I know of at least one other time where preferred stock is mentioned in Risk Factors

It's certainly not new. I am pretty sure is has been in the caveats for several years. Right now, thou, it bothers me, in part because of what happened with Swartz and in part because there is noone at the top with adequate business experience to run a company. Sure, both Flowers and Felcyn have an accounting background but neither look able to run a serious multimillion dollar company and turn it around. Their initials "F" are all you need to know. John is allegedly an attorney, and I don't recall any indication that he knows business and how to improve shareholder equity (i.e. make a profit quarter over quarter).