Greetings HHSE Friends & Followers. What a crazy year we had in 2020, but what an exciting year we are facing beginning in just the next few days!
Here's a few updates, including the most critically requested information on our FORM 10 Filing, the S1 Offering and the Launch of the MyFlix Consumer Site & Service.
1). MYFLIX - If we were launching a streaming service with one (1) movie via a self-service "ROKU" Channel, we might have been able to create some momentary shareholder excitement... but we would not be creating a legitimate, sustainable service with repeat customers and a major revenue base. Accordingly, it was not surprising to discover (over the past few weeks of work with our web design supplier) that a major site like MyFlix - with access to over 15,000 titles - requires substantial infrastructure and technical attention for proper operations.
What we do NOT want to do is launch with a skeleton site, or with a site featuring only 1,000 titles. On the other hand, we also do NOT want to launch the site and see an immediate crash from data overload and streaming constrictions. Our plan was to publish the consumer site THIS WEEK (between Christmas & New Years), under the belief that there would be a lot of people at home due to Holidays and Covid. But the site simply is not ready, even with a simplified graphics and tendril model.
Based on the ongoing problems with Covid and the delayed vaccine roll-out, we believe that people will STILL be mostly at home for some time... and that a release of the site in January is far more likely to not encounter technical problems.
2). FORM 10 - As described previously, the "going-forward" business model for HHSE is two fold, consisting of the MyFlix service and the production of higher profile features. The prior model of acquiring and distributing micro-budgeted indie films for DVD release is no longer viable due to the maturation of the home video market away from low-budget, non-star-driven titles (plus, we have discovered that many of those micro-budget producers are delusional nuts - and prone to litigation).
Accordingly, much of the body of the Form 10 Registration concerning operations is focused on MyFlix and not surprisingly, many details of the MyFlix site and supplier partner details are disclosed in the Form 10. With technical issues currently impacting the launch date of MyFlix, we find ourselves facing one of two principal choices: 1). Delay the release of the Form 10 until MyFlix is launched; or 2). Revise the Form 10 to remove non-public details about MyFlix, and release this registration immediately after these edits. We have decided to go for option two, and we have been editing / updating the F10 the past three days so that it's publication will not inadvertently expose MyFlix supplier partners and unique site services. We do not want to self-sabotage MyFlix by revealing the details of the service before it is functionally "live" to consumers.
With respect to Form 10 financial details, we have confirmed that there is no issue regarding our filings being viewed as "stale" under S.E.C. timing requirements. So, we will all enjoy an amazing start to 2021... which is more poetic than launching during a historically notorious year anyway.
3). S1 FILING - The filing of the S1 will be just a few days after the publication of the Form 10, and we have received strong indications from media partners and large investors that the initial block of 50-mm shares at $.03 / share are poised to sell out quickly. The likelihood of the second tranche of shares (50-mm at $.05) being sold will likely depend upon the public market's pricing for shares at that time. The funds raised will be utilized 70% for MyFlix and new operations, and 30% for existing debt management
5). LEGAL UPDATES - HHSE participated in a court hearing last week regarding the "Getting Grace" dispute. Months ago, we were informed (by the Company's prior counsel in Pennsylvania) that our settlement terms had been accepted but not documented. After months of delays, HHSE ultimately prevailed in getting the case moved into Arkansas - where the local judiciary has little tolerance for inappropriate and unsupported claims by plaintiffs and their attorneys. Following last week's hearing, HHSE and our new counsel in the matter (Steven M. Kay) have renewed confidence that we will prevail in the dispute (instead of making a "settlement"), and were encouraged by the Judge's attention to a discussion about the appropriateness and applicability of awarding legal fees to Hannover House and other improperly named defendants. A long-term schedule was set, and this was a VERY GOOD day for HHSE. Stay Tuned...
GET READY FOR AN AMAZING 2021~!
