Agreement by Company Adopting Contract Made on Its Behalf Before Incorporation (India) by OLL
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Agreement by Company Adopting Contract made on its behalf before its Incorporation
This Agreement made at New Delhi on this………………. day of………………. 2018 between Shri A of the 1st part, Shri B of the Second part and AB & Co. Ltd. (hereinafter referred to as ‘the company’) of the third part. Whereas after the execution of the contract on 10th July, 2018 (hereinafter referred to as “the said contract”) between Shri A, the vendor, and Shri B, on behalf of the company, the said company AB & Co. Ltd. has been incorporated under the Companies Act, 2013. Now it is hereby agreed by and between the parties hereto as under: 1. The said contract dated 10th July, 2018 is hereby adopted by the company and shall be binding on the said Shri A and on the company in the same manner and shall take effect in all respects as if the company had been in existence at the date of the agreement. 2. Shri B who actually signed on behalf of the proposed company shall be discharged from all liability under the said contract as the company had adopted and ratified the said contracts. In witness whereof the parties hereunto have put their hands and signatures and the company has caused its common seal affixed in the presence of Shri……………. and Shri……………. two directors who have set their respective hands and signatures the day and year first herein above written in terms of the Resolution passed in its Board of Directors in their meeting held on……………. Common Seal Witnesses: …………………. (Signature) 1…………………. Director 2…………………. …………………. (Signature) Director Signatures of A …………………. B….………
This legal template is used by a newly incorporated company in India to formally adopt and ratify a contract that was signed on its behalf by a promoter or representative before the company was legally formed. By signing this agreement, the company assumes all rights and obligations of the prior contract and releases the individual representative from personal liability.
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About this template
What is this template?
This document is a formal ratification agreement between a vendor, a promoter, and a new company. It is not a novation agreement involving a new party, but a specific adoption of pre-incorporation acts under the Companies Act 2013.
When should you use it?
Use this when a company has been incorporated and needs to legally take over a contract signed by its founders during the setup phase; use a Novation Agreement if the original contract is being replaced entirely.
What's inside
| Clause | Name | What it does |
|---|---|---|
| 1 | Adoption of Contract | Binds the Vendor and the Company to the pre-incorporation contract dated 10th July 2018 as if the company existed then. |
| 2 | Discharge of Liability | Discharges the individual who signed on behalf of the proposed company from all liability once the company ratifies the contract. |
Who it's for
- an Indian company ratifying a vendor contract signed by a promoter before the company's registration date
- a promoter seeking to be discharged from personal liability for a contract made on behalf of a future entity
How long it runs and how it's signed
Law it's drafted under
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