Bhang Chocolate, one of the nation’s leading producers of marijuana edibles, has declared Mentor Capital in breach of agreement, according to a statement posted on its Facebook page and Twitter feed late Tuesday evening.
The announcement comes just over a month after Mentor Capital announced that it was investing $39 million and acquiring a 60 percent interest in the gourmet edibles company. According to the statement released by Bhang, Mentor Capital failed to produce $7.5 million of the promised money by June 16th and today, having not received the past due amount, Bhang formally declared Mentor to be in breach of agreement, terminating all relations with the California-based venture capital firm.
Bhang Chocolate, founded in 2010 by Scott Van Rixel, a Master Chocolatier and certified Chef d’Cuisine has already won several awards for its cannabis-infused chocolates, including the Best Edible Awards at the 2010 San Francisco Medical Cannabis Competition and the 2012 Los Angeles Medical Cannabis Cup. In addition to its medicated chocolates, Bhang also produces chocolates from non-THC hemp, which are marketed at mainstream outlets such as Whole Foods Market, and whose packaging includes information designed to educate the general public about the benefits of medical cannabis. Mr. Van Rixel also serves as a board member of the National Cannabis Industry Association. Bhang Chocolate is the Industry Pioneer sponsor of the Cannabis Business Summit, which takes place over June 24-25 in Denver Colorado and Mr. Van Rixel is listed as one of the summit’s featured speakers.
Founded in 1985 as a small chain of gyms, Mentor Capital has undergone several reinventions, having been forced to sell all of its assets in 1997 before re-emerging as a hedge fund investor in 2007. Two years later, Mentor Capital was providing private equity for Quantum Immunologies, a biotech firm working on a new treatment for breast cancer. Since then Quantum Immunologies seems to have all but disappeared. As recently as October 2013, Mentor Capital’s website billed the company as a funder of leading-edge cancer research.
However, in February of 2014, Mentor Capital had pivoted its focus from cancer research to the industrial cannabis market, announcing its acquisition of Florida-based MicroCannaBiz, LLC. However, it is unclear what exactly MicroCannaBiz does. According to their BusinessWeek profile, the company “Provides investment publication services. The company publishes online business magazine and national directory of private and public cannabis and marijuana (sic).” Although the company does not seem to have a website, a Mentor Capital press release states that MicroCannaBiz has already begun generating revenue in its fourth month.
According to the company’s unaudited financial statement for Q1 2014, the company has $14,158,030 in assets and the exact same amount, $14,158,030 in liabilities.
Neither Mr Van Rixel nor Chet Billingsley, CEO of Mentor Capital, was available for comment and Mentor Capital has yet to release a public statement regarding the declaration by Bhang Chocolate.