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In finance, a debenture is a long-term debt instrument used by governments and large companies to obtain funds. It is similar to a bond except the securitization conditions are different. A debenture is usually unsecured in the sense that there are no liens or pledges on specific assets. It is however, secured by all properties not otherwise pledged. In the case of bankruptcy debenture holders are considered general creditors. Finance studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. ...
In finance, a bond is a debt security, in which the issuer owes the holders a debt and is obliged to repay the principal and interest (the coupon) at a later date, termed maturity. ...
Securitization is a financing process in which a corporate entity moves assets to an ostensibly bankruptcy-remote vehicle to obtain lower interest rates from potential lenders--because the assets cannot be seized in a bankruptcy proceeding, the risk is less for lenders and they are willing to offer a lower...
In law, lien is the broadest term for any sort of charge or encumbrance against an item of property that secures the payment of a debt or performance of some other obligation. ...
Notice of closure stuck on the door of a computer store the day after its parent company, Granville Technology Group Ltd, declared bankruptcy (strictly, put into administration - see text) in the UK. Bankruptcy is a legally declared inability or impairment of ability of an individual or organizations to pay their...
A creditor is a party (e. ...
The advantage of debentures to the issuer is they leave specific assets unencumbered, and thereby leave them open for subsequent financing.
Debentures are generally freely transferrable by the debenture holder. An assignment is a term used with similar meanings in the law of contracts and in the law of real estate. ...
''==Debenture holders== In the United Kingdom debentures have frequently been used as a mechanism for raising funds to build or finance sports or leisure venues. Often these debentures pay little or no interest, but entitle the holder to privileges tickets for the venue. For example, the All England Lawn Tennis and Croquet Club first issued debentures in 1920 in order to purchase the current premises in Wimbledon, London, and debenture issues take place every five years. The 2001-2005 debenture issue was priced at £2,000 each, with an additional premium of £18,000, and Value Added Tax of £3,150; holders of these debentures are entitled to a free seat in the Centre Court Stand for each day of the championships for five years, and have access to exclusive lounge and catering facilities. At the Royal Albert Hall debenture holders are known as members; they own rights to individual boxes, and are entitled to view almost all performances. In 2003 Box 70 was offered on the open market for £250,000 [1]. Other stadia financed through the issue of debentures include Millennium Stadium, Wembley Stadium, Arsenal, Twickenham Stadium and Trent Bridge in Nottingham.'' The All England Lawn Tennis and Croquet Club is based at Wimbledon in the London Borough of Merton, at grid reference TQ242721. ...
Wimbledon (pronounced ) is a suburb of London, part of the London Borough of Merton and located seven miles (11. ...
Value added tax (VAT) is tax on exchanges. ...
The Royal Albert Hall of Arts and Sciences is an arts venue dedicated to Queen Victorias husband and consort, Prince Albert. ...
The Millennium Stadium (Welsh: Stadiwm y Mileniwm), is the national stadium of Wales, located in the capital Cardiff, and is used primarily for rugby union and football home internationals. ...
Wembley Stadium was a football stadium located in Wembley, London. ...
Arsenal Football Club (also known as Arsenal, The Arsenal or The Gunners) are an English professional football club based in Holloway, north London. ...
Twickenham Stadium (usually known as just Twickenham or Twickers[1]) is a stadium located in Twickenham, a suburb of south-west London (in the historic county of Middlesex). ...
For more coverage of cricket, go to the Cricket portal. ...
Nottingham is a city (and county town of Nottinghamshire) in the East Midlands of England. ...
Nomenclature
In practice the distinction between bond and debenture is not always maintained. Bonds are sometimes called debentures and vice-versa.
In some countries (notably the United Kingdom), the term debenture is also frequently used by the legal profession as shorthand for a security document which creates fixed and floating charges over all of the property of the chargor. This usage derives from the frequent inclusion of provisions for security interests in conventional debt instruments. A lawyer is a person licensed by the state to advise clients in legal matters and represent them in courts of law and in other forms of dispute resolution. ...
A security interest is a property interest created by agreement or by operation of law over assets to secure the performance of an obligation (usually but not always the payment of a debt) which gives the beneficiary of the security interest certain preferential rights in relation to the assets. ...
A floating charge is a security interest over all of the assets of a company which floats until an event of default is triggered or until the company goes into insolvent liquidation at which time the floating charge crystallises and attaches to all of the assets of the company. ...
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