| Definitions | | debenture |
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noun
- A certificate that acknowledges a debt
- An unsecured certificate of debt backed only by the credit of the borrower.
- : Written acknowledgement of a debt secured only by the general credit or promise to pay of the issuer. Debentures are the common type of bond issued by large, well established corporations with adequate credit ratings. The written agreement under which the debentures are sold, the indenture, is specific as to maturity date, interest rate, call features, and convertibility. Holders of debentures representing corporate indebtedness are creditors of the corporation, and entitled to payment before shareholders upon dissolution of the corporation.
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