All of the Following Are True of Promoters of a Corporation

question 76

Multiple Choice

All of the following are true of promoters of a corporation EXCEPT:

• A) They solicit investors to begin the corporation.
• B) They prepare the formal documents of incorporation.
• C) They may make contracts in the name of the corporation.
• D) They continue to solicit capital whenever needed after incorporation.

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Definitions:

Negotiability

The characteristic of a document, such as a check or bill of exchange, that allows it to be transferred or endorsed from one party to another in legal transactions.

Other Agreements

Pertains to additional contracts or understandings between parties that are separate from the main agreement.

Recital

In legal terms, a recital refers to a narrative or introductory part of a legal document that outlines the background information or context.

Non-negotiable

A term describing an instrument or agreement that cannot be transferred or altered by endorsement or negotiation.