Since LEXG has been averaging a negative $100K cash flow per month, they will need cash to cover it until the UT is earning profits. If that is by the end of June, then they need $600K to keep operating. At their 35% discount rate, they will need to sell an additional $900K in stock to finance it. In addition, they still have the outstanding debt that will need to be paid off. It is pretty hard to determine how much they need to pay off the old debt, but based on the Dec 10Q in Note 6, I am estimating $1.9M. This means a total of $2.8M in stock is required to pay off all their debt. With the moratorium on dilution ending 3/31, the big question is will it be renewed and extended until the UT is earning profits or will dilution be required to fund this? Please note that these numbers are my best estimates based on limited knowledge of how they are handling their debt and I would appreciate any better explanation of how much they will need to fund the company until the UT is earning funds and how this funding will come about.
