What does "Convert To" under the text annotations options menu do?

The "Convert To" option allows you to convert text from a basic text annotation into an annotation that has a connector that can point to a particular part of your document.  

Image 1.  Text options menu with the "Convert To" option.

To use this feature, create text on your document using the Text Annotation feature.

Image 2.  Add a text annotation to a document.

After you have added text, tap on the text with you finger and then from the small pop up, select INSPECTOR.

Image 3.  Tap on text and select INSPECTOR.

From the pop over, select CONVERT TO and then CALLOUT.

Image 4.  Select CALLOUT next to CONVERT TO.

The text should change to a callout box with an arrow.

Image 5.  Text changed to a callout box with an arrow.

Tap on the document to close the pop over and then tap on the text to select it.  You can then move it and tap on the green dots to change the direction of the arrow.

Image 6.  Adjusted callout text box.