Debenture Replace Mark For Free

Ing to the Companies Act, 2013, private companies are permitted to issue optionally convertible debentures. The relevant statutory provisions to consider in this regard are Section 71 and Section 73 of the Companies Act, 2013.

A convertible debenture is a type of long-term debt issued by a company that can be converted into shares of equity stock after a specified period. Convertible debentures are usually unsecured bonds or loans, often with no underlying collateral backing up the debt.

What are the main differences between NCDs and CCDs? NCDs provide fixed returns without an option for conversion into equity, while CCDs offer potential equity conversion at a predetermined time, combining debt and equity features.

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.

Partially convertible debentures (PCDs) involve redeeming a fraction of the value of the security for cash and converting the other part into equity. A fully convertible debenture (FCD) involves a full conversion of the debt security into equity at the issuer's notice.

Fully Convertible Debenture: These are debentures in which the whole value of debentures can be converted into equity shares of the company. Partly Convertible Debenture: In this kind of debentures, only a part of the debentures will be eligible for conversion into equity shares.

Secured Debentures: Secured debentures are that kind of debentures where a charge is being established on the properties or assets of the enterprise for the purpose of any payment. The charge might be either floating or fixed. ... Unsecured Debentures: They do not have a particular charge on the assets of the enterprise.

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.

A debenture has been signed by a director of the company and by its secretary.My understanding is that the charges created are generally equitable and would only need to be executed as a deed (and signed by the lender) if the debenture were to create a fixed charge over future acquired land.

Put simply, a debenture is the document that grants lenders a charge over a borrower's assets, giving them a means of collecting debt if the borrower defaults. Debentures are commonly used by traditional lenders, such as banks, when providing high-value funding to larger companies.