Debenture
A loan raised by a company, paying a fixed rate of interest & which is secured on the assets of company. Debentures are fixed interest securities in return for long-term loans, they tend to be dated for redemption between ten & forty years ahead of date of issue. They may be secured by a floating charge on the company's assets or they may be tied to specific, named assets.Debenture interest has to be paid by a Comp. whether it makes a profit or not - if the debenture holders do not get paid they can legally force the Comp. into liquidation to realise their claims on the company's assets. |
|
