Mentor Capital (MNTR)

This is the discussion board for MNTR



Referral from Bob Meyer :  "I've known and interacted with Chet Billingsley for 18 years and he's a top notch person"


As of September 2013, the capital structure of Mentor Capital is approximately 6 Million shares and 23 Million warrants. The proceeds of the warrants at the current strike prices are more than $140 Million.
The Mentor structure is unique and has extreme flexibility that allows management a number of tools to increase the likelihood of timely funding. Management created the capital structure and received an SEC “no comment” letter and approval under USC 1145. As such, MNTR management is well versed in the nuances of the formation documents that allow MNTR to proceed along funding paths that are most beneficial to all parties.
The warrants are freely tradable and the shares that spring from the warrants are immediately freely trading. The warrants are already in the hands of approximately 1,500 warrant holders. If a warrant is not exercised timely when called, it can be reassigned by the company to another person to be exercised by them. Several hundred shareholders have asked to be designated to redeem warrants if the original holder does not exercise.
Mentor management has been in discussion and plans to file the 15(c)2-11 paperwork to make a market in the warrants, in addition to the market already made in the shares.
Importantly, to bring the $7 warrants into the money, and prepare for NASDAQ, the company may conduct a reverse split with an $8 or higher target. e.g. If a holder had 8,000 shares at $2 = $16,000 the reverse could give them 2,000 shares at $8 = $16,000. There is no change to the value and a 2% holder pre-split remains a 2% holder post-split. Note: The warrants have a non-dilutive quality approved by the courts under 1145, and already subject to historic review by the SEC who issued a no comment letter, FINRA who reviewed and approved trading and DTCC who effected an earlier reverse split. That is, a reverse split of the shares specifically does not affect the exercise price of the warrants. (See footnote page 50, Section 1145 Disclosure Statement). All original shareholders hold warrants. Any new shareholder may become a company designee to act as a substitute exercisor of warrants, by contacting the company with that inquiry, and if such warrants are available under the rules commented on by the SEC and as ruled on by the court in the original warrant formation. For emphasis: NOTE THAT A CONTEMPLATED REVERSE SPLIT OF THE STOCK WILL NOT IMMEDIATELY AFFECT THE PERCENTAGE OF ANY SHAREHOLDER’S HOLDINGS. HOWEVER, THE WARRANT STRIKE PRICE IS SPECIFICALLY NOT AFFECTED BY THE REVERSE. THIS NON-DILUTIVE CHARACTERISTIC WILL BRING OUTSTANDING WARRANTS INTO THE MONEY. THAT WILL EQUALLY SHIFT VALUE FROM SHAREHOLDERS’ SHARES OVER INTO THEIR WARRANTS. ANY SHAREHOLDER THAT DOES NOT HOLD WARRANTS SHOULD CONTACT THE COMPANY BEFORE OR AT THE TIME OF THE REVERSE TO SEE IF THEY MAY ALSO COME TO HOLD WARRANTS AS A COMPANY DESIGNEE AND EQUALLY CAPTURE THIS SHIFT IN VALUE.
Post-split Mentor will have a simplified structure. There will be shares at a post-split target of $8 and warrants at a strike price of $7. The shares represent the value of the company assets already paid for at that time.
The (i) low dilution ratio of shares to warrants, (ii) freely tradable nature of warrants, (iii) possible arbitrage in the market for warrants, (iv) immediate tradability of shares, and (v) reassigning of warrants all are factors that would favor warrant exercise upon accumulation of assets.


Mentor Capital and its CEO completely support the SEC and FINRA in their general warning to investors about being wary of pump and dump schemes in the marijuana public stocks sector. The Mentor CEO has not sold any Mentor Capital, Inc. shares in 13 years and finds pump and dump actions by public company executives as reprehensible.
To further distance and contrast Mentor Capital from the reported bad actors amongst the public marijuana stocks, the CEO is escrowing his personal MNTR shares.
100% of Chester Billingsley’s Mentor Capital shares are being held at The Corporate Law Group in Burlingame, California in a voluntary escrow, The CEO shares may only be released back into Billingsley’s normal possession after a public announcement of the upcoming return. In this fashion, the only controlling company officer is voluntarily blocked from easily profiting from any pump and dump actions. In fact, with his shares in escrow the CEO would lose significantly and is inherently motivated to block any potential dumping to protect his own locked up interests.
Mentor knows of no other public cannabis CEO who is taking such a strong action to block any possibility of a pump and dump activity in the other public marijuana companies.

Shares & Warrants Outstanding (09-29-2013):

Common Shares6,419,312CUSIP# 587 183-104
Public Float1,866,897
Shareholders of Record1,526
Series A ($0.09) Warrants1,271,072CUSIP# 587 183-112
Series B ($0.11) Warrants1,200,818CUSIP# 587 183-120
Series C ($0.01) Warrants149,325CUSIP# 587 183-138
Series D ($7) Warrants20,084,225CUSIP# 587 183-146

I had a long conversation with Mr. Billingsley on 1/26 and would be very cautious with this name.  It seems like there could be a reverse split.  Further, the whole concept seems to be based on the stock price going up (so cash is generated from warrant exercise).  

Posted to Your Cannabis Analyst on Jan 18, 2014 — 3:01 PM
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