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The Promissory Note Cosigner Agreement is essential in Canadian lending practices where additional security is required for a loan or credit facility. This document is typically used when a primary borrower's creditworthiness or financial status alone is insufficient to secure the desired financing, requiring a third party (cosigner) to guarantee the debt. The agreement must comply with Canadian federal legislation, including the Bills of Exchange Act, and relevant provincial laws governing guarantees and consumer protection. It details the cosigner's obligations, the conditions under which they become liable, notice requirements, and the extent of their liability. The document is crucial for both personal and business lending scenarios, providing lenders with additional security while clearly defining the rights and obligations of all parties involved. The agreement includes specific provisions for enforcement, default remedies, and communication requirements, making it a vital tool in risk management for Canadian financial transactions.

1. Parties: Identifies and defines the Lender, Primary Borrower, and Cosigner with their full legal names and addresses

2. Background: Explains the context of the agreement, referring to the primary promissory note and the desire to have it cosigned

3. Definitions: Defines key terms used throughout the agreement including 'Primary Note', 'Obligations', 'Default', and other relevant terms

4. Cosigner's Guarantee: Details the fundamental promise by the cosigner to guarantee the primary borrower's obligations under the promissory note

5. Scope of Liability: Defines the extent of the cosigner's liability and specifies whether it is limited or unlimited

6. Nature of Obligation: Establishes that the cosigner's obligation is joint and several with the primary borrower

7. Waiver of Rights: Specifies rights the cosigner waives, such as requiring the lender to first pursue the primary borrower

8. Payment Terms: Outlines when and how the cosigner must fulfill payment obligations if the primary borrower defaults

9. Duration: Specifies how long the cosigner's obligations remain in effect

10. Notices: Details how and when notices must be given to the cosigner regarding the primary borrower's payment status or defaults

11. Governing Law: Specifies that the agreement is governed by Canadian law and the applicable province

12. Execution: Signature block for all parties with date and witness provisions