Pacheco Inc. issued convertible bonds 10 years ago. Each bond had an initial term of 30 years, had a face value of $1,000, paid a coupon rate of 11% and was convertible into 20 shares of Pacheco stock, which was selling for $30 per share at the time. Since then the price of Pacheco shares has risen to $65, and the interest rate has dropped to 8%. What is the least that each of the bonds is worth today? Comment on the function of the bond valuation procedure for convertibles.