Fact Pattern 41-3
DIY Fasteners Company decides to consolidate its operations with Evergrip Studs, Inc., to form Fit-Rite Bolts & Screws Inc.
-Refer to Fact Pattern 41-3. Evergrip had rights in certain property. After the consolidation, Fit-Rite acquires the rights
A) automatically.
B) only after completing certain additional statutory procedures.
C) only if Evergrip's former shareholders expressly approve.
D) only if the acquisition is a specified result of the consolidation.

Question

Fact Pattern 41-3​
DIY Fasteners Company decides to consolidate its operations with Evergrip Studs, Inc., to form Fit-Rite Bolts & Screws Inc.
-Refer to Fact Pattern 41-3. Evergrip had rights in certain property. After the consolidation, Fit-Rite acquires the rights​
A) ​automatically.
B) ​only after completing certain additional statutory procedures.
C) only if Evergrip's former shareholders expressly approve.
D) only if the acquisition is a specified result of the consolidation.

Quizplus · Accepted Answer

In a consolidation, the surviving entity (Fit-Rite Bolts & Screws Inc. in this case) acquires all of the assets and liabilities of the company being consolidated (Evergrip Studs, Inc.). Therefore, Fit-Rite would automatically acquire the rights to the property that Evergrip had prior to the consolidation.

Fact Pattern 41-3​ DIY Fasteners Company Decides to Consolidate Its Operations with Evergrip

Fact Pattern 41-3 DIY Fasteners Company Decides to Consolidate Its Operations with Evergrip