Indenture Law and Legal Definition
Indenture is a term that is subject to different meanings. In the context of real property, it refers to a type of real property deed in which two parties agree to continuing mutual obligations. One party may agree to maintain the property, while the other agrees to make periodic payments. Indenture may also refer to a binding contract obligating one person to work for another.
Also, in a financial context, an indenture is a written agreement that describes the borrowers' responsibility to the lenders in a bond or debenture issue. Among other things, the indenture sets the maturity date and the interest rate. It is the formal agreement between a group of bondholders and the debtor as to the terms of the debt. This type of indenture is also refereed to as a bond indenture.
The following is an example of a Federal Statute defining the term indenture:
According to 15 USCS § 77ccc[Title 15. Commerce and Trade; Chapter 2a. Securities and Trust Indentures; Trust Indentures] the term indenture means “any mortgage, deed of trust, trust or other indenture, or similar instrument or agreement (including any supplement or amendment to any of the foregoing), under which securities are outstanding or are to be issued, whether or not any property, real or personal, is, or is to be, pledged, mortgaged, assigned, or conveyed thereunder.”
