PROMISSORY NOTE (SIMPLE IOU)
THIS PROMISSORY NOTE (“Note”) is made on [Date], by and between:
Borrower: [Borrower Name], residing at [Borrower Address]
Lender: [Lender Name], residing at [Lender Address]
WHEREAS
The Borrower has received a loan from the Lender and agrees to repay the loan under the terms set out in this Note.
1. Principal Amount
The Borrower promises to pay the Lender the principal sum of [Loan Amount] ([Loan Amount in Words]) (the “Principal”).
2. Interest
The Principal shall bear interest at the rate of [Interest Rate]% per annum, calculated [simple/compound] interest, [specify if applicable: on the outstanding balance/until paid in full].
3. Payment Terms
- Repayment Schedule: The Borrower shall repay the Principal and interest as follows:
[Describe repayment schedule, e.g., in one lump sum on [Due Date], or in [Number] equal installments of [Installment Amount] each, payable on the [Day] of each month, starting [First Payment Date].] - Place of Payment: All payments shall be made to the Lender at [Payment Address or Bank Details], or as otherwise directed in writing by the Lender.
4. Prepayment
The Borrower may prepay all or any part of the Principal and accrued interest at any time without penalty. Any prepayment shall first be applied to accrued interest, then to the Principal.
5. Late Payment
If any payment is not made within [Number] days of its due date, the Borrower shall pay a late fee of [Late Fee Amount or Percentage], or as otherwise agreed in writing.
6. Acceleration Clause
If the Borrower fails to pay any amount when due, or otherwise defaults under this Note, the Lender may declare the entire remaining balance of Principal and accrued interest immediately due and payable.
7. Waivers
The Borrower and all endorsers, sureties, and guarantors hereby waive presentment, demand for payment, notice of dishonor, and protest.
8. Governing Law
This Note shall be governed by and construed in accordance with the laws of [Governing Law State/Country].
9. Amendment
Any amendment or modification to this Note must be in writing and signed by both the Borrower and the Lender.
10. Assignment
Neither party may assign or transfer their rights or obligations under this Note without the prior written consent of the other party.
11. Notices
All notices under this Note shall be in writing and delivered to the parties at their respective addresses stated above (or as updated by written notice).
12. Severability
If any part of this Note is found to be invalid or unenforceable, the remainder shall remain in full force and effect.
13. Entire Agreement
This Note constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes all prior agreements or understandings, whether written or oral.
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 Promissory Note as of the date first written above.
Lender:
Signature: __________________________
Name: [Lender Name]
Date: [Date]
Borrower:
Signature: __________________________
Name: [Borrower Name]
Date: [Date]
