Law for Business 12th Edition by James Barnes,Terry Dworkin,Eric Richards

Exercise 7

Basis entered an agreement with Amazon whereby it would provide services allowing Amazon to create an electronic commerce service in Japan. A few months later, they signed a "Series of Preferred Stock Purchasing Agreement" under which Amazon bought 1,654,412 shares of Basis stock and got a seat on Basis's board. It also got an agreement designed to maintain the percentage of Amazon's ownership of Basis. The agreements became the focus of a dispute between them. Basis sued Amazon. The parties entered into settlement negotiations. Basis counsel sent an e-mail that set out the terms and ended it by saying, "please contact me first thing tomorrow morning if this e-mail does not accurately summarize the settlement terms...." Amazon replied, "Correct." After this they exchanged e-mails and drafts which kept changing. When Basis sought to enforce the settlement agreement, Amazon argued it was incomplete and indefinite. Is Amazon correct? Why?