A debt instrument which gives the issuer the right to deliver more instruments (i.e., bonds)- considered a new tranche by its own- to the investor at preset dates and at a certain price. The investor (holder of the original tranche) is obliged to buy the instruments offered. Any tranche issued as part of the same instrument bears the same features (coupon, maturity) but a different issue date.

Such an instrument is associated with the right that can be exercised by the issuer, on a respective exercise date, to release additional tranches when the present value of the tranches drops below the strike price on the exercise date. The issuance of additional tranches depends on the level of their present value (PV) relative to the strike price. If the issuer exercises this right once, it does not mean that such a right shall be exercised again in the future.

These rights constitute a portfolio of embedded European put options.