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 Harris Texas Preincorporation Agreement between Incorporates and Promoters is a legally binding contract that outlines the terms and conditions agreed upon by the individuals involved in the process of forming a new corporation in Harris County, Texas. This agreement serves as a foundation for the corporation's formation and sets forth the roles, responsibilities, and obligations of the incorporates and promoters involved. In a Harris Texas Preincorporation Agreement, the incorporates and promoters typically agree on various key elements related to the formation of the corporation. These elements may include: 1. Name and Purpose: The agreement will specify the desired name of the corporation and outline its intended purpose or business activities. 2. Capital Contributions: The agreement will outline the amount and type of capital contributions that each incorporated and promoter will be required to make towards the initial funding of the corporation. 3. Ownership and Shares: The agreement will detail the number of shares to be distributed among the incorporates and promoters, as well as any restrictions or conditions on the transfer of these shares. 4. Management and Decision-Making: The agreement will establish the guidelines for the management and decision-making processes within the corporation, including the appointment of directors, officers, and any specific requirements for board meetings or voting procedures. 5. Responsibilities and Liabilities: The agreement will define the rights, duties, and liabilities of the incorporates and promoters, ensuring clarity regarding their obligations towards the corporation and each other. 6. Intellectual Property: If applicable, the agreement may address the ownership or licensing of any intellectual property rights related to the corporation's activities. It is worth noting that there may be variations or different types of Harris Texas Preincorporation Agreements between Incorporates and Promoters, depending on the specific circumstances and needs of the parties involved. For instance, some agreements may include additional clauses related to non-disclosure or confidentiality, while others may focus more on indemnification and dispute resolution provisions. Therefore, it is essential for all parties to seek legal advice and tailor the agreement to their particular requirements. In conclusion, a Harris Texas Preincorporation Agreement between Incorporates and Promoters is a crucial legal document that facilitates the seamless formation of a new corporation. By clearly defining the rights, responsibilities, and obligations of the parties involved, this agreement ensures a solid foundation for the corporation's operations and helps mitigate potential conflicts or disputes during the early stages of its existence.A Harris Texas Preincorporation Agreement between Incorporates and Promoters is a legally binding contract that outlines the terms and conditions agreed upon by the individuals involved in the process of forming a new corporation in Harris County, Texas. This agreement serves as a foundation for the corporation's formation and sets forth the roles, responsibilities, and obligations of the incorporates and promoters involved. In a Harris Texas Preincorporation Agreement, the incorporates and promoters typically agree on various key elements related to the formation of the corporation. These elements may include: 1. Name and Purpose: The agreement will specify the desired name of the corporation and outline its intended purpose or business activities. 2. Capital Contributions: The agreement will outline the amount and type of capital contributions that each incorporated and promoter will be required to make towards the initial funding of the corporation. 3. Ownership and Shares: The agreement will detail the number of shares to be distributed among the incorporates and promoters, as well as any restrictions or conditions on the transfer of these shares. 4. Management and Decision-Making: The agreement will establish the guidelines for the management and decision-making processes within the corporation, including the appointment of directors, officers, and any specific requirements for board meetings or voting procedures. 5. Responsibilities and Liabilities: The agreement will define the rights, duties, and liabilities of the incorporates and promoters, ensuring clarity regarding their obligations towards the corporation and each other. 6. Intellectual Property: If applicable, the agreement may address the ownership or licensing of any intellectual property rights related to the corporation's activities. It is worth noting that there may be variations or different types of Harris Texas Preincorporation Agreements between Incorporates and Promoters, depending on the specific circumstances and needs of the parties involved. For instance, some agreements may include additional clauses related to non-disclosure or confidentiality, while others may focus more on indemnification and dispute resolution provisions. Therefore, it is essential for all parties to seek legal advice and tailor the agreement to their particular requirements. In conclusion, a Harris Texas Preincorporation Agreement between Incorporates and Promoters is a crucial legal document that facilitates the seamless formation of a new corporation. By clearly defining the rights, responsibilities, and obligations of the parties involved, this agreement ensures a solid foundation for the corporation's operations and helps mitigate potential conflicts or disputes during the early stages of its existence.
