Which of the Following Is Not True About Promoters of a Corporation

question 17

Multiple Choice

Which of the following is not true about promoters of a corporation?

• A) A promoter can be relieved of liability on a contract entered into on behalf of a corporation with a third party if, after the corporation is formed, there is a novation.
• B) A promoter can be relieved of liability on a contract entered into on behalf of a corporation with a third party if, at the time the contract is entered into, the third party agrees to a novation to occur automatically upon the valid creation of the corporation.
• C) The creation of the corporation does not automatically release the promoter from contracts entered into on behalf of the corporation.
• D) If the corporation fails to come into existence, the promoter cannot be held liable on a contract entered into on behalf of the corporation.
• E) If the corporation is formed, it becomes liable on a promoter's contract only if the promoter agrees to be bound by the contract.

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Definitions:

Infertility

The inability to conceive a baby.

Blockage

The obstruction or hindrance in the flow or movement of something.

Fallopian Tubes

Pair of tubes along which eggs travel from the ovaries to the uterus in the female reproductive system.

Closed Adoptions

Adoption processes where there is no exchange of contact information and no contact between the biological and adoptive families after the adoption is finalized.