Preferred shares can be used for these purposes:
1) they can be used in lieu of outright increasing common shares for purchase buy out equity or hiring new people. They are worth some value (as noted by several others here talking about conversion), sometimes having clauses with anti dilution and May also have expiry time or even be able to be bought out. But they also may have preference should a company be bought out. But they are used in lieu of just outright raising the OS. In this case I think they are being used for both the weshield and rafina merger / company buy out.
2) on the company being bought out note above, preferred shares may have a clause to prevent someone coming in to have a controlling interest in the company should they buy more than 50% of the common shares. These preferred are not common and would convert should someone want a hostile take over. A company or group of people may try to buyout a considerable amount of the common shares sometimes sending letters to holder saying they will buy your shares for x. If they get enough, they then can control and take over the company. These preferred shares with such a high conversion would convert to prevent this giving those shares to the original holder or controlling entities. While the preferred share owners or shares don’t have voting rights, it gives some reassurance and protection of why they were used in the first place.
3). Looking at equity and company revenues. When looking at valuation etc, the preferred shares are not in the common share structure so they are favorably to share price to revenue valuations. There’s other ways to look at this too.
4). Preferred shares are not some sort of guaranteed dilutive event. They have some details of which we don’t know on when they can be converted, repurchased etc.
Long story short I believe they were used two fold here:
Equity or collateral for the recent company purchase (rafina and weshield) and anti take over. At 5 cents a share with up to 200 million in revenue and ~2 billion (~1.6billion OS), this could be an easy take over target itself. ($80 million total if someone bought out all the OS to get $200 million in revenues).
Just my IMO.
