Promissory Note for Asset Purchase or Rollover | Canada

Prepare a Section 85 Rollover Agreement for a share exchange between a corporation and a shareholder with this template form, pursuant to s. 85 of the Income Tax Act (Canada).

• The shareholder sells common shares it holds in the capital stock of the corporation back to the corporation in exchange for new preferred shares, to be issued from Treasury.
• The parties agree to file a joint election for fair market value of the old common shares.
• The purchase price is adjusted to ensure that the redemption amount for the new shares does not exceed any reassessment of the fair market value of the old shares, or vice versa.
• This document package contains:
  • a template Share Purchase Agreement, and
  • a set of corporate resolutions of the directors and shareholders approving and authorizing the rollover.
• The rollover forms package is provided in MS Word format and is fully editable to fit your specific circumstances.
• This legal document is compliant with Canadian tax laws and is intended for use only in Canada.

This package contains the resolutions and corporate forms required for a reorganization of a corporation's share capital through a Section 86 Rollover.

• This package contains the following:
  • Special Resolution with instructions for wording of the Articles of Amendment, with the redemption amount on the new preference shares to be set by the directors at the time of issue;
  • Share Subscription form for the new shares;
  • Corporate Resolutions accepting the subscriptions, limiting the addition to the capital account;
  • Directors' Undertaking not to declare dividends if it would reduce the corporation's assets and make it unable to redeem the shares at their full redemption amount.
• This Section 86 Rollover Resolutions Package contains all of these documents in one downloadable MS Word file. All forms are fully editable to fit your specific circumstances.
• Governed by Canadian tax laws and intended to be used only in the Province of Ontario.

Prepare an Agreement for Set-off and Cancellation of Shares between two affiliated Canadian companies with this downloadable template.

• One of the companies (selling company) sells shares to the other (purchasing company), as part of a rollover transaction.
• The purchase price of the shares is set off against the redemption of shares of stock held by the purchasing company in the capital of the selling company.
• The purchaser pays for the shares by way of a promissory note. The vendor redeems the shares and pays the redemption price also by way of promissory note.
• Both promissory notes are for the same amount and set each other off.
• This legal template is available in MS Word format, and is fully editable to fit your specific circumstances.
• This is a Canadian legal document pursuant to the Income Tax Act (Canada).

Prepare a section 85 Share Purchase Agreement (value stated) with this rollover document package for the Province of Alberta.

• The vendor sells the subject shares to the purchaser in exchange for shares in the capital stock of the purchaser, pursuant to Section 85 of the Income Tax Act (Canada).
• The shares being issued have an aggregate redemption value equal to the fair market value of the vendor shares, with any shortfall in value covered by a promissory note for the balance.
• The parties agree to make such amendments as may be required by any CRA determination that the amounts or values differ from those stated in the agreement, amendments to be retroactive to the effective date.
• The package includes:
  • Share Purchase Agreement,
  • Schedule of Assets with breakdown of elected amount limits and consideration received,
  • Demand Promissory Note form.
• Intended for use in the Province of Alberta, Canada.

Use this easy package of downloadable forms to facilitate a Section 86 asset rollover as part of a corporate reorganization of a Canadian company.

This package contains the following documents in Microsoft Word format:

1. Share Exchange Agreement pursuant to Section 86 of the Income Tax Act (Canada).
2. Form of Subscription for the new shares being issued in exchange for the existing shares.
3. Corporate resolutions to authorize the transaction.
4. Schedule to Articles of Amendment setting out the terms and conditions to be attached to the classes of shares.

This Section 86 Rollover Agreement for Shares is pursuant to Canadian tax laws and is intended for use solely within Canada.