Buchanan Air Corporation's board of directors is elected by a vote of the common stockholders.As such, the board believes that it owes a fiduciary duty to maximize the returns for common shareholders.The board is evaluating a proposal to raise an additional $10,000,000 in capital by issuing preferred stock.The company's underwriter for the preferred stock offering has determined that the preferred stock will carry a 3% rate if the preferred shares are offered as cumulative shares and a 4% rate if noncumulative.