic on e. O ne s ide se ek s to up hold restr ic tive cove nant s while the ot her si de arg ues the cov enan ts’ over brea dth. Plain tiff i s a nati onw ide restor at ion fir m tha t purc hase d the Defend ants ’ reg iona l rest ora tion bu sine ss i n Tenne s see. The sale a greement, along with a con temporaneou s employm ent agree me nt and su bse quen t incen tiv e unit agr eeme nt, al l conta ine d restr ic tive coven ants. Plain tiff alle ges tha t Defe nd ants ha ve v iola ted t he res trict ion s and breac hed th ose a gree men ts. Plai ntiff seek s a preli minar y inj uncti on. Defen dant s coun ter tha t the restr ic tive c oven ants ar e u nenfor cea ble, and t hat Pla int iff’ s cla ims shoul d be di sm isse d. I addre ss t he Mo tion to Di smis s fir st bec ause if the re str ict ive covenants are deemed unenforcea bl e then the pre limi nar y injunc ti on can not suc cee d. For the rea son s belo w, I fi nd the re stri cti ve coven ant s unenf or ceab le and gr ant t he Defe nda nts’ M otio n to Dis miss.

3 I. BACKG RO UND 1 Plain tiff BluS ky R es torat ion C ontr act ors, LLC (“Bl uSk y” or Plai ntif f) is a nati onal re stor at ion c ontrac tor “wi th loc ati ons c oast to coa st. ” 2 This in cludes 60 corpor at e and r eg iona l offi ces i n 27 stat es. 3 BluS ky pr ovi des c omme rcia l an d reside ntia l “m itig ati on, c onstr uct ion, renova tio n, ge nera l cont rac ting, envir onme nta l, ro ofi ng and c atas trop he r espo nse ser vic es. ” 4 This includ es “ind ustr ial, he alth car e, mult i - fam il y, go vernm ent al, a nd re side nti al se cto rs.” 5 Defe nda nts Jo hn D avid R obb ins (“Ro bbins”) an d Chr ist opher J. P opwe ll (“Popw ell”) 6 c o - foun ded S harp, Robb ins & Popwe ll, L LC (“S RP”), a Ten ness ee - 1 I draw the following facts from the Ame nded Verified Complaint (Docket Item (“D.I.”) 51 [hereinafter “Am. Compl.”]) and Exhib its attached thereto. I refer to the parties’ briefing as follows: OB (Opening B rief in Support of Motion for Pr eliminary Injunction), AB (Defendant’s Om nibus Answering Brief to Plaintiff’s Motion for Prelimina ry Injunction and Openi ng Brief to Its Motion to Dismiss), RB (Plaintiff’s Combined Answering Brief in Opposition to Defe ndant’s Motion to Dism iss and Reply Brief in Further Support of Pl aintiff’s Motion f or Preli minary Injunction), an d SRB (Defendant’s Reply Brief in Fur ther Support of Their Motio n to Dismiss). A final transcript has not been completed as of this wr iting, so references to the Draft Transcript are listed a s “Draft.Tr. _. For purposes of the M otion to Dismiss, I do not consider facts fo und in the Motion for Preliminary Injunction, responses to the Motion or any exhibits t hereto. 2 Am. Compl. ¶ 2. 3 Id. ¶ 40. 4 Id. ¶ 2. 5 Id. 6 Robbins and Popwell will also be referred to collectively as Defen dants.

4 based restora tion and mi tigation business. 7 Robb ins a nd Po pwel l were SRP’ s Vic e Pres iden ts an d over saw S RP’ s opera tio ns, financ es, a nd str at egy. 8 A. BluSky Acquires SRP in 2019 and Defenda nts Sign the Equity Purchase Agr eemen t. On Dece mber 20, 201 9, BluS ky ac quir ed SR P thro ugh an E qui ty Purc has e Agree men t (“EP A”) for a purc hase pric e descr ibe d in the “ten s of m illio ns.” 9 BluSk y in tegra ted S RP’s bus ines s int o its nati onal platf orm. 10 The E PA cont ained restr ictive c ovenants covering non - competitio n and non - solici tati on for Rob bins a nd Popwe ll. 11 B. Defendants Become BluSky Employees and Sign Employm ent Agreement s That same day, R obb ins a nd Po pwe ll also e nter ed i nto Em plo yme nt Agree men ts (“ EA”) wi th Bl uSk y. 12 Robb ins a cce pted a role as Se nior Vic e Pres iden t and P opwe ll o btai ned a p osit ion as Regiona l Vice Pre side nt. 13 Robbi ns’ posit ion i nclu ded m itig atio n, ex pan sion of the hea lth care por tion of BluSky ’s 7 Am. Compl. ¶ 3 8 Id. ¶ 5. 9 Id. ¶¶ 4, 49; Am. Compl. Ex. A. 10 Am. Compl. ¶ 55. 11 Id. ¶¶ 6, 64. 12 Am. Compl. Ex. B a nd C. Robbins’ and Popwell’s Empl oyment Agre ements are similar and will be referred to j ointly. 13 Am. Compl. ¶ 52.

5 busin ess, and s trate gic trai nin g. 14 Popw ell’s c ap acit y inc lude d “a ll as pects of busine ss in B luS ky’s m idsou th re gion. ” 15 The EAs cont ained non - co mpetition, non - solic ita tion, and c onf ide ntia lity pr ovis ion s. 16 C. BluSky ’s Parent, KPSK Y, G rant s Ince ntive Units t o Defen dan ts i n an Agre em ent C ontain in g Restr ict ive C oven ants After SRP ’s p urcha se in 20 19, Rob bins a nd P opwe ll w orke d f or Bl uS ky for almos t five year s. 17 In 2022, Bl uSky’ s par ent, KPSK Y 18, con ferred 396 I ncentive Units o n Robb ins an d 795 In ce ntive Units on P op well (t he KPS KY Agr eeme nts). 19 The KPS KY A gre eme nts c onta ine d a Res trict ive C ove nan ts Agr eeme nt (t he “RCAs”). 20 The RC As con tain ed non - comp etition, n on - solic itation, and confi dent iali ty re str icti ons, i nclu din g retu rn of mate ria ls. 21 14 Id. ¶ 53. 15 Id. ¶ 54. 16 Am. Compl. Ex. B and C, §§ 6 and 5, res pectively. 17 Am. Compl. ¶ 61. 18 Id. ¶ 2. BluSky is an i ndirect, wholly ow ned subsidiary of KP SKY Holdings L.P. 19 Id. ¶ 76. 20 Id. ¶ 77; Am. Compl. Ex. D and E. Robbin s’ and Popwell’s KPSKY Agreements an d RCAs are similar and will be referred to jo intly. 21 Am. Compl. Ex. D an d E §§6, 5, and 1.

6 D. Defen dant s Le ave Blu Sky and For m Mid south Prope rty Maint enan ce Robb ins an d Pop wel l sub mitte d the ir re sign atio ns o n Septe mb er 11, 202 4. 22 Robbi ns’ s la st da y wa s to be N ovem ber 1; Pop well’ s was O ctobe r 18. 23 They forme d their new en tity, M ids outh Pr oper ty Main tena nce, LLC (M PM), on or abou t Octo ber 3, 2 024. 24 MPM is a Te nnes see li mite d lia bilit y com pan y that pr ovi de s restor at ion, r eco very, an d en viro nme ntal serv ice s to damage d pro perties. 25 M PM has off ices i n Ten nesse e an d offer s services simila r to BluSky ’s. 26 Defe ndants reta ined thousa nds of BluSk y file s aft er t hey re sig ned f rom t he c ompa ny. 27 E. Proce dural Post ure BluSk y file d a Ver ifi ed Ame nde d Compl aint o n Oct ober 2. 28 BluSky a lle ge d breac h of c ontr act ag ains t Robb ins a nd P opwe ll (Co unt s I and I I, r espec tive ly) f or viola ting t he non - compe titio n and non - sol icita tio n prov ision s of the EP As. 29 It sought injunct ive relief p rohibiti ng Robbins and Popwe ll from “operatin g Midsouth 22 Am. Compl. ¶ 85. 23 Id. 24 Id. ¶ 86. 25 Id. ¶19. 26 Id. ¶¶ 19–20. 27 Id. ¶22. 28 D.I. 51. 29 Am. Compl. ¶¶ 93 –99, 102–08.

7 Prope rty in the same restor at ion in dus try an d geo gra phic area s as Bl uS ky or solic itin g Bl uSky ’s cur rent, rec ent, a nd p rospe ct ive cu stom ers for the rest ric tive perio d of two ye ars”, or com pe nsat ory da mage s in the a lter nati ve. 30 Coun ts III and IV cla imed R obbi ns and P opwe ll violat ed the no n - competi tion, n on - solicit ation and non - disclo sure c ondi tion s in the EAs by Ro bbin s and Pop wel l. 31 BluSky ag ai n sought injunc tive re lief or c ompensato ry damage s for th ese inf ractions. 32 Finall y, Coun ts V an d VI allege d tha t De fend ants d efi ed th e non - com pe titio n, n on - solic itation, conf ide ntia lity, and “Ret urn of Mater ials” prov isos in t he KPS KY RCAs. 33 As with the o ther coun ts, B luSk y soug ht in junc tive re lie f or com pe nsat or y dama ges. 34 BluSk y file d a Mo tion f or Pre lim inar y Inju ncti on and Open ing B rief i n suppor t the reof on Oc tober 1 3. 35 BluS ky c laim ed t hat Defe ndan ts vi ola ted the restr ictive co vena nts in the EPAs, the E As, and the R CAs. It so ught t o enj oin Defe nda nts from usin g or dis clos ing c onfi dent ial B luSk y inform at ion, f rom 30 Id. ¶¶ 100–01, 109– 10. BluSky conceded at oral argument that the restrictive covena nts have lapsed, so it can n o longer seek injun ctive relief. Draft Tr. 47:7-13. 31 Am. Compl. ¶¶ 1 11– 18, 121–28. 32 Id. ¶¶ 119–20, 129–30. 33 Id. ¶¶ 131–38, 141–48. 34 Id. ¶¶ 139–40, 149–50. 35 D.I. 57.

