Bio Corp. has 10,000 shares of convertible bonds, with total face value of $10 million, and the maturity is 4 years later. One share of convertible bond can be converted at maturity to 50 shares of newly-issued common stock. Right now, Bio Corp. has 4 million common stocks outstanding. The market value of Bio Corp.'s asset is 150 million with an annual volatility of 0.35. Suppose during the next 4 years, Bio Corp.'s capital structure only contains the common stock and the convertible bond. There is neither dividend payment nor coupon payment. The annualized continuously compounded interest rate is 3%. a. Under what circumstances will the bondholder convert the bond to stock? (5 pts) b. What is a fair price for the convertible bond per share now? (10 pts)