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.
Louisiana Preincorporation Agreement between Incorporates and Promoters is a legally binding document that outlines the terms and conditions agreed upon by the individuals (promoters) who are responsible for organizing and planning the formation of a corporation and the incorporates who act as the initial shareholders of the proposed corporation. This agreement serves as a crucial step in establishing a corporation in accordance with Louisiana state laws. The purpose of the Louisiana Preincorporation Agreement between Incorporates and Promoters is to define the responsibilities, obligations, and rights of both parties involved in the corporation's preincorporation stage. It aims to ensure a smooth and well-coordinated process, as well as to protect the interests of all parties. The agreement typically includes important provisions, such as the proposed corporation's name, purpose, registered office, duration, and the number of authorized shares. It also establishes the roles and responsibilities of the promoters, who are responsible for preparing and filing the necessary documents with the Louisiana Secretary of State, such as the Articles of Incorporation. In addition, the agreement outlines the duties and obligations of the incorporates, who are often the initial shareholders of the corporation. While there may not be different types of Louisiana Preincorporation Agreement between Incorporates and Promoters in a legal sense, the specific terms and conditions may vary depending on the unique nature of the proposed corporation and the agreement reached between the parties. Some agreements may include additional clauses related to the distribution of shares, the allocation of initial capital, or intellectual property rights specific to the corporation's business model. In conclusion, the Louisiana Preincorporation Agreement between Incorporates and Promoters is a crucial legal document that formalizes the working relationship between the promoters and incorporates during the preincorporation phase of a corporation. It establishes the foundation for the successful formation of a corporation and provides a clear understanding of the parties' roles, responsibilities, and obligations.
