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.
Keywords: Cuyahoga Ohio, preincorporation agreement, Incorporates, Promoters Description: The Cuyahoga Ohio Preincorporation Agreement between Incorporates and Promoters is a legally binding document that outlines the agreements and obligations between the individuals seeking to incorporate a business in the Cuyahoga County of Ohio. This agreement serves as a preliminary contract between the incorporates (the individuals initiating the incorporation process) and the promoters (individuals responsible for organizing and promoting the business venture). There are different types of Cuyahoga Ohio Preincorporation Agreements between Incorporates and Promoters, each serving specific purposes. Let's explore a few of them: 1. Cuyahoga Ohio Preincorporation Agreement for Profit Corporations: This agreement is relevant when the incorporates intend to establish a for-profit corporation in Cuyahoga County, Ohio. It includes provisions related to the allocation of shares, distribution of profits, appointment of officers, and various operational aspects. 2. Cuyahoga Ohio Preincorporation Agreement for Nonprofit Corporations: For those interested in forming a nonprofit corporation in Cuyahoga County, Ohio, a specialized preincorporation agreement is required. This agreement addresses the unique considerations of nonprofit entities, such as the purpose of the corporation, restrictions on activities, governance structure, and potential tax-exempt status. 3. Cuyahoga Ohio Preincorporation Agreement for Professional Corporations: Professionals looking to establish a professional corporation, particularly in regulated fields such as medicine, law, or accounting, will require a specific preincorporation agreement. This agreement typically includes provisions related to licensing requirements, compliance with professional regulations, and limitations on liability. Regardless of the type of Cuyahoga Ohio Preincorporation Agreement, there are certain common elements that should be addressed. These may include the business name and purpose, duration of the agreement, rights and responsibilities of the incorporates and promoters, capital contributions, decision-making authority, and dispute resolution mechanisms. It is crucial for the incorporates and promoters to consult legal professionals experienced in business formation to draft, review, and execute a comprehensive Cuyahoga Ohio Preincorporation Agreement. This ensures that the rights and expectations of all parties involved are clearly defined and protects the interests of the business and its stakeholders.Keywords: Cuyahoga Ohio, preincorporation agreement, Incorporates, Promoters Description: The Cuyahoga Ohio Preincorporation Agreement between Incorporates and Promoters is a legally binding document that outlines the agreements and obligations between the individuals seeking to incorporate a business in the Cuyahoga County of Ohio. This agreement serves as a preliminary contract between the incorporates (the individuals initiating the incorporation process) and the promoters (individuals responsible for organizing and promoting the business venture). There are different types of Cuyahoga Ohio Preincorporation Agreements between Incorporates and Promoters, each serving specific purposes. Let's explore a few of them: 1. Cuyahoga Ohio Preincorporation Agreement for Profit Corporations: This agreement is relevant when the incorporates intend to establish a for-profit corporation in Cuyahoga County, Ohio. It includes provisions related to the allocation of shares, distribution of profits, appointment of officers, and various operational aspects. 2. Cuyahoga Ohio Preincorporation Agreement for Nonprofit Corporations: For those interested in forming a nonprofit corporation in Cuyahoga County, Ohio, a specialized preincorporation agreement is required. This agreement addresses the unique considerations of nonprofit entities, such as the purpose of the corporation, restrictions on activities, governance structure, and potential tax-exempt status. 3. Cuyahoga Ohio Preincorporation Agreement for Professional Corporations: Professionals looking to establish a professional corporation, particularly in regulated fields such as medicine, law, or accounting, will require a specific preincorporation agreement. This agreement typically includes provisions related to licensing requirements, compliance with professional regulations, and limitations on liability. Regardless of the type of Cuyahoga Ohio Preincorporation Agreement, there are certain common elements that should be addressed. These may include the business name and purpose, duration of the agreement, rights and responsibilities of the incorporates and promoters, capital contributions, decision-making authority, and dispute resolution mechanisms. It is crucial for the incorporates and promoters to consult legal professionals experienced in business formation to draft, review, and execute a comprehensive Cuyahoga Ohio Preincorporation Agreement. This ensures that the rights and expectations of all parties involved are clearly defined and protects the interests of the business and its stakeholders.
