diplomatic incident that, when made public in 1798, nearly involved the United States and France in war. Pres. John Adams dispatched three ministers to France in 1797 to negotiate a commercial agreement to protect U.S. shipping. In Paris the ministers were approached by three French agents who suggested a bribe of $250,000 to Talleyrand, the French foreign minister, and a loan of $10,000,000 to France as a prelude to negotiations. In April 1798 the machinations of the three French agents (called X, Y, and Z in the diplomatic correspondence) were made public in the United States. There was a great outcry over the bribe solicitation, followed by preparations for war. Although a period of undeclared naval warfare ensued between France and the United States formal war was avoided, and the incident was settled by the Convention of 1800.