Replies to post #314902 on ERHC Energy Inc (ERHE)

[ssc]

What have you read that leads you to state: "Continuing with convertible debt is simply not an option anymore"?

From the latest filing, in multiple places (pay attention to the bold print):

PLANS FOR FUNDING OF POTENTIAL ACQUISITIONS
ERHC's future plans will depend on the Company's ability to attract new funding. The Company is implementing a series of steps to fund the geophysical work, including magnetic/gravity and seismic surveys, prior to securing potential farm-out on Chad acreage. Said funding steps include but are not limited to the issuance of a series of convertible notes, which the Company has commenced, issuance of shares of common stock through registered direct offerings, which the Company plans to commence shortly and farm-outs to potential partners on its assets in Africa. The fund raising might include:

Farm-outs of part of the Company’s assets in Kenya, Chad and the Sao Tomé and Príncipe Exclusive Economic Zone

Issue shares of common stock through a registered direct offering

Other available financing options

The Company is continuing discussions with several international investment advisory and financial brokerage firms to act as financial advisors and intermediaries to ERHC. While ERHC has always used expert professional assistance to formulate and execute its capital raising initiatives, it is re-focusing on the retention of such advisors and intermediaries as a strategic imperative of the increased funding requirements that arise from the rollout of the new work programs in Chad and Kenya. The new firms retained will perform such financial advisory and investment banking services for the Company as are customary and appropriate in transactions of this type, including assisting the Company in analyzing, structuring, negotiating and effecting proposed capital raises. These initiatives may include any transaction or series of transactions in which one or more capital providers (existing or otherwise) commits debt capital to the Company, purchases equity of the Company (or securities of the Company convertible into equity), or alternatively funds the Company either directly or through farm-ins, farm-outs or other arrangements in which the capital provider earns an interest in oil and gas properties of the Company.

LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2015, the Company had $479,246 in cash and cash equivalents, and a working deficit of $2,579,466. We are implementing a series of steps to fund the geophysical work and seismic surveys, prior to securing potential farm-out on Chad acreage. The fund raising might include:

Farm-outs of part of the Company's assets in Kenya, Chad and the Sao Tomé and Príncipe Exclusive Economic Zone


Issue shares of common stock through a registered direct offering


Convertible loans and other debt instruments


Other available financing options




GOING CONCERN
Our financial statements contain additional note disclosures describing the circumstances that lead to this disclosure Their assessment is a result of our recurring operating losses and the continuing and immediate need for capital raising to fund operations. Management does believe it has created and is executing on a viable plan that has the capability of eliminating the threat to continuation of our business. This plan involves hiring outside professional services and continuing to seek for opportunity to farm-out its assets in Kenya, Chad and the Sao Tomé and Príncipe Exclusive Economic Zone. We will have to raise additional funds to continue our operations and, while we have been successful in doing so in the past, there can be no assurance that we will be able to do so in the future. Our continuation as a going concern is dependent upon our ability to obtain necessary additional funds to continue operations and the attainment of profitable operations.

Future financing may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, existing holders of our securities may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our securities.