A promoter can be held liable on a contract entered into on behalf of a corporation that is not yet formed.

Name: A promoter can be held liable on a contract entered into on behalf of a corporation that is not yet formed.
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Question

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The promoter of a corporation can be held personally liable for contracts entered into on behalf of the corporation before it is legally formed. Once the corporation is formed, the corporation becomes liable for contracts made on its behalf.

A Promoter Can Be Held Liable on a Contract Entered