Really,You are spot on with the convertible note. (at least in...

Really,

You are spot on with the convertible note. (at least in the ones I have been involved with)

The money has already been paid to KRL, the note holder has generally been paid interest during the period of the note & as part of the terms, the conversion rate is set for maturity. (I have no idea what that was in this instance)

The note holder just needs to dictate whether they convert (get shares at the agreed rate) or redeem. (get their money back.)