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Thursday, January 15, 2015

Thursday AM - Updates

Greetings - shipments are underway, which have been completely demanding of management attention and energy (sales are the Company's life's blood, and videos are street-date sensitive). 

Meanwhile, here's some super brief updates per shareholder email requests:

1).  Share Structure - UNCHANGED.  Company is NOT diluting, or doing debt conversions, and the officers are not selling.  It's all chat-room nonsense.  Transfer Agency is NOT "gagged" - although last month, there was a requirement for requests to be sent via email, which resulted in a slight delay while the identity of the emailer was being cross-checked against known manipulators.  The email procedure was lifted after sufficient inquiries were tracked. UPDATE- noon CST - we've just been informed that Standard Registrar issued the JSJ shares (from the previously announced transaction) TWICE, which is a shock to us, and is being addressed immediately. HHSE will resolve this situation and update on this matter today.  UPDATE:  9:00 pm CST - An error has occurred with respect to shares issued to JSJ.  But the details are still undetermined as to where and how a mistake occurred due to the Company's inability to reach JSJ today to inquire as to how they could circumvent HHSE and request a share issuance directly from Standard Registrar.  These items have always required Company and Board approval before the T.A. will act. At this time, after reviewing the documents with JSJ, HHSE cannot find a basis for any additional share issuances; but we will defer a final determination until after a consultation and review with JSJ.  It is possible that JSJ is entitled to shares; if this is the case, and they can support this position, then HHSE will have erred in stating this morning that the share structure was unchanged.  Although, to be clear, as of this morning's post, an unchanged share structure was certainly the Company's sincere belief.  This situation will be further reviewed, resolved and posted on tomorrow (Friday).

2).  Credit Lines - While the documents for the first of three credit facilities for HHSE were signed 10 days ago, the initial funding from this facility has not yet been released.  The issue has to do with compliance in removing pre-existing (but no longer valid) U.C.C. liens.  This is being resolved; Shefte is in Los Angeles this week, among other meetings, to get one of the prior security interest lien holder to get their filing "satisfaction" on record. The compliance of removing the U.C.C.s will activate the credit lines and enable the Company to file the Form 10 version that is preferred.

3).  Titles / Shipments - The line-up of new titles / new orders / and confirmed skus at Mass Merchants for HHSE / Medallion titles is unprecedented.  Details will be released when we're past the current shipping-fulfillment issues.