| On the second day of July,1909, the village of X promises topay the bearer at the City TrustCo., Cleveland, Ohio, twenty-fivedollars, being 6 months' intereston its bond. No. 1 dated Jan. 2, 1909. | On the second day of January,1910, the village of X promises topay the bearer at the City TrustCo., Cleveland, Ohio, twenty-fivedollars, being 6 months' intereston its bond. No. 1 dated Jan. 2, 1909. |
| D. B. X.______________ | D. B. X.______________ |
| Mayor. | Mayor. |
| X. Y. Z.______________ | X. Y. Z.______________ |
| Clerk. | Clerk. |
| On the second day of July,1910, the village of X promises topay the bearer at the City TrustCo., Cleveland, Ohio, twenty-fivedollars, being 6 months' intereston its bond. No. 1 dated Jan. 2, 1909. | On the second day of January,1911, the village of X promises topay the bearer at the City TrustCo., Cleveland, Ohio, twenty-fivedollars, being 6 months' intereston its bond. No. 1 dated Jan. 2, 1909. |
| D. B. X.______________ | D. B. X.______________ |
| Mayor. | Mayor. |
| X. Y. Z.______________ | X. Y. Z.______________ |
| Clerk. | Clerk. |
Interest Coupons Attached to Municipal Bond.
Similar coupons follow for payment at intervals of 6 months until maturity of bond in 1920.
129. Collateral and Judgment Notes. Banks frequently require borrowers to sign collateral notes. These instruments are promissory notes, with an added agreement to the effect that certain collateral security is given the payee by the maker as security for the note. Such security is usually certificates of stock, bonds, other promissory notes, or chattel property. The collateral note contains a stipulation that upon default, the payee may sell the collateral. The following is a common form of collateral note used by banks:
| $5,000.00 | Cleveland, Ohio, Dec. 26, 1908. |
Six months after date, I promise to pay to the order of the Fictitious Bank at its banking rooms in Cleveland, Ohio, the sum of Five thousand dollars for value received, with interest at the rate of 6% per annum. I have deposited with said bank as collateral security for the payment of this note the following property; 20 shares of stock of the Columbia Sewing Machine Co., par value $100.00 each, 2 diamond rings, 1 warehouse receipt of the City Storage Co., covering household furniture valued at $3,000.00. The value of this property is now $5,600.00. It is agreed that the payee, or his assigns, may have the right to call for additional security at any time it considers this collateral security insufficient, and on failure of the maker of this note to furnish additional security to satisfy the holder of this note, the note may be deemed payable at once at the holder's option. The holder shall also have power to accept substitutes for this collateral. Should the maker violate any of the conditions of this note, or fail to pay it when due, the holder shall have the power to sell the collateral or any substitute given therefore, at private or public sale, at any time without notice to anyone, and after deducting all legal expenses connected with the sale, and after paying the note, shall return the balance to the maker.
(Signed)
John Smith.
A judgment note contains a provision that upon default of payment, any attorney at law may appear in court and take judgment thereon by presenting the note, without observing the formalities of an ordinary suit at law. This kind of a note is also called a cognovit note. The following is a common form of judgment note: