ERHC Energy Inc (ERHE)

[ERHClongtimer]

Tryoty, from an armchair quarterback's perspective, I agree with you that the placement via Rodman & Renshaw seemed like a deal with the Devil. The terms were certainly not very favorable to current shareholders, at face value. Wonder who was the brainchild of that deal?! But maybe it was necessary to secure some of the things that have happened recently; who knows.

In any case, that placement highlights the advantage of floating a "rights offer" to current stakeholders in the company. They are more likely to invest in a company they already have a vested interest in (and perhaps at better terms for the company--and consequently better for all shareholders, vis-à-vis the R & R deal), especially if there are to be some gratuitous terms (favorable warrants) involved (as was the case with the placement via R & R). How much better to reward current shareholders for upping their investment in the company than some opportunistic, greedy broker/dealer and their client(s).

I surely hope ERHC has this in mind with the proposed increase in authorized shares. I have to believe Offor would not stand for anything less, with his substantial stake in the company. And that makes me think it might be better to save some dry powder if those favorable terms materialize.

But it's anyone's guess at this point. - Longtimer

P.S.: It has been claimed by some that there would be an increase of 3 billion shares; but that is simply not true. The most that could be issued in new shares is 2.25 billion. And I am pretty confident that no where near that number will be issued anytime soon.