Penalty in case of early repayment of a debt instrument (typically a bond, but it can also be included for certain loans).
Typical structure for a high yield bond: after the first 1, 2 or 3 years of Non-Call Period, there is a call premium of 50%/25%/0% for subsequent years. This means that for a 5-year Non-Call 2-year (“5NC2”) bond, the bond can be repaid at Par plus a premium of 50% of coupon in year 3, Par plus a premium of 25% of coupon in year 4, and at Par in year 5.
See also: Non-Call Period