Indenture

Indenture is a legal contract binding one party to perform specific duties for another, typically under conditions resembling apprenticeship. Historically, it often referred to a formal agreement between a master and a servant or apprentice, outlining the terms of employment, duration, and obligations. The term derives from the practice of cutting a document in half to create duplicate copies, with the distinctive cut ensuring both parties had matching terms. It can also refer to the indentured servitude system prevalent in the colonial era.

Indenture meaning with examples

• In the 18th century, many young people signed an indenture to work on plantations in the Americas, often in exchange for passage to the New World, thereby entering a contract that dictated their work conditions for several years.
• The craft guilds in medieval Europe utilized indenture contracts to formally train apprentices, outlining the duration of their apprenticeship and the skills they would learn while working under a master craftsman.
• Some historical records indicate that in exchange for their land and support, farmers would sometimes enter into an indenture agreement with wealthier landowners, effectively binding themselves to labor under strict conditions.
• The government introduced a new form of indenture for skilled workers during the industrial revolution, intending to provide stability in employment by committing them to factories for a set number of years in return for training and remuneration.
• In contemporary legal terms, the use of indenture has evolved and is often found in financial contexts, such as indenture bonds, which establish the rights of bondholders and the obligations of the issuer.