Question

The shareholders of Motive Power Corp. need to elect three new directors to the board. There are 15,000,000 shares of common stock outstanding, and the current share price is $11.15. If the company uses cumulative voting procedures, how much will it cost to guarantee yourself one seat on the board of directors? (Do not round intermediate calculations and round your answer to the nearestwhole dollar amount. (e.g., 32)) Total cost

Answer 1

Number of shares required to elect director = ((15,000,000 + 1) / (3+1)) + 1

Number of shares required to elect director = 3,750,001

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Total cost = Number of shares required to elect director * Current share price.

Total cost = 3,750,001 * $11.15

Total cost = $41,812,514.