TLDR:
A freeze-out (or squeeze-out) is a technique used by majority shareholders to force minority shareholders to sell their shares, typically through a merger or acquisition transaction at a court-appraised fair value.
Freeze-Out Standards and Protections
Courts scrutinize freeze-out transactions carefully because they create obvious conflicts of interest — the majority is using its power to remove the minority at a price the majority controls. In Delaware, freeze-outs are subject to heightened “entire fairness” review unless they are conditioned upfront on approval by both an independent special committee of directors and a majority of minority shareholders, in which case the more deferential “business judgment” standard may apply. The “MFW Structure” (from Kahn v. M&F Worldwide) has become the gold standard protective structure for freeze-out transactions.