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The Secured Promissory Note is a crucial financial instrument commonly used in Indian lending transactions where a lender requires both a payment obligation and security for their loan. This document type is particularly useful in situations where formal credit arrangements are needed but a full loan agreement might be excessive, such as in smaller business loans, asset-backed lending, or personal loans with collateral. The document combines elements of a standard promissory note under the Negotiable Instruments Act, 1881 with security provisions governed by property and security laws. The Secured Promissory Note typically includes details of the principal amount, interest calculations, repayment schedule, and specific descriptions of the pledged security, along with enforcement mechanisms. It provides a balanced approach to protecting the lender's interests while offering borrowers a straightforward way to access secured credit.

1. Parties: Details of the lender and borrower, including full legal names, addresses, and any registration/identification numbers

2. Background: Brief context of the loan arrangement and purpose

3. Definitions: Key terms used throughout the document including 'Security', 'Principal Amount', 'Interest Rate', 'Default', etc.

4. Promise to Pay: Core promise by the borrower to repay the principal amount with specified interest

5. Principal Amount and Interest: Specific amount borrowed and interest rate details, including calculation method and payment frequency

6. Payment Terms: Schedule of payments, payment method, and prepayment provisions

7. Security Details: Description of assets/property pledged as security, including location and identification details

8. Events of Default: Circumstances that constitute default and consequences

9. Rights and Remedies: Lender's rights in case of default, including enforcement of security

10. Representations and Warranties: Borrower's confirmations regarding their capacity, authority, and status of security

11. Notices: How formal communications between parties should be made

12. Governing Law and Jurisdiction: Specification of Indian law and relevant jurisdiction