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The firm decides to issue a bond with the warrants instead. The firms straight bonds yield 3%. Assume the bonds are 10-year bonds, $1,000 par
The firm decides to issue a bond with the warrants instead. The firms straight bonds yield 3%. Assume the bonds are 10-year bonds, $1,000 par value with annual coupons. There are 80 warrants attached to each bond. The value of the warrants is $6.239. What coupon interest rate, and dollar coupon, must the company set on the bonds with warrants so the total package sells for $1000.
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