Encyclopædia Britannica, Ninth Edition/Debenture

DEBENTURE, a deed by which certain property is charged with the repayment of money lent at a fixed inte rest. It is commonly adopted by companies of a public nature as a means of raising money for carrying on their undertakings. The creation of debenture stock in such com panies is regulated in England by the Companies Clauses Act, 18G3, part iii., which makes debenture stock a prior charge on the undertaking, and gives the interest thereon priority of payment over all dividends or interest on any shares or stock of the company, whether ordinary or preference or guaranteed. Payment of arrears may be enforced by appointment of a receiver, or (in Scotland) of a judicial factor.