Create your Free Shareholder Loan Agreement
Frequently Asked QuestionsWhat is a lump-sum payment?"Lump-sum payment at end of term" means that the corporation pays nothing to the Shareholder until the end of the loan term, at which time the corporation repays the entire loan in one payment.What are specific payment amounts?"Specific payment amounts" refers to the specific amount of money which the corporation will repay to the Shareholder at agreed upon intervals.What is a principal and interest payment?"Principal and interest" means that the corporation makes regular payments to the Shareholder that are put towards paying off both the principal amount and the interest as it is compounded. At the end of the term, there will be no amount outstanding.What is an interest only payment?"Interest only" means that the corporation makes regular payments to the Shareholder that just pays the current interest on the principal with no portion of the payment going towards the principal amount itself. At the end of the term, the corporation will then pay off the whole amount of the principal.