Guy Holcomb owns and operates Oasis Goodtime Emporium, an

adult entertainment establishment. Holcomb wanted to create

an adult Internet system for Oasis that would offer

customers adult theme videos and live chat room programs

using performers at the club. On May 10, Holcomb signed a

work order authorizing Crossroads Consulting Group (CCG) to

deliver a working prototype of a customer chat system,

demonstrating the integration of live video and chatting in

a Web browser. In exchange for creating the prototype,

Holcomb agreed to pay CCG $64,697. On May 20, Holcomb signed

an additional work order in the amount of $12,943 for CCG to

install a customized firewall system. The work orders stated

that Holcomb would make monthly installment payments to CCG,

and both parties expected the work would be finished by

September. Due to unforeseen problems largely attributable

to system configuration and software incompatibility,

completion of the project required more time than

anticipated. By the end of the summer, the Web site was

still not ready and Holcomb had fallen behind in his

payments to CCG. CCG was threatening to cease work and file

suit for breach of contract unless the bill was paid. Rather

than making further payments, Holcomb wanted to abandon the

Web site project. Using the information presented in the

chapter, answer the following questions.

1. Would a court be likely to decide that the transaction

between Holcomb and CCG was covered by the Uniform

Commercial Code (UCC)? Why or why not?

2. Would a court be likely to consider Holcomb a merchant

under the UCC? Why or why not?

3. Did the parties have a valid contract under the UCC?

Explain.

4. Suppose that Holcomb and CCG meet in October in an

attempt to resolve their problems. At that time, the parties

reach an oral agreement that CCG will continue to work

without demanding full payment of the past due amounts and

Holcomb will pay CCG $5,000 per week. Is the oral agreement

enforceable? Why or why not?