Promissory Note Template Philippines

PROMISSORY NOTE (NEGOTIABLE INSTRUMENT)

Document ID: PN-[YYYYMMDD]-[SERIAL#] Effective Date: [Date] Version: 1.0 Governing Jurisdiction: Republic of the Philippines

---

LEGAL NOTICE AND DISCLAIMER

This document is drafted in accordance with the Civil Code of the Philippines and the Negotiable Instruments Law (Act No. 2031). This template constitutes a formal legal instrument. It is recommended that this document be reviewed by licensed Philippine counsel to ensure compliance with specific tax implications (e.g., Documentary Stamp Tax under the National Internal Revenue Code) and specific lending regulations relevant to the parties involved.

---

1. PARTIES

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

MAKER (Borrower): [Full Legal Name], a [Individual/Corporation] with principal address at [Complete Philippine Address], hereinafter referred to as the “Maker”.

PAYEE (Lender): [Full Legal Name], a [Individual/Corporation] with principal address at [Complete Philippine Address], hereinafter referred to as the “Payee”.

---

2. PROMISE TO PAY

For value received, the Maker hereby unconditionally promises to pay to the order of the Payee the principal sum of [Amount in PHP/USD] (the “Principal Amount”), together with interest on the unpaid principal balance at the rate of [Insert Percentage]% per annum, calculated on the basis of a 360-day year.

---

3. PAYMENT TERMS

The Principal Amount and all accrued interest shall be paid as follows: (a) Installments: The total amount shall be paid in [Number] monthly installments of [Amount], commencing on [Date] and continuing on the same day of each subsequent month until [Maturity Date]. (b) Manner of Payment: All payments shall be made in Philippine Pesos via [Bank Transfer/Check/Cash] to the account designated by the Payee. (c) Prepayment: The Maker reserves the right to prepay the outstanding principal balance in whole or in part at any time without penalty.

---

4. LATE PAYMENT AND DEFAULT

If any payment due under this Note is not paid in full within [Number] days of its due date, a late charge of [Percentage]% of the overdue amount shall be imposed. In the event of a default, the Payee may declare the entire unpaid principal balance and all accrued interest immediately due and payable.

In the event of litigation to enforce this Note, the Maker agrees to pay all reasonable attorney’s fees and costs of collection incurred by the Payee, which shall be no less than [Percentage]% of the total amount due.

---

5. WAIVER OF PRESENTMENT

The Maker and all endorsers, sureties, and guarantors of this Note hereby waive presentment, protest, notice of dishonor, and notice of non-payment. The Maker agrees that this Note shall be a primary obligation and not merely a suretyship.

---

6. GOVERNING LAW AND VENUE

This Note shall be governed by and construed in accordance with the laws of the Republic of the Philippines. Any legal action or proceeding arising under this Note shall be brought exclusively in the proper courts of [City/Municipality, Province], to the exclusion of all other venues.

---

7. MISCELLANEOUS

(a) Amendments: No modification or amendment of this Note shall be effective unless in writing and signed by both parties. (b) Severability: If any provision of this Note is held to be invalid or unenforceable, the remaining provisions shall continue to be valid and enforceable to the fullest extent permitted by law. (c) Entire Agreement: This Note constitutes the entire agreement between the parties regarding the subject matter hereof and supersedes all prior discussions or understandings.

---

8. EXECUTION

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

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

---

STEP-BY-STEP EXECUTION AND FILING GUIDE

1. Drafting: Replace all bracketed [ ] text with actual data. Ensure the "Principal Amount" is written in both words and numerals to avoid ambiguity.
2. Verification of Authority: If the Maker or Payee is a corporation, obtain a Secretary’s Certificate authorizing the signatory to sign the Promissory Note on behalf of the entity.
3. Documentary Stamp Tax (DST): Under Philippine law, Promissory Notes are subject to DST. Ensure the tax is paid at the Bureau of Internal Revenue (BIR) and the corresponding stamp is affixed to the document to ensure it is admissible in court.
4. Notarization: While not strictly required for validity, it is highly recommended to have the Note notarized by a Philippine Notary Public to convert it into a Public Document, which carries the presumption of regularity and simplifies enforcement in court.
5. Digital Signature: If using DocuSign or Adobe Sign, ensure the platform is set to "Qualified Electronic Signature" mode to comply with the Philippine Electronic Commerce Act (RA 8792).
6. Retention: Maintain the original hard copy (or original digital file with audit trail) in a secure, fireproof repository. Provide a copy to the Maker immediately upon execution.