An FRN that has a very long or endless (perpetual) maturity, with the right to convert back and forth between the initial issue and one with a short maturity. In other words, it gives the holder the option to convert after a specified period of holding, at each coupon payment date or whatsoever, into a short-dated floater that typically pays a lower margin over LIBOR (or any reference rate) than the original floater.
It also gives the holder the option at a later date to convert back into the initial issue before redemption of the short-dated floater. The option to flip-flop is usually conferred against some penalty.
