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Senior Promissory Note Template for Singapore

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Key Requirements PROMPT example:

Senior Promissory Note

"I need a Senior Promissory Note for a secured loan of SGD 5 million to be repaid in quarterly installments over 3 years, starting from March 2025, with my manufacturing company as maker and ABC Bank as payee."

What is a Senior Promissory Note?

The Senior Promissory Note is commonly used in Singapore for structured financing arrangements where a clear hierarchy of debt is required. It provides a formal, legally binding commitment to repay a debt with senior priority status. The document is particularly useful in complex financing structures where multiple layers of debt exist. Under Singapore law, these notes must comply with the Bills of Exchange Act and include specific elements such as an unconditional promise to pay, a fixed sum, and defined payment terms. The senior status provides additional protection to the holder by establishing priority over junior debt in case of default.

What sections should be included in a Senior Promissory Note?

1. Promise to Pay: Unconditional promise to pay a specific sum with clear identification of maker and payee

2. Payment Terms: Detailed terms including principal amount, interest rate, payment schedule, and maturity date

3. Senior Status Declaration: Clear statement of senior priority status and ranking in relation to other debt obligations

4. Place and Date: Location where note is made and date of execution

5. Events of Default: Comprehensive list of circumstances that trigger immediate repayment obligation

6. Governing Law: Specification of Singapore law as governing law and jurisdiction

What sections are optional to include in a Senior Promissory Note?

1. Security Provisions: Details of any collateral or security arrangements, include when note is secured

2. Guarantees: Terms of third-party guarantees, include when guarantors are involved

3. Subordination Terms: Provisions regarding relationship with junior creditors, include when there is subordinated debt

4. Transfer and Assignment: Terms governing transferability of the note, include when note is intended to be negotiable

5. Prepayment Provisions: Terms for early repayment, include when early repayment is permitted

What schedules should be included in a Senior Promissory Note?

1. Payment Schedule: Detailed amortization schedule showing payment dates, amounts, and interest calculations

2. Security Details: Comprehensive description of any collateral or security arrangements if note is secured

3. Guarantor Information: Details of guarantors including their obligations and financial information if applicable

4. Compliance Certificate: Form of compliance certificate to be delivered by maker periodically

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions


















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Industries

Bills of Exchange Act (Cap. 23): Primary legislation governing negotiable instruments in Singapore, defining promissory notes, their requirements, and setting out rights and obligations of parties

Contracts Act (Cap. 53): Core legislation governing contract formation and enforcement, covering essential elements like offer, acceptance, consideration, and addressing contractual capacity and validity

Money-lenders Act (Cap. 188): Regulates money lending activities, including licensing requirements and interest rate restrictions, relevant if the note involves money lending

Banking Act (Cap. 19): Applicable when the note involves regulated financial institutions, setting out banking regulations and requirements

Limitation Act (Cap. 163): Establishes time limits for enforcement of the note, generally 6 years for contractual claims

Stamp Duties Act (Cap. 312): Outlines requirements for stamp duty payment, including timing and amount of duties for promissory notes

Priority and Security Rules: Legal framework governing priority rights of senior creditors and security arrangements if the note is secured

Consumer Protection (Fair Trading) Act: Provides consumer protection measures, applicable if the note involves consumer transactions

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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