Promissory Note Template Ohio

PROMISSORY NOTE (UNSECURED)

Document ID: PN-OH-2024-001
Effective Date: [Date]
Version: 1.0
Governing Jurisdiction: State of Ohio

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LEGAL DISCLAIMER

This document is provided for informational and template purposes only and does not constitute formal legal advice or the establishment of an attorney-client relationship. Promissory notes are subject to specific state statutes, including Ohio Revised Code (ORC) Chapter 1303 (Uniform Commercial Code - Negotiable Instruments). Users should review this document with qualified legal counsel to ensure compliance with specific interest rate limitations (usury laws under ORC § 1343.01), tax implications, and regulatory requirements applicable to their specific transaction.

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1. PARTIES AND PRINCIPAL SUM

This Promissory Note (the "Note") is made and entered into as of the Effective Date by and between:

BORROWER: [Borrower Full Legal Name], having a principal address at [Borrower Address] (the "Borrower").

LENDER: [Lender Full Legal Name], having a principal address at [Lender Address] (the "Lender").

PRINCIPAL SUM: The Borrower promises to pay to the order of the Lender the principal amount of $[Amount in USD] (the "Principal Sum"), together with interest on the unpaid principal balance at the rate of [Rate]% per annum, calculated on the basis of a 365-day year.

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2. REPAYMENT TERMS

The Principal Sum and accrued interest shall be due and payable as follows:

2.1 Payment Schedule. Borrower shall make [Number] payments of $[Amount] starting on [Date] and continuing on the [Day] of each [Month/Quarter] thereafter until the Principal Sum and all accrued interest are paid in full (the "Maturity Date").

2.2 Application of Payments. All payments made under this Note shall be applied first to the payment of accrued interest, and the remainder to the reduction of the Principal Sum.

2.3 Prepayment. Borrower reserves the right to prepay the Principal Sum in whole or in part at any time without penalty.

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3. DEFAULT AND ACCELERATION

3.1 Events of Default. The occurrence of any of the following shall constitute an "Event of Default": (a) failure of Borrower to make any payment when due; (b) the filing of a bankruptcy petition by or against the Borrower; or (c) the insolvency of the Borrower.

3.2 Acceleration. Upon the occurrence of an Event of Default, the Lender may, at its option, declare the entire unpaid Principal Sum and all accrued interest immediately due and payable, without presentment, demand, protest, or further notice of any kind.

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4. GOVERNING LAW AND VENUE

This Note shall be governed by, construed, and enforced in accordance with the laws of the State of Ohio, without regard to its conflict of law principles. Any legal action or proceeding arising under this Note shall be brought exclusively in the state or federal courts located in [County Name] County, Ohio.

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5. MISCELLANEOUS PROVISIONS

5.1 Costs of Collection. In the event this Note is placed in the hands of an attorney for collection after default, the Borrower agrees to pay all reasonable attorney fees and court costs incurred by the Lender.

5.2 Waivers. Borrower waives presentment for payment, notice of dishonor, protest, and notice of protest.

5.3 Entire Agreement. This Note constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes all prior discussions or understandings. No modification of this Note shall be effective unless in writing and signed by both parties.

5.4 Severability. If any provision of this Note is held to be invalid or unenforceable, such provision shall be severed, and the remaining provisions shall remain in full force and effect.

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6. EXECUTION AND SIGNATURE BLOCKS

FOR BORROWER: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

FOR LENDER: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

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7. STEP-BY-STEP EXECUTION AND FILING GUIDE

1. Information Verification: Ensure all bracketed information (e.g., [Borrower Name], [Amount], [Interest Rate]) is verified against primary identity documents (ID/Driver’s License) and the underlying loan agreement.
2. Interest Rate Compliance: Verify the interest rate against Ohio’s statutory limits. Per ORC § 1343.01, the general usury limit is 8% per annum, unless the parties have agreed in writing to a different rate or specific exemptions apply.
3. Digital Execution: If using DocuSign or Adobe Sign, ensure the "Audit Trail" feature is enabled to capture IP addresses, timestamps, and email verification for both parties. This provides non-repudiation evidence.
4. Notarization: While not strictly required for a simple promissory note in Ohio, having the document notarized creates a "self-authenticating" document under the Ohio Rules of Evidence, significantly simplifying enforcement in court should a dispute arise.
5. Record Retention: Both parties should retain an original wet-ink or certified electronic copy. The Lender should store this in a secure, fireproof, or encrypted digital archive as it functions as a legal instrument of indebtedness.
6. Filing: If the note is secured by real property, it must be recorded with the County Recorder's Office in the county where the property is located. If unsecured, filing is generally not required for the note to be enforceable, but strict record-keeping is required for accounting and potential tax reporting (IRS Form 1099-INT if interest exceeds $600).