Question: Godard Inc enters into an agreement on March 1 2013

Godard Inc. enters into an agreement on March 1, 2013, to sell 60% of a wholly owned subsidiary, Combine
Ltd., which it has owned for several years to Svelt Inc. Godard’s representatives on the board of directors of Combine will immediately resign and will be replaced by Svelt Inc.
Godard has also provided Combine with short-term financing in the form of a demand loan. Svelt has agreed to apply certain operating decisions that Godard requires as long as the demand loan is outstanding. Godard can veto any operating decision that is contrary to Godard’s requirements.
Does Godard still have control over Combine? Explain.

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  • CreatedJune 09, 2015
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