Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Middy, we've had our differences, but I agree with you 100% on this. There is absolute no LEGAL reason for the BOD to ignore Ntephe's actions and allow him to remain as CEO. This crisis was created by him and is being perpetuated by him to the detriment of the shareholders he is sworn to work for.
He should be fired and turned over to the SEC. The non-existant BOD should be investigated for their involvement as well.
ERHC was a potential Cinderella story but the hogs at the trough killed it.
7 billion new shares.
Now can we address the elephant's (plural) in the room that everyone ignores?
1.) There have been at least 750M new shares released since last summer. Offor hasn't bought them. He therefore may not be the biggest shareholders anymore. If he doen's act soon he may lose the company.
2.) This company came to shareholders and asked for a vote to have the authorized raised to 3B shares. Why did they bother? They could have left the authorized at 950M and done a reverse split to lower the outstanding, and then dump more on the market... wash, rinse, and repeat. All of what they are doing could have been done with the Authorized left at 950M.
None of what is happening makes any sense... this is where the company's "piece of garbage CEO" could and should step up and communicate... but he doesn't, and all of the Director's (in name only because they don't do sh!t) sit and watch the company be destroyed by Ntephe.
WHY???
I don't know that Offor's conversion will cause a "massive discount" since he won't be selling those shares.
For all we know they were given spot bonuses for a job well done and used that to money buy their shares. With this sleazy gagging of the transfer agent I won't put anything past them... they think they are above the law.
Got it. Thanks arnim-v-b
Can you explain what you are trying to say with more words?
This is how I see this playing out...
A reverse split will occur. I has to. Offor owned 305M of 753M shares. Now there are roughly 1.5 billion shares out. Offor hasn't filed that he bought any, so *somebody* is holding those 750M new shares. Are they held by the retail crowd? Is it plausible that some entity grabbed half of them and now own more than Offor?
To maintain his control a reverse split will neuter current shareholders and then Offor will supply funding in return for a massive amount of shares.
He wins. We lose. Welcome to Nigeria.
"It will give true numbers"
"True numbers"??? From a CEO that is actively trying to hide the share structure changes he is making from shareholders??
That's funny... not.
With this gag order Ntephe has taken ERHC from a legitimate company to a scam, and yet the BOD do nothing.
They *all* should face charges.
I agree with this, except that Ntephe has gagged the transfer agent. IMO that is criminal deception and he should be held accountable for it. Nothing good can come from trying to hide the truth.
The market cap will be less than cab fare after a repeat of last year.
It looks like they are planning to do a reverse split without telling us and they are trying to hide it. Criminals.
Attention. Nothing more.
Yes.
ERHC being bought at the lowest price in the history of the company (by a factor of over 100 I might add) certainly sounds like a type of deal Ntephe would entertain. Mistake, after mistake after mistake is how his resume reads since he's been at ERHC.
Anyone in favor of any type of buyout now is a complete and utter fool. The BOD needs to show that they even exist, fire ntephe, and put someone FROM OUTSIDE OF THIS MESS in as CEO.
It's the first step of many that needs to happen to ever regain investor confidence.
I can agree with Ntephe on this...
8/100th's of a cent per share is "not ideal".
The man is completely out of touch with anyone's perception of reality.
Not ideal??? Unbelievable.
Ruby?
"Offer has bought what, 125 Million? (So Far)"
Offor entered a convertible loan agreement for $250K. The share price is 0.0014 and likely to be hammered in April. If it drops to 0.0003 and it very well could, Offor can convert his $250K to over 800 million shares.
Where did you get the 125M from???
Yep. I don't like it, but I see it for what it is.
We either give up, or grab our ankles and let them hump.
LOL! @ Easter
We'll know soon enough.
Ntephe has been with the company since 2001. Offor was Chairman until 2007. If Offor has skeletons in the closet, Ntephe knows what and where they are.
Don't dismiss Ntephe as insignificant in the shadow of the almighty Offor. There is a reason Offor has been silenced since 2007 when his shares were worth over $100,000,000. They are now worth only $427,000. Why is Ntephe still CEO?
Would you smile and continue paying the salary of someone that cost you NINETY NINE MILLION, FIVE HUNDRED and SEVENTY THREE THOUSAND DOLLARS if there weren't something he was keeping secret for you??
It seems to me that Ntephe isn't a "nobody" in this equation. Ntephe has forced Offor to fund ERHC or lose it.
Kenya could be worth $1-3B (with a B), the STP-EEZ *could* be worth 10X that, with the early seismic showing "very large" structures.
Does Offor Checkmate Ntephe and close the doors NOW? That is extremely unlikely, IMO. Offor *has* to see this to the end because the potential is staggering. How he deals with his "problem child" remains to be seen. For the last eight years, Ntephe has been winning... and that has cost Emeka Offor a LOT.
Great post Strategyone, thanks for sharing.
You have some good points in your post.
1.) "And why did Peter and Sylvan buy so much, so high in that case. They knew more, and they knew it sooner."
They are confident about the future, or it wasn't their money?
2.) "The price is totally unrealistic, given the value of the assets."
I agree, but what are the values of these assets? I think they're worth billions, but I assume successful drilling at some point.
However,
"They did not do ANYTHING to cut cost"
We don't know that. They could have eliminated salaries months ago and not PR'd it. Why would they, in the midst of a toxic debt debacle, announce that nobody is getting paid?
It's like I said yesterday to another poster that feels they should have announced the convertible debt, terms, and timeframes ahead of issuing that debt. The fund raising would have been a non-starter... a failure... making the next steps even more damaging.
