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compensation were offered, a covenant not to compete sought by
N.L. Industries after it acquired Sperry Sun. After leaving
Sperry Sun, Forest formed a company involved with drilling
steering tools, which he sold 8 months later. He then took a job
with Drill Tech International, which he left to form petitioner
in 1984.
Based on their experience together at Sperry Sun, Forest and
Wagner each respected the other's abilities. Both saw a niche
market for lower-cost surveying and steering equipment that was
not available at that time, and the two formed petitioner in May
1984 to develop such equipment and exploit that niche market.
Wagner did not leave Sperry Sun until 1985, on an early
retirement package.
Petitioner's business was a success. By the late 1980's,
petitioner held 80 percent of market share for the products and
services it supplied to the utilities construction business and
25 to 30 percent of market share for oil and gas drilling, which
was the largest share of any company involved in that field.
Various expressions of interest to purchase petitioner were made.
One approach, made by Castex, Inc. (Castex), in mid-1990 was
considered seriously by Forest and Wagner. They expended
considerable time and money responding to Castex's interest,
including obtaining financial analyses of petitioner for Castex's
review. As part of the purchase negotiations, Castex made clear
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