You are not buying a share, but you are buying the option to buy a share at the strike price which here is 7.5c before the expiry date. To get the share you need to buy the option, and then if you want to convert it send the company (AGO) 7.5c for every option you want to convert to a share.
So your costs are: buying the option + 7.5c per option
You do not need to convert the options, but if you don't convert them or sell them on before expiry then you will loose your money. If the share price is under 7.5c on expiry you can still convert, but will probably be cheaper just to buy the heads.
AGO Price at posting:
4.6¢ Sentiment: Buy Disclosure: Held