Elements of Contract Formation are the essential components that must be present for a contract to be legally binding. These elements include the parties agreeing to enter into the contract, an offer being made, payment or exchange of goods or services in some form, acceptance of the terms of the agreement, consideration (the legal value given by both parties), and a clear understanding of the promises each party is making. A strong contract formation includes all these elements as well as proper documentation and signatures from both parties. Without all of these elements, a valid legal contract cannot be formed.