Frederick Richmond agreed to sell UForma Shelby Business Forms,

Frederick Richmond agreed to sell UForma Shelby Business Forms, Inc., a business forms printing business, to Samuel Peters pursuant to a stock-purchase agreement at a price of $3.6 million to be paid in annual installments. The amount of each installment was one-half the amount by which the profits of UForma and Miami Systems, Inc., another company owned by Peters, exceeded the 1988 and 1989 average annual profits of Miami Systems alone. The agreement stated that this formula might result in no payment being made in some years. At the time of the sale, UForma was operating at a loss. The sales agreement also stated that Peters should operate UForma according to “sound business practices.” Peters paid Richmond $496,057 for 1990 and $147,368 for 1991. Because the earnings of UForma and Miami Systems were insufficient to trigger a payment under the formula in the agreement, Peters paid Richmond nothing for the years 1992 through 1995. Richmond sued Peters for breach of contract and breach of fiduciary duty, alleging that he was entitled to additional payments and that Peters had not operated UForma in accordance with sound business practices. How should the court rule? [Richmond v. Peters, 1998 U.S. App. LEXIS 30114 (6th Cir. 1998), reh’g denied, 173 F.3d 429 (6th Cir. 1999).]