Which of the following is most likely to happen with a convertible bond when the market price of the stock exceeds the conversion price? The stock does not pay a dividend

A) The bondholders will immediately convert their bonds to stock.
B) The issuing company will call the bonds and the bondholders will redeem them for the call price.
C) The issuing company will call the bonds and bondholders will convert them to common shares.
D) Both the issuing company and the bondholders will wait for the bonds to reach their maturity date.

Answer: C