Wilcox, chief executive officer and chairman of the board of directors, owned 60 percent of the shares of Sterling Corporation. When the market price of Sterling's shares was $22 per share, Wilcox sold all of his shares in Sterling to Conrad for $29 per share. The minority shareholders of Sterling brought suit against Wilcox demanding a pro rata share of the amount Wilcox received in excess of the market price.
(a) What are the arguments to support the minority shareholders' claim for a pro rata share of the amount Wilcox received in excess of the market price?
(b) What are the arguments to reject the minority shareholders' claim for a pro rata share of the amount Wilcox received in excess of the market price?
(c) Which side should prevail?