Two common ways for the issuing corporation to retire bonds before maturity are to (1)exercise a convertible option or (2)purchase them on the open market.

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The two common ways for a corporation to retire bonds before maturity are to (1) call them (redeem them before their maturity date at a specified price) or (2) purchase them on the open market. Exercising a convertible option is a decision made by the bondholder to convert the bonds into a predetermined number of shares of the issuing company, not a method used by the company to retire the bonds.

Two Common Ways for the Issuing Corporation to Retire Bonds