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Contracts Keyed to Frier
Empro Manufacturing Co., Inc. v. Ball-Co Manufacturing, Inc.
Citation:
870 F.2d 423 (7th Cir. 1989)Facts
Plaintiff drafted a letter of intent to buy Defendant’s plant and assets. The letter of intent provided general terms and conditions and stated that the agreement in the letter was subject to a definitive Asset Purchase Agreement and various conditions, including the approval of Plaintiff’s board of directors and shareholders. During subsequent negotiations, it became clear that Defendant wanted to retain a security interest in the land under the plant, but Plaintiff refused. After finding out that Defendant started negotiating with a different company, Plaintiff brought suit and filed for a temporary restraining order. The district court dismissed the complaint, finding that the statement that the agreement was “subject to” the execution of a definitive contract (which appeared twice in the letter of intent) meant that the letter had no independent force. . Plaintiff appealed.
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