What Is a Master Promissory Note?
A promissory note refers to a debt certificate issued by a debtor to a creditor, promising to pay a certain amount when due. According to the Capitalist Country Bill Law, if the promissory note is not forged or expired, the debtor must pay it unconditionally, otherwise the creditor can take to court. Before promissory notes are promissed, they can be transferred by endorsement and added to circulation as a means of payment or purchase. Under the capitalist system, promissory notes can be transferred multiple times. After the transfer, the promissory note cannot be repaid, and the endorser has the responsibility to pay. Promissory notes can also be applied to banks for discounts before they expire, as a tool for financing. [1]
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- A promissory note refers to a debt certificate issued by a debtor to a creditor, promising to pay a certain amount when due. According to the Capitalist Country Bill Law, if the promissory note is not forged or expired, the debtor must pay it unconditionally, otherwise the creditor can take to court. Before promissory notes are promissed, they can be transferred by endorsement and added to circulation as a means of payment or purchase. Under the capitalist system, promissory notes can be transferred multiple times. After the transfer, the promissory note cannot be repaid, and the endorser has the responsibility to pay. Promissory notes can also be applied to banks for discounts before they expire, as a tool for financing. [1]
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- promissory note
- [promissory note / term bill]
- China Metallurgical Import and Export Corporation's financing structure for the Australian Chana Iron Ore Project is to use European promissory notes with various options as debt funds. At present, the main types of financing instruments used in the European promissory market are the following types:
Promissory note
- This type of European promissory notes includes Euro note Issuance Facility (EIF), Note Issuance Facility (NIF), and Syndicated Note Issuance Facility (SNIF). Various forms. This type of promissory note is a relatively simple type of European promissory notes. Issuers of promissory notes use a variety of issuance methods such as the Tender Panel within a certain period (usually 3-7 years) to issue short-term promissory notes. Transfer of notes to raise funds, the term of the notes is generally 1 to 6 months. One of the characteristics of this type of European promissory note is that there is usually no promissory group to back up the issue, so it is generally only suitable for financing activities of reputable government agencies and large companies familiar with the European promissory market.
Promissory notes Recyclable offtake loans
- This type of European promissory notes includes revolvable off-take loans (RUFs), a narrower range of transferable revolving underwriting facilities (TRUFs), promissory notes and debit options (Browrowers Options for Notes and Underwriting Standby).
- Revolving offtake is actually a mechanism of offtake added to the European promissory note issuing process. It is the most typical structure of European promissory notes and the most commonly used form. Recyclable offtake loans are provided by a group of financial institutions with a medium-term offtake commitment. Under this offtake, the borrower raises funds by issuing short-term (1 to 6 months) promissory notes, and any promissory notes that have not been sold in the tender. Purchased by the offender.
- During the off-take period, each time a promissory note expires, a new note is issued in place of the promissory note to achieve the purpose of continuously using the loan funds. Revolving off-take loans can also be used as a source of backup funds. Revolving off-take loans have lower costs and more flexible structure. One of the important reasons is that the medium-term risk bearers (scheduled buyers) ) And the role of the actual fund provider (promissory note holders) are separated, and it is precisely because of this separation and the possibility of the promissory note purchaser's own funding is low, making the off-take of the revolving off-take loan Fees are lower than syndicated loan commitments.
Promissory note Comprehensive promissory loan
- This type of European promissory notes includes several options such as Multi-Option Facilities (MOF) and Comprehensive Promissory Note Loans (GNF). This type of financing activity in the form of European promissory notes has greater flexibility. Within the determined maximum borrowing amount, the promissory note issuer (that is, the borrower) may issue European promissory notes on the European bond market, or issue commercial paper on the US commercial paper market, or raise funds through other prescribed methods such as direct loans. Debt funds needed.