Accrued salary, accrued retirement and related party incentive fee
|12 Months Ended|
Dec. 31, 2015
|Accrued salary, accrued retirement and related party incentive fee|
|Accrued salary, accrued retirement and related party incentive fee||
Note 17 - Accrued salary, accrued retirement and related party incentive fee
As of December 31, 2015 and 2014, the Company had an outstanding liability to its Chief Executive Officer ("CEO") as follows:
The Company agreed to advance the CEO $944,000 against the accrued liabilities due him, in January 2014, to exercise additional warrants into shares to be used as collateral for a potential loan to the Company. The warrant exercise was a cashless transaction made solely for the benefit of the Company in its efforts to obtain financing. After the warrants were exercised, the CEO put 100% of his shares owned, 5,000,486 shares, in an escrow which was to guarantee the potential loan. The loan was never funded and was mutually rescinded on June 12, 2014. The shares remain in escrow as of the audit date. The CEO must make a public press release and post a notice on the Mentor website before he removes the shares from escrow.
As provided by Board of Director resolution in 1998, the CEO will be paid an incentive fee and a bonus which are payable in cash upon merger, resignation or termination or in installments at the CEOs option. The incentive fee is 1% of the increase in market capitalization based on the bid price of the Companys stock beyond the book value at confirmation of the bankruptcy, which was approximately $250,000. The bonus is 0.5% of the increase in market capitalization for each $1.00 increase in stock price up to a maximum of $8 per share (4%) based on the bid price of the stock beyond the book value at confirmation of the bankruptcy. The Company recorded $0 and $190,581 of accrued incentive fee and bonus expense in 2015 and 2014, respectively.
Entire disclosure for accrued retirement and related party incentive fee
No definition available.