Soft Call Provision

DEFINITION of 'Soft Call Provision'

A feature added to convertible fixed-income and debt securities. The provision dictates that a premium will be paid by the issuer if early redemption occurs.

BREAKING DOWN 'Soft Call Provision'

A sweetener added to increase securities' attractiveness, a soft call provision acts as an added restriction for issuers should they decide to redeem the issue early.

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