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A debenture is essentially a long-term loan that a corporate or government raises from the public for capital requirements. For example, a government raising funds to construct roads for the public.

(a) Convertible Debentures: Debentures which are convertible into equity shares or in any other security either at the option of the company or the debentureholders are called convertible debentures.

An entity that issues debentures and has lower credit quality can expect to pay a high interest rate, to compensate investors for the increased risk associated with these instruments. Both corporations and governments make use of debentures. Examples of debentures are Treasury bonds and Treasury bills.

Types of Debentures Convertible Debentures. The investors' debenture holdings can convert these types of debenture into equity shares of the company. ... Non-Convertible Debentures. ... Registered Debentures. ... Unregistered Debentures. ... Redeemable Debentures. ... Irredeemable Debentures. ... Incentivized Debentures.

A debenture is a form of unsecured debt (in American usage). The debenture is the most common variety of bonds issued by corporations and government entities. Strictly speaking, a U.S. Treasury bond and a U.S. Treasury bill are both debentures.

Debenture | Business English a type of loan, often used by companies to raise money, that is paid back over a long period of time and at a fixed rate of interest.

Example of a debenture It bears 5% interest per year, payable on 31 July every year. An investor agrees to offer the loan at a fixed charge. If ABC defaults on the payment, the investor may now sell the company's assets to raise the capital needed to fulfil the loan.

In a simple sense, the Conversion of Debentures into Equity Shares means to change the loan liability into a capital liability. After the Conversion of Debentures into Equity Shares, the Debenture Holder becomes Shareholder. The shareholders will get the right to vote.

Share. A debenture is a marketable security (a type of investment) issued by a business or other organization to raise money for long-term activities and growth. It is a form of debt capital so it is accounted for as debt on the balance sheet of the issuing company.

Hold Board Meeting and pass the Board Resolution for Conversion of CCD into Equity Shares along with approving Notice of Genernal Meeting for the approval of Shareholders of the Company. 3. Hold General meeting of the Shareholders of the Company and pass the Special Resolution for Conversion of CCD into Equity Shares.