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Phillips was the principal promoter of the Waterloo Corporation, a corporation which was to have been incorporated not later than July 31, 2002. Among the many things to be accomplished prior to incorporation were the obtaining of capital, the hiring of key executives and the securing of adequate office space. In this connection, Phillips obtained written subscriptions for $1.4 million common stock from 17 individuals. He hired himself as the chief executive officer of Waterloo at $200,000 for five years and leased three floors of office space from Downtown Office Space, Inc. The contract with Downtown was made in the name of the corporation. Phillips had indicated orally that the corporation would be coming into existence shortly. The corporation never came into existence, through no fault of Phillips. Which of the following is correct?
a. The subscribers have a recognized right to sue for damages since the stock never became available for purchase.
b. Phillips is personally liable on the lease to Downtown.
c. Phillips, as an agent of the corporation, has the right to recover the fair value of the services which he rendered to the proposed corporation.
d. The subscribers are bound to purchase stock from Phillips even though the corporation never carne into existence.
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