Involuntary Conversion

See: The Inquisition. They were good at that.

In this venue, it doesn't apply to the marketing of Catholicism, but rather the forced conversion of one security into another, usually a bond, into shares of stock.

A prototypical example might run such that investors bought convertible bonds with par value of $1,000. Those bonds were mandatorially convertible into 40 shares of stock, should the stock "trade for $25 or better for the trailing 20 trading days." Or something like that.

And this involuntary conversion makes sense, right? If the shares were trading at $25 or better, then 40 of them would be worth more than the $1,000 bond par value, so why wouldn't an investor want to convert them? They could just sell and do better than the grand they're owed n years away when the bond matures.

As the Inquisition asked, "What would Jesus do?"