APT MotoVox Group Inc. (MTVX)

[bullethole27]

APT Property Sale DD

Here's what I have been able to find that I would give reasonable credit to. My abbreviated thoughts are that APT is not selling their building but likely much of the land around it. It will earn them somewhere between 18M and 26M. We will get the details for sure on July 9th.

APT has stated in their interview with Francis Gaskins that this non-revenue asset sale would allow them to reduce their expenses by 1/3. This would be accomplished by paying down debt they said. Currently their expenses are $1,353,360. The 10Q does not provide enough detail to determine what portion of the expenses are debt but it should be contained within the 800k of General and Administrative. 450k is 1/3 of expenses per quarter which equals 1.8M per year. If we assume a yearly rate of 7% on debt then they would need to pay off 26M to reduce quarterly expenses by 450k. If we assume 10% then it would be 18M. Don't forget that they said some of the money would be kept for cash on hand purposes.

It may be the case that they are not talking about the current expenses which are artificially inflated with lawyers fees on both FROZ and APT's sides from the reverse merger. If we reduce that by 300k then we are looking at 333k as 1/3 of expenses and 7% would equal 19M and 10% would equal 13M. Again remember that they are claiming to be able to pay this much off and still have cash on hand.

APT also states in their shareholder preliminary update that:

"APT is reviewing an attractive offer for the sale of certain non-core corporate assets that do not produce revenue and are not vital to operations or the company's long term business plan. We anticipate the transaction to be completed in early Q3. A portion of the sale proceeds are earmarked to fund the growth capital needs for 2014. The balance is targeted for the direct retirement of debt instead of selling equity, which will result in improvements to the balance sheet, cash flow and operating expenses."

The bolded portion leads me to believe that they are not selling their building as that would be vital to operations. Remember that they own 18 acres worth of land.

The announcement on the specifics of the Cerner deal is likely to take place on July 9th. Cerner was quoted as saying:

“Our revised plan, which will be shared at the July TIF Commission meeting..."

http://www.bizjournals.com/kansascity/news/2014/06/02/cerner-adds-acreage-to-three-trails-campus-for.html

Looking up the July TIF Commission meeting shows that it takes place on July 9th at 8:30am.

http://edckc.com/calendar-of-events/

This also coincides with APT stating that it will occur in early Q3.