Anti-Cash Hoarding Clause (Loan Agreement)

Summary

This precedent is an anti-cash hoarding clause for corporate loan agreements and credit facilities governed by applicable provincial and federal laws of Canada. This clause sets out the process pursuant to which a loan agreement will give a lender the right of denying loan advances to the borrower to avoid the borrower’s having excess cash available. This form includes practical guidance and drafting notes. For more information on loan and security agreements, see the practice notes Loan Types, Asset-Based Loans, Loan Agreement Alternatives, and Termination of Loan and Security Documents. For more information about the use of covenants in a loan agreement, see Covenants in a Loan Agreement. For an overview of the key elements found in a loan agreement, see Loan Agreement: Key Elements. For information to assist you with the drafting and negotiation of loan and credit agreements, see the flowchart Loan and Credit Agreements Table. For an introduction to asset-based financing, see ...