Helen is a promoter who, prior to forming Bayne Corp., contracted to purchase tile-manufacturing machinery from Owen Machinery Inc. The contract was negotiated and entered into in the name of Bayne Corp. Subsequently, a certificate of incorporation was issued to Bayne Corp. Which of the following statements is true of this scenario?
A. Helen would be liable for the contract with Owen Machinery Inc.
B. If the board of directors of Bayne Corp. issues a suitable resolution, Helen would be relieved from all liability for the contract with Owen Machinery Inc.
C. Since Bayne Corp. was not in existence at the time the contract was negotiated, the contract is void.
D. Only Bayne Corp. is liable for the contract with Owen Machinery Inc. as it received its certificate of incorporation.
Answer: A
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