8 solic iting BluS ky customer s and employe es, and using MPM to compet e unfairly with B luSky. 36 On October 15, Ro bbi ns an d Popw ell f ile d a Motio n to Dism iss t h e Verif ied Ame nde d Com plai nt. 37 Combin ed br iefi ng o n the M oti on for P rel imi nar y Inju ncti on and M oti on to Dism iss too k pla ce. 38 Defendants argu ed that the breach of con trac t coun ts s hould b e dism isse d be cause the re str ic tive c ovena nts a re unenforceab le. 39 Robbin s and Popwe ll co nte nded that t he res tric tive c ove nan ts do not pro tect a ny legi timate BluS ky bus ines s intere st an d are overl y broa d in geogr aphi c, te mp oral, an d subs tant ive s cop e. 40 Defe nda nts ur ged the Co urt t o re sis t the ur ge to b lue penci l any un enforce able provisio ns. 41 Becaus e the restrictive coven ants we re une nf orcea ble, Defend ants m aint aine d that Bl uSky co uld no t sho w a reaso nab le pr obab ility of succee din g on t he pre limi nary i njun cti on. 42 Conver sely, BluSk y insi sted t hat the co nfid enti alit y prov ision s and non - compe tes an d non - solic its we re e nforc eable an d not ne arly a s broa d as Def en dant s wou ld lea d the Cour t 36 OB at 3– 4. 37 D.I. 58. 38 D.I. 57, 62, 67, 70, 72. 39 AB at 32. 40 Id. at 33, 35. 41 Id. at 37. 42 Id. at 38.

9 to bel ieve. 43 BluSky prop osed t hat th e Co urt cou ld bl ue pe ncil any ove rly - br oa d prov ision s given t he co nside rati on paid a nd Defe nda nts’ legal represe nta tion a nd awar enes s of the res tric tion s. 44 The Court hea rd argu ment on both motions on Januar y 12, 20 26. II. ANAL YSIS A. Robbin s and Pop well’ s Mot ion t o Dis mis s. Defe nda nts move to d ismi ss the Ver ifie d Am ende d Com pla int und er Co urt of Chanc ery R ule 12(b)(6) for fai lure to s tate a cl aim u pon whic h rel ief can b e grante d. 45 The stan dar d for a Rule 12(b)(6) mot ion is fam ilia r to the pa rtie s: “(i) al l well - plea ded fa ctua l all egat ion s are acc ept ed as tr ue; (i i) ev en vag ue alle gat ions a re ‘well - plea de d’ if the y give the o ppos ing party noti ce of the cl aim; (iii) the Co urt must d ra w al l rea sona ble infer ence s in f avor of t he no n - moving party; and (iv) dism issa l is inap prop riat e unle ss ‘t he plai nti ff woul d not be e ntitl ed to rec ove r under any re ason abl y conce iva ble se t of cir cums tanc es s uscep tib le of pr oof.’ ” Savo r, Inc. v. FMR C or p., 812 A.2d 894, 896 - 97 (D el. 2002) (citing Kof ron v. Amo co Chems. Corp., 44 1 A.2d 226, 227 (Del. 198 2)). 43 See RB. 44 RB at 39 45 D.I. 58.

10 The re aso nable c on cei vabi lity s tanda rd grant s a pla int iff “a ll re aso nabl e infer ence s tha t lo gica lly f low f rom the fac e of the c om plai nt” b ut doe s n ot ob liga te the C ourt “ to a cce pt e very s tra ine d inte rpre tat ion of the [p lain tiff’ s] all ega tion s.” In re Gene ral Moto rs (H ughe s) S ’ holder Lit ig., 897 A.2d 1 62, 168 (Del. 20 06) (quot ing Malpie de v. To wnson, 780 A.2 d 1075, 10 83 (De l. 2 001)). The Co urt will “ ignor e concl usor y alle gat ions tha t lac k spec ific sup port ing fact ual a lleg ati ons.” FM LS Hldg. Co. v. Integr is Bi oSer vices, LLC, 2023 W L 72 972 38, at * 5 (De l. Ch. Oc t. 30, 2023) (quoting Ramunno v. Cawley, 705 A.2d 102 9, 103 4 (Del. 19 98)). B. Th e EPA is U nenforceab le B ecau se of its O verbreadth. The Co urt dec line s to mec ha nica lly e nfor ce re stric tive c o ven ants, inst ead subje cti ng the m to in creas ed sc rut iny be cause the y are “re str ict ive of tr ad e.” Fa w, Cass on & C o. v. C ran ston, 375 A.2d 4 63, 466 (Del. Ch. 197 7). Rathe r, the coven ants mus t me et the f ollo wing thre e - el emen t test: (1) The restr icti ve cove nant s have reasona ble te m poral a nd ge ogr aph ic sco pe; (2) t he cov ena nts a dvanc e the legi timate eco nomic inte res t of the party se eki ng the ir enf orce men t; and (3) the covena nts surv ive a balancin g of the equit ies. Kodia k Building Partne rs, LLC v. Adams, 20 22 W L 52405 07, a t *4 (De l. Ch. Oc t. 6, 20 22). The r estr icti ve c ovena nt s in the EP A arose as part of BluSk y’s pu rc hase of SRP. R estri ctive cove nant s are subje ct t o a le ss sea rchi ng i nquir y in the s ale of a b usin ess t han in an empl oyme nt contra ct. Tristate Cou rier and Car riage, I nc. v. Be rrym an, 2004 WL 835 886, at *10

11 (Del. Ch. A pr. 1 5, 200 4). “Al thou gh re lati vely broad r es trict ive c ovena nts have bee n enfor ced i n the sa le of a bu sine ss co ntex t, such cov ena nts m ust be ta ilore d to th e compe titi ve spa ce r eac hed b y the se ller a nd ser ve the buye r’s le giti mat e eco nom ic intere sts. ” Inte rtek T est ing Se rvs. NA, Inc. v. East man, 2023 WL 2 544236, a t *4 (Del. Ch. Mar. 16, 2023) (citations omitte d). 1. The EP A Non - Comp et e BluSky alleges Def endants imp roperly c ompeted by “ diverting cus tomers to a kno wn co mpet itor” and by ope rat ing M SM, a dire ct co mpet itor of B luSk y in the same g eogra phic area in whic h Ro bbi ns pr evio usly se rve d as a sen ior ma nag er for BluSky. 46 The EPA No n - Com pete pr ovisi on i s fou nd at s ecti on 5.0 4(a)(iii): (a) In consi dera tio n of the tra nsa cti ons co nte mplat ed by t his A gree ment, duri ng the p erio d fro m the Cl osing Date to the da te tha t is fi ve (5) years after the C losi ng Da te, ea ch Se ller shall no t, and s hall cau se the ir respective Aff iliat es not to: (iii) d irectly or i ndir ectly (inc lud ing as a propri etor, princ ipal, agent, par tner, of fice r, direc tor, equi tyho lder, em ploye e or otherw ise) (A) op erate, en gage in (or as sist othe rs t o enga ge in), co nsult wit h, acquir e, partic ipat e in, prov ide ser vices to, be empl oyed by, mana ge, contr ol or own (or pa rtic ipat e in t he m anage ment, co ntro l or o wne rshi p of), or hold any C ompeting B usiness a nywher e in t he Re stri cted A rea or (B) ac quire (thr ou gh merge r, st ock p urcha se or purcha se of all or subst antially all of the asse ts or othe rw ise) the owner ship of, or a ny equi ty inte rest i n, any Per son unaff ilia ted wi th the C ompa ny G roup if such Pe rson der ives reve nues of fiv e perce nt (5 %) or m ore from any Compe ting Busin ess and, pro vided, tha t suc h Pers on shal l not, at any 46 Am. Compl. ¶ 96.

12 time, der ive r even ues of f ive p erce nt (5 %) o r mor e fr om a ny Co mpet ing Busi ness. “Com pany Gro up” i s def ined as “ the Co mpany an d an y of i ts Su bsidia rie s.” 47 The “Re stri cted Ar ea” is “an ywhe re in the world.” 48 “Com pet ing Bus ines s” is “a ny Pers on, bu sine ss, or subd ivision of a bus ine ss of t he ty pe and c haracter e ngaged in the B usiness or an y su ch pe rso ns w hich is ac tive ly p lann ing to engage in th e Busi ness. ” 49 “Res trict ive c ovenan ts in c onnectio n with the sale of a busine ss legitim ately protec t only t he pur cha sed as set’ s goodwil l and compe tit ive s pace that its em plo yee s devel oped or ma inta ine d.” Kodiak Bui lding P’ rs, LLC v. Adam s, 20 22 WL 5 240 507, at *1 0 (Del. Ch. Oct. 6, 202 2) (cita tions omi tted). The purpo se of the non - compete is to pr otect B luSky’ s intere st in SRP’ s good wil l and com petiti ve spa ce. SR P was Tenne ssee - base d. 50 Thus, B luSky ha s a legi tima te protec tive inter est in the r egio na l footprint of SRP (the mid - sou th re gion). BluSk y inte grate d SRP into its nati ona l platf orm. 51 BluSky paid “te ns of mill ions” to pr otec t its inve stme nt in SRP. But t he EPA non - compe te provi sions g o far beyond B luSky’ s legi tima te busines s intere sts 47 EPA section 1.01. Th e “Company” is S RP. See Preamble to the EPA. 48 EPA section 1.01. 49 Id. 50 Am. Compl. ¶ 3. 51 Id. ¶ 55.

