WILSONVILLE, OR -- Mentor Graphics is raising $20 million in a private placement of convertible subordinated debentures to be used for general corporate purposes.

The EDA software company is issuing debentures that will pay 6.25% interest, mature in 16 years and convert into cash, stock or a combination at $17.97 a share.

The company reported a first-half net loss of $37.3 million.

A debenture is a type of bond backed by the general creditworthiness and reputation of the issuer, not by collateral.