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Friday, August 8, 2014

Significant balance sheet improvements and modest debt issuance actions in 4-years

Good afternoon HHSE Friends & Shareholders - The company has received inquiries regarding the issuance of debt conversion shares over the past month, and we've seen a lot of misinformation posted on various stock chat boards.  In order to analyze the managerial steps that have been taken over the past four years at HHSE, it's important to look at the overall corporate position and direction.

Below are two graphic charts, covering total shares and debt structure.

The first is a table showing the total amount of shares in issue for HHSE over the past four years, and the rate that new shares and debt conversion equities have been issued during that time frame.  The bottom line summary is that HHSE has increased the total shares in issue by 31.9% over the past four years, representing a total count increase of 147,132,575.  Out of this 147-mm increase, 10-million shares are in the process of return to treasury (from the settlement of the TCA venture)  and 27-million shares are considered to be in "long-term / friendly" hands (through the VODwiz / Nanotech venture structured by Ahnume Business Consultants).

The second table is a side-by-side comparison of data from the company's 12-31-2010 and 12-31-2013 balance sheets.  Contrary to some chat board posts, the total amount of debt has DECREASED over the past four years (by about $600,000).  But the point of this chart is to show how nearly $3-million dollars of "short term" or "toxic" debt has been either paid off or moved into long-term / friendlier structures over the past three years.  The company has judiciously utilized its modest debt conversion / equity issuances to retire debt or to motivate the creditors into longer-term payment structures.

At the Annual Shareholder's Meeting (held this past February at the Grand Hyatt in New York City), and via prior public filings, the Company disclosed that the total amount of Authorized Shares was to be RESTORED to its prior level of 700-million.  It was further disclosed with clarity that the purpose of restoring the authorized share count was to enable the managers to continue with modest and judicious debt-conversion transactions specifically to retire toxic debts, or to motivate key creditors into accepting longer-term payment plans that were more conducive to the company's operating cash flows.

Over the next few weeks, with the launch of VODwiz and with the filing of the Form 10 Registration Statement, there is widespread confidence that the company's share price could significantly appreciate.  Accordingly, future debt conversion, as needed, will not require as large a number of shares to effectuate the same levels of cash relief.