Convertible Preferred Stock

What Does Convertible Preferred Stock Mean?
Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date.

Also known as "convertible preferred shares".

Investopedia explains Convertible Preferred Stock
Most convertible preferred stock is exchanged at the request of the shareholder, but sometimes there is a provision that allows the company (or issuer) to force conversion. The value of convertible common stock is ultimately based on the performance (or lack thereof) of the common stock.

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"Upon closing of the financing, JJNICL will own 51% of the common shares of Liberty which represents a change of control of the Corporation. If all of the preferred shares were converted, JJNICL would own 76.8% of the common shares of the Corporation. The additional 272,727,273 common shares issued from a full conversion would represent a 331% dilution of the currently outstanding common shares. JJNICL will work with Liberty to minimize the common share dilution resulting from the conversion of preferred shares into common shares as much as is feasible once the Corporation is in full production.

The preferred shares shall:
a) be redeemable by the Corporation with cash or payment to JJNICL for nickel in concentrate, at a price per share determined to be its fair value at the time of the redemption;
b) have voting rights on an as-converted basis to common shares;
c) be convertible by JJNICL into common shares at any time without expiry at no additional cost and at a 1:1 conversion ratio. The conversion ratio is to be maintained pursuant to customary anti-dilution adjustments such as a common share reorganization due to a consolidation or split of the common shares; a rights offering of common shares; or a capital reorganization through a merger or amalgamation with another company; and
d) pay an 8% cumulative annual dividend to JJNICL.
As part of this financing, JJNICL will directly pay the negotiated balance due on the loan described in the February 19th press release. The balance of the financing will be funded to Liberty to pay amounts owing to employees, trades and suppliers; and to provide additional working capital. "