This whole thing smells of a chess match between Offor and Ntephe. It looks like Ntephe asked for Offor's support with the Rights Offering and Offor ultimately said "no". So Ntephe has now move his (toxic) Queen into place and said, "Check, Sir Emeka Offor". It is now Offor's move. He can continue the game by providing the funding Ntephe needs (and I believe he will), or he can Checkmate Ntephe and ending the game by refusing to fund ERHC.
There is little doubt something is happening and we don't (and won't) know what it is until it is over.
My line of thinking is that this company will last about 9 seconds past it's first discovery before it's acquired. Where it trades and how many shares are out are irrelevant other than from a personal percentage of ownership standpoint.
I disagree with this: " Nobody will make money with that many shares"
Share count is irrelevant. It's all about percentage of ownership. Whether Offor holds 43% of 750M shares or 43% of 100 billion shares, his gain on any discovery will be identical.
"IMO were close to news"
I agree. Something has to give.
I'd guess around 1.5B or so, but that's just a guess.
"IMO once they burn thought their convert obligations"
That is the point I am trying to make, they don't have enough shares, even maxed out at 4 billion, to get through the conversion obligations in April.
They only have 3 options. Raise the authorized; reverse spilt; or buy back the debt to prevent conversion. I don't like the first two and the third is a loooong shot. Why would they have incurred the cost of selling the convertible Notes in the first place only to buy them back prior to conversion?
The only "good" scenario is a deal getting inked with Chad or the EEZ that gives them the money to buy back the debt, but then accusations would fly that exec's bought shares knowing that deal was coming, etc. and lawsuits would be filed.
It's most likely going to be a higher authorized or reverse split. The bottom line is anyone that can print money as fast as they print shares will make out fine if the Kenya well finds oil. Everyone else will be screwed and forgotten. This stock has always been about finding oil, the only new twist is now we are forced to throw more and more money at it to ever realize a gain.
Dr. J, I don't disagree with what you are saying, however you need to do the math. Assuming the share price stays flat this week the next conversion will take place at 0.001
If the price stays at that level until the following conversion, that will occur at 0.0006 and a week later 0.0003.
ERHE will need roughly 6B shares to fulfill those conversions. Now assume the are no more convertible debt agreements going forward and Offor decides to convert his $250K
250,000 / 0.00018 (60% of .0003) is another 1.4B shares. Offor would have 1.7B shares with 7.5B outstanding. He is losing his share in that scenario, so either the price is going much lower so he converts to several billion shares (10B authorized???) or something has to prop up the price to keep the conversions from exponentially increasing the share count.
I agree that Offor can and will fund this through drilling. He would be crazy not to, but if the result is him owning 99 billion of the 100B shares outstanding by then, what's left for us retail bagholders? A commercial Kenya discovery would get the share price to a penny or two if we're lucky.
And keep in mind, 0.0001 is the lowest stock price possible. If it is allowed to hit that then a reverse split is the only option.
You could throw another $10K or more at this trying to keep up and find that it is worth $100 in a couple months. The only ones that will make money are those that can continue to throw money at it all the way down and then hope to God they find oil in that first well.
Are you feeling lucky?
"he is making 'the best' of of it."
The company can't get through the April conversions without a reverse split or raising the authorized to something like 8 billion shares.
If that's making the best of it I'd hate to see your dark scenario(s). Absent any significant changes the market cap will drop below one million dollars in April.
Sigh.
I'm sorry emdyal, but this makes absolutely no sense to me:
"Also if any toxic financing was going to be required the amount and timing should have been presented to shareholders"
What you are suggesting is that Ntephe should have made the financing many times more painful, if not impossible... which would bankrupt the company. To announce the convertible debt financing ahead of the convertible debt financing neuters that financing as viable. The share price would have been crushed prior to the pigs Ntephe is dealing with crushing it.
You wouldn't have saved a dime had he told you in advance, you would have lost it faster.
WHAT??? "I'm sure he can retain his 40% of the company with his 250K."
While I don't disagree he can maintain his share, his share is now worth a couple hundred grand rather than thirty MILLION dollars.
You seem to be suggestting that Offor threw away $30M so that he only had to invest $250K,
I'll end as I started... WHAT???
"I must say I resent the implication that anything I have ever posted here is dishonest Mr. erhehasproven."
I'll let everyone decide honesty issues for themselves. FWIW, ERHC does have proven, about a half trillion cubit feet of gas as I recall.
If you can be honest for a millisecond you would agree the right now, depending on each investors situation, ERHE is all three.
"One man's trash is another man's treasure"
Offor has made many mistakes. Not funding the Rights Offering may have been his biggest, and it may cost him the company. As low as the market cap is a hostile takeover is likely. With as many missteps Offor has already made I wouldn't be surprised if he was caught unaware and unable to defend against it.
2IRAs, that last paragraph is spot on. Thank you.
aggie, middy is correct...
"But, if the share count goes up to 3 billion shares you will only own .025% of that billion dollar company. That means your stake is now worth $250,000."
however...
Let's assume that the shares out has gone to 3 billion from 750M. That's 4X what they were when you bought. To keep your 0.1% of the company and not be diluted you would have to increase your 750K share position to 3M shares. In other words you would have to add 2.25M shares. At the current share price that would be an additional $2250.00 investment into ERHC to avoid dilution.
I don't know what you originally paid for your shares, but for many hear that is mighty cheap for insurance against dilution. There are many here that have taken that a step further and significantly INCREASED their percentage ownership because, although dilution is occurring, the share price is falling many times faster than the dilution is occurring... opening an opportunity for those with $$$ and a brass pair.
Lining up funds to buy the company outright?
The Shares Authorized is not high enough to support the April convertibles at this price level. Options are limited...
a.) Raise the authorized and continue to print
b.) pay back the debt prior to conversion with funds from ???
c.) default and close shop
April is going to hurt... a lot.
It wasn't funny the first time.