A more thorough explanation:

An equipment trust certificate is a type of security that is typically issued by a railroad company to finance the purchase of new equipment. The certificate represents a debt obligation that is secured by the equipment itself. The title to the equipment is held by a trustee until the debt has been fully paid off.

For example, a railroad company may issue an equipment trust certificate to finance the purchase of new locomotives. The certificate would be sold to investors, who would receive regular interest payments until the debt is fully repaid. The title to the locomotives would be held by a trustee until the debt is fully paid off, at which point the title would transfer to the railroad company.

Another example of an equipment trust certificate is a car trust certificate, which is a similar type of security used to finance the purchase of automobiles or other vehicles.

These examples illustrate how an equipment trust certificate works by providing a way for companies to finance the purchase of expensive equipment without having to pay for it all upfront. The certificate allows investors to provide the necessary funds, while the equipment itself serves as collateral to ensure that the debt is repaid.