Warehouse Loan Agreement for Canada

Warehouse Loan Agreement Template for Canada

A comprehensive legal agreement governed by Canadian law that establishes the terms and conditions for a loan facility secured by inventory stored in one or more warehouse facilities. The document outlines the lending arrangement, security interests, operational requirements for warehouse management, reporting obligations, and enforcement mechanisms. It incorporates provisions compliant with Canadian federal banking regulations and provincial personal property security laws, particularly focusing on the creation and perfection of security interests in stored inventory.

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What is a Warehouse Loan Agreement?

The Warehouse Loan Agreement is essential for businesses seeking to leverage their inventory as collateral for financing while ensuring proper storage and management of such inventory. This document type is commonly used in Canadian commercial lending practices where businesses require working capital secured against their stored goods. The agreement combines elements of secured lending and warehouse management, detailing the rights and obligations of all parties involved. It must comply with Canadian federal banking regulations and provincial secured transactions laws, including the Personal Property Security Act (PPSA) and Warehouse Receipts Act. The document provides comprehensive coverage of loan terms, security arrangements, inventory management requirements, monitoring provisions, and enforcement mechanisms.

What sections should be included in a Warehouse Loan Agreement?

1. Parties: Identifies the lender, borrower, and warehouse operator (if separate from borrower)

2. Background: Sets out the context of the agreement, including the purpose of the loan and the warehousing arrangement

3. Definitions: Defines key terms used throughout the agreement

4. Loan Facility: Details of the loan amount, purpose, availability, and drawdown procedures

5. Interest and Fees: Specifies interest rates, calculation methods, and applicable fees

6. Security Interest: Describes the security interest in the warehoused goods and other collateral

7. Warehouse Arrangements: Specifies the terms of storage, handling, and maintenance of the collateral

8. Representations and Warranties: Standard representations and warranties from the borrower regarding their business and the collateral

9. Covenants: Ongoing obligations of the borrower regarding business operations and the collateral

10. Conditions Precedent: Conditions that must be satisfied before the loan facility becomes available

11. Events of Default: Circumstances constituting default and consequences

12. Enforcement Rights: Lender's rights and remedies upon default

13. General Provisions: Standard boilerplate provisions including notices, amendments, governing law

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

1. Insurance: Detailed insurance requirements when specific coverage types are needed for the warehoused goods

2. Environmental Matters: Required when storing goods that could pose environmental risks

3. Third Party Warehouse Operator Provisions: Required when the warehouse is operated by a third party rather than the borrower

4. Multiple Warehouse Locations: Required when goods are stored across multiple warehouse facilities

5. Intellectual Property: Required when the stored goods involve branded products or licensed merchandise

6. Cross-Border Provisions: Required when the warehouse arrangement involves multiple jurisdictions

7. Subordination Provisions: Required when there are multiple secured creditors

8. Government Contract Provisions: Required when the warehoused goods relate to government contracts

What schedules should be included in a Warehouse Loan Agreement?

1. Schedule A - Facility Details: Detailed terms of the loan facility including limits, interest rates, and fees

2. Schedule B - Warehouse Locations: List and details of approved warehouse facilities

3. Schedule C - Eligible Inventory: Description of types of inventory that qualify as acceptable collateral

4. Schedule D - Borrowing Base Certificate: Form for calculating available credit based on eligible inventory

5. Schedule E - Insurance Requirements: Detailed insurance requirements and minimum coverage amounts

6. Schedule F - Reporting Requirements: Forms and timing for inventory and financial reporting

7. Schedule G - Warehouse Receipt Form: Standard form of warehouse receipt to be used

8. Schedule H - Security Documentation: Forms of security agreements and PPSA registrations

Authors

Alex Denne

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

Jurisdiction

Canada

Publisher

Genie AI

Document Type

Finance Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Manufacturing

Retail

Wholesale Distribution

Agriculture

Commodities Trading

Consumer Goods

Automotive

Electronics

Pharmaceuticals

Food and Beverage

Textiles

Industrial Equipment

Chemical Storage

Logistics and Supply Chain

Relevant Teams

Legal

Finance

Treasury

Operations

Risk Management

Compliance

Supply Chain

Warehouse Operations

Credit

Commercial Banking

Trade Finance

Security

Relevant Roles

Chief Financial Officer

Treasury Manager

Finance Director

Commercial Lending Officer

Credit Risk Manager

Warehouse Manager

Operations Director

Legal Counsel

Compliance Officer

Supply Chain Manager

Inventory Control Manager

Security Trustee

Corporate Banking Manager

Trade Finance Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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