An option contract is a legally enforceable promise that limits an offeror's power to revoke the offer. When is the promise legally enforceable?
The promise to hold the offer open for a specified time, is legally enforceable if (1) the promise is in writing; (2) signed by the offeror; (3) the writing recites the consideration given in exchange for the promise; and, (4) the bargain proposed by the offer involves a fair exchange in a reasonable time period. See Restatement (Second) Contracts § 87(1)(a).
Note: (1) - (4) are not the only way an option contract can arise. In some cases, they arise by statute which asserts that a certain type of offer is irrevocable. In effect, such a statute sees the act of making the offer as including a legally enforceable promise to hold the offer open. See Restatement (Second) Contracts § 87(1)(a).