Definition of Convertible Debenture

Convertible Debenture

Are debt instruments that are convertible into common or preferred shares, take secondary or no security against assets, have flexible terms of repayment and charge fixed or floating interest rates.

Busted convertible

Related: Fixed-income equivalent.

Convertible price

The contractually specified price per share at which a convertible security can be
converted into shares of common stock.

Convertible bonds

Bonds that can be converted into common stock at the option of the holder.

Convertible eurobond

A eurobond that can be converted into another asset, often through exercise of
attached warrants.

Convertible exchangeable preferred stock

convertible preferred stock that may be exchanged, at the
issuer's option, into convertible bonds that have the same conversion features as the convertible preferred
stock.

Convertible preferred stock

Preferred stock that can be converted into common stock at the option of the holder.

Convertible security

A security that can be converted into common stock at the option of the security holder,
including convertible bonds and convertible preferred stock.

Debenture bond

An unsecured bond whose holder has the claim of a general creditor on all assets of the
issuer not pledged specifically to secure other debt. Compare subordinated debenture bond, and collateral
trust bonds.

Subordinated debenture bond

An unsecured bond that ranks after secured debt, after debenture bonds, and
often after some general creditors in its claim on assets and earnings. Related: debenture bond, mortgage
bond, collateral trust bonds.

convertible bond

Bond that the holder may exchange for a specified number of shares.

Convertibles

Securities (generally bonds or preferred shares) that are exchangeable at the option of the holder for common shares of the issuing firm.

Debenture

A written acknowledgment of debt, usually secured by a lien on assets.

Subordinated Debenture

A bond having a claim on assets only after the senior debt has been paid off in the event of liquidation.

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