A promoter is a person who starts up a business, particularly a corporation, including the financing. The formation of a corporation starts with an idea. Preincorporation activities transform this idea into an actual corporation. The individual who carries on these preincorporation activities is called a promoter. Usually the promoter is the main shareholder or one of the management team and receives stock for his/her efforts in organization. Most states limit the amount of "promotional stock" since it is supported only by effort and not by assets or cash. If preincorporation contracts are executed by the promoter in his/her own name and there is no further action, the promoter is personally liable on them, and the corporation is not.
Under the Federal Securities Act of 1933, a pre-organization certificate or subscription is included in the definition of a security. Therefore, a contract to issue securities in the future is itself a contract for the sale of securities. In order to secure an exemption, all stock subscription agreements involving intrastate offerings should contain representations by the purchasers that they are bona fide residents of the state of which the issuer is a resident and that they are purchasing the securities for their own account and not with the view to reselling them to nonresidents. A stock transfer restriction running for a period of at least one year or for nine months after the last sale of the issue by the issuer is customarily included to insure that securities have not only been initially sold to residents, but have "come to rest" in the hands of residents.
Los Angeles, California Preincorporation Agreement between Incorporates and Promoters is a legal document that outlines the terms and conditions agreed upon by individuals or entities involved in forming a corporation in Los Angeles, California. This agreement serves as a crucial precursor to the official incorporation process and sets a foundation for the future relationship between the incorporates and promoters. In a Los Angeles, California Preincorporation Agreement between Incorporates and Promoters, several important elements are typically included. These may vary based on the specific circumstances and requirements of the parties involved. However, some essential components found in most agreements include: 1. Purpose: This section clearly defines the purpose of the future corporation and the objectives it aims to achieve. It outlines the specific business activities and ventures the corporation will engage in. Keywords: purpose, objectives, business activities. 2. Incorporates' Responsibilities: The agreement outlines the responsibilities and contributions of each incorporated involved in the formation of the corporation. It may include a detailed breakdown of their financial investments, expertise, resources, or services to be provided. Keywords: responsibilities, contributions, financial investments, expertise. 3. Promoters' Duties: This section describes the duties and obligations of the promoters, who are responsible for promoting and organizing the corporation. It may include tasks such as preparing the necessary legal documents, securing finances, seeking investors, or conducting market research. Keywords: duties, obligations, legal documents, finances, investors. 4. Share Allocation: The agreement determines the allocation of shares among the incorporates and promoters. It may outline the number and classes of shares each party will receive and any conditions for their transfer. Keywords: share allocation, classes of shares, transfer conditions. 5. Ownership and Control: This section defines the ownership structure of the corporation, indicating the percentage of ownership held by each party. It may also outline the decision-making process, voting rights, and the appointment of directors. Keywords: ownership, control, decision-making process, voting rights, directors. 6. Confidentiality and Non-Competition: The agreement may include clauses that ensure the confidentiality of sensitive business information and prohibit incorporates and promoters from engaging in competition during or after the incorporation process. Keywords: confidentiality, non-competition, sensitive information. 7. Termination: This section outlines the circumstances or events that may lead to the termination of the agreement. It may include provisions for dispute resolution and methods to handle potential conflicts between the parties. Keywords: termination, dispute resolution, conflict resolution. Note: There are no specific types of Los Angeles, California Preincorporation Agreement between Incorporates and Promoters, as each agreement is customized to fit the specific needs of the parties involved. However, the aforementioned elements are typically covered in such agreements regardless of their variations.Los Angeles, California Preincorporation Agreement between Incorporates and Promoters is a legal document that outlines the terms and conditions agreed upon by individuals or entities involved in forming a corporation in Los Angeles, California. This agreement serves as a crucial precursor to the official incorporation process and sets a foundation for the future relationship between the incorporates and promoters. In a Los Angeles, California Preincorporation Agreement between Incorporates and Promoters, several important elements are typically included. These may vary based on the specific circumstances and requirements of the parties involved. However, some essential components found in most agreements include: 1. Purpose: This section clearly defines the purpose of the future corporation and the objectives it aims to achieve. It outlines the specific business activities and ventures the corporation will engage in. Keywords: purpose, objectives, business activities. 2. Incorporates' Responsibilities: The agreement outlines the responsibilities and contributions of each incorporated involved in the formation of the corporation. It may include a detailed breakdown of their financial investments, expertise, resources, or services to be provided. Keywords: responsibilities, contributions, financial investments, expertise. 3. Promoters' Duties: This section describes the duties and obligations of the promoters, who are responsible for promoting and organizing the corporation. It may include tasks such as preparing the necessary legal documents, securing finances, seeking investors, or conducting market research. Keywords: duties, obligations, legal documents, finances, investors. 4. Share Allocation: The agreement determines the allocation of shares among the incorporates and promoters. It may outline the number and classes of shares each party will receive and any conditions for their transfer. Keywords: share allocation, classes of shares, transfer conditions. 5. Ownership and Control: This section defines the ownership structure of the corporation, indicating the percentage of ownership held by each party. It may also outline the decision-making process, voting rights, and the appointment of directors. Keywords: ownership, control, decision-making process, voting rights, directors. 6. Confidentiality and Non-Competition: The agreement may include clauses that ensure the confidentiality of sensitive business information and prohibit incorporates and promoters from engaging in competition during or after the incorporation process. Keywords: confidentiality, non-competition, sensitive information. 7. Termination: This section outlines the circumstances or events that may lead to the termination of the agreement. It may include provisions for dispute resolution and methods to handle potential conflicts between the parties. Keywords: termination, dispute resolution, conflict resolution. Note: There are no specific types of Los Angeles, California Preincorporation Agreement between Incorporates and Promoters, as each agreement is customized to fit the specific needs of the parties involved. However, the aforementioned elements are typically covered in such agreements regardless of their variations.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
