Good job offer's deadline is up, but a preferred job offer is incoming.

I worked at an organization that was something like the "Job B" scenario above. The applicant told us that he wanted to work for us, but he had a job offer with [other company] that he had kept putting off. If we couldn't get a job offer to him quickly, he'd have to take his Job A. Every one of us who interviewed him wanted him to join, with the exception of a higher-up who wanted to hire an engineer with zero experience in the field we were working in. At the post-interview discussion, everyone else said that not only should we hire him, but hiring him was a no-brainer. The higher-up made a show of backing down, and the head of that group and the HR hiring person worked quickly to get the paperwork done. And then they put it on the higher-up's desk. The higher-up then sat on it for days, until our candidate told us that he had to give up and take Job A. We instead hired the other candidate, the one with no job experience in our field. All of this is to say that you may not have a written job offer from "B" because there might still be political infighting at that company which is preventing a written job offer from reaching you. Sure, it may be bureaucratic incompetence like others in this thread are saying, but it may be even worse than that. If I were you, I'd take Job A if the offer is still available.

Job B knows that I have Offer A, and has been trying to work within the deadline, and then the extended deadline, but seems unable to. Any (for-profit/non-academic/non-government) competent employer can turn a job offer in less than a day if they are on a deadline. Based on that, either Job B doesn't really want to hire you or Job B has a ridiculous bureaucracy that you don't want to deal with anyway. Go for Job A. There's no question here.

I don't know where you are geographically, so I don't know what your hiring laws are like, but I would imagine in many places that having a written statement (i.e. that email) that they are ready to extend an offer to you, but are just waiting for a signature, is equivalent to an offer, and that you might have some legal recourse if they changed their mind after that. Oh no no no no no NO. I've seen many many people burned by ideas like that. If it's not in writing and sitting in your inbox, it's not real. You can argue the legal stuff all day long, but if there's no job there's no job. Any (for-profit/non-academic/non-government) competent employer can turn a job offer in less than a day if they are on a deadline. Seriously? I've seen it happen many times, and I work for a pretty organized firm. We just happen to have 80,000 employees spread around the country and it's not something that gets turned instantly. And didn't we just review that it's the holidays? Who knows what kind of missing people there are in the chain that just are out of the office until 1/2 or whatever. I'm not giving B the benefit of the doubt here, but A gave you an http://www.joelonsoftware.com/items/2008/11/26.html which isn't really cool either.

Waiting for B best case: you get the preferred job. Waiting for B worst case: you get neither job, and you upset a friend and ally. Accepting job A immediately best case: you get a good job. Accepting job A immediately worst case: you miss out on a preferred job. Personally, I'd either accept job A to minimize my downside risk overall, or actively reject job A and express to my friend how grateful I am they made the effort etc. to maximize my upside potential without losing a friend (and with eyes open that I might not get either job.) If you didn't have the friend involved, my advice would be different, but you do.

(I expect to look back on this moment and say "I had a tough life decision to make, but I was fortunate to receive advice from a very wise person named UrineSoakedRube.")

I've seen the Company B situation - almost ready, just need a signature, etc. - turn into we hired the other candidate and the whole team was back and forth and seen it turn into "actually the role doesn't exist any more." I've also seen it turned into an offer at a company that can't get its act together. I would take into account how much warning and notice you gave Company B to get an offer together. If it was a very fast, I would cut them some slack. They were overoptimistic about how quickly they could actually move. If you told them you'd ask for an extension on the first offer and they had enough notice? I really worry about the kind of boundaries you're setting for yourself. It might be your dream job, but culturally, I'd ask yourself if there were other things that seemed disrespectful or like they were testing how far they could inconvenience you - interviews at the last minute without schedule flexibility, keeping you waiting, any paperwork or hoops that seemed out of the ordinary. Because whether it's intentional or not, a company that has a culture where the worker and candidates are worth less than the company's needs and time is only a good fit for a certain kind of person - and if that person is walking into it with their eyes open. Because I value culture, smooth operations and how much a company takes my needs into consideration, in your shoes, I would take Company A or, if I were already employed somewhere that wasn't miserable, decline Company A and throw my resume in at Company C, D, E and F and do what I tell Company B I will so they know I mean what I say when it comes to my boundaries.

Accept Job A and if Job B pans out with a better offer, accept Job B and quickly resign Job A. Both companies are being weird in this situation, one giving an offer that expires on Christmas when no one will even be working, and one twiddling their thumbs on making an offer. Don't worry about offending either company -- your happiness is what's most important. Your friend will be fine.

If you told company B when company A's offer would expire, company B will be in a much stronger position when they make you their offer and they will know it. How confident are you that company B will not only make you an offer but an offer that you would accept without negotiation? Note that I disagree with JoeZydeco that company A has made you an exploding offer. An exploding offer is an offer with a very short deadline intended to prevent you from comparing offers. We're talking about a couple of days, or even just overnight. It is not an exploding offer just because it has a deadline, especially if that deadline has already been extended once. I wouldn't try to interpret anything shady out of the Christmas Day deadline if it was given after you asked for an extension.

"I had a tough life decision to make, but I was fortunate to receive advice from a very wise person named UrineSoakedRube." Join the club, brother. And congratulations on the new job!