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Hilton Hotels Corp. has a convertible bond issue outstanding. Each bond, with a face value of $1,600, can be converted into common shares at a

  1. Hilton Hotels Corp. has a convertible bond issue outstanding. Each bond, with a face value of $1,600, can be converted into common shares at a rate of 61.3004 shares of stock (the conversion rate), or $26.1010 per share. Hiltons common stock is trading at $25.68 per share and the bonds are trading at $1,588. What is the minimum share price the stock must reach to make it worthwhile to convert the bonds to stock?

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