— Kishore V, SME and ACW at Edumarz
- A convertible debenture is a sort of long-term debt that may be converted into equity stock after a predetermined length of time.
- Convertible debentures are unsecured bonds or loans that have no underlying security to back them up.
- Like any other bond, these long-term debt securities pay interest to bondholders.
- Convertible debentures are special in that they may be exchanged for shares at specific dates.
- This provision provides some security to the bondholder, which may help to mitigate some of the risks associated with investing in unsecured debt.