13 in SRP ’s goodw ill and b usine ss footpr int. SR P was a r egio nal b usine ss. Yet the EPA p reve nts D efenda nts fr om compe ting with BluSky wor ldwide. T he Ver ified Amen ded Compl aint notes t hat “[d] ef en dant s were proh ibite d from com peti ng, direc tly or indi rectly, or ass istin g another to comp ete, wit h any of BluSky’s busine ss line s.” 52 BluSky ’s busine ss lines ar e nati onw ide. Aga in, this i s well outs ide t he bound s of Bl uSky’ s legitim ate bu sine ss interes t in SRP’ s regiona l span. A worl dwide ban i s beyo nd eve n BluSky’ s nat ionwi de busines s footpri nt. BluS ky point s the Cour t to t he EPA’ s pro visio n where th e Defe ndants a cknowled ge that t he restrictiv e covenants are rea sonable in sc ope, durat ion, and ge ogra phy. 53 But this Court h as sh unned per func tory a ccep tance of the se arran geme nts. Re stric tions on compe tition ar e ma tter s of pu blic pol icy an d re quir e the Cour t “t o eval uate nonc ompe tition an d non - sol icit ation contr acts holi stically, ca reful ly, and nonme chanica lly, with an e ye t owar ds reas onab lenes s, equi ty, a nd the ad vanc eme nt of legi timate b usine ss int ere sts.” Kodia k Bu ilding P ’ rs, LLC, 2022 WL 5240 507, at *8 (Del. Ch. Oct. 6, 202 2); FP UC Hldg s., LLC v. Ha milton, 2020 WL 1 492783 (Del. Ch. Ma r. 27, 2 020). Def endants’ con tractu al stipul atio n to the re asonab lene ss of the r estr icti ve c ovena nt’s scop e ca nnot c ompe l the Cour t to a dmit i ts 52 Am. Compl. ¶ 65. 53 EPA § 5.05.

14 reaso nabilit y. The EP A’s non - com pete goes bey ond B luSk y’s legit ima te bus ines s intere sts in SRP and is unre as onab le. I next t urn t o whether the tem poral and geogr aphic sc ope of t he EP A non - compe te was re asona ble. Cour ts cons ider th e inte rpl ay bet wee n restr ictions “syner gistica lly” and “‘a cour t mu st co nside r how the tempor al and geo gra phic restr ict ions op erat e toge ther ’” bec ause the “‘t wo dimensi ons neces saril y inter act.’ ” Sunde r Ene rgy, LLC v. Jacks on, 305 A. 3d 723, 753 (De l. 2023) (quoting Del. Elevato r, Inc. v. Williams, 2011 W L 1 0051 81, at * 8 (Del. Ch. Mar. 16, 2011)). Th at intera ction m eans th at “a longe r res tric tive coven ant wi ll be m ore rea sonable if geogr aphical ly tem per ed, an d a re stric tive coven ant cover ing a broa der ar ea wi ll be more r eas ona ble if t em pora lly ta ilor ed.” De l. Elev ator, Inc., 2011 WL 100 5181, at *8 (D el. C h. M ar. 16, 20 11). T he EPA re stric tive cove nant s were f or a peri od of five years. 54 The geogr aphic sco pe was worldwi de. This C ourt’s re ason ed ana lysi s in Inte rtek serves a s guidance. Ther e, t he Cour t found a sim ilar five - year wor ldwide non - compe te une nfo rceab le due to th e inc ongruit y bet ween t he provis ion’s worl dwide geo grap hic scope an d the ac quired bu siness’ na tional se rvice ar ea. Inter tek Te sting Serv ices NA, 2023 WL 254423 6, at *4. Here, the restr icted area is worldw ide. BluSky’s bus iness lines are nat ionwide. Y et S RP’ s sphe re wa s only 54 EPA ¶ 5.04.

15 regio nal. Under t he circum sta nces, a five - y ear limitatio n with thes e dis cordant physic al bounda ries i s unju stif ied. The EP A non - compe te is unreasonabl e bas ed on its ge ogra phic and te mporal o verbr ead th. The non - com pete do es no t surv ive a ba lanc ing of the eq uitie s. B luSk y argue s tha t Defe nda nts were “ paid ten s of mill ions” and “ han dsome ly com pensate d” in the SRP pur chase. 55 That i s a signi fica nt sum. But is i t substa ntial con sider atio n? I look a gain to Intertek on balanc ing t he eq uiti es. The re, th e sel ler rec eived te n mill ion do llars for his busine ss inter est. I nter tek, 202 3 WL 2544236, at * 1. But th e non - compe te reac hed market s not serve d by the acqu ire d busi ness. ” Id., at *4. Where Bl uSky’ s ar gume nt fa lls s hort is t hat t he “te ns of mi llio ns” c ompensa ted Defe nda nts fo r SRP’ s goodw ill a nd co mpet itive spac e, not Blu Sky’s. B luS ky doe s not su ggest tha t SRP wa s a nationa l compa ny. I t wa s no t. BluS ky pai d for S RP’ s regio nal rea ch. That was wor th “tens of mill ions. ” B ut tha t amoun t doe s no t compe nsate Defe ndants f or the o ver broa d non - com pete in the E PA that cove rs va st terr itor y outs ide of SRP ’s re ach. Even in a sa le of the busine ss conte xt, i t i s unenforceab le. 55 Am. Compl. ¶ 49

16 2. The EP A Non - Solicits BluSk y arg ues tha t Defenda nts vi olate d the EPA non - s olic its w he n they active ly solic ited B luSky c ustom ers. 56 The E PA contained n on - solic itation restr ictions. Those r ead as fol lows: (a) In c onsidera ti on of t he tra nsac tio ns con temp lated by this Agree men t, dur ing t he perio d from the C losi ng Da te to t he da te that is five (5) year s after t he Clo sin g Date, eac h Selle r sh all n ot, a nd sha ll cause their r espective A ffiliate s not to: (i) eit her al one or in co ncert with o thers, direc tly or indire ctl y, (A) rec ruit or hir e or otherwise soli cit for em ploym ent (or a ssist a ny other P erso n unaffi liated with t he Com pany Grou p in en gagi ng in a ny such ac tivities), any Person wh o is or wi thin t he twelve (12) mon th perio d imm edia tely prior to the Clo sing Date, was a n empl oyee or inde pend ent co ntra ct or of a ny mem ber of the Compan y Group or (B) other wise ind uce or attempt t o induc e (or as sist a ny ot her Pers on unaff ilia ted wi th the Com pany Gro up in en gagin g in an y suc h activ itie s) an y empl oyee of the C ompany or any of i ts Subsid iarie s to term inate such P ers on’s e mpl oyme nt wi th Purc haser or its Af filia tes, or tort iousl y interfer es with t he re lati ons hip be twe en Pur cha ser a nd it s Affil iates, on the one ha nd, a nd any suc h employe e, of fice r or d ire ctor on the othe r han d; (ii) d irectly or i ndir ectl y, on its or t heir own be half o r on beha lf of any other Per son u naff ilia ted w ith t he Com pany Gro up, (A) p ersuad e or atte mpt t o pers uad e, any c ustom er or cli ent or p oten tial c usto mer or clien t of the Compa ny Group to w hich a mem ber o f the Com pany Grou p has ma de a pre senta tion, or wi th whic h a mem ber of the Compa ny Group ha s had disc ussion s (eac h, a “Custo mer”), no t to h ire Purc haser or it s Affi liate s or to hire a nother c ompan y in re lat ion to t he goods a nd serv ices prov ided by t he Bu s ines s, (B) i n any wa y inten tionally or know ingly in terfer e with the relations hip betw een Purc haser or an y of its Aff ilia tes an d any C ustom er or busi nes s 56 Id. ¶¶ 96, 105.

17 rela tions hip, or (C) solicit or in duce an y Cus tomer of P urc haser or a ny of its Aff iliates to purch ase go ods or serv ices fr om a Com peting Busi ness in co mpet ition wit h the Com pan y, the Purchase r or any of it s Affil iates or t o aid a ny Com peting B usine ss in id entifying or solic iting any suc h Custom er; provid ed, ho wever, that t he for ego ing res trict ion shal l not ap ply wi th respect to any p erf orm ance du ly reques ted wi th the appro val b y the b oar d or sim ilar gove rnin g ent ity of t he Co mpa ny Grou p, Purch aser or any of the ir respec tive Aff ilia tes As with the non - comp et e, Defe nda nts t ake iss ue with the no n - solicits ’ legi timate busin ess and geogr aph ic sco pes. 57 Defe ndan ts cla im tha t they ex cee d SRP’s business spher e and service area. 58 BluS ky coun ters tha t the non - sol icit s a re appro pria tely meas ured to SRP ’s b usi ness foot prin t. 59 Like the EP A non - co mpet e, the sco pe of the EP A non - solicit is bro ader than reas onab le geo gra phic ally an d to pro tec t BluSk y’s le gitim ate bu sine ss interes t in SRP. Geog raphi cally, th e non - solic it for both c ustomer s an d empl oyees c onta ins n o geogr aphic lim itat ions. This lac k of limita tion, e spe cial ly whe n cons ider ing SRP’ s region al natur e, is unre asonabl e. The n on - solicit contains other provi sions tha t are not tail ored to Blu Sky’s legi timate busi ness inter est. Th e employee non - solic it conta ins langu age p rohibiting “an a ttemp t to i nduc e” a n empl oyee from term ina ting it s re lati onsh ip wi th Bl uSky 57 AB at 51. 58 Id. 59 RB at 37.

18 and its Aff ilia tes. 60 The n on - sol icit f or custom ers sim ilarly proh ibits a n “at tempt to persua de” any cus tomer or c lien t not to h ire Bl uSky or its aff iliate s. 61 This Cour t has fou nd si milar bans to be “f atal ly ov erbr oad” b eca use the y capture n on - compe titive co nduc t. BankU nite d, N.A. v. Shu lick, 2 026 WL 21 637, at *9 (Del. Ch. Jan. 2, 202 6); s ee HKA Globa l, LLC v. Beirise, 2025 WL 36 398 11, a t *5 (De l. Ch. Dec. 16, 2025). The E PA non - soli cits a re une nfor ceab le due to thi s “a ttempt” overbr eadth. The no n - sol icit s suffe r from para llel affli ctio ns base d on their incl usio n of “affi liate s.” The EP A define s “Aff ili ates ” of a Pe rso n as: any ot her P erso n dir ect ly or i ndire ctly c ontroll ing, c ontrolle d by, or under c ommon co ntrol wit h, such P ers on; provi ded, that f or the purp oses of t his de finition, “contr ol” (inc ludi ng, with corr elative mean ings, the term s “c ontr olle d by” an d “un der c ommo n contro l with”), a s use d wi th resp ect to a ny Per son, shal l mea n the posse ssion, direc tly or indir ectly, of the p ower t o dire ct or ca use the dire cti on of t he mana geme nt a nd pol icies of s uch Pe rso n, whe ther thr ough th e owner shi p of v oting securit ies, by Co ntr act or other wise 62 Defe nda nts ar gue th at t his a ddition e ncom passes no t jus t SRP a nd BluSky, bu t the chil dren of tho se cove red (f or the sellers) a nd the up strea m an d downstr eam a ffi liat es 60 EPA § 5.04(a)(i). 61 Id. § 5.04(a)(ii). 62 Id. § 1.01.

