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.
A New Hampshire Preincorporation Agreement is a legal document that outlines the terms and conditions agreed upon between the incorporates and promoters before incorporating a business in the state of New Hampshire. It serves as a crucial step in the formation of a corporation, safeguarding the interests of all parties involved in the process. The agreement sets out the framework for the future company and delineates the roles, responsibilities, and financial obligations of the incorporates and promoters. Some important aspects typically covered in a New Hampshire Preincorporation Agreement include: 1. Purpose and Name: The agreement specifies the purpose and nature of the business to be incorporated, along with the proposed name of the company. This helps ensure that all parties are aligned in their understanding of the intended operations. 2. Contributions: It outlines the financial and non-financial contributions to be made by each promoter and incorporated towards the new business. This might include capital investments, assets, intellectual property, or services that will be provided to facilitate the establishment of the corporation. 3. Ownership Distribution: The agreement determines the ownership percentage or capital contributions that each party will hold in the newly formed company. This is important for establishing the rights and privileges of each stakeholder and their influence over decision-making. 4. Management and Control: It delineates the roles and responsibilities of the incorporates and promoters in managing and controlling the business. This may include appointing directors, officers, and establishing decision-making procedures. 5. Intellectual Property: In cases where intellectual property is involved, the agreement addresses matters such as ownership, licensing, usage rights, and protection of intellectual property rights. 6. Confidentiality and Non-Compete: It includes clauses to protect sensitive information shared during the preincorporation stage and may impose restrictions on promoters or incorporates from engaging in competitive activities during or after the incorporation process. 7. Indemnification: The agreement may outline the obligations of each party to indemnify and hold harmless the other parties from any liabilities or damages that may arise during the formation process. Different types of New Hampshire Preincorporation Agreements may exist based on the specific needs and circumstances of the parties involved. These agreements can vary in terms of complexity and content, such as agreements tailored to technology startups, nonprofits, or professional service corporations. Each type of agreement may have its own set of provisions and clauses that address industry-specific requirements and legal considerations. In conclusion, a New Hampshire Preincorporation Agreement between Incorporates and Promoters is a critical legal document for establishing a corporation in New Hampshire. It sets the foundation for the future business, defining the roles, responsibilities, and financial arrangements between incorporates and promoters. As always, it is recommended to consult with a legal professional experienced in corporate law to ensure that the agreement meets all legal requirements and adequately protects the interests of all parties involved.A New Hampshire Preincorporation Agreement is a legal document that outlines the terms and conditions agreed upon between the incorporates and promoters before incorporating a business in the state of New Hampshire. It serves as a crucial step in the formation of a corporation, safeguarding the interests of all parties involved in the process. The agreement sets out the framework for the future company and delineates the roles, responsibilities, and financial obligations of the incorporates and promoters. Some important aspects typically covered in a New Hampshire Preincorporation Agreement include: 1. Purpose and Name: The agreement specifies the purpose and nature of the business to be incorporated, along with the proposed name of the company. This helps ensure that all parties are aligned in their understanding of the intended operations. 2. Contributions: It outlines the financial and non-financial contributions to be made by each promoter and incorporated towards the new business. This might include capital investments, assets, intellectual property, or services that will be provided to facilitate the establishment of the corporation. 3. Ownership Distribution: The agreement determines the ownership percentage or capital contributions that each party will hold in the newly formed company. This is important for establishing the rights and privileges of each stakeholder and their influence over decision-making. 4. Management and Control: It delineates the roles and responsibilities of the incorporates and promoters in managing and controlling the business. This may include appointing directors, officers, and establishing decision-making procedures. 5. Intellectual Property: In cases where intellectual property is involved, the agreement addresses matters such as ownership, licensing, usage rights, and protection of intellectual property rights. 6. Confidentiality and Non-Compete: It includes clauses to protect sensitive information shared during the preincorporation stage and may impose restrictions on promoters or incorporates from engaging in competitive activities during or after the incorporation process. 7. Indemnification: The agreement may outline the obligations of each party to indemnify and hold harmless the other parties from any liabilities or damages that may arise during the formation process. Different types of New Hampshire Preincorporation Agreements may exist based on the specific needs and circumstances of the parties involved. These agreements can vary in terms of complexity and content, such as agreements tailored to technology startups, nonprofits, or professional service corporations. Each type of agreement may have its own set of provisions and clauses that address industry-specific requirements and legal considerations. In conclusion, a New Hampshire Preincorporation Agreement between Incorporates and Promoters is a critical legal document for establishing a corporation in New Hampshire. It sets the foundation for the future business, defining the roles, responsibilities, and financial arrangements between incorporates and promoters. As always, it is recommended to consult with a legal professional experienced in corporate law to ensure that the agreement meets all legal requirements and adequately protects the interests of all parties involved.
