Acquicor Tech Enjoys Apple's Halo

Then Amelio awarded himself nearly 5 million shares, most of them purchased at less than a half-cent a share. Lead underwriter ThinkEquity also got to buy 1.25 million shares for a cool $100. When Acquicor went public, Amelio was not only reimbursed for his loan, his 16% stake in the company was suddenly worth $30 million. Not bad for a company without a cent in revenue.

That may not be the end of it: Acquicor says it's authorized to issue more than 90 million additional shares priced at 1/100th of a penny a share.

There's more in the prospectus to either amuse or frighten readers, depending on whether or not they are shareholders. Some highlights: "You will have no basis upon which to evaluate our ability to achieve our business objective"; "none of our officers or directors is required to commit their full time to our affairs"; and "the personal and financial interests of our directors and officers may influence their motivation in identifying and selecting target businesses."

Translation: We may fail at this, and if we bother to show up for work, it may be simply to use your money to buy companies we already own.

The corker, however, is this: "You will not be entitled to protections normally afforded to investors of blank check companies under federal securities laws."

That's right. The federal laws protecting investors don't apply here. Specifically, Rule 419, which requires funds raised by blank-check companies to be put into an insured escrow account. Acquicor is putting its money in a trust account "located at Lehman Brothers." The key word there is trust.

Also, Rule 419 says blank-check companies can't trade their stocks until they actually buy another company, and that investors be refunded if no acquisition has been completed within 18 months. Acquicor brushed those provisions aside as well.