SCOTTSDALE, AZ--(Marketwired - Oct 22, 2014) - Lithium Exploration Group Inc. (
Last week, shareholders passed a vote to increase our authorized shares and approve a reverse split of the common shares of Lithium Exploration Group. I want to address these issues by commenting on each of them individually. It is also important for you to note that I abstained from voting any of the shares that I control for both initiatives.
If we had not increased our authorized shares, we would not have been able to meet our obligations to creditors and would have been forced to sell our disposal assets to pay principal, interest, and, more than likely, penalties to avoid bankruptcy. That would have been a very unfortunate situation and could have been detrimental to everything that we have built to date. Many of you have expressed concerns about management issuing bonuses and other chicanery to take advantage of the increase and dilute shareholders. I can assure you that is not the case. Should the company not be able to fulfill obligations in cash, we will issue shares to meet them; but there will be no raises, bonuses, or additional compensation to any employees or management until we get this company producing positive cash flow and moving ahead.
We authorized a reverse split for the purposes of bringing our outstanding share balance down and our price up when the time is right. In part, this is because some brokerage firms simply cannot trade below certain price points, and, in part, this is because I have a goal of bringing LEXG's market cap to $100MM and, when we are there, I would prefer to see us well above $1 per share. We will not be reversing the stock just for the sake of reversing the stock. We will do it when we have cleared the path for price appreciation and market cap growth. At this time, I have not considered a timeframe for this, but I can assure you it will not happen in 2014.
The one thing that we have discussed doing in the next few months is changing our name and ticker to more accurately reflect our present business operations in technology, disposal, and mineral exploration. The name Lithium Exploration Group is still relevant for part of our business, but should not be misconstrued as our only endeavor.
In March of 2014, we raised $1,000,000 to purchase 50% of Tero Oilfield Services ("Tero"). Over the past six months, we have seen a precipitous decline in our market cap but we have added assets and revenue to our financial statements. When we had the business valued 12 months ago, it was worth $2-2.4M. Since then, the company has increased both revenue and profitability, so by any stretch of the imagination, the value of the company has increased. We recently raised the capital to close on the option to purchase an additional 25% of Tero, effective January 1, 2015.
I realize that, to repay the debts that we took on to close on the Tero transaction, we have had to issue additional shares of stock. I truly believe that we have made our company more valuable but our market cap does not reflect that reality. We successfully tested a technology in February that is being modified now to field test, and have a second unit in process to be delivered to Tero to test for oil upgrading capabilities.
In my wildest dreams, I would not have imagined that buying an amazing facility like Tero, after having successfully tested a technology that has endless potential, would lead to our market cap bottoming below $5M. That market capitalization is a joke, and is a fraction of where it should be, given all of our positive activity this year.
I apologize to all of our shareholders for this reality, but I also hope that you will have patience and see how the next few quarters play out. By adding Tero to our quiver, we are no longer at risk of being the technology company that goes out of business before it is monetized. We are going to be here to bring it to market. The only question now is: how much money will it generate for us in the future.
Lithium Exploration Group
About Lithium Exploration Group
Lithium Exploration Group is a US-based exploration and development company focused on the acquisition and development potential of lithium brines and other precious metals that demonstrate high probability for near-term production. Currently the company is focused on its Western Canada lithium assets, testing its Ultrasonic Generator Technology and the acquisition of oil and gas related assets in Western Canada. Lithium Exploration Group is a fully reporting company traded on the OTCQB under the symbol LEXG. Website: www.lithiumexplorationgroup.com.
Safe Harbor Statement
This news release contains "forward-looking statements." Statements in this press release that are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future testing of the ultrasonic technology.
Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with mineral exploration and difficulties associated with obtaining financing on acceptable terms. We are not in control of lithium prices and these could vary to make development uneconomic. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements.
Although we believe that the beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our most recent annual report for our last fiscal year, our quarterly reports, and other periodic reports filed from time-to-time with the Securities and Exchange Commission.