Note 5 - Bhang Corporation (formerly known as Bhang Chocolate Company, Inc.) and Judgment
|12 Months Ended|
Dec. 31, 2018
|Note 5 - Bhang Corporation (formerly known as Bhang Chocolate Company, Inc.) and Judgment||
Note 5 Bhang Corporation (formerly known as Bhang Chocolate Company, Inc.) and Judgment
The Company entered into an agreement with Bhang Chocolate Company, Inc., the predecessor in interest to Bhang Corporation (together Bhang), effective February 28, 2014. As part of that agreement, which was ultimately rescinded, Mentor delivered $1,500,000 to Bhang which Bhang refused to return following rescission of the agreement. Following arbitration of the dispute, on December 29, 2016, Mentor obtained a judgment in the amount of $1,921,534 against Bhang Corporation and its predecessor in interest, Bhang Chocolate Company, Inc., in the United States District Court for the Northern District of California. The judgment accrued interest at the rate of 10% from December 29, 2016 until November 20, 2017, when the parties stipulated to payment terms.
On January 23, 2018, the Company received a net payment of $1,758,949 in satisfaction of the judgment and 117,000 shares of Mentor common stock, originally sold to two Bhang shareholders, were returned to Mentor in exchange for a payment of $286,719 to the two Bhang shareholders, which was offset from the judgment of $2,045,668. Receipt of Common Stock returned by the Bhang shareholders was accounted for as a reduction of outstanding Common Stock and reduction to the Receivable from Bhang Chocolate Company by the original purchase price of $228,150 upon their receipt by Mentor in January 2018.
The Company collected and recognized $55,585 of interest income in the third quarter of 2017. In the fourth quarter of 2017, at the time the parties stipulated to payment terms, $540,521 of interest income was recognized on the judgment. At January 1, 2017, accrued interest was fully reserved pending the Companys ability to collect on the judgment.
The receivable and accrued interest consisted of the following at December 31, 2018 and 2017:
Represents the textual narrative disclosure of Note 5 - Bhang Corporation (formerly known as Bhang Chocolate Company, Inc.) and Judgment, during the indicated time period.
No definition available.