M ACDONALD S AGER M ANIS LLP "Lawyers who speak your language."™ 1

OVERVIEW 1.Initial Letter 2.Joint Retainer 3.Financing a Purchase vs. Refinancing 4.Lands Owned By Bare Trustee 5.Title Insurance 6.Personal Property Security Act (Ontario) 7.Insurance Policies 8.Know Your Client (KYC) 9.Security Grab Bag 10.Guarantees: A Closer Look 11.Undertakings 12.Independent Legal Advice (ILA) 13.Time Lines / Communication 2

INITIAL LETTER Four Reasons to Send an Initial Letter to the Borrower’s Counsel: 1.Introduce 2.Notice 3.Information 4.Locate Minute Book(s) 3

JOINT RETAINER Acting for Both Borrower & Lender: 1.Acknowledged by ALL Parties 2.Obtain Minute Book(s) ASAP 3.Review and Correct Deficiencies in Minute Book(s) 4.Information in Initial Letter is still Required 4

FINANCING A PURCHASE vs. REFINANCING 1.Copy of Draft Transfer for the Purchase of the Property 2.Copy of Agreement of Purchase & Sale, with all Amendments, Waivers, etc. 3.Copy of Statement of Adjustments 5

LANDS OWNED BY BARE TRUSTEE 1.Who is/are the Beneficiary/Beneficiaries? 2.Need Copy of Trust Agreement 3.Need Authorization, Acknowledgment and Direction from Beneficiaries 6

TITLE INSURANCE  Cost  Scrutiny of Insurer  Joint Policy with Lender & Purchaser 7

Personal Property Security Act (Ontario) (PPSA)  Importance of Accurate Identification  Perfected Security Interest  Notice to the World 8

PPSA CONTINUED… 1.Discharge 2.Postponement 3.Comfort Letter 4.Priority Agreement 9

PPSA vs. Bank Act (Federal Registration)  Priority Between Provincial and Federal Registrations  Bank Act vs. Perfected PPSA Interest: “First in Time” Rule  Bank Act vs. Unperfected PPSA Interest 10

INSURANCE POLICIES Types of Insurance Coverage: 1.Property Insurance 2.Business Interruption Insurance 3.Asset Insurance 4.Life Insurance  Assignment of Insurance  Acknowledgment of Assignment  Existing or New Policy 11

KNOW YOUR CLIENT (“KYC”) 12

KYC CONTINUED… 1.Full and Correct Names of ALL Individuals Giving Security 2.Date(s) of Birth for ALL Individuals Giving Security 3.Type of Borrower (i.e. Sole Proprietor, Partnership, Limited Partnership, Limited Liability Partnership Or Corporation) 4.If Corporation, Full and Correct Names of ALL: a)Officers b)Directors c)Shareholders 13

SECURITY GRAB BAG 1.Guarantees 2.Postponement of Lease 3.Non-Disturbance Agreement 4.Pledge of Shares 5.Waiver of Distraint 6.Tenant Estoppel 7.General Security Agreement (GSA)  Site Specific vs. All Assets  Ranking Priority 14

GUARANTEES: A CLOSER LOOK Case Study: Manulife Bank of Canada v John Joseph Conlin, Renewals vs. Extensions 2.Contra Preferentem 3.General Rule: Obtain Consent of Guarantor 15

Undertakings  Relevance and Purpose  Enforceability 16

INDEPENDENT LEGAL ADVICE (ILA) 17

TIME LINES / COMMUNICATION  Check Vacation Dates  Check Logistics of Signatures  Be Realistic with Timing  Be Included in Communications 18

THANK YOU! 19 MACDONALD SAGER MANIS LLP ON BEHALF OF… Steven Sager T | Barristers & Solicitors and Trade-Mark Agents 150 York Street, Suite 800, Toronto, Ontario "Lawyers who speak your language."™