Various elements must be present to demonstrate that a valid contract exists between Sam and the retail chain. These four elements necessary for a contract are agreement, consideration, contractual capacity and legal object. The first element is the agreement that begins with an offer between two parties called the offeror and the offeree. The offer consists of three elements seriously intent on binding together an agreement, a logically defined term, and communication to the recipient. Once the offer has been properly presented by the offeror to the offeree, the process begins. Now the offeree can accept or reject the offer, if the offer is accepted a contract is formed. On the other hand, if the offeree refuses the offer, the contract may not be concluded. There are different types of consideration and one is required in each contract; it is what you will receive in exchange for a certain obligation. To fully understand the consideration there must be an awareness of the rules that govern it and their exceptions (Kubasek 343). In order for a promise to be kept by the courts there needs to be some kind of consideration. Promising to do something that is already expected of you is not an official consideration. Another rule is that a past consideration is not a consideration at all. An exception to the consideration is promissory estoppel which occurs when an individual makes a promise with the thought that another individual is certainly relying on this promise and actually relying on it. The only way to avoid injustice is to impose this promise even if the consideration is favorable. Consideration comes into play when Sam verbally offers to send 1,000 units to the national retail chain in exchange for exclusive sales of his product. The third element is contractual capacity, which concerns the legal capacity to enter into a binding agreement. An individual with legal capacity is not a minor or an insane person and clearly understands his or her legal rights and obligations under a