If I understand it correctly....each preferred sha

If I understand it correctly....each preferred share must be held for 1 year. But since you have to hold it for a full year, you get it as a discount. After the year, you can convert those shares at a rate of 1 preferred = 100,000 common. So yes, as the preferred shares convert, they will dilute the share structure.

Buying preferred does nothing to the PPS.