19 of BluS ky. 63 BluSky c ounte rs tha t “affiliat es” is pref ace d by cond itions th at appro pria tely and re asonably l imit appl ica bilit y. 64 It argue s tha t the c ontrac t lang uage l imit s it to SRP cust omer s, c onta ins a s cien ter re quiremen t, an d limit s the scope of aff iliates b y incorp orating t he phrase, “fr om a C ompe ting Busi ness. ” 65 “Inc ludin g aff ilia tes in a re stric tive cove nant grea tly expand s the coven ant’ s breadt h, a nd the ref ore re quir es a br oader le gitim ate econo mic inte rest. ” Fortil ine, In c. v. McCa ll, 2024 W L 40 8862 9, at *4 (De l. Ch. Sep. 5, 2024) (ci tin g Ainsli e v. Can tor Fitzg erald, L.P., 2023 W L 106924, a t *18 (De l. Ch. Ja n. 4, 2023), rev’ d on othe r groun ds, 31 2 A.3d 674 (Del. 2024)). Aff iliates a s define d in the E PA incl ude the Defe ndan ts’ c hildr en. 66 This Cour t has found s imila r restric tio ns tha t incl ude a pe rs on’s c hil d to be exce ssive and unrea sonable. Sunde r E nergy, LLC, 305 A.3 d at 75 6 – 57 (De l. 20 23). Affi liates wo uld a lso incl ude othe r bu sine sses contr olle d by D efe ndant s but o utsi de the busi ness ar ea of BluS ky, and othe r aff ilia te s of BluS ky in its cor porate s truc ture. For i nsta nce, if Rob bins was also ow ner of a compa ny that pro duc ed paper prod uct s, and an em ployee a t that c ompa ny s ugge ste d that a friend who w orke d at a pa per c omp any i n Bl uSky’ s corpor ate structur e qu it 63 AB at 48–50. 64 RB at 37–38. 65 Id. at 38 (citing EPA § 5.04(ii)(c)). 66 “[A] ny other Pe rson directly or indirectl y. . . controlle d by. . . suc h Person. ” EP A § 1.01.

20 her job for a bet ter of fer, tha t would be violat ive con duct un der the EPA non - solicit. This e xemp lifies the ove rbre adt h crea ted b y the af fil iate a dditio n. The custome r non - solici t is s imila rly prob lematic. Tak ing our sam e hypot hetical empl oy ee at Rob bins’ pa per c ompa ny, if he r ne xt door n eig hbor is seeki ng restor at ion s erv ices a nd the Ro bbins e mplo yee, una ware tha t SRP ma de a prese nta tion to t he neighbo r, su gges ts a c ompe titor for the r estora tion, tha t wo uld viola te the cust omer no n - compe te. These seem ingl y isolate d hyp othe tical s show th e dange r that this C ourt co nfron ted i n Fortili ne — shie ldin g un specif ied and u nrela te d affi liate s incr eases th e thre at t hat the restr icte d part y will unkno win gly viol ate the letter of the cove nant. Forti line, Inc., 2024 WL 4088629, at *4. That is the risk with an over ly broa d restr iction an d why suc h rest raints ar e une nforcea ble. The ba lanc e of the equ itie s anal ysis f or th e non - s olic its i s iden tica l to that o f the non - compete. BluSky p aid “te ns of mi llions” f or SRP. B ut it is n ot the amoun t paid that c ontr ols. Ther e is n ot a brig ht li ne amo unt tha t trigger s the Cou rt to fin d a restr icti on re asona ble. The non - solic its are int ende d to protect B luSky fro m tampe rin g with it s e mpl oyee s or f rom tam peri ng w ith S RP’s cus tomer s. But th e affi liate l ang uage makes the restri ctions fa r broade r tha n necess ary, an d m ore than what is rea sonab le base d on the p urcha se price. The bal ance of equitie s fav ors Defe nda nts. The EPA non - so lici tati on prov isi ons are une nfor ce able.

21 C. The EA s are sim ilar ly unen force able becau se the geog raph ic scop e tempo ral dur ation, and sub stantive reac h are overbr oad. When BluS ky purch ase d SRP, Defe ndants e ntered i nto th e EAs t o become BluSk y employe es. 67 Robbin s beca me a Se nior Vice Pr es iden t and P opwell bec am e a Reg iona l Vice P res ide nt. 68 Indee d, the E PA and EA s were si gned t he same da y. 69 Yet each EA is a c ontr act se parate from the EPA. They ha ve their own co nside rati on and diff erent tem pora l limits tha n the EPA. 70 Defend ants were ea ch paid $300, 000 annua lly, plus the abili ty to earn bon uses. 71 1. The EA Non - Comp ete 72 The no n - competitio n porti on of the EAs read s as follo ws: 6. Non - Compe titi on and Non - Solicitation. Exec utive ackno wle dges t hat i n the c ourse of E xecut ive’s emp loyme nt with th e Empl oyer a nd its S ubsidiar ies, Exe cut ive ha s, and w ill c onti nue to, becom e fa mili ar wit h the E mpl oyer ’s and its Su bsidiari es’ Trad e Secre ts a nd with other Prop rie tary I nformati o n conc ern ing the Empl oyer a nd its Sub sidiarie s an d that Exe cuti ve’s se rv ices ha ve been and wi ll be of spe cial, unique and ext rao rdina ry va lue to the Empl oyer and i ts Su bsidia rie s. Theref ore, in f urthe r conside rat ion o f th e compe nsation t o be pa id to Exe cutive here under, Exe cuti ve agr ees t hat, witho ut limitin g any other obliga tion purs uant to th is Agre eme nt: 67 Am. Compl. ¶ 7. 68 Id. 69 Am. Compl. Ex. A–C. 70 Id. Ex. B–C. 71 Id. §3. 72 Robbins’ and Popwell’s Employment Agre ements are identical regarding the non- compete, non-solicit, a nd confidentiality p ortions, so I will refer t o them jointly.

22 (a) Non - Com pete. Dur ing the perio d that E xec utive is empl oye d with or enga ged by the Em ploye r or an y of its Subsi diaries an d for a perio d ther eaf ter of t went y - four (24) months (c ollecti vel y, th e “ Prote ction Perio d ”), Exe cutive shall n ot d irectly o r indi rectly (incl udi ng as a pro priet or, pr incipal, ag ent, partne r, off icer, dir ector, equit yholder, employee or otherwis e), either for Executiv e or for any other P erso n, (i) o perate, en gage in (or a ssist oth ers to en gage in), cons ult wit h, acquire, par tici pate i n, provid e serv ices t o, be emplo yed by, ma nage, contr ol or own (or par ticipa te in the m anag eme nt, c ontr ol or ow ners hip of), or ho ld a ny Co mpe ting B usiness a nywhere in the Restr icted Ter ritory or (ii) acquire (through merg er, stock pu rchase or purch ase of a ll or substantia lly all of the a ssets or oth erwise) th e owne rship of, or any equit y inte rest in, any Pe rson una ffilia ted with the Empl oyer a nd its Sub sidiarie s if s uch Pe rso n deri ves r even ues fr om any Compe ting Busi ness. No thing h erein sha ll pro hib it Exe cut i ve from ownin g not more t han five pe rcent (5%) of the o utstand ing stoc k of any class of a corpor at ion tha t is publi cly trade d, so lon g as Exec utive is merel y a passi ve inve stor a nd has no act ive partic ipation in the busine ss of suc h corpora tio n. 73 “Restricted Terr itory” means: any sta te, provin ce or ter rit ory in t he Uni ted Sta tes or a ny othe r coun try in whic h the Em ployer or an y of its Sub sidiarie s enga ges in t he Busi ness or a cti vely plans t o enga ge in the Busi ness d urin g th e Empl oyme nt Period (or, if the challe nged acti vit y occur s followi ng the term inat ion of Exec utive ’s em plo ymen t, th en as of t he last da y of suc h emplo yment or a t any t ime during th e twelve (12) mont hs precedi ng such dat e). 74 “Subs idiary” in clu des: 73 EA § 6(a) 74 Id. § 22.

