Assume Zilda Company went public in an IPO by issuing 100 million shares at an offer price of $20 per share. The underwriters commission was 6%. Zilda paid auditors fee of $500,000, legal advice fees of $1.2 million, and filing fees of $850,000. The first day closing price was $25. Subsequently, the stock price hovered around $28 per share. The underwriter exercised 15% green shoe option.

a) What was the net proceeds to Zilda Company from the IPO issue including the green shoe option?

b) What was the rate of underpricing?