Promissory note, twelve month term note

Promissory note template

A timber company owes $45,000 to a private lender and needs one page that says so. No conditions precedent, no covenants, no security. Only the maker signs, which is what keeps a note short and what lets the holder pass it on to somebody else.

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The document, page by page

Every page as it renders and as it prints, with nothing summarised. Read the wording before you reuse it.

Wren and Boyle Timber Co
Wren and Boyle Timber Co Pty Ltd · ACN 604 771 285 41 Sawmill Road, Wauchope NSW 2446 accounts@wrenboyle.example · 02 6580 1144
Wren and Boyle Timber Co
Wren and Boyle Timber Co
Wren and Boyle Timber Co
Promissory note WB-2026-03 · negotiable instrument · retain the originalPage 1 of 4
Promissory note WB-2026-03 · negotiable instrument · retain the originalPage 2 of 4
Promissory note WB-2026-03 · negotiable instrument · retain the originalPage 3 of 4
Promissory note WB-2026-03 · negotiable instrument · retain the originalPage 4 of 4

FOR VALUE RECEIVED, Wren and Boyle Timber Co Pty Ltd ACN 604 771 285 of 41 Sawmill Road, Wauchope NSW 2446, called the Maker, unconditionally promises to pay to Cassia Holdings Pty Ltd ACN 133 887 620 of 9 Ridgeway Court, Port Macquarie NSW 2444, called the Holder, or to its order, the sum of forty five thousand dollars ($45,000.00) with interest as set out below, on 1 October 2027.

Forty five thousand dollars, advanced by the Holder to the Maker on 1 October 2026, receipt of which the Maker acknowledges.
Simple interest at 7.00 percent per annum on the principal outstanding, calculated from 1 October 2026, not compounding. Over the full twelve months that is $3,150.00, and $48,150.00 in total falls due at maturity if no interest is paid earlier.
The Maker pays interest of $787.50 quarterly in arrears on 1 January, 1 April and 1 July 2027, and the final quarter of interest together with the principal on 1 October 2027.
Payment is made by electronic transfer in Australian dollars to the account the Holder nominates in writing, and is taken to be made when the funds are cleared in that account.
The Maker pays in full without deduction, set off or counterclaim. Any dispute between the Maker and the Holder about another matter is dealt with separately and does not reduce what is payable under this note.
The Maker may repay all or part of the principal at any time without penalty, together with interest accrued to the date of payment. A part payment reduces the principal on which later interest is calculated.
The Maker is in default if any amount is not paid within ten business days of its due date, or if the Maker becomes insolvent, has a controller appointed, or resolves to wind up.
On default the Holder may, by written notice, declare the whole of the principal and accrued interest immediately due and payable, without waiting for the maturity date.
An overdue amount carries interest at 11.00 percent per annum from its due date until it is paid, in place of the rate in clause 1.2 for that amount.
The Maker pays the reasonable costs the Holder incurs in recovering an overdue amount, including legal costs on a solicitor and client basis.
The Holder may endorse and deliver this note to another person, who then holds it with the same rights. The Maker must be told in writing of a transfer before its next payment is due, and pays whoever is identified in that notice.
The Maker may not transfer its obligations under this note to anyone, with or without consent.
The Maker waives presentment for payment, demand, notice of dishonour, protest and notice of protest. The Holder does not have to present this note in person before enforcing it.
A failure or delay by the Holder in exercising a right under this note does not waive that right, and a single or partial exercise does not prevent a further one.
This note is not secured over any property of the Maker. No security interest is registered and the Holder ranks with other unsecured creditors if the Maker becomes insolvent.
The advance is wholly for the business purposes of the Maker, being the purchase of kiln stock ahead of the 2027 building season. It is not a consumer credit arrangement.
This note is governed by the laws of New South Wales, and the Maker submits to the courts of that state.
If any part of this note is unenforceable, it is severed and the rest continues to bind the Maker.

Signed by the Maker on 1 October 2026 at Wauchope, New South Wales, by a director authorised to bind the company, in the presence of the witness below.

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Section by section

What each section is for, so you can keep the ones you need and drop the rest.

Letterhead and headline terms
A ledger letterhead carrying the maker's company details, then a stats row with the principal, rate, issue date and maturity, footnoted with the note number and a reminder that only one original exists.
The promise
The operative paragraph opening for value received, naming the maker and the holder or its order, the sum in words and figures, and the date payment falls due.
A note is not a contract of two sides
An information panel drawing the line between a note and a loan agreement, and explaining why only the maker signs.
1. What is owed
The principal advanced and acknowledged, simple non compounding interest at 7 percent, quarterly payments of $787.50, and a four row schedule totalling $48,150.00.
2. How and where to pay
Electronic transfer in Australian dollars, payment taken as made when funds clear, no deduction or set off for any unrelated dispute, and prepayment at any time without penalty.
3. If a payment is missed
Default at ten business days or on insolvency, acceleration of the whole balance by written notice, default interest at 11 percent, and recovery costs on a solicitor and client basis.
4. Transfer and waivers
The holder may endorse and deliver the note onward, the maker may not transfer at all, presentment and protest are waived, and delay in enforcing is not a waiver.
5. General
The note is unsecured with nothing registered, the advance is for business purposes described in the clause, New South Wales law governs, and unenforceable parts are severed.
Keep the original
A warning panel on storing the signed original securely and handing it back marked cancelled once the final payment clears, since a scan makes both steps harder to prove.
Execution
A statement of where and when the note was signed, a signature block for the maker through an authorised director, and a witness block for name, address and date.

What makes this document work

It stays one sided, which is the whole point

There is nothing here the holder has to do, so there is nothing the holder can breach. That is what lets the note be handed to a third party by endorsement and delivery without renegotiating anything, and it is why the document runs to a handful of clauses instead of a contract's worth.

Interest is scheduled, not left to accrue in silence

Four dated rows of $787.50, three of them interest only and the last carrying the principal, adding to $48,150.00. The holder finds out on 2 January 2027 whether the maker is in trouble rather than on the maturity date, and the maker has a number to budget against each quarter.

It admits out loud that it is unsecured

Clause 5.1 says no security interest is registered and the holder ranks with the other unsecured creditors if the maker becomes insolvent. Plenty of notes leave that unsaid and let the lender assume the timber stock stands behind it. Saying it in the document is what makes the 7 percent rate an informed decision.

Questions people ask

What makes a document a promissory note?

Under Part IV of the Bills of Exchange Act 1909, a promissory note is an unconditional promise in writing made by one person to another, signed by the maker, to pay a certain sum of money on demand or at a fixed or determinable future time. Add a condition to the promise and it stops being a note. This one names the sum, the rate, the maturity date and the holder or its order on the first page.

Does a promissory note have to be witnessed?

The Act does not require a witness. What it does require is delivery to the payee, since a note is incomplete until it is delivered. A witness is added here anyway, with a block for name, address and date, because the cheapest way to answer a later argument about who signed and when is to have a third person who can say so.

Can the lender sell or transfer the note?

Yes. A note is a negotiable instrument, and AUSTRAC treats promissory notes as bearer negotiable instruments for reporting purposes. Clause 4.1 lets the holder endorse and deliver it to someone else, who then holds the same rights, and requires the maker to be told in writing before the next payment falls due so it pays the right party.

Does the face value of a note matter?

It can. ASIC's published position is that a simple promissory note with a face value of more than $50,000 is generally not a financial product, provided it carries no other significant obligations. Below that figure, or where repayment depends on how the proceeds are used in a common enterprise, a note can fall inside the disclosure and licensing rules. Worth checking before issuing one, particularly for a small note like this $45,000 example.

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