What does it mean by "on the best of terms" in this sentence?
A hotel employee remembers Luciano and Sinatra swimming together, evidently on the best of terms.

Question

What does it mean by "on the best of terms" in this sentence?
A hotel employee remembers Luciano and Sinatra swimming together, evidently on the best of terms.

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I think it means in good condition.

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It is an offer, the offeror claims that the terms are the best.

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It means that they were very good friends and enjoyed each other's company.

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Their relationship could not have been better. (It was 'best') 
There was no disagreement (at all) between them. 
They were 'on the best of terms'.