Debenture Trust Deed Contracts
The contract must specify the interest rate and dates of interest and principal payments. Some debenture contracts also include requirements for the issuing company, such as minimum liquidity ratios and profit margins, acceptable levels of financial risk and disclosure of the company's credit rating.
Only banks, insurance companies and other public financial institutions may serve as a debenture trustee. The institution may not be named as a trustee if it holds a share of the company, receives financial compensation from the company or guarantees any other type of debt instrument. The trustee's duties include requesting periodic reports from the company and enforcing the security interests of debenture holders according to the trust deed's provisions.