Secured Promissory Note

Draft Secured Promissory Notes in Minutes, Not Hours

12 minutes with Para

Explore this workflow

Get started with Para

Para is an AI colleague for legal teams. Send it this work by email, Teams or Slack, and it hands back the finished document.

12 minutes with Para

What you'll need

Deal Term Sheet
Party Information
Collateral Description

Plans from $20 a month, with usage included.

Workflow

Overview

CaseMark's Secured Promissory Note skill uses AI to draft complete, enforceable secured promissory notes for commercial lending transactions. It generates lender-protective provisions, UCC Article 9 compliant collateral grants, and state-specific usury compliance checks — transforming hours of manual drafting into a streamlined, intelligent workflow.

Drafting secured promissory notes for commercial lending transactions is a time-intensive process that requires careful attention to interest rate structures, collateral descriptions, UCC compliance, state usury limits, and dozens of interrelated provisions. A single oversight in default triggers, collateral grants, or rate calculations can expose lenders to significant financial and legal risk.

CaseMark automates the drafting of secured promissory notes by intelligently assembling lender-protective provisions based on your specific deal terms. The AI handles complex interest rate structures, generates UCC Article 9 compliant collateral descriptions, flags potential usury issues, and produces a comprehensive draft ready for attorney review — cutting drafting time by up to 80%.

How to hand this to Para

1. Send Para the files
Email them, drop them in a Teams or Slack message, or upload them.
2. Para runs the Secured Promissory Note skill
It works from your files and checks its citations against the record.
3. The finished document comes back
Para returns it where you asked, usually as a DOCX, and offers the next step.

Example request · email, Teams or Slack

Para, run the Secured Promissory Note skill for the Garcia matter. I've attached the Deal Term Sheet, Party Information and Collateral Description. Send the finished draft back here as a DOCX.

What Para does

1. Upload your deal term sheet, party information, and collateral details
2. AI analyzes deal terms and drafts a complete secured promissory note with lender-protective provisions
3. Review the draft, customize clauses, and resolve any flagged compliance issues
4. Export the finalized note in your preferred format (DOCX, PDF)

What you get

Recitals and Defined Terms
Promise to Pay and Principal Terms
Interest Rate and Payment Schedule
Collateral Grant and UCC Article 9 Provisions
Events of Default and Remedies
Covenants and Reporting Obligations
Prepayment and Late Fee Provisions
Governing Law, Venue, and Dispute Resolution
Notice Provisions
Signature Blocks and Exhibits

What it handles

Generates complete secured promissory notes with lender-protective default and remedy provisions
Structures UCC Article 9 compliant collateral descriptions and filing jurisdiction guidance
Supports fixed and variable interest rate structures with day-count convention options
Includes cross-default, covenant, and subordination clause drafting
Validates state usury law compliance and flags potential issues
Produces prepayment, late fee, and default interest provisions tailored to deal terms

Required documents

Deal Term Sheet
Summary of loan terms including principal, interest rate, payment schedule, maturity date, and key deal provisions
.pdf, .docx, .xlsx
Party Information
Legal names, entity types, states of formation, addresses, and authorized signatory details for borrower and lender
.pdf, .docx
Collateral Description
Detailed description of collateral assets, categories, and UCC filing jurisdiction information
.pdf, .docx

Supporting documents

Security Agreement
Existing or draft security agreement to ensure consistency with the promissory note terms
.pdf, .docx
Guaranty Agreement
Personal or corporate guaranty to be cross-referenced in the note
.pdf, .docx
Subordination or Intercreditor Agreement
Existing priority arrangements with other creditors that may affect note terms
.pdf, .docx
Board or Manager Resolutions
Corporate or LLC authorization approving the borrowing and granting of security interests
.pdf, .docx

Why teams use it

Reduce drafting time from hours to minutes with AI-generated secured promissory notes that follow market-standard conventions

Minimize compliance risk with automated usury law flagging and UCC Article 9 collateral description guidance

Ensure consistency across your lending portfolio with standardized lender-protective terms and default provisions

Accelerate deal closings by producing complete, review-ready drafts that require minimal manual revision

Questions

Does this tool ensure compliance with state usury laws?

Yes. CaseMark flags interest rates and default rates that may exceed state usury limits based on the governing law you select. You should always confirm compliance with local counsel, but the AI provides an important first-pass review.

Can I draft notes with variable interest rate structures?

Absolutely. CaseMark supports fixed and variable rate structures, including index-based rates (SOFR, Prime) with margin, floor, and cap specifications. The AI drafts the appropriate rate adjustment and fallback language.

Does the output include UCC Article 9 collateral provisions?

Yes. CaseMark generates collateral descriptions with sufficient specificity for UCC Article 9 perfection and identifies the appropriate filing jurisdictions based on debtor location and collateral type, including fixture and real property filings.

Can I include cross-default and covenant provisions?

Yes. CaseMark supports optional cross-default thresholds, financial and operational covenants, reporting requirements, and insurance obligations. Simply provide the relevant deal terms and the AI incorporates them into the draft.

Is the generated note ready to execute as-is?

CaseMark produces a comprehensive, professionally structured draft that follows market-standard commercial lending conventions. However, all generated documents should be reviewed by qualified legal counsel before execution to ensure they meet your specific transaction requirements.

What types of commercial loans does this support?

CaseMark's secured promissory note skill handles a wide range of commercial lending scenarios including term loans, equipment financing, working capital facilities, and other collateral-backed lending arrangements with customizable amortization and payment structures.