Final Answer:
EEE' contract still in effect after a buyout is typically governed by Novation thus option B is correct.
Step-by-step explanation:
Novation is a legal concept that plays a crucial role in contracts, particularly in the context of buyouts or mergers. In the scenario described, if a buyout occurs, novation allows the original contract (EEE') to remain in effect, but with a substitution of one of the parties. The new entity resulting from the buyout steps into the shoes of the original contracting party, assuming both the rights and obligations outlined in the existing contract. This legal mechanism ensures the continuity of the contractual relationship despite changes in ownership or corporate structure.
Unlike novation, other options listed do not necessarily address the continuation of the original contract after a buyout. A merger clause typically defines the agreement between the parties but may not explicitly address the impact of a buyout on the contract. Force majeure is a clause that covers unforeseeable events that may prevent the fulfillment of contractual obligations but is not directly related to changes in ownership. Rescission involves the termination of a contract, which is not the case when novation is implemented, as the contract persists with the new party.
In summary, novation is the appropriate legal mechanism when a buyout occurs, allowing for the seamless continuation of the existing contract with the involvement of the new entity (option B). This ensures the preservation of the contractual rights and obligations initially established by the parties involved, despite the change in corporate ownership or structure.