ERHC Energy Inc (ERHE)

[Krombacher]

EDIT! OOPS! Fixed the numbers below. While it is true that the warrants will raise $1.9 million only when exercised, the holder of the warrants would also have to pay .28 cents a share in order to exercise. We do not know, unfortunately, how many warrants were issued; it could be as many as what the shelf is worth.

Let's say the number of warrants represents another 10 million shares.

 
 Payment when exercised:			 $1,900,000  
 Number of Shares				 10,000,000  
 Exercise Price				            0.28 
 Exercise payment				 $2,800,000  
 Total Cash Outlay				 $4,700,000  
 Share Price to Cash Flow the Deal		    0.47 
 

Then to cash flow the warrants payment entirely, you would need the share price to equal $0.47 in order to break even over the next five years in order to pay for the warrants.

Krombacher