Free Promissory Note Forms for a
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Note: Please refer to our page on Secured Promissory Note first for guidelines and to select the blank promissory note best suitable for your requirements.
You may also want to consider a Promissory Note Guaranty to guarantee payment performance. Our Promissory Note main page has additional information and links to more free legal forms.
Upon full and final settlement of the promissory note and upon return of the goods to the Borrower, a release of the Security Agreement can be issued, where the Borrower acknowledges receipt of the goods held as collateral.
SECURITY AGREEMENT
Lender's Name:
Lender's Address:
Borrower's Name:
Borrower's Address:
1. Whereas the Borrower executed a Promissory Note in favor of the Lender on the ______ day of _________________20____ in the principal amount of $________(____________________________). In consideration of this Note and as inducement to the Lender to extend a loan to the Borrower, the Borrower grants the Lender a security interest in the following goods:
(hereinafter referred to as "the Collateral")
2. The Lender acknowledges receipt of the Collateral and shall retain possession of the Collateral for the duration of the Note and until all monies due under the Note have been paid in full.
3. Upon full and final settlement of all monies due under the Note, the Lender shall release the Collateral to the Borrower.
4. The Borrower warrants that he/she is the lawful owner of the Collateral, that it is free of any and all encumbrances and that no other party has any right to the Collateral.
5. The Lender shall insure the Collateral against all risks with a recognized insurance company at his/her cost. The Lender shall furnish proof of such an insurance policy to the Borrower.
6. The Borrower agrees that upon default under the terms as set out in the Note, the Lender shall have the right to sell the Collateral in any manner which he/she may deem fit and to apply the proceeds to the repayment of monies due under the Note.
7. The Lender agrees that proceeds from the sale of the Collateral shall first be applied to repayment of monies due under the Note and that any surplus money shall be transferred to the Borrower.
8. The Lender further agrees that where the proceeds from the sale of the Collateral are not sufficient to repay all monies due under the Note, such shortfall shall be for the Lender's account and the Borrower shall have no further obligations under the Note.
OR
8. The Borrower agrees that he/she shall remain liable for any shortfall if the proceeds from the sale of the Collateral are not sufficient to repay all monies due under the Note.
9. No relaxation, indulgence, waiver, release or concession extended to the Borrower by the Lender and no delay or omission in the enforcement or exercising of the Lender's right under the Note shall affect the rights of the Lender under this security agreement.
10. This agreement shall be binding upon and accrue to the benefit of the parties, their successors, legal representatives and assigns.
11. This agreement shall be construed, interpreted and governed in accordance with the laws of the State of _______________ and should any provision of this agreement be judged by an appropriate court of law as invalid, it shall not affect any of the remaining provisions whatsoever.
Signed at ________________ on this _______ day of _____________________20___.
Lender's Signature: _________________________________ who warrants his/her full authority to enter into this agreement.
Borrower's Signature: _________________________________ who warrants his/her full authority to enter into this agreement.
Signed in the presence of:
(1) Witness Name _____________________________
(1) Witness Signature __________________________________
(2) Witness Name _____________________________
(2) Witness Signature __________________________________
Return from Free Promissory Note Forms to Free Legal Documents
Our free promissory note forms are provided as templates only and legal counsel must be consulted before entering into any agreement.
