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Rollover Loan Agreement for Canada

Rollover Loan Agreement Template for Canada

A Rollover Loan Agreement under Canadian law is a specialized financing document that enables borrowers to extend or 'roll over' their loan facility for additional periods without the need for a new loan agreement. This agreement is structured to comply with Canadian federal and provincial lending regulations, including the Interest Act and relevant provincial securities legislation. It details the mechanisms for rolling over the loan, interest calculations, conditions precedent for each rollover period, and includes specific provisions for compliance with Canadian usury laws and disclosure requirements. The agreement typically incorporates both federal and provincial regulatory requirements, making it a comprehensive document for managing ongoing lending relationships in the Canadian context.

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Rollover Loan Agreement

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What is a Rollover Loan Agreement?

The Rollover Loan Agreement is designed for situations where businesses require flexible, ongoing access to credit without the administrative burden of executing new loan agreements at the end of each term. This document type is particularly relevant in the Canadian lending landscape, where it must comply with federal legislation such as the Interest Act and Bank Act, as well as provincial consumer protection and securities laws. The agreement typically includes comprehensive provisions for the rollover mechanism, interest rate calculations, conditions for renewal, and security arrangements if applicable. It's commonly used in commercial lending scenarios where borrowers need to maintain consistent access to funding while retaining the ability to adjust loan terms periodically. The document incorporates specific Canadian legal requirements regarding interest rate disclosure, calculation methods, and borrower protections, making it distinct from similar agreements in other jurisdictions.

What sections should be included in a Rollover Loan Agreement?

1. Parties: Identification of the lender and borrower with their full legal names and addresses

2. Background: Context of the loan arrangement and purpose of the rollover facility

3. Definitions: Definitions of key terms used throughout the agreement, including 'Rollover Period', 'Interest Rate', and 'Maturity Date'

4. The Facility: Details of the loan amount, purpose, and availability

5. Rollover Mechanics: Specific provisions governing the rollover process, notice requirements, and conditions for rollover

6. Interest and Fees: Interest rate calculation, payment dates, and any associated fees

7. Repayment Terms: Terms for repayment including scheduled payments and final maturity

8. Conditions Precedent: Conditions that must be satisfied before the loan is advanced or rolled over

9. Representations and Warranties: Standard declarations made by the borrower about their legal and financial status

10. Covenants: Ongoing obligations of the borrower during the term of the loan

11. Events of Default: Circumstances that constitute default and the lender's rights upon default

12. Governing Law and Jurisdiction: Specification of Canadian law as governing law and jurisdiction for disputes

What sections are optional to include in a Rollover Loan Agreement?

1. Security: Required if the loan is secured by any assets or guarantees

2. Guarantees: Required if there are third-party guarantors for the loan

3. Insurance Requirements: Required if specific insurance coverage is mandated for the borrower

4. Tax Provisions: Detailed tax considerations, required if complex tax implications exist

5. Assignment and Transfer: Required if either party needs the right to assign or transfer their rights

6. Increased Costs and Market Disruption: Required for loans sensitive to market conditions or regulatory changes

7. Multi-currency Provisions: Required if the facility can be drawn in multiple currencies

What schedules should be included in a Rollover Loan Agreement?

1. Schedule 1 - Loan Details: Specific terms of the loan including amount, interest rate, and payment schedule

2. Schedule 2 - Conditions Precedent Documents: List of required documentation to be provided before drawdown

3. Schedule 3 - Rollover Notice Form: Standard form for requesting loan rollover

4. Schedule 4 - Calculation of Interest: Detailed methodology for interest calculation

5. Schedule 5 - Fee Schedule: Breakdown of all applicable fees and charges

6. Appendix A - Compliance Certificate: Form of certificate confirming compliance with loan terms

7. Appendix B - Draw Down Request Form: Standard form for requesting loan disbursement

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions


















































Clauses





































Relevant Industries

Banking and Financial Services

Real Estate

Manufacturing

Retail

Technology

Infrastructure

Energy

Healthcare

Transportation and Logistics

Agriculture

Mining and Resources

Construction

Telecommunications

Relevant Teams

Legal

Finance

Treasury

Compliance

Risk Management

Credit

Corporate Secretariat

Operations

Business Development

Relationship Management

Relevant Roles

Chief Financial Officer

Treasury Manager

Finance Director

Corporate Lawyer

Legal Counsel

Compliance Officer

Risk Manager

Credit Manager

Banking Relationship Manager

Loan Officer

Corporate Secretary

Financial Controller

Account Manager

Business Development Manager

Finance Operations Manager

Industries








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