This is how i picture convertible notes to work: the company gets a loan from a investor, and pays a certain annual interest. the note also has a conversion price, and if the market price of the stock goes above that conversion price, the note can be converted to stock at that conversion price/share.
the company also makes no money for converting the note into new stock unlike warrants?
if the price of the company's stock never goes above the conversion price, the notes are not converted? and the company only pays back the money in cash?
please let me know if i'm correct or wrong