Good post.
Your numbers are correct but you have omitted the key consideration of income tax. As such, there is a little more downside risk than you have stated (albeit not a whole lot).
For a 15% taxpayer (e.g. super fund) buying AFIG at $110 and holding until maturity, the downside risk is 1.5%pa (annualised). If AFI is trading at $5.75, the upside is 8.1% annualised.
For a 39% taxpayer, with the same assumptions, downside risk is 3.3% annualised, and upside is 6.4% annualised.
While the numbers aren't as promising as you have presented them, it does nonetheless look like a good play with respect to risk/reward - and certainly far better than buying AFI ordinary shares at this stage.
AFIC convertible notes, page-2
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