Blank-Check Company

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DEFINITION of 'Blank-Check Company'

A company in a developmental stage that either doesn't have an established business plan or has a business plan that revolves around a merger or acquisition with another firm.

INVESTOPEDIA EXPLAINS 'Blank-Check Company'

These companies are generally speculative in nature and will issue penny stock in order to finance future operations.

According the Securities Act of 1933 (under Rule 419), blank-check companies are required to disclose the terms and conditions of their offering as well as place any funds received from the offering into an escrow account.

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  3. Penny Stock

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  5. Escrow

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