Holding companies may give creditors of their subsidiary companies a ‘letter of comfort’ regarding the ability of the subsidiary to pay its debts. What is the legal effect of a 'letter of comfort'?
A.
It is legally binding on the holding company only
B.
It is legally binding on the subsidiary company only
C.
It is legally binding on the holding company and subsidiary company
D.
It is not legally binding on the holding company or subsidiary company