23 any Per son of w hich (i) if a corp oration, a majori ty of the tota l votin g power of sha res of stoc k enti tled (w ith out r egar d to the occurr ence of any cont ingenc y) to vote in the elec tion of di rectors, managers, or trus tees the reof is at t he time owne d or con trolled, direc tly or indir ectly, by the Empl oyer or one or more of th e other Sub sid iaries of the Empl oyer or a combi nati on t here of or (ii) if a li mite d liabili ty c ompa ny, partne rship, as sociatio n or ot her busin ess entity (other t han a corpor ation), a majo r ity o f partne rship or oth er simi lar owne rship intere st thereof i s at the tim e ow ned or con trolled, d irec tly or in direc tly, by the E mplo yer or one or m ore S ubsid iar ies of t he Em ploye r or a combin ation th ereof and for thi s purpos e a Person or Persons owns a major ity ow nership i nter est i n such a bu sine ss ent ity (o ther tha n a corpor ation) if suc h Pe rson or Per son s sha ll be a lloca ted a maj ority of such busine ss entit y’s gains or losses o r shall be or con trol any mana ging d irector or ge neral par tner of suc h bus in ess ent ity (othe r than a cor pora tio n). F or the purpose s hereof, the term Su bsidia ry s hal l incl ude al l Sub sidiarie s of s uch Su bsi diary. The no n - com pete last s for two ye ars a fter Defe ndants se parate f rom B luSk y and is at le as t nati onwide in ge ograp hic s cope. “Restr icted Te rritory” is anyw here that B luSky or i ts subsi diari es do bus ines s. BluS ky pres ents a uni que ar gument on the re stric tive c ovenant s in the EA. BluSk y conte nds that t he EAs were e xecute d as part of the sale. 75 At the sam e time, it argues t hat Bl uSky is n ot limi ted to the ir legi timate int erest i n the SR P purcha se becau se of the e mplo yme nt co nte xt. BluSk y’s disti lled ar gument i s that i t fully b enefits f rom the le ss searchi ng in quir y 75 The EAs a ppear to be more consistent with freestanding empl oyment agreements. They are documents separat e from the EPA and provide for separate co nsideration. The onl y connection to the EPA appears to be timing. The EPA and EAs were signed on the same date. Still, B luSky alleges that they were part of the SRP sale, so I will consider th em as such for purposes of thi s decision.

24 in the co nte xt of a bu sine ss sal e, but it also rea ps th e expa nded footpr int of a stan dalo ne em ploym ent con trac t. Trista te C ourie r, 2004 WL 835886, a t *10 (De l. Ch. A pr. 1 5, 2004). But B luS ky ca nnot have it b oth wa ys. Whe n restr ictive coven ants a re par t of the sa le of a busine ss, the acqu iror’s leg itima te busine ss inte res t is the acquired company ’s compe titive r each. Inte rtek, 2023 WL 2 544236, at *4 (Del. Ch. Ma r. 16, 202 3). As w ith the EP A, the Court m ust cons ider how t he restr ict ive co vena nt’s face ts wo rk togethe r. Sund er En ergy, LLC, 3 05 A.3d at 7 53 (Del. Ch. 2 023) (“ A covena nt t hat res tricts emp loyment i n a sim ilar i ndu stry f or tw o year s migh t be rea son able if it only a pplie s within a si ngle t own or co unty, and vic e versa. All e lse equa l, a lon ger restr ict ive co venan t will be more re asonab le i f g eogr aphi call y tem pe red, a nd a broa der r est ricti ve c oven ant will be more r easo nable if temp orall y tail ore d.”). The EA non - comp ete suffe rs fr om some of t he same m alad ies as the EPA non - compe te. Al though sh orter, it a lso prov ides subs tan tiall y le ss cons idera tion. It far exceeds SRP’s compet it ive space. SRP was a regional compa ny. BluS ky ext ols it s bus ines s rea ch as c oast to coa st. The ration ale for limi ting B luSk y’s r each t o SRP’s com petitive space is th e same here as i t was for the EP A. In the sal e of a busi ness conte xt, B luSk y has no le giti mate busin ess in tere st in pr otec ting itse lf fr om co mpe titio n i n the ma ny areas t hat SRP did not se rve. Like the EPA non - com pete, the EA non - com pete is ove rl y broa d and unenf orceable.

25 The balanc e of the equ itie s ana lysis va ries s lightly f rom that with the EPA. Plainti ff cla ims that t he EAs w ere ma de as par t of the sale of the b usi ness. But t he E As ha ve se parate c onsi dera tio n, so t he “te ns of mi llion s” consi dera tio n argum ent is inap plica ble. Each EA aw arded De fen dants a sala ry of $30 0,000 pe r year pl us the pos sibil ity of integra tio n bonuse s in 2020 an d 2021 an d annual bo nuse s begi nning in 2020. Th is co nsi dera tion d oes n ot com pensate Defe nda nts a s C - suite exec utive s and BluS ky ma kes no ar gumen t that the y are C - su ite exec utives. B ut like the EPA, in the sa le of a b usine ss, the a cquiror is payi ng for the go odwill an d busine ss spac e of t he se ller. The EA s co mpensate Def enda nts for t hose, bu t the geogr aphic, tem poral, a nd legi tima te busine ss int ere sts far excee d SRP ’s reac h. The compe nsation is be fit ting re gio nal executiv es but is not com mens urate with a nati onwid e ban on com peti tion. The ba lance of the e quities we ighs in favor of Defe nda nts. The EA non - compe te is u nenf orceable. 2. The EA Non - Soli cit The EA non - soli cit deriv es from t he followi ng in th e Employ ment Agree ments: 6. Non - C ompet iti on and N on - Solicitati on. Exe cutive ackno wle dges t hat i n the c ourse of E xecut ive’s emp loyme nt with th e Empl oyer a nd its S ubsidiar ies, Exe cut ive ha s, and w ill c onti nue to, becom e fa mili ar wit h the E mpl oyer ’s and its Su bsidiari es’ Trad e Secret s a nd with other Prop rietary I nformati on concer ni ng the Empl oyer a nd its Sub sidiarie s an d that Exe cuti ve’s se rv ices ha ve been and wi ll be of spe cial, unique and ext rao rdina ry va lue to the Empl oyer and i ts Su bsidia rie s. Theref ore, in f urthe r conside rat ion o f th e

26 compe nsation t o be pa id to Exe cutive here under, Exe cuti ve agr ees t hat, witho ut limitin g any other obliga tion purs uant to th is Agre eme nt: (b) Non - Solic itation of Em ployees. Duri ng the Prote ction Per iod, Executi ve sha ll not directly or indi rectly thr ough a nother Pe rson (oth er than on be half of the Empl oyer and it s Sub sidia ries) (i) recr uit or hire or ot herwi se solici t for emp loyme nt (or a ssist a ny other Pers on unaff iliated with th e Employer and its Subsid iaries in engaging in an y such acti vities), any Pe rson who is (or, if the cha lle nged acti vit y occ urs foll owing the term inati on o f Exe cuti ve’ s emp loyme nt, the n as of th e last d ay of s uch empl oyme nt or a t any time duri ng th e twe lve (12) mont hs prec edi ng suc h date was) a n emplo yee or inde pend ent contra ctor of th e Em ploye r and its Su bsi diarie s or (ii) oth erwi se induce or atte mpt t o induc e (or as sist an y other Person unaf fi liate d with the Employ er a nd its S ubsidiar ies in e ngag ing i n any such a ctiviti es) a ny emplo yee of the Em ployer o r any of its Su bsidia rie s to ter min ate suc h Pers on’s em ployme nt wit h the Em ployer, its Sub sidiarie s or the ir Affil iates, or i n any way i nterfere wit h the relati onship betwe en the Empl oyer, its Su bsi diarie s and thei r Affil iates, o n the on e hand, and a ny such em ploye e, off icer or direct or on the o ther han d. (c)Non - Sol icita tion of C ustom ers. Dur ing the Prote ction Per iod, Executi ve sha ll not directly or indi rectly thr ough a nother Pe rson (oth er than o n behalf of th e Emp loyer and its S ubsid iaries) (i) pers uade or attem pt to pers uade, an y cust ome r or c lient or pot ential custome r or clien t of t he Em ployer and i ts Su bsidia rie s to whic h an y suc h ent ity ha s made a pr ese ntat ion, or with whic h any s uch e ntit y has ha d discussi ons duri ng the Emp loym ent P erio d (or, if the chal len ged ac tivi ty occur s follo wing th e ter mination of Exec utive ’s emplo yme nt, t hen a s of the last d ay of s uch empl oyme nt or a t any time duri ng th e twe lve (12) mont hs prec ed ing suc h date was) (eac h, a “ Cust omer”), not to h ire the Empl oyer, its S ubsidia ries or the ir Aff iliates or to hire a nothe r compan y in re lati on to t he goods a nd servic es pr ovi ded b y the B usi ness, (ii) in any way intentio nally or kno wingly in terfere with the rel ationship betw een the Employer, its Subs idiaries or their A ffiliates and any Cust omer or bus ine ss re lati onshi p or (iii) s olic it or induce a ny Cust omer of the Empl oyer, its Sub sid iarie s or thei r Aff ilia tes to purch ase goods o r ser vice s any where i n the Restr icted Terr itory fr om a Compe ting Bus iness in c ompe titi on with t he Emplo yer, its S ubsidia ries or their Affi liate s or to aid any Comp eting Bus iness in ide ntif ying or

27 solic itin g any s uch Cus tomer; pro vid ed, ho wever, that t he for egoi ng restr ict ion sha ll not a pply wi th res pect t o any pe rform ance reque sted by or for th e direc t benef it of the Empl oyer, its Subs idiarie s or thei r Affil iates. The non - so lici t has a two - ye ar dur ati on. It has at lea st a natio nwi de reac h beca use it trac ks Blu Sky’s s ubs idiar ies and affi liates. BluSky is nation wide, b ut the defin iti on of “Aff ilia tes”, as explain ed below, ex pan ds the sphe re e ven fu rther. Like the EA non - compe te, BluSky tries to fi nd ref uge in the arg ued duali ty of the EA bein g both i n the conte xt of a sale and a s epara te em plo ymen t agree ment. Bu t the law pr ovides Bl uSky no ha ven. Even i f the EAs are made in the sa le of a busine ss conte xt, then B lu Sk y’s le gitim ate bus in ess inter est is in prote cti ng the asse ts, goodw ill, and compe titive b usine ss space it purcha sed fr om SRP. Kodiak, 202 2 WL 5240507, at *9 (“Whe n [buy er] p urcha sed [sell er], it pur cha sed [s eller’s] asse ts, incl uding its goodw ill. As e xpla ine d, Dela ware law r eco gnizes [buyer ] has a legi timate eco nom ic interes t in protec ting wh at it purch ased f ro m [se ller].”). Sinc e the non - so lici t app lie s far bey ond S RP’s com petitive space, i t does n ot a dvanc e BlueS ky’ s legi timat e economic inte rest in the pur chased compa ny an d is unrea sona ble.

