SECURED PROMISSORY NOTE
THIS SECURED PROMISSORY NOTE (the "Note") is made and entered into as of [Date] (the "Effective Date"), by and between:
Lender:
[Full Legal Name of Lender]
[Address of Lender]
AND
Borrower:
[Full Legal Name of Borrower]
[Address of Borrower]
(Each a "Party" and collectively, the "Parties").
RECITALS
WHEREAS, Lender has agreed to loan to Borrower the principal sum set forth below, and Borrower agrees to repay this sum, together with interest, on the terms and conditions set forth herein; and
WHEREAS, Borrower agrees to secure this Note with the collateral described below.
NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the Parties agree as follows:
1. PRINCIPAL AND INTEREST
1.1 Principal Amount: Borrower promises to pay to Lender the principal sum of [Loan Amount] ([Amount in Words]), together with interest as provided below.
1.2 Interest Rate: The outstanding principal shall bear interest at the rate of [Interest Rate]% per annum, calculated on the basis of a [365/360]-day year.
2. PAYMENT TERMS
2.1 Payment Schedule: Borrower shall make payments to Lender as follows:
- Payment Amount: [Payment Amount]
- Payment Frequency: [Monthly/Quarterly/Annually/Other]
- First Payment Due: [First Payment Date]
- Final Payment Due: [Maturity Date]
2.2 Prepayment: Borrower may prepay all or any part of the outstanding principal and accrued interest at any time without penalty.
3. COLLATERAL
3.1 Grant of Security Interest: As security for the full and timely repayment of this Note, Borrower hereby grants to Lender a security interest in the following collateral (the "Collateral"):
- [Description of Collateral, including serial numbers or other identifying details]
3.2 Perfection of Security Interest: Borrower agrees to execute all documents and take all actions reasonably requested by Lender to perfect and maintain Lender’s security interest in the Collateral, including but not limited to filing financing statements.
3.3 Use and Maintenance of Collateral: Borrower shall keep the Collateral in good condition and not sell, transfer, or otherwise dispose of it without Lender’s written consent.
4. DEFAULT
4.1 Events of Default: The following shall constitute an event of default ("Event of Default") under this Note:
- Failure to make any payment when due;
- Failure to perform any obligation under this Note or any agreement securing this Note;
- Insolvency, bankruptcy, or assignment for the benefit of creditors by Borrower.
4.2 Remedies on Default: Upon the occurrence of an Event of Default:
- The entire unpaid principal, together with all accrued interest, shall, at the option of Lender, become immediately due and payable;
- Lender may exercise all rights and remedies available under law or this Note, including foreclosure or sale of the Collateral.
5. REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants that:
- Borrower has full authority to enter into this Note;
- The Collateral is owned by Borrower and is free from all liens and encumbrances except as disclosed to Lender in writing.
6. NOTICES
Any notice required or permitted to be given under this Note shall be in writing and delivered to the Parties at their addresses set forth above (or such other address as a Party may specify in writing).
7. GOVERNING LAW
This Note shall be governed by and construed in accordance with the laws of [Governing Law State/Country], without regard to its conflict of law provisions.
8. AMENDMENTS AND WAIVERS
No amendment or waiver of any provision of this Note shall be effective unless in writing and signed by both Parties.
9. ASSIGNMENT
Neither Party may assign its rights or obligations under this Note without the prior written consent of the other Party, except that Lender may assign its rights to the Collateral upon an Event of Default.
10. SEVERABILITY
If any provision of this Note is found to be invalid or unenforceable, the remaining provisions shall continue in full force and effect.
11. ENTIRE AGREEMENT
This Note constitutes the entire agreement between the Parties with respect to its subject matter and supersedes all prior agreements or understandings, whether written or oral.
12. COUNTERPARTS
This Note may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Disclaimer
This document is a template and may not be suitable for all situations. The parties should consult with legal counsel before signing this agreement.
SIGNATURES
IN WITNESS WHEREOF, the Parties have executed this Secured Promissory Note as of the Effective Date.
LENDER:
Signature: _______________________________
Name: [Lender Name]
Date: [Date]
BORROWER:
Signature: _______________________________
Name: [Borrower Name]
Date: [Date]
