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.
Arizona Preincorporation Agreement between Incorporates and Promoters is a legally binding document that outlines the terms and conditions for the establishment of a corporation in the state of Arizona. This agreement serves as a crucial step in the incorporation process, defining the roles, responsibilities, and liabilities of the parties involved. Keywords: Arizona, preincorporation agreement, incorporates, promoters, corporation. A Preincorporation Agreement is typically used when the incorporates and promoters are working together to form a corporation. It ensures that all parties are on the same page and have a clear understanding of their obligations before the formal incorporation process begins. The agreement may include provisions related to the purpose of the corporation, the initial capital contributions, the allocation of shares, the management structure, and other important details. It outlines the rights and responsibilities of each party involved in the formation of the corporation, promoting a fair and transparent business relationship. Different types of Preincorporation Agreements can exist, depending on the specific needs and preferences of the parties involved. For example, a Joint Venture Preincorporation Agreement may be used when two or more individuals or entities collaborate to form a corporation for a specific project or venture. This type of agreement outlines the terms and conditions of the joint venture, including the sharing of profits and liabilities. Another type of Preincorporation Agreement is the Standard Preincorporation Agreement, which covers the general terms and conditions required for the formation of a corporation. This may include clauses related to financing, intellectual property, employment agreements, and other common considerations. It is important for all parties involved to carefully review and negotiate the terms of the Preincorporation Agreement to ensure that their interests are protected. Seeking legal advice before entering into such agreements is highly recommended ensuring compliance with Arizona state laws and regulations. In conclusion, the Arizona Preincorporation Agreement between Incorporates and Promoters is a crucial document that sets out the terms and conditions for the formation of a corporation. It outlines the responsibilities, rights, and obligations of the parties involved, and may vary depending on the specific circumstances and goals of the incorporation.Arizona Preincorporation Agreement between Incorporates and Promoters is a legally binding document that outlines the terms and conditions for the establishment of a corporation in the state of Arizona. This agreement serves as a crucial step in the incorporation process, defining the roles, responsibilities, and liabilities of the parties involved. Keywords: Arizona, preincorporation agreement, incorporates, promoters, corporation. A Preincorporation Agreement is typically used when the incorporates and promoters are working together to form a corporation. It ensures that all parties are on the same page and have a clear understanding of their obligations before the formal incorporation process begins. The agreement may include provisions related to the purpose of the corporation, the initial capital contributions, the allocation of shares, the management structure, and other important details. It outlines the rights and responsibilities of each party involved in the formation of the corporation, promoting a fair and transparent business relationship. Different types of Preincorporation Agreements can exist, depending on the specific needs and preferences of the parties involved. For example, a Joint Venture Preincorporation Agreement may be used when two or more individuals or entities collaborate to form a corporation for a specific project or venture. This type of agreement outlines the terms and conditions of the joint venture, including the sharing of profits and liabilities. Another type of Preincorporation Agreement is the Standard Preincorporation Agreement, which covers the general terms and conditions required for the formation of a corporation. This may include clauses related to financing, intellectual property, employment agreements, and other common considerations. It is important for all parties involved to carefully review and negotiate the terms of the Preincorporation Agreement to ensure that their interests are protected. Seeking legal advice before entering into such agreements is highly recommended ensuring compliance with Arizona state laws and regulations. In conclusion, the Arizona Preincorporation Agreement between Incorporates and Promoters is a crucial document that sets out the terms and conditions for the formation of a corporation. It outlines the responsibilities, rights, and obligations of the parties involved, and may vary depending on the specific circumstances and goals of the incorporation.