28 As with t he EPA, th e non - s olic its c onta in si milar fata lly ov er broad langu age abou t atte mpting to i nduc e (e mplo yees) 76 or atte mpt ing t o pers uad e (customers). 77 BankU nite d, N.A. v. Sh ulick, 2026 WL 21 637, at *9. (Del. Ch. Ja n. 2, 202 6); s ee HKA Global, LLC v. Beirise, 2025 WL 3639811, at *5 (D el. Ch. De c. 16, 2025). The non - solic its ar e un enfor cea ble on thi s bas is. Like the non - solicit i n the EPA, th e EA non - sol icit al so includ es “affi liate s” in cove rage for b oth em ployee s and cu sto mer s. “Af filia te” a s def ine d in the EA: mean s, wit h respe ct to t he Emp loyer an d its Su bsid iaries, an y othe r Pers on con trol ling, con trol led b y or und er comm on con trol with t he Empl oyer or any of it s Sub sidia ries and, in the ca se of a P erso n wh ic h is a par tner shi p, any p artner of t he Per son. Notwiths tanding a nyt hing to the co ntrary in this Ag reemen t, Exec utive sha ll not be de em ed an Affil iate of t he Emp loy er or a ny of its S ubsi diari es. 78 The def init ion inc lud es both u pstre am and do wns trea m entit ies. Plaintif fs ar gue th at despi te the pres ence of “affi liates” in the EA n on - solicit s, the l anguage of the non - solic its reason ably limi ts appli cability. 79 76 EA § 6(b). 77 Id. § 6(c). 78 Id. § 22. 79 AB at 30–33.

29 The non - so lici t for e mployee s pro hib its D efendant s fr om rec rui ting, hiring, o r solic itin g for empl oyme nt a ny BluS ky or BluS ky sub sidiary emp loyee or inde pend ent c ontra ctor (her ei nafte r “e mplo yees”) or ind ucin g or a ttem ptin g to induc e em ploye es t o term ina te the ir em plo yment with BluS ky, BluSk y su bsidia rie s, or BluS ky affil iate s. Plainti ff conte nds that t his o nly proh ibits Defenda nts f rom seeki ng out Bl uSk y or B luSky su bsi diary emp loye es. T hat argu ment ign ores t hat affi liate s refer s to ter minat ing emplo yme nt wit h BluSky a ffili ates and u nnece ssarily expands the cov ered pool to BluSky a ffiliate employees. This is unre asonably overb roa d and unen forcea ble. The non - so lici t for customer s als o suf fe rs un der th e wei ght of aff ilia te overbr eadth. T he custom er n on - sol icit proh ibits Def endants f rom p ers uad ing or attem pting to per suade any Bl uSky or Blu Sky su bsi diary cu stomer or c lien t wher e BluSk y has had disc ussio ns or ma de a pre sent ati on not to hir e BluS ky or it s affil iate s or to hire anothe r company f or goods and s ervices p rovided by Blu Sky. The next clause 80 pre vents De fendant s from in tentional ly or knowingl y interf ering w ith the rela tions hip betwe en B luSk y, Bl uSky subs idiaries, or their affi liate s and a ny cust omer or bu sine ss re lationsh ip. T he f inal c laus e pr ohib its D efe ndan ts fro m solic iting o r induc ing a cus tomer of Bl uSky, BluSk y subsidia ries, or Bl uSk y 80 EA § 6(c.)(ii.).

30 affi liate s to purc hase goo ds or serv ices a nywher e nat ion wide from a c ompe titor of BluSk y, its subs idiar ies, or aff iliates, or to a id com peti tors i n ide ntifyin g or so lici ting cust omer s. 81 The pr oblem wit h each of the se clause s is tha t the y wer e mad e in t he cont ext of the sa le of SRP to B luSk y. The incl usion of Blu Sky’ s affil iate s, upstrea m, downs tream, and n ationwi de, ex pand Bl uSky’s bus iness inte re st far be yon d wha t could be consid ered re asonab le for the SRP purc hase. Thi s is i llustr at ive of the dange r that th is Co urt d iscu ssed abou t incl udi ng affi liat es and othe r cor pora te busine ss lines in a restr ict ive co venan t. Fortiline v. McCall, 202 4 WL 408 8629, at *4 – 5 (D el. Ch. Se pt. 5, 202 4); Hub Gp. Inc. v. Kn oll ¸ 2024 WL 3453863 (Del. Ch. Jul. 1 8 202 4); A inslie v. Ca ntor Fitzg erald, L.P., 202 3 WL 1 0692 4, at * 18 (De l. Ch. Jan. 4, 202 3), rev ’d o n othe r grou nds, 312 A.3d 6 74 (Del. 2 024). “Affi liate s” is a signif icant ter m an d its i ncl usion h as c onse quenc es. T he no n - solic its are unrea sona bly broa d and unen forc eable. The bal anc e of the equi ties an alys is is l ike tha t for the EA non - compe te. Defe nda nts we re c ompe nsate d as reg iona l exec utives a nd th e bus ines s so ld wa s regio nal. But the r estr iction exc eeds SR P’s ge ogra phic f ootprint an d BluS ky’s 81 Id. § 6(c.)(iii.).

31 legi timate busin ess i nter est i n its a cqu ired e ntity. The non - s olicit covenant is exce ssive in sc ope a nd i s une nforc eab le. 3. Conf ide ntial ity Defend ants argue that the confi dentiali ty restric tions in th e EA are unenf orc eable beca use they do n ot adv anc e BluS ky’s legi timat e business a nd are substa ntively a nd temp orall y over broad. I n resp onse, BluS ky conte nds t hat t he confi dent iality agr eement i s enforce able when view ed thr ough the p ers pect ive o f breac h of contr act inste ad of re str icti ve covena nt. Like the non - solic it, BluSk y asser ts tha t embedde d modifie rs li mit t he sc ope to Blu Sky’ s legi timate b usine ss intere st. EA sec tio n 5(a) spe lls ou t the conf ide ntia lity r estr icti on: Prote cti on of P roprie tary I nfor mat ion. Exe cuti ve ac know ledge s that the cont inued success o f the E mployer a nd its Subsidi aries and Affil iates depe nds u pon the use and pr otectio n of a lar ge bod y of Propr ietar y Inform ati on. Exec utive agr ees tha t he shall n ot disc lose to any oth er Person an y Propriet ary Infor mation or use at any time, eithe r duri ng his e mpl oyme nt and/or se rv ice wi th the E mpl oyer or ther eafter, any Pr oprie tar y Infor mation of w hich Execut ive is or bec ome s aware (or has pre viousl y become awar e) du r ing or as a r es ult of his emplo yment wi th t he Em ployer (whethe r pri or to or a fter the date here of), wh ether or not s uch info rma tio n is devel oped by E xecut ive, exce pt to the exte nt th at such d iscl osur e or use i s rela ted t o and re quire d by Exec uti ve’s pe rfo rmanc e of dutie s assigne d to Exec utive by the Chief Execu tive O fficer or is oth erwi se permitte d under this Agree ment. “Pro priet ary in form atio n” is def ined as: all i nform ati on of a c onfide ntia l or pr oprie tary nat ure (whet her or not s pecif ically l abele d or identif ied as “co nfi dent ial” an d now

32 exis ting or to be de velo ped in t he futur e), in an y form or med ium (pape r, ele ctronic, in E xecut ive’s mem ory, or othe rwise st ored or recor ded), whet her oral or wr itten, th at re lates t o or result s from the Busi ness, histor ical or proje cted fina ncial res ults, produc ts, serv ice s, resea rch or d evel opm ent, or o pera tion s of the E mpl oyer or a ny of it s Subs idiar ies or Su bsidia ries or t heir respe ctive sup pliers, d istr ibut ors, cust omer s, inde pendent co ntrac tors or other b usin ess re lati ons. Propr ietar y Inf ormation w ill be i nterpr eted as broa dly as pos sible to incl ude a ll inform ati on of any sort (whe ther mer ely reme mber ed o r embod ied in a tan gible or inta ngi ble for m) that is (a) r elat ed to th e Empl oyer’ s or its Subs idia ries’ or Aff iliates’ (incl uding the ir prede ces sors’ prior to be ing acq uire d by the Emp loy er or an y Subs idiar y) curr ent or pote ntia l bus ines s and (b) is no t generall y or publi cly known. I fir st ad dress how to f rame re view of the confi dentiali ty pr ovision: whet her as res trict ive c ove nant or breac h of contrac t. BluSky as ks me to f ind tha t a confid entiality agre ement i s simply a contr act th at p revents a party from di sclosing the ot her pa rty’ s conf idential i nformati on, rather than bein g a restric tive co vena nt. Marti n Mariett a Mate rials, Inc. v. Vulc an Materi als Co., 6 8 A.3d 1208, 1219 (Del. 2012). BluSky sugges ts that und er Martin Mariet ta, the conf ide ntia lity a gree men t differs from “p rev en ting a party fro m engaging in certain hos tile o r competitiv e activi ty.” 82 The reliance on Ma rtin Marie tta is misp lace d. Tha t case deal t wit h a hosti le takeo ver an d a compar ison bet wee n sta ndsti ll a greem ents an d confide ntia lit y agree me nts. Martin Marie tta, 68 A.3d, at 1218 (Del. 20 12) (f inding t hat “S tandsti l l 82 RB at 16.

