This sample Employee Loan Agreement has been provided by Welch LLP and Kelly Santini LLP for

informational purposes only

and does not constitute advertising, a solicitation, or legal advice. Neither the transmission of this sample Employee Loan
Agreement nor the transmission of any information contained herein is intended to create, and receipt hereof or thereof does
not constitute formation of, a lawyer-client relationship. Internet subscribers and online readers should not rely upon this
sample Employee Loan Agreement or the information contained in this website for any purpose without seeking legal advice
from a qualified lawyer practicing in the reader’s province. There may be tax consequences to both the employer and the
employee when making a loan as contemplated herein. Tax advice should be solicited prior to making such a loan. The loan may
impact an employee’s eligibility to receive employment insurance benefits.  As such, legal advice should be sought by both the
employer and the employee before making a loan.

The information contained in this website is provided only as general information and may or may not reflect the most current
legal developments; accordingly, information on this website is not promised or guaranteed to be correct or complete. Welch
LLP and Kelly Santini LLP expressly disclaims all liability in respect to actions taken or not taken based on any or all the contents
of their website.

Employee Loan Agreement (the “Agreement”)

This is agreement is dated as of •, 2020

Between

• (the “Company”)

- And –

• (the “Employee”)

WHEREAS

A. The Employee is an employee of the Company; and

B. The Company has agreed to loan the Employee funds in an amount set forth below pursuant to
the terms of this Agreement.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Employee agree as follows:

1) The Company agrees to loan the Employee CAD$• [insert loan amount] (the “Loan”) on an interest
free basis except as provided below.

2) The Employee agrees and covenants to repay the loan starting • weeks [insert number of weeks
until first repayment installment is due and owing. Alternatively, given the uncertainty of when
the economy will “re-open” you can state that the loan repayments will commence upon the
employee returning to work] from the date of this agreement in • equal bi-weekly [insert number
of installment payments] installments of • [insert repayment amount].

3) By signing the Agreement, the Employee acknowledges that they are providing the Company with
written authorization to deduct the bi-weekly installments from the Employee’s pay cheque in
accordance with section 13(3) of the Ontario Employment Standards Act, 2000 or section 254.1 of
the Canada Labour Code. The Company shall advise the Employee should it decide to make
deductions from the Employee’s pay cheques.
4) Failure to make any payment upon the applicable due date shall result in interest owing on such
payment at the rate of •% [insert annual interest rate. Under the Criminal Code, Annual interest
rate cannot exceed 60% although our sense an appropriate interest range would be 5-10%].

5) If the Employee’s employment is terminated for any reason whatsoever, including where the
Employee is dismissed with or without cause, resigns, or is laid off, or the Employee’s employment
ends by operation of law, the Loan shall remain due and payable in accordance with the terms of
this Agreement.

6) This Agreement shall be governed by and enforced in accordance with the laws of the Province of
Ontario and the federal laws of Canada applicable therein without regard to conflicts of law. If any
provision of this Agreement be deemed illegal or otherwise unenforceable, that provision shall be
severed and the remainder of this Agreement shall remain in full force and effect. Failure to enforce
any provision of this Agreement shall not constitute a waiver of any other term hereof. A waiver of
a breach or default under this Agreement shall not be a waiver of any other or subsequent breach or
default. This Agreement may be executed by facsimile and in counterparts. This Agreement does not
in anyway impact the existing terms and conditions of the employment relationship between the
employer and the employee. Neither this Agreement nor any right or obligation under this
Agreement may be assigned by any Party without the prior written consent of the other Parties. This
Agreement enures to the benefit of and is binding upon the Parties and their respective successors
and permitted assigns. This Agreement constitutes the entire agreement between the Parties
pertaining to the subject matter of this Agreement and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the Parties, and there are
no representations, warranties or other agreements between the Parties, express or implied, in
connection with the subject matter of this Agreement except as specifically set out in this
Agreement.

7) Each of the Parties confirms that: (i) it has been instructed to obtain independent legal advice
(“ILA”) prior to executing this Agreement; (ii) has obtained or hereby waives its right to ILA; (iii) is
signing this Agreement voluntarily; and (iv) has read this Agreement and accepts and agrees to be
bound by its terms.

IN WITNESS WHEREOF the parties have executed this Agreement as of the date first mentioned
above.

_________________________ _______________________________
Witness [Employee Name]

[CORPORATION NAME]
By:
Name:
Title: