50MM shares more dilution in the next 3 months? Well Alex says he is going to raise $1MM by the end of June.
The "usual" way (other than the recent non-convertible 30 day notes which are in default so I doubt investors are lining up to do that again) is to sell convertibles at a 25% discount to the stock which would be 51MM MORE shares at the current price (since the low of the averaging period would be $.0259 before the 25% discount), more than currently authorized and massive dilution relative to the 33.6MM shares outstanding today and the 6.7MM shares outstanding less than a year ago on 3/31/17 or the 0.1MM shares outstanding less than two years ago on 3/31/16. Does anyone here know of a company that has been more dilutive in the past two years? I can't find one.
Also, it was interesting to see in his March update that he appears to be abandoning, as it is not the weird split / reverse merger with ALYI as it is not the "right time to complicate" that relationship (with no mention of how that relationship has changed materially since he PR'd the weird merger / split).
Another "red flag" is that he says that "the royalty from the field today is modest ...will increase significantly as each well comes online... I hope that oil continues to hold above $60." These comments appear to be the first that hint at the royalties will be small compared to the $879,000 they advanced to White Top late last year and that his explanation of doing this to have cash flows to fund the business will be a provably wrong reason (as they could have used the $879,000). It never made sense as a company with a much lower cost of capital (junk bond issuers can finance at less than 5% now for one year financing while LEXG's cost of one year convertible funds has been greater than 117%) could buy this asset for a much higher price and have it be more profitable to them.