33 agree me nts a nd c onfi dent iali ty ag reeme nts are qual itat ivel y dif fer ent. ”). B luSk y’s attem pt to brid ge t he gap fr om ho sti le t akeov er t o com peti tive r est rict ions and confi dent iality pr ovi sion s goes too fa r. Unl ike BluSk y’s ar gument a bove, the Martin Marie tta Cour t did not a dd compe titi ve ac tivi ty int o the hos tile takeo ver mix. T his Court has repeat edly ana lyze d conf identia lity pro vis ions u nder the r estr ict ive covenant fram ework. See, e. g., Forti line, 20 24 WL 4088 629, at *4 – 5; Ko diak, 20 22 WL 5240 0507, at * 11; Inte rtek, 20 23 W L 254423 6, at *6. I will do so here as w ell. The co nfid enti alit y agr eem ent lacks a te mpora l limita tion. It pr ohibits disc losur e at a ny ti me, even af ter the Def en dant s leave Bl uSky’ s employ. Th e prov ision i s not limi ted t o the l ife of B luSky, its subs idia rie s, and affiliate s. The lac k of a tem pora l limit is a factor but is n ot determ inat ive. Restr icti ve cove nants are review ed holisti cally. Sunder Energy, LL C, 30 5 A.3d at 753 (Del. 2023). The confi dent iality ag ree ment i s substa nti vely o verbr oad. Eve n so, I di sagre e with Defe nda nts tha t “propri eta r y infor mat ion” include s all non - public informati on. 83 The fir st se ntenc e of the defi nition con stra ins it to confi den tial or pro prietar y inform ation. Yet th e definit ion of “pro priet ary in form ati on” is st ill not a ppr opria tel y limi ted. A s BluS ky notes, the first sent ence of the d efin ition doe s not inc lude “affiliates. ” But the seco nd sent ence do es. And that sec ond sente nce const rues 83 AB at 53.

34 “propr ietary infor mation” as broad ly as po ssibl e. The i ncl usi on of “aff ilia tes” modif ies the en tire d efini tion to make it im perm issi bly broad. As thi s Court has previ ously held: A cove nant i ncludin g the em ployer’ s affi lia tes is ‘ not tailor ed to [the emplo yee’s] role while empl oyed,’ and t he inclusi on of a ffili ate s in diffe rent sec tors a nd d iffer ent c ountrie s is ‘not es sent ial to th e protec tion of [the e mplo yer’ s] leg itimate busine ss func tions. ’ It also prese nts the proba bility t hat a res trai ned par ty coul d unknowi ngl y breac h the c ove nant. Where a plai ntiff fail s to sh ow an y legi tima te busine ss inter est serv ed by sh ield ing a ll it s unspec ifie d aff iliates from the re straine d part y’s com peti tion, and f ails to s how t he restra ine d part y had acce ss to any kind of inf orma tion that wo uld warra nt that restr ict ion, t he pla intiff ha s failed t o jus tif y the re stricti ve cov ena nt as draf ted.” Fortilin e, 2024 WL 408 8629, at *4 (i nterna l citat ions omit ted). The de fini tion als o inc lude s the c onf iden tial o r pr opri etar y inf orma tion of Bl uSky ’s and it s subsi diaries ’ “r espect ive suppl iers, distr ibu tors, c ustomers, ind epen den t contra ctors or o ther business re lations. ” For insta nce, t his would c over t he confi dent ia l and pro prietary infor mation of a jan itor ial ser vice th at cle ans the Blu Sky or BluS ky subsi diary’s off ice space. Such a sco pe exte nds far beyond the confi dent ial infor mati on tha t Def enda nts w ould ha ve access t o and c harac terizes t he imper mis sible overbr eadth of the pr ovisi on. Simila rl y, as the C our t fou nd i n Sunder, whi le a two - year restrictive coven ant is not pe r se unre aso nabl e, it m ust be geo grap hically te mper ed. I t is not h ere. Unde r the non - solic it of em ploye es sec tion 6(b), it is ove rly broa d.

35 D. The KPSKY agreements suffer fr om the same failin gs as the EAs. 84 After Defe ndants w ere Bl uSky vice pre sidents f or m ore tha n two year s KPSKY, Bl uSky’s pa rent, gra nte d 396 Ince ntive Un its t o Rob bins a nd 79 5 Inc ent ive Units to P opwe ll. 85 The I nce ntive Unit Awar d include d the RCA s. The RCA s conta ined non - compe te, non - solic it, co nfide ntialit y, an d retur n of ma teria ls provi sions. Defe nda nts, as the y did with the EA non - compe te, non - solic it, and confi dent iality re strictio ns, asser t tha t the RCA prov isi ons a re une nforcea ble beca use t hey ar e sub stan tive ly an d geo grap hically ov er broad. In re sponse, B luSk y argue s tha t the Def endants’ focu s on “affil iate s” di stract s from the De fen da nts ow n misde eds in v iola ting the restr icti ve c ove nant s. I n any even t, B luSky ask s the Cour t to ad opt a m ore restr aine d inte rpre tation of “affi liate s.” 86 The RC As are be tween KPS KY, Bl uSky, an d the indiv idua l Defe nda nts, bu t the con tract lang uage i nvolves ot her e ntitie s as we ll. 87 KPSKY and BluSky are col lective ly calle d “the Company.” KPS KY, BluS ky, and their affi liat es are “Compan y Partie s.” 88 The RC A defines affi liate s as: 84 Robbins’ and Popwell ’s RCA are substa ntially similar, so I con sider them jointly. 85 Am. Compl. ¶ 76.; A m. Compl. Ex. D and E. 86 RB at 33. 87 RCA Preamble. 88 Id.

36 any in divi dual, cor poration, part nership, assoc iation, join t - stock compa ny, trust, unin cor porat ed as soc iati on or o ther en tity (oth er tha n the Co mpany) that direc tly or in direc tly, thr oug h one or mor e interm ediarie s, con trols, is co ntro lled b y, or is u nder com mo n contr ol with, the Com pany a nd any membe r of an af filia ted gr oup of which the Compa ny is a com mon paren t corp oration. 89 The “R estr icte d Per iod” is the term of Def endants’ serv ice p lus tw o yea rs afte r the end of ser vice. 90 The RC As occurr ed as par t of D efenda nts’ em plo yment r at her tha n due to SRP’s sale to B luSk y. I n the sale o f the bus iness con text, the RC A “mus t be t ailored to the com petitive spac e re ache d by the selle r and se rve t he b uyer ’s le git imat e econom ic inte rests. ” Intertek Tes ting Serv s. NA, In c. v. Ea stman, 20 23 WL 25442 36, at *4 (Del. C h. Mar. 16, 2023) (citin g FP UC, 2020 W L 14927 83, a t *7)). Outsi de the sale of a bus ines s conte xt, however, the Co urt un derta kes a more searc hin g inq uiry. Rath er than “ tick thr ough individu al fe atures of a restricti on in isola tion, ” the Cour t will c ons ider th e RCA “ syne rgis tica lly.” Sunde r Ener gy, LLC, 305 A.3 d at 753. 1. The RCA No n - Com pete The RCA non - compe titi on restr iction pr ovide s: 89 RCA § 1(b). 90 Id. § 7.

37 Duri ng the Restr icted Pe rio d (as de fine d bel ow), the Pa rtic ipa nt wi ll not, anywhere in any geog raphic area in whi ch any Com pany Pa rty cond ucts b usine ss at any t ime dur ing the per iod of the P artic ipant’s Serv ice or, w ith respe ct to th e port ion of the Res tri cted Period that foll ows the term ination of suc h Ser vice, at the t ime of such term inat ion, partic ipate i n the R est ric ted Bu sine ss (a s de fined belo w). F or purpose s of th is Agr eemen t, (i) the term “par ticipat e” mea ns to ha ve a ny direc t or in direc t inte res t or in vol veme nt, w het her a s an off icer, di rect or, emplo yee, par tner, member, ma nage r, sole pr oprie tor, agent, repre sent ativ e, in depe ndent cont rac tor, consu ltan t, fra nchisor, franc hise e, cr edit or, owne r or ot herwise; prov ided, h owever, t hat the term “part icip ate” shall n ot incl ude ow nersh ip of less th an two perce nt of a cla ss of st ock of a publicly - held corp orati on which is t rad ed on a nati onal sec urities ex chang e or in the over - the - cou nter mar ket, so long as the Par ticipa nt doe s not hav e any act ive par ticipat ion in th e busin ess or ma nagem ent of s uch e nti ty; a nd (i i) th e ter m “R estr icte d Busine ss” mean s an y busi ness con duct ed b y any Com pany Par ty d uring the period of the Par ticipa nt’s Se rvice or, wit h res pect to t he por tion of the Restr icted Pe riod that foll ows the t erm ina tion of su ch Se rvice, at the time of su ch term inat ion. The RC A’s restr icted perio d is D efend ant s’ length of servi ce plus two yea rs. The geog raphi c restriction enco mpa sses any area whe re KPS KY, BluSk y, or the ir affi liate s con duct bus ines s. Thi s inc lud es up stream an d do wnst ream e ntities. It i s also g loba l in ge ograp hic breadt h and i s not limi ted to t he typ e of bus iness cond ucte d by BluS ky. BluSky sug gests that t he Court should a dopt “a muc h more sensi ble and reas onab le co nstr ucti on of ‘ Affilia tes’” tha t doe s not i nclude B luSk y’s u pstre am assoc iate d entitie s. 91 But that r equ est i gnore s the plain m ean ing o f the ter ms. Thi s 91 RB at 33.

38 Court w ill not tortu re co ntrac tua l lang uage to gi ve it a mea ning that was n ot intende d. AT&T v. Lil lis, 953 A.2d 241, 252 (De l. 2008) (“ Clear and una mbiguous l anguage ... should b e giv en it s ordinar y an d usua l mea ning. Absent som e ambiguity, Delaw are c ourts wil l no t destr oy or twis t [con tra ct] lan guage unde r the gui se of cons trui ng it.”). The per tinent lan gua ge in the “Aff iliates” defi nition ap plie s to “an y other Person controlling, contr olled by or un der co mmon cont rol wi th the Employer or any of it s Subsid iaries.” 92 There is no ques tion th at the defini tion a pplies to both upstr eam and downs tream e ntitie s. The C ourt wil l con stru e the language wit h th e plai n mea ning th e parties’ inte nde d. The r estrict ion i s unrea sonably b road. It goe s beyo nd BluS ky’s bus ines s intere sts and be yon d its ge ograp hy. As this Co urt has held, inc lusio n of aff iliates wh o are not in t he em ploye r’s co mpetiti ve busine ss space and l ocat ions cou ld le ad t he re stric ted party to inadver tent ly vi olat e the restric tion. Fortil ine, 202 4 WL 4 088 629, a t *4 (Del. Ch. Sep. 5, 2 024) (A restr ict ive cove nant that i nclu des af fil iates “ prese nts the pr obabili ty tha t a res trai ned party c ould unknowi ngly b reach the co venant.”). The n on - compe te p aramet ers are broa der tha n nece ssar y to sa tisf y BluS ky’s legi tima te b usi ness inter es t. Bala ncin g the eq uitie s betwe en Bl uSky and Defe ndants doe s not chan ge th e analy sis. It is uncl ear whethe r Def enda nts are s ophi stica ted par ties. The y gr ew a 92 EA § 22 (emphasis ad ded).

