Promissory Note
$[DOLLAR AMOUNT] [DATE]
1. MAKER’S PROMISE TO PAY
IN RETURN FOR VALUE RECEIVED, the undersigned ______________________, a [STATE] corporation, having a principal place of business at [ADDRESS OF COMPANY REPAYING THE DEBT] (“Maker”), hereby promises to pay to the order of ____________________________, located at [ADDRESS] (“Payee”), the principal sum of [DOLLAR AMOUNT WRITTEN OUT] ($[DOLLAR AMOUNT IN NUMBERS]) Dollars (“Principal Amount”), together with accrued interest on the unpaid principal balance at the applicable rate as set forth in Section 2 hereof (as the same may be supplemented, modified, amended, or restated from time to time in the manner provided herein, this “Note”). Maker acknowledges and agrees that Payee may assign or otherwise transfer this Note at any time. Payee or anyone who takes this Note by any such transfer and who is entitled to receive payments under this Note is sometimes hereinafter referred to as the “Note Holder.”
2. INTEREST
Interest shall accrue from the date of this Note on the unpaid Principal Amount at a rate equal to __________ percent (__ %) per annum (“Interest Rate”). Interest shall be computed based on a three hundred and sixty-five (365) day year. Notwithstanding the foregoing, upon the occurrence of an Event of Default as described in Section 6(a) below, and for so long as such default continues, the sum(s) of the Principal Amount then due and payable hereunder, whether by acceleration or otherwise, shall bear interest at the per annum rate of ________ percent ( ___%) (“Default Rate”).
3. PAYMENTS
The Principal Amount together with any interest accruing thereon shall be paid by the Maker to the Payee by ____________ (“Maturity Date”), except that all of the Principal Amount and interest accruing thereon shall be due upon the occurrence of an Event of Default as described in Section 6(a) below. The Maker will make monthly principal and interest payments in the amount of [DOLLAR AMOUNT WRITTEN OUT] ($[DOLLAR AMOUNT IN NUMBERS]) Dollars on the [DATE] day of each month beginning on [DATE OF FIRST PAYMENT], and every [DATE] day of each month thereafter until the Principal Amount is repaid in full. Monthly principal and interest shall be based on a [NUMBER OF MONTHS] month amortization. The Maker will make all payments to Payee in lawful money of the United States of America at such place as the Payee or the Note Holder may from time to time designate in writing to the Maker.
On the Maturity Date, the entire unpaid principal balance hereof, together with accrued but unpaid interest thereon and any other sums then due hereunder, shall immediately become due and payable in full.
Any payments received by Payee or Note Holder pursuant to the terms hereof shall be applied first to the payment of any sums, other than Principal Amount and interest, due to the Payee or Note Holder pursuant to the terms hereof, next to the payment of all interest accrued to the date of such payment, and then to the payment of the Principal Amount.
4. PREPAYMENT
Maker shall have the right to prepay all or part of the unpaid principal balance hereof, together with accrued but unpaid interest thereon, at any time without premium or penalty of any kind. Any such prepayment shall be applied first to any costs outstanding, and then to accrued interest to the date of the prepayment, and then to any remaining Principal Amount outstanding. Any partial prepayment shall not postpone the due date of any subsequent installments.
5. PAYMENT IN FULL
Upon receipt of payment in full of the Principal Amount, together with all accrued interest thereon, and all other amounts outstanding under this Note, (a) all obligations of the Maker to the Payee under the Note shall be deemed satisfied; (b) the Note shall be of no further force and effect; (c) the Payee and Note Holder shall be deemed to have waived and relinquished any and all rights, remedies, and legal actions of any nature whatsoever which they would otherwise be entitled to under the Note; and (d) the Payee or Note Holder shall deliver to the Maker any additional documentation reasonably required to evidence satisfaction and payment in full of all of the Maker’s obligations under the Note.
6. LATE CHARGE
All payments are due no later than the [DATE] day of each month. If any payment or the unpaid principal balance due under this Note is not received by the Payee or Note Holder within _____ ( __ ) calendar days after the date such payment is due, then the Maker shall pay, without demand, a late charge in an amount equal to ____ percent (__%) of the amount past due. It would be impracticable or extremely difficult to fix the actual damages of the Payee or Note Holder if payment is not paid when due hereunder, and said late charge shall be deemed to be the damages for any such late payment, but shall not limit the right of the Payee or Note Holder to compel prompt performance of any obligation or to exercise any other remedy under this Note. No late charge assessed shall exceed the maximum permitted by law.
