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.
The Virgin Islands Preincorporation Agreement between Incorporates and Promoters is a legal document that outlines the agreement between individuals or entities who are in the process of incorporating a business in the Virgin Islands. This agreement serves as a blueprint to establish the roles, responsibilities, and obligations between the incorporates and promoters involved. One specific type of the Virgin Islands Preincorporation Agreement between Incorporates and Promoters is the General Preincorporation Agreement. This agreement sets out the basic terms and conditions for the formation of a new company. It includes provisions regarding the allocation of shares, appointment of directors, distribution of profits, and management decisions. Another type is the Specific Purpose Preincorporation Agreement. This agreement is tailored to a particular business endeavor or project. It outlines the specific goals, objectives, and actions required to accomplish the intended purpose, such as developing a real estate project, launching a new product, or entering into a joint venture. The Virgin Islands Preincorporation Agreement generally includes the following key elements: 1. Parties: The agreement identifies all the incorporates and promoters involved, along with their respective roles and responsibilities. 2. Purpose: It clearly defines the purpose for which the company is being formed, whether it is for profit, non-profit, or a specific project. 3. Shares and Capital: This section outlines the allocation and distribution of shares and capital among the incorporates and promoters. 4. Management and Decision Making: It specifies how decisions will be made, who will have authority, and the process for resolving any conflicts or disputes. 5. Term and Termination: The agreement determines the duration of the agreement and the conditions under which it can be terminated. 6. Confidentiality and Non-compete: It may include clauses that protect the confidentiality of information shared during the preincorporation stage and restrict incorporates and promoters from engaging in competing activities. 7. Governing Law and Jurisdiction: The agreement indicates the applicable laws and jurisdiction in the Virgin Islands for any disputes arising from the agreement. It is important for all incorporates and promoters to carefully review and negotiate the terms and conditions of the Virgin Islands Preincorporation Agreement before proceeding with the incorporation process. Seeking legal advice or assistance is highly recommended ensuring compliance with Virgin Islands laws and regulations.The Virgin Islands Preincorporation Agreement between Incorporates and Promoters is a legal document that outlines the agreement between individuals or entities who are in the process of incorporating a business in the Virgin Islands. This agreement serves as a blueprint to establish the roles, responsibilities, and obligations between the incorporates and promoters involved. One specific type of the Virgin Islands Preincorporation Agreement between Incorporates and Promoters is the General Preincorporation Agreement. This agreement sets out the basic terms and conditions for the formation of a new company. It includes provisions regarding the allocation of shares, appointment of directors, distribution of profits, and management decisions. Another type is the Specific Purpose Preincorporation Agreement. This agreement is tailored to a particular business endeavor or project. It outlines the specific goals, objectives, and actions required to accomplish the intended purpose, such as developing a real estate project, launching a new product, or entering into a joint venture. The Virgin Islands Preincorporation Agreement generally includes the following key elements: 1. Parties: The agreement identifies all the incorporates and promoters involved, along with their respective roles and responsibilities. 2. Purpose: It clearly defines the purpose for which the company is being formed, whether it is for profit, non-profit, or a specific project. 3. Shares and Capital: This section outlines the allocation and distribution of shares and capital among the incorporates and promoters. 4. Management and Decision Making: It specifies how decisions will be made, who will have authority, and the process for resolving any conflicts or disputes. 5. Term and Termination: The agreement determines the duration of the agreement and the conditions under which it can be terminated. 6. Confidentiality and Non-compete: It may include clauses that protect the confidentiality of information shared during the preincorporation stage and restrict incorporates and promoters from engaging in competing activities. 7. Governing Law and Jurisdiction: The agreement indicates the applicable laws and jurisdiction in the Virgin Islands for any disputes arising from the agreement. It is important for all incorporates and promoters to carefully review and negotiate the terms and conditions of the Virgin Islands Preincorporation Agreement before proceeding with the incorporation process. Seeking legal advice or assistance is highly recommended ensuring compliance with Virgin Islands laws and regulations.
