Document background
The Share Charge Agreement is a crucial security document used in Canadian lending and security arrangements when shares are being provided as collateral. It is commonly used in corporate finance transactions, acquisition financing, and general secured lending where a lender requires security over shares owned by a borrower or guarantor. The agreement must comply with provincial Personal Property Security Act (PPSA) requirements for creation and perfection of security interests, as well as relevant corporate legislation governing share transfers and charges. The document typically includes detailed provisions regarding the charged shares, secured obligations, representations and warranties, covenants, enforcement mechanisms, and necessary regulatory filings. It is particularly important in syndicated lending arrangements and cross-border transactions where Canadian shares are part of a larger security package.