39 succe ssf ul rem edia tio n and re stor ati on busi ness. Pres umin g that the y we re busin ess savv y, the y were ove r two yea rs rem ove d from the sale of t he business. The leve rag e to barga in for diffe rent restr ictions w hen KPS KY grante d the m ince nti ve uni ts was gone. While I presume that the i ncen tive unit s ha ve inhere nt val ue, t he com plaint lacks unit va luation tha t would le ad me to be lie ve tha t Defe ndants we re ad equa tel y compe nsated f or suc h a broad re strict ion. The RCA non - compe te is u nenforce ab le. 2. The RCA Non - Solic it The no n - sol icit prov isio n prohibi ts Def endants f rom a ct ing to: (a) em ploy, e ngag e or d irec tly or i ndirec tly sol icit for emplo yment or en gag emen t any in div idua l who is a n empl oyee of any of the Compan y Par ties (or wa s an empl oye e of a ny s uch e nti ties duri ng the y ear prec edi ng suc h solici tati on) or otherw ise seek to a dv ersely infl uence or alt er s uch in divi dual’ s relatio nsh ip with a ny of the Compa ny Pa rtie s; or (b) dir ectl y or in dire ctly s olic it or enc ourage an y cust ome r, suppl ier or ve ndor of any Comp any P arty, or a ny prosp ect ive c ust omer, suppl ier or ven dor o f any C ompa ny Party, to term inate, d iminish o r othe rwise alte r his or its relationship with any Com pany Party or to cond uct w ith an y othe r Pers on an y bu sine ss tha t suc h cus tomer, suppl ier or vend or (or prospe ctive cu stomer, supplier, or ven dor) coul d cond uct wi th any C ompany Par ty; provide d, howeve r, tha t these restr ict ions s hall appl y (y) only w ith re spe ct to t hose Pe rs ons who a re or hav e been a c ustomer, sup plie r or ven dor of any Com pan y Par ty at any t ime w ithin the eigh teen (18) - mon th peri od imm edia tely pr ece din g the ac tivit y that is res tricte d by this Sec tion 6(b) or who se bus ine ss has been s olic ited on beh alf of a ny Compa ny Par ty by a ny of t heir of ficers, emplo yees or ag ents wit hin suc h eightee n (18) - mon th per iod, ot her tha n by for m letter, bla nke t mail ing or p ubl ishe d ad verti sem ent, a nd (z) o nly if the P artic ipant ha s perfor med w ork for s uch Per son d uri ng the Part icipa nt’s S ervice or been i ntro duce d to, or oth erwise had c ontac t with, such P erso n as a result of the Pa rti cipan t’s S ervic e or ha s had

40 acces s to Co nfide ntial Inf orm ati on whic h woul d assi st in t he Part icipa nt’s so lici tati on of suc h Perso n. The no n - sol icit suffe rs from the same ove rreac h issues as the non - com pete. The term “C ompany Pa rti es” inc ludes KPS KY, B luSky, and t heir a ffil iate s. Includin g all af fil iates, whe rev er they are and in wha tev er bu siness fie ld is wel l bey ond the reas onab le range of B luSk y’s leg itima te busine ss and geogr aph ic inter est. The non - so lic it pr ovis ion is ove rly br oad and un enf orcea ble. 3. RCA Confi dentiali ty The RC As restr ict t he Def endant s from disc losing c onfi den tial infor mat ion other t han as necessa ry to per form their d uties a s empl oyees. 93 The re strictio n ends only when t he conf identia l infor mat ion be comes ge neral ly known to t he public. 94 Temp orally, t he res tric tions cou ld be e ndle ss. Th e RCA def ines C onfiden tial Infor mati on as: any an d al l conf identia l, propri eta ry or tra de secr et infor mation, whet her disc losed, di rect ly or ind irec tly, v erba lly, in wr iting or by an y other means i n ta ngible or intan gible for m, inclu ding tha t whic h is conce ived or dev elop ed by th e Part icipant, applic able to or i n any wa y rela ted to: (i) the pre sent or future busin ess of any of the C ompa ny Part ies; (i i) the rese arch an d deve lopment of any of t he Compan y Part ies; or (iii) the bu sine ss of any c lie nt or vend or of any of the Compa ny Partie s. 93 RCA § 1(a). 94 Id.

41 As with t he RCA non - compe te and non - solic it res tric tion s, “Compa ny Par ties ” incl udes all KPSK Y an d BluS ky u pstre am and d owns tream affilia tes. Th is Co urt has co nsis ten tly fo und su ch restric tions to b e over broad and unenf orc eable. Fortil ine, 2024 W L 408862 9, at *1, 4 – 5; Intertek, 2023 WL 25 4423 6, at *6; Kodia k, 2022 WL 524050 7, at *4 – 5. Bl uSky a rg ues tha t KPS KY gra nte d Defe nda nts eq uit y in the KPSK Y family and “c ontempl ated ac cess to br oade r ca teg orie s of in form ati on withi n that corp orat e fam ily.” 95 In the con text of t he e mplo yer - employee rela tions hip with De fendan ts, B luSk y ha d a reas onable e xpec tatio n of De fendan ts’ acces s to con fide ntial Bl uSky i nform ati on be yond the foo tpri nt of th e origi nal SRP sale. But to su gges t that De fendan ts’ equ ity i ntere st in t he KPS KY fam ily wo uld give t hem acc ess to the co nfide ntial inf ormatio n of ever y com pany under the corporate umbre lla o verste ps the mark. Even rea sonably bro ader access w ithi n the corpor ate fam ily w ould not e xten d to e ver y affi liate. A Retur n of Mate rials prov isi on is c onc urre nt wit h the Conf ide ntia lity restr ict ion. 96 This restr iction re quires De fenda nts to ret urn all m ater ials conta ini ng the KPS KY, BluS ky, an d the ir aff ilia tes’ conf ide ntia l inf ormation to the com pany. The re quiremen t is subje ct to the sam e a nalys is as the C onfi dent iality re strictio n and 95 RB at 20. 96 RCA § 2.

42 suffe rs the s ame f ate. The Return of Mate rials c onstr aint enc ompa sses mater ials at all Blu Sky’s aff iliates, o ut of Def endants’ ac cess and r each. I find this requi rement to be u nenf orceable f or the sam e re aso ns as t he Conf idential ity A gree ment. E. The Court De cl ines t o Blue Penci l the Unenforceable Rest rictions BluSk y urges me t o bl ue pen cil a ny ove rbro ad re stri ctiv e cove nants. 97 Thi s Court m ay bl ue pen cil “ exp ansi ve no n - co mpete s to supply j udic ious l imit ations.” Intert ek, 2023 WL 2 54423 6, at *5. I will not do so her e. “Wher e nonc ompe te or nonso licit cove nants are un reasona ble in p art, De laware c ourt s are he sita nt to ‘b lu e penci l’ such a greem ent s to m ake them r ea sona ble. ” Kodiak, 202 2 WL 5240 507, at *4 n.49. The res tricti ons ar e overb road in a varie ty of wa ys — geogra phica lly, tempor ally, and substa ntively. If I bl ue penc il the se pro vis ions, it wo uld el imin ate the goa l - requir ing p arties t o draf t restr ictions s pecif ically t ail ored t o the parties ’ circ umsta nce s an d legi timat e bu sine ss intere sts. B lue penc ilin g wo uld inc entiviz e future pa rties to c ompo se restri cti ons withou t appropr iate acc urac y an d prec ision, certa in in th e belief that the Cour t would be a safet y net for any overreach. I d ecl ine to blue pe ncil t he re str icti ve cov enants. 97 RB at 39.

43 F. The Pre limin ary Injun ction is Deni ed Be cause BluS ky Ha s Not S hown a Rea sonab le Likeli hood of Suc cess on t he M erit s BluSk y’s Amend ed Ver ified Com pla int all eges s ix Breac h of Contra ct Claim s. 98 The cl aim s are brok en d own in to t hree c laim s against e ach Def end ant f or viola ting the restr icti ve c ovena nts in the EP A, the EAs, an d the RCAs, respe ctivel y. The ele men ts re quire d to gran t a prelimi nary inju ncti on are w ell k now n. BluS ky must pr ove “(i) a rea sonable proba bil ity of succe ss on the merit s; (ii) a thre at o f irre para ble in jur y if an inj unct ion i s not gr ante d; an d (iii) tha t the bal anc e of the equi ties fa vors the i ssuance o f an in junc tio n.” Pe ll v. K ill, 135 A.3d 7 64, 783 (De l. Ch. 2 016) (citing Revlo n, In c. v. M acAndre ws & Forbe s Hld gs., Inc., 506 A. 2d 173, 179 (Del. 1986)). I have found each of the res tric tive cove nant s une nfor ceab le. As a result, BluSk y is not rea sona bly like ly to succ eed on t he mer its. Havi ng fai led to m eet t he initia l elemen t, BluS ky’s reque st for pre limi nary i nju ncti on is de nied. I do not addre ss the rem ain ing pr elimina ry in junc ti on elem ents. CONC LUSIO N For the rea sons e xplained a bove, I re commend t hat B luS ky’ s reque st for prelim inary i njunc tio n be denie d and the D efenda nts’ Mot ion to Dismiss b e gra nte d 98 Am. Compl. ¶¶ 93 –150.

44 on all c ounts for f ail ure to s tate a claim. Th is is a F ina l R eport under Court of Chanc ery R ule 144.