blank-check company

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Blank-Check Company

A company that has not yet defined its business operations. Blank check companies issue penny stocks; the funds raised through a blank check offering must usually be placed in an escrow account until certain conditions have been met. Because a blank check company has not begun or even defined its operations, it effectively asks investors to trust it. Blank check companies are therefore subject to extra regulation to protect these investors from the possibility that the company is a fraud. In any event, investing in a blank check company is always speculative.

blank-check company

A company that issues penny stock in order to finance its involvement in establishing a business in which principal operations have not yet commenced. The company either has no business plan or plans to engage in a merger or acquisition with an unspecified business entity. Essentially, the company is given a blank check with regard to investors' money. Blank-check companies are required to provide certain information prior to and after the registration of securities. In addition, funds received from a penny stock offering must be placed in an escrow account for the benefit of the purchaser. See also Rule 419.
References in periodicals archive ?
27 February 2017 - Texas-based blank check company Hennessy Capital Acquisition Corp.
31 January 2017 - Texas-based blank check company Hennessy Capital Acquisition Corp.
Ratzan, is a blank check company formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
II is a blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
The company is a Cayman Islands exempted company incorporated as a blank check company formed for the purpose of entering into a share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities, or entering into contractual arrangements that give it control over such a target business.
29 December 2016 - Texas-based blank check company Hennessy Capital Acquisition Corp.
28 December 2016 - China-based blank check company Pacific Special Acquisition Corp.