Callable Clause Samples
A Callable clause gives the issuer of a financial instrument, such as a bond, the right to redeem or "call" the instrument before its scheduled maturity date. Typically, this means the issuer can repay the principal to investors and terminate the bond early, often after a specified period and sometimes at a premium. This clause allows issuers to take advantage of favorable market conditions, such as declining interest rates, by refinancing debt at lower costs, while investors face the risk of reinvestment at potentially lower yields.
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Callable. The Corporation can buy back any amount of the issued shares at any time without notice, at One ($1.00) Dollars per share, with the approval of the Board of Directors. The shares are callable by the Corporation, in whole or part, unless the Corporation is in default with its interest payment. If shares are called back by the Corporation, the dividend payment is adjusted proportionally, based on the number of shares owned by the holder.
Callable. A feature of a bond whereby it may be redeemed by the issuer prior to maturity under terms designated prior to issuance. Bonds drawn for redemption prior to maturity.
Callable. A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline since an issuer issues securities, it will likely call its current securities and reissue them at a lower rate of interest. Callable securities have reinvestment risk as the investor may receive its principal back when interest rates are lower than when the investment was initially made.