Continue using original plan for new entity

Hi,

I would greatly appreciate insight on this matter. Client had a company "A" (since 09) and a DB PLAN for company A since 2012. In March 2019 he sold "A" --however, corporation is still in existence and its only asset is aprox 10,000 in cash. In April 2019 he set up a new corp "B" (set up a corp and purchased the assets of a business). Company B has new employees and does not do the same service as '"A" corp did.

1.  Is he allowed to continue the DB Plan of 'A" for company "B'? (so that he has prior service and benifits from "A" and salary average from "A")?

2. If yes, is the owner the only employee eligible to participate in the plan for 2019 (as he has a year of service from the prior company and is the ONLY employee that will have 1,000 hours for 2019). Thank you very much for any insight on this matter,

It sounds like this is a controlled group and he can probably amend the plan to extend it to company B's employees, but this is too important and too fact-critical to resolve through a message board inquiry.

jpod, thank you very much. Yes, this is fact critical., however, the fact that you have pointed out that this is a controlled group brings clarity.

53 minutes ago, SSRRS said:

jpod, thank you very much. Yes, this is fact critical., however, the fact that you have pointed out that this is a controlled group brings clarity.

It shouldn't. 

Was company A sold in an Asset sale or a Stock sale?

Company A was sold in an asset sale. Thank you Lou S.