Demand Letter - Payment

DEMAND FOR PAYMENT LETTER

[Comprehensive Legal Template – Universal/Choice-of-Law]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Operative Provisions
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
8. Dispute Resolution
9. General Provisions
10. Execution Block

1. DOCUMENT HEADER

Re: Demand for Payment Under [UNDERLYING AGREEMENT]

Date: [DATE]

To:
[DEBTOR NAME]
[DEBTOR ADDRESS]

From:
[CREDITOR NAME]
[CREDITOR ADDRESS]

Governing Law: [GOVERNING LAW STATE]

Recitals
A. Pursuant to that certain [UNDERLYING AGREEMENT] dated [AGREEMENT DATE] (the “Agreement”), Debtor is obligated to pay Creditor the Outstanding Amount (as defined below).
B. Debtor is in default of its payment obligations.
C. Creditor now issues this Demand for Payment (this “Demand”) in accordance with applicable state contract law.

2. DEFINITIONS

For purposes of this Demand, the following capitalized terms have the meanings set forth below:

“Agreement” means the contract identified in Recital A.
“Business Day” means any day other than a Saturday, Sunday, or legal holiday in [GOVERNING LAW STATE].
“Creditor” means [CREDITOR NAME], and includes its successors and assigns.
“Debtor” means [DEBTOR NAME], and includes its successors and assigns.
“Demand Date” means the date first written above.
“Interest Rate” means [INTEREST RATE %] % per annum, or the maximum rate permitted by law, whichever is lower.
“Outstanding Amount” means USD [OUTSTANDING_AMOUNT], plus all accrued interest, fees, and costs.
“Payment Due Date” means [PAYMENT_DUE_DATE], or such later date expressly agreed to in writing by Creditor.

3. OPERATIVE PROVISIONS

3.1 Amount Due. As of the Demand Date, the Outstanding Amount is due and owing, exclusive of continuing interest, late charges, and collection costs.

3.2 Demand for Immediate Payment. Creditor hereby demands that Debtor remit the Outstanding Amount in full, together with accrued interest calculated at the Interest Rate, on or before the Payment Due Date.

3.3 Acceptable Payment Methods. Payment shall be made in immediately available funds via:
(a) wire transfer to the following account:
 Bank: [ACCOUNT_BANK]
 Routing/ABA: [ACCOUNT_ROUTING]
 Account No.: [ACCOUNT_NUMBER]; or
(b) such other method as Creditor may approve in writing.

3.4 Conditions Precedent. Receipt by Creditor’s bank of collected funds constituting the entire Outstanding Amount shall be a condition precedent to any discharge of Debtor’s payment obligations.

3.5 No Accord and Satisfaction. Partial or conditional payments shall not constitute settlement or satisfaction of the Outstanding Amount unless Creditor expressly agrees in a separate, duly-executed writing.

4. REPRESENTATIONS & WARRANTIES

4.1 Creditor Representations. Creditor represents that (a) the Outstanding Amount is justly due and owing, and (b) all credits and offsets known to Creditor have been applied.

4.2 Debtor Acknowledgment. Failure by Debtor to dispute this Demand in writing within ten (10) Business Days after the Demand Date shall constitute Debtor’s acknowledgment that the Outstanding Amount is accurate and undisputed.

4.3 Survival. All representations and warranties herein survive payment in full and any subsequent settlement.

5. COVENANTS & RESTRICTIONS

5.1 Covenant to Pay. Debtor covenants to pay the Outstanding Amount on or before the Payment Due Date.

5.2 Covenant to Cooperate. Debtor shall promptly provide Creditor with any information reasonably requested to verify Debtor’s compliance with this Demand.

5.3 Negative Covenant. Until the Outstanding Amount is paid in full, Debtor shall not transfer or encumber any assets outside the ordinary course of business if such action would materially impair Debtor’s ability to satisfy its obligations hereunder.

6. DEFAULT & REMEDIES

6.1 Default. Any failure to remit the Outstanding Amount in full by the Payment Due Date constitutes an Event of Default.

6.2 Cure Period. There is no cure period beyond the Payment Due Date, time being of the essence.

6.3 Remedies. Upon an Event of Default, Creditor may, without further notice:
(a) commence litigation to recover the Outstanding Amount, interest, and costs;
(b) pursue all rights and remedies under the Agreement and applicable law; and
(c) seek recovery of attorney fees, court costs, and collection expenses to the fullest extent permitted by law.

6.4 Reservation of Rights. Creditor reserves all rights, claims, and remedies, at law or in equity, none of which are waived by the issuance of this Demand.

7. RISK ALLOCATION

[Per metadata, indemnification and liability caps are not applicable and therefore intentionally omitted.]

7.1 Disclaimer of Duty to Mitigate. Nothing herein shall impose on Creditor any duty to mitigate damages beyond that required by applicable law.

7.2 No Waiver of Additional Damages. Creditor expressly reserves the right to seek incidental, consequential, and exemplary damages as permitted by law.

8. DISPUTE RESOLUTION

8.1 Governing Law. This Demand, and any dispute arising herefrom, shall be governed by the substantive laws of the State of [GOVERNING LAW STATE], without regard to its conflict-of-laws rules.

8.2 Forum Selection. The parties shall submit to the exclusive jurisdiction of the state and federal courts located in [COUNTY], [GOVERNING LAW STATE] for all proceedings arising out of or relating to this Demand.

9. GENERAL PROVISIONS

9.1 Amendments. This Demand may be amended only by a written instrument signed by Creditor.

9.2 Assignment. Creditor may assign its rights hereunder without Debtor’s consent. Debtor may not assign any obligations without Creditor’s prior written consent.

9.3 Severability. If any provision of this Demand is held invalid or unenforceable, the remaining provisions shall remain in full force and effect.

9.4 Entire Agreement. This Demand, together with the Agreement, constitutes the entire agreement of the parties concerning the subject matter hereof and supersedes all prior demands or communications.

9.5 Counterparts; Electronic Signatures. This Demand may be executed in counterparts and delivered electronically, each of which shall be deemed an original and all of which together constitute one instrument.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the undersigned hereby issues this Demand as of the Demand Date.

[CREDITOR NAME]

By: _____________________________________
Name: [AUTHORIZED SIGNATORY]
Title: [TITLE]
Date: _________________

cc: [ATTORNEY NAME], Esq., [LAW FIRM]
cc: [COLLECTION AGENCY], if applicable