Replies to post #225420 on ERHC Energy Inc (ERHE)

[balance_builder]

Doc....interesting that DK is tell you in this email that:

"The money raised last week and in future placements will fund acquisitions."


The supplemental prospectus says differently.



Since we have broad discretion in how we use the proceeds from this offering, we may use the proceeds in ways in which you disagree.

We intend to use the net proceeds from the sale of the securities under this prospectus supplement for general corporate purposes, including, without limitation, exploration and development activities, regulatory affairs expenses, capital expenditures, potential acquisitions and working capital. Because we have not allocated specific amounts of the net proceeds from this offering for any specific purposes, our management will have significant flexibility in applying the net proceeds of this offering. Accordingly, you will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. It is possible that the net proceeds will be invested in a way that does not yield a favorable, or any, return for our company. The failure of our management to use such funds effectively could have a material adverse effect on our business, financial condition, operating results and cash flow.



................and



USE OF PROCEEDS

We expect the net proceeds from this offering to be up to approximately $1.88 million after deducting the placement agent fees (excluding the cost of the warrants issued to the placement agent), as described in “Plan of Distribution,” and other estimated offering expenses payable by us, which include legal, accounting, filing fee and various other fees and expenses associated with registering the securities and listing the common stock, and excluding the proceeds, if any, from the exercise of the warrants issued in this offering. We intend to use the net proceeds from the sale of the securities under this prospectus supplement for general corporate purposes, including, without limitation, exploration and development activities, regulatory affairs expenses, capital expenditures, potential acquisitions and working capital.

As of the date of this prospectus supplement, we cannot specify with certainty all of the particular uses of the proceeds from this offering. Accordingly, we will retain broad discretion over the use of such proceeds. The amounts and timing of our actual expenditures will depend on numerous factors, including the progress in, and costs of, our exploratory and development activities, and the amount of cash used by our operations. Pending the uses described above, we intend to deposit the proceeds temporarily in our non-interest bearing checking account or to invest them temporarily in interest-bearing, investment-grade securities.
http://secfilings.nasdaq.com/filingFrameset.asp?FileName=0001140361%2D10%2D040478%2Etxt&FilePath=%5C2010%5C10%5C07%5C&CoName=ERHC+ENERGY+INC&FormType=424B5&RcvdDate=10%2F7%2F2010&pdf=


Perhaps DK is giving you material information that wasn't available at the time of the supplemental prospectus or he is simply guessing. Its even possible, I guess, that DK hasn't read the prospectus to learn WHAT the funds are slated to be used for?


I would be concerned if I truely thought these funds would be for DK's stated purpose. I, however, don't believe this nor do I suspect we will see additional offerings despite the shelf registration.