ERHC Energy Inc (ERHE)

[Krombacher]

In the 8k they talk about doing financing through litigation financing.

Here's a small blurb about litigation financing from a company who provides it from the internet:

"Commercial litigation funding liberates a company to use its capital for corporate purposes; we fund fees and expenses associated with monetizing a legal claim and can also provide capital to maintain operations. Our litigation funding is non-recourse. If the underlying claim is unsuccessful, we are owed nothing."

For ERHC to secure litigation financing, their claim has to be pretty strong ... because litigation funding is NON-RECOURSE. Why would a litigation funder fund ANYTHING if there wasn't a strong case...or risk losing being paid back? Plus now they have a stake in making sure that the legal claim comes to fruition.

Granted litigation financing can be a very expensive cost of capital (perhaps they can take half of the claim)...but they may even get operating capital from the funding...which allows them to survive - see quoted paragraph above.

Krombacher