Under the option rule, an exception allows enforceable options without consideration. Which situation provides this exception?

• A. A firm offer by a merchant signed in writing that promises to keep open for a stated period
• B. A firm offer by a non-merchant
• C. An oral option
• D. A conditionally accepted offer

Answer: (A)

Under the option rule, keeping an offer open without giving something in return is generally not enforceable, because an option contract usually requires consideration. The exception comes from the UCC’s firm offer rule: a signed, written promise by a merchant to keep an offer open for a stated period creates an enforceable option without needing separate consideration. This matters in commercial transactions for goods—the merchant’s written assurance is treated as a binding commitment to hold the offer open for the time stated (not exceeding three months unless extra consideration is given).

So, the situation that fits this exception is a firm offer by a merchant signed in writing that promises to keep the offer open for a stated period. The other scenarios don’t qualify: a firm offer by a non-merchant isn’t covered by this rule; an oral option generally requires consideration to be enforceable; and a conditionally accepted offer isn’t an option to keep the offer open.