A modified version of the barrier floor. It is an interest rate floor that comes in the form of an up-and-out floor or an up-and-in floor. It deactivates (activates) when the reference rate reaches or falls below the barrier and the original floor is replaced by another floor with a lower strike price. In other words, this floor has an upper strike, a lower strike and a trigger. Insofar as the underlying rate is above the trigger, the floor holder obtains protection at the higher strike. For periods when the underlying rate is at or below the trigger, the floor holder receives protection at the lower strike level.

The following example illustrates how an N-floor works. An investor buys an N-floor which combines a 5.5% knockout floor and a 3.5% knock-in floor. Both floors are subject to a 3% trigger rate. That means, the investor can floor his receipts at 3.5% in addition to the premium paid for the floor unless rates fall to 3%. At this rate, the knockout and knock-in features come into life and the receipts readjust downward.

It is also referred to as an indexed strike floor or a dual strike floor.