You own 10 Bitterroot Industries, Inc., 8 percent convertible debentures maturing in 2030. The conversion ratio of the debentures is 30, and the debentures are callable at $1,070 each. You bought the debentures when they were originally issued in 2000 for $1,000 each. At that time, Bitterroot common stock was selling at $28.50 a share, and now it is up to $44 a share.
The convertible debentures are now selling at $1,320 each. Last week, you received a notice from Bitterroot Industries stating that the company is calling the debentures.
a. What are your alternatives?
b. Which alternative should you choose?