from wikipedia:
Options
If a player is on the 40-man roster but not on the active major league roster, he is said to be on optional assignment—his organization may freely move him between the major league club and the minor league club. If a player is on the 40-man roster and not the active 25 man roster for any part of more than three seasons (in which he spent 20 or more total days of service in the minors), he is out of options and may not be assigned to the minors without first clearing waivers. However, if a player has less than 5 years of professional experience, he may be optioned to the minors in a fourth season without being subject to waivers. If a major league player is ineligible for free agency and "has options" remaining, his team may option him to a minor league team without consequence. This is usually what is meant when players are "sent down" to the minors. Likewise, when a player on the 40-man roster is added to the active major league roster, he is "called up" to the majors.
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