Extendible and retractable bonds
An extendible bond is a bond issue that contains an option to extend its maturity period. Depending upon the terms of the bond indenture, the bond issuer, the bond holder, or both may have one or more options to delay the repayment of the bond's principal while the bond interest is continued to be paid. In addition, either party may have the right to exchange it for a bond of longer maturity at the same or higher interest rate. Extendible bonds usually sell at a higher price than the non-extendable bonds.
A retractable bond is one that features an option for the holder to force the issuer to redeem the bond before maturity at par value. An investor may choose to shorten the maturity on a bond because of market conditions or if he or she requires the principal sooner than expected.