On May 11, the federal government announced the Large Employer Emergency Financing Facility (LEEFF) program as a new component of its COVID-19 Economic Response Plan. It is for Canada’s largest employers, whose needs during the pandemic are not being met through conventional financing, to keep their operations going. Loans of $60,000,000 and above are being made available through LEEFF.
This program is designed to help Canadian businesses withstand the current economic downturn, help protect Canadian jobs, and avoid bankruptcies where possible.
This support is not meant to restructure firms, resolve bankruptcies, or provide financing to companies that already have the capacity to manage the crisis.
LEEFF will be delivered through the Canada Enterprise Emergency Funding Corporation (CEEFC), a subsidiary of Canada Development Investment Corporation (CDEV), in cooperation with Innovation, Science and Economic Development Canada (ISED) and the Department of Finance.
Large Employer Emergency Financing Facility Overview
The intent of this program is to provide bridge financing to large Canadian employers to help these enterprises until they can access more traditional market financing.
LEEFF Eligibility Criteria
Eligible Canadian employers and specific criteria includes:
- Large for-profit enterprises in all sectors (except for those in the financial sector);
- Certain not-for-profit organizations such as airports;
- Have annual revenues of approximately $300M or more;
- Require a minimum loan of approximately $60M;
- Have significant operations or workforce in Canada;
- Have not been found guilty of tax evasion;
- Must commit to minimizing the loss of employment and sustaining their domestic business activities; and
- Must demonstrate that funding forms part of their overall plan to return to financial stability.
The loan size for each applicant will be assessed on a case-by-case basis in consideration of demonstrated need. Loans of $60 million and above are available, based on the applicant’s cash flow needs for the next 12 months.
The program has built-in safeguards for taxpayers — including a requirement that large companies that borrow money give the government the option of taking an ownership stake or provide a cash equivalent of 15% of the principal amount.
“If they’re in a situation where they cannot access that credit, they can turn to the government for funds through the LEEFF program, but they are loans that come with conditions around governance, around paying proper share taxes, around a plan for climate change. These are the kinds of things that we expect as Canadians when our taxpayer dollars go towards supporting businesses.”
– Prime Minister Justin Trudeau
More terms and conditions can be found on the Large Employer Emergency Financing Facility Factsheet.
Interested applicants should reach out to LEEFF-CUGE@cdev.gc.ca. A delegate from Canada Enterprise Emergency Funding Corporation (CEEFC) will send applicants a non-disclosure agreement, application form, and instructions. This application form will request important information regarding the applicant and its financial condition.
Applicants will be contacted by both representatives of CEEFC and Innovation, Science and Economic Development Canada (ISED) Canada to begin the process.
There is no set deadline for the Large Employer Emergency Financing Facility (LEEFF) program. It will be open while the current economic situation continues.
Learn More About COVID-19 Support Programs
In addition to extra measures taken by the federal and provincial governments, Canadian government grants and loans are a great COVID-19 recovery strategy. Take the next step and find out if your business is applicable.