My answer would be Yes for the first and No for the second, but I'm no expert.
I have always understood "typical" preferred shares (though there are endless forms of Preferred stock) to be an equity/debt combo from a company's perspective. It's equity, because the owner of the preferred share has voting rights and is an owner in the company as expressed by the payment of dividends to preferred shareholders first. But it's also debt in the sense that it's no different that a CD. You put $10 in, that $10 pays a set interest, and at the end of the term, you get your $10 back to reinvest of to cash out.
Of course the BIG difference here is that PBLS is saying that if you have $2.50 worth of common, we will give you $10 worth of preferred that pays a 6% annual dividend. It has the appearance of an instant 4 bagger and is what sweetens this deal so to speak.
Again, IMO...I'm certainly no expert of securities or I'd be retired already.
"Experience: that most brutal of teachers. But you learn, my God do you learn." C.S. Lewis
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