Mentor Capital, Inc. (OTCMKTS:MNTR)Surges Above a Dollar
Yesterday Mentor Capital, Inc. (OTCMKTS:MNTR) made a significant jump up the chart, broke through the 1 dollar mark and closed the session with a gain of 33% at $1.15. Although for the majority of pennystocks such prices could be seen as impressive compared to its 52-week high posted just seven months ago MNTR is actually sitting 88% lower.
Even yesterday’s recovery was only possible through the combination of the general hype associated with the midterm elections when 3 states and the DC voted on less restrictive marijuana laws and a new PR published by the company. The press announcement informed investors that MNTR’s CEO was featured in a Forbes article about marijuana investments. Well, the topic is rather ironic because so far their investments have been spectacularly unsuccessful.
In January they announced that a $7 million funding was going to be provided to the company HempCon, Inc. Six days later though in an email HempCon denied all the information published in MNTR’s PR. A few days after that Mentor issued their stance on the subject saying that after “inconclusive negotiations” the deal was terminated.
One failed deal is not that discouraging but the next attempt ended in a total disaster. In March they signed a $39 million funding agreement with Bhang Chocolate. In the first 90 days after the signing the sum of $9 million had to be provided to Bhang but MNTR managed to pay only $1.5 million. Bhang took the money and rejected the whole deal. Now both companies are involved in a law suit. In addition Mentor is also trying to get back $612 thousand paid as fees for a loan that ultimately never happened.
A few weeks ago the CEO of the company also discussed the subject of ethics in management – another fitting topic. We wonder if it is ethical to reduce the exercise price of millions of warrants from $7 to $1.6 and not inform the shareholders of the company. The reduction was revealed more than a month after it happened in the quarterly report filed on August 1. The same warrants were going to provide the $39 million for the Bhang deal while in 2002 they were going to bring $150 million. Neither of those things actually happened.
MNTR is surrounded by red flags and investors have been reluctant to put their trust in the company. The underwhelming operations in the marijuana industry, the failed fundings and the past history of the company demand the use of caution.
