JOHN WOOD GROUP USA

JOHN WOOD GROUP USA - JOHN WOOD GROUP USA, INC.; Wood Group...

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JOHN WOOD GROUP USA, INC.; Wood Group Drilling & Production Services Ltd.; and John Wood Group PLC, Appellants, v. ICO, INC., Appellee. [Cite as John Wood Group USA, Inc. v. ICO, Inc., 26 S.W.3d 12] No. 01--98--00518--CV. Court of Appeals of Texas, Houston (1st Dist.). March 9, 2000. Rehearing Overruled Aug. 31, 2000. Page 13 Page 14 David W. Holman, Kevin Dubose, Levon G. Hovnatanian, Jack O'Neill, Byron C. Keeling, Molly Duson Naylor, Houston, for appellant. D. Gibson Walton, Marie R. Yeates, Adam Schiffer, Karen B. Jewell, Sandra Garza Rodriguez, Julie Plantes Woody, Houston, for appellee. Panel consists of Chief Justice SCHNEIDER and Justices TAFT and PRICE.(fn*) OPINION MICHAEL H. SCHNEIDER, Chief Justice. The issue in this case is whether a letter agreement for the sale of millions of dollars worth of corporate assets, which stated that the essential terms of the proposed sale were "not binding," was unambiguous and nonbinding as a matter of law, or whether it presented a jury question on the issue of the parties' intent to be bound. Because we hold that there was no binding sale agreement as a matter of law, we reverse the judgment on appellee's claim for breach of a sale agreement and remand its claim for liquidated damages for further proceedings. FACTS I. The proposed sale between the Wood Group and ICO In 1993, appellee, ICO, Inc. ("ICO"), began to explore the possibility of purchasing the assets of NDT(fn1) from NDT's parent companies, appellants, Wood Group Drilling & Production Services, Ltd. and John Wood Group USA, Inc. (collectively, "the Wood Group"). ICO believed that the acquisition of NDT, which manufactured pipe inspection equipment, would make ICO a dominant player in the pipe inspection services industry. At the same time, the Wood Group was in discussions with one of ICO's competitors,
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Tuboscope Vetco International ("Tuboscope"), regarding the sale of NDT. However, negotiations between Tuboscope and the Wood Group soon broke down, and the Wood Group continued to negotiate the sale of NDT to ICO. Page 15 II. The July 22, 1994 Letter Agreement The negotiations culminated in an agreement between the parties, which was signed on July 22, 1994 ("the letter agreement" or "letter of intent"). The letter agreement contained a clause that provided: 15. Binding Effect. This Letter Agreement constitutes a summary of the principal terms and conditions of the understanding which has been reached regarding the sale of certain assets to Purchaser [ICO]. It does not address all of the terms and conditions which the parties must agree upon to become binding and consummated. The Purchaser, however, does intend to move forward with its due diligence and expects to expend considerable sums to review the Sellers' Business. In consideration therefor, the parties have agreed to make certain covenants of this letter binding upon the parties notwithstanding the fact that not all details of the transactions have been agreed upon. Accordingly, it is understood and
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This note was uploaded on 09/30/2011 for the course EMGT 5130 taught by Professor Jeong during the Fall '11 term at UH Clear Lake.

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JOHN WOOD GROUP USA - JOHN WOOD GROUP USA, INC.; Wood Group...

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