7. EVENT OF DEFAULT
An “Event of Default” under this Note shall be deemed to occur upon the happening of any of the following events, circumstances, or conditions:
(a) The failure of the Maker to pay principal, interest and any other sums due in the manner or at the time provided for in this Note, and any amount due hereunder shall not be paid within _____ ( ___) days after the same becomes due;
(b) The failure of the Maker to fully comply with any other covenant or obligation under this Note;
(c) The Maker shall become insolvent (however evidenced) or be unable to make payments under the Note as they mature;
(d) The Maker shall make an assignment for the benefit of creditors, or consent to the appointment of a receiver;
(e ) The commencement of any proceedings by the Maker under any law or statute concerning bankruptcy, arrangement of debt, insolvency or readjustment of debt, or the commencement of any such proceedings without the consent of the Maker and such proceedings shall continue undischarged for a period of sixty (60) days; or
(f) The Maker or its shareholders approve a plan of liquidation for the Maker.
8. REMEDIES
Upon the occurrence of an Event of Default hereunder, the Payee or Note Holder may, in its sole and absolute discretion and without demand or notice to the Maker, (a) declare the entire unpaid balance hereof, together with accrued but unpaid interest thereon and any other sums then due hereunder, immediately due and payable, and (b) exercise any and all rights and powers and pursue any and all remedies now or hereafter available under applicable law. No delay or omission on the part of the Payee or Note Holder in exercising any right or remedy under this Note shall operate as a waiver of such right or remedy.
9. NOTICES
Any notice, request, demand, instruction or other communication to be given to any party hereunder shall be in writing and shall be deemed to have been duly given three (3) business days after deposit in the United States mail or, if personally delivered or sent by registered or certified mail, return receipt requested, when delivered to the other party, at the address appearing in the introductory paragraph of this Note, but each party may change such address by written notice in accordance with this Section. However, unless and until such written notice of change is actually received, the last address and addresses as stated by written notice, or provided herein if no written notice of change has been received, shall be deemed to continue in effect for all purposes hereunder.
10. WAIVERS
The Maker hereby waives diligence, presentment, protest and demand, notice of protest, demand, dishonor and nonpayment of this Note, and notice of intention to accelerate the maturity of this Note and expressly agrees that, without in any way affecting the liability of the Maker hereunder, the Payee or Note Holder may extend any maturity date or the time for payment of any installment due hereunder, accept additional security, release any party liable hereunder and release any security now or hereafter securing this Note. The Maker hereby waives all rights of setoff and counterclaim with respect to this Note, including rights of setoff and counterclaim with respect to this Note which may arise from claims heretofore unknown to Maker.
11. ATTORNEYS’ FEES
If the Payee or Note Holder seeks legal advice following a default by the Maker hereunder or refers this Note to collection or to reclaim, protect, preserve or enforce its interest in this Note or under any instrument securing this Note, then the Maker shall pay all attorneys’ fees and expenses and other costs relating thereto.
12. SEVERABILITY
Every provision of this Note is intended to be severable. In the event any term or provision hereof is declared by a court of competent jurisdiction to be illegal or invalid for any reason whatsoever, such illegality or invalidity shall not affect the balance of the terms and provisions hereof, which terms and provisions shall remain binding and enforceable.
13. NUMBER AND GENDER
In this Note the singular shall include the plural and the masculine shall include the feminine and neuter gender, and vice versa, if the context so requires.
14. TIME IS OF THE ESSENCE
Time is strictly of the essence under this Note, and any amendment, modification or revision hereof. No delay or omission on the part of Payee in exercising any right hereunder shall operate as a waiver of such right or of any other remedy under this Note. A waiver on any one occasion shall not be construed as a bar to or waiver of any such right or remedy on a future occasion.
15. CHOICE OF LAW
This Note is made pursuant to the substantive laws of the State of __________, without reference to its conflicts of law provisions. The exclusive venue for adjudication or resolution of all disputes and collections relating to this Note shall be the state or federal courts located in ______ County, _______, and Maker specifically consents to the venue and jurisdiction of said courts as chosen by Payee.
16. JOINT AND SEVERAL LIABILITY
If this Note should be signed by more than one party, the liability under this Note of each party shall be joint and several. In addition, if Maker is a partnership, the liability under this Note of each general partner of Maker, and the liability of each general partner of a partnership which is itself a general partner of Maker, shall be joint and several.
IN WITNESS WHEREOF, the Maker has executed this Note as of the date first written above.
MAKER:
By: ______________________________________
Name: ___________________________________
Title: ____________________________________
State of ______________ )
) SS
County of ____________ )
I, the undersigned, a Notary Public in and for said County, in the State aforesaid, do hereby certify that __________________, an individual personally known to me to be the same person whose name is subscribed to the foregoing instrument, appeared before me this day in person, and acknowledged that he/she signed, sealed and delivered the said instrument as his/her free and voluntary act, for the uses and purposes therein set forth.
Given under my hand and official seal this ____ day of _____________, 20___.
________________________________
Notary Public
