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The Personal Guarantee Promissory Note is a crucial financial instrument used in Canadian lending practices when a lender requires additional security beyond the primary debtor's promise to pay. This document is particularly valuable in situations where the primary debtor's creditworthiness needs to be supplemented by a personal guarantor, often used in small business loans, startup financing, or real estate transactions. The document incorporates elements of both a standard promissory note and a personal guarantee, creating a comprehensive security instrument that complies with Canadian federal legislation (including the Bills of Exchange Act and Interest Act) and provincial laws. It typically includes detailed financial terms, payment obligations, default provisions, and enforcement mechanisms, while clearly establishing the guarantor's obligations and the unconditional nature of the guarantee commitment. The personal guarantee component makes this document particularly significant as it puts the guarantor's personal assets at risk in case of default by the primary debtor.

1. Parties: Identifies the Lender (Promisee), Primary Debtor (Maker), and Guarantor with their full legal names and addresses

2. Background: Explains the context of the loan and guarantee relationship between the parties

3. Definitions: Defines key terms used throughout the document including 'Principal Sum', 'Interest Rate', 'Payment Terms', and 'Event of Default'

4. Promise to Pay: States the principal amount, interest rate, and payment terms of the promissory note

5. Guarantee Provisions: Details the guarantor's unconditional promise to pay and perform the obligations of the primary debtor

6. Payment Terms: Specifies payment schedule, method of payment, and application of payments

7. Interest Calculation: Details how and when interest is calculated and compounded

8. Events of Default: Lists circumstances that constitute default under the note

9. Remedies: Outlines the lender's rights and remedies upon default

10. Representations and Warranties: Statements of fact by the maker and guarantor regarding their ability to enter into and perform the agreement

11. Notice Provisions: Specifies how and where formal notices must be delivered

12. Governing Law: Establishes that Canadian law governs the agreement and specifies the applicable province