When you're constantly on the job, sometimes 24-7 is still not enough…

Last month when HHSE selected July 28 as the filing date for our Form 10 registration, this was based on Q2 review time needed for the auditors, and the additional formatting and XBRL time needed for M2 Compliance prior to submission to the S.E.C. Edgar Database. 

 

We knew last month, that HHSE would separately be required to make additional changes, updates and new filings in order for all disclosures and accounting procedures to be consistent with the audit report and Form 10. The most time-challenging remaining items on the Form 10 HHSE plate have been:  revision of 2019, 2020 and 2021 Federal 1120-S tax returns to conform to a cash-only accounting basis, and a restatement and re-filing of the 12-31-2020 and 12-31-2021 OTC Markets Annual Reports to also reflect the cash-basis accounting and revisions to the Film & Television Rights Library. Previous obstacles - all major events - were already completed (including the Library update, the settlement or resolution of material legal matters and significant balance sheet strengthening through negotiated debt reductions). 

 

Theoretically, this could have all been done by today’s goal. But without a support staff, and working within the physical limitations of a 24-hour day (and the occasional need for food and sleep), the target goal has proven itself impractical.  Accordingly, the Form 10 registration was not released today – but a lengthy delay is not this project's destiny. HHSE must make these updates and revised filings first before we can publish the registration.  There is also a logistics issue to resolve in that restating the 2020 and 2021 Annual Reports will require a new attorney opinion letter, and needs to be implemented in a manner to minimize the risks of a temporary change in the OTC Markets status for the company.  But it's all doable (and everything requires some investment of time). 

 

Some shareholders have reached out to HHSE CEO Eric Parkinson for status updates on the Form 10 – which information cannot be given out individually under disclosure rules, but which must be publicly disseminated, such as via this blog.  So, apologies for the lack of response to these shareholders. 

 

Bottom Line is that great effort has been made to complete the HHSE agenda items – but July 28^th proved to be an unobtainable publishing date. If all other HHSE issues, projects, calls and operational obligations had been completely ignored – there would still be the limitation of a 24-hour day and a seven-day week. So, sincere apologies on behalf of the company and individually from Eric Parkinson.  It’s all getting done, and literally could not be completed any faster under the reality of a linear-time.

 

Over the next few days – watch for OTC Markets filings (and a SEC Form 8 Information Disclosure) – all of which are components of the registration process.  Then one morning, very soon, watch this blog for a link to the S.E.C. Edgar site and the HHSE Form 10.

 

We realize that there are some exhausted shareholders - and some that might decide to sell their HHSE shares now, at the worst possible time for their own self-interests. If this occurs, this could be a fantastic upside opportunity for those following the WARREN BUFFET strategy of buying for value and buying for where a company is headed... not for the momentary peaks and dips from emotionally-charged day trading. HHSE was founded in 1993 (29-years ago), and is a long-term serious play.  There are occasional "day trade" opportunities such as buying into a stock pump promotion behind a company with no assets, zero revenues and $235-MILLION in debt (yes, some shareholders suggested that HHSE should operate more like a particular - unnamed - OTC issuer that purportedly is an "entertainment" company despite nothing more than mountains of debt and a stock promotion !!!). But that's the opposite of the HHSE operating business model. HHSE is not a stock pump... and with MyFlix and the HHSE slate of high-end original productions, HHSE is turning into the big, long-term score you can brag about to your kids and grandkids. 

Hold tight and watch this space.

Thank you.

Out with the Old... In with the New! HHSE Embraces New Business Model

Greetings HHSE Friends & Followers - As mentioned in recent months, Hannover House is embarking on an exciting new chapter for the company - one that best reflects the current market conditions for the worldwide entertainment industry and the direction of new trends.

Rather than handle the DVD (and other format) distribution of third-party-owned features, Hannover House is instead focusing on a two tier business model with primary efforts on:

1).  MYFLIX - the multi-studio / revenue sharing streaming service; and,

2).  ORIGINAL PRODUCTIONS - the creation / production / ownership of feature films and television properties without the distraction and dilution of third-party owners.

As many HHSE longs know, the prior business model of handling distribution for third-party-owned, primarily low-budget, independent productions spiraled into nothingness as the consumer market for collecting physical DVD copies evaporated. During these declining years (2015 - 2018), Hannover House found itself as the target of five producer lawsuits, in which the program owners improperly blamed HHSE for the changing market conditions. 

All five of these lawsuits could have - and should have - been dismissed immediately for lack of factual merit. However, Fred Shefte, in-house attorney and HHSE President (at that time) was struggling with dire health issues, and as a result, the company did not respond to these cases in a timely manner (and ended up with "default judgments"). Unfortunately, Shefte has since passed-away from his health challenges... however, the default judgments survived, and it was essential that HHSE deal with these prior to filing the S.E.C. Registration Statement.

How has HHSE dealt with these?  In a snapshot, one could modestly proclaim "quite well" >>

*  Default Judgment Debts - Originally $3.879-million dollars in total - were negotiated into settlements for a total of  $627,500 in cash payments, a reduction of EIGHTY-THREE PERCENT.

*  Cash Payments on Settlements (since Sept. 2021) have been $207,500, with monthly installments over the next 9-months from existing company cash flows sufficient to entirely wipe out all remaining balances.  

*  No New Lawsuits - Reflecting the company's refocus away from outside acquisitions, there have been no new lawsuits of any nature stemming from activities since the release of "Getting Grace" in March of 2018.  

 MEANWHILE - HHSE is in the final pre-filing stages for the Form 10-12(g) registration, the launch of the MyFlix streaming venture, and the completion of the feature film, "WILDFIRE: THE LEGEND OF THE CHEROKEE GHOST HORSE" (which was produced with financial and other assistance by Hannover House along with private investors and lenders for that specific project). The company is also in final pre-production for the Principal Photography of the epic $12-mm feature western, "THE LEGEND OF BELLE STARR" (although four days of seasonal-specific second-unit scenes have already been filmed).

The future is bright - the future is now.  This is the beginning of an exciting new chapter for the 29-year-old Hannover House operations!

Speaking of "THE LEGEND OF BELLE STARR," HHSE C.E.O. (and Belle Starr feature director) ERIC PARKINSON was hosted by the City of Wichita (Kansas) Parks Service and Historic Cowtown facility last week - for location scouting of scenes for this feature.  Cowtown consists of approx. 65 period-correct (and fully functional) buildings from the late 1880's on a forty-acre city-owned park site. Cowtown has over 250 registered "wardrobe-correct" re-enactors available to appear in Belle Starr as background-extras - and the fully furnished homes and buildings will save the company hundreds-of-thousands-of-dollars in art, props and set-dressing costs.  All these savings will ADD to the bottom line for HHSE, to enhance the benefits already enjoyed from production overhead fees and eventual sales & licensing income. 

Watch this space!

HHSE Welcomes the WEBULL Platform as a Preferred Brokerage Service

Greetings HHSE Friends and Followers - we are pleased to announce the addition of WEBULL to the family of on-line retail brokerage services supporting the buying and selling of Hannover House (HHSE) shares. WEBULL is one of the emerging services to cater fairly and efficiently to the masses of traders in the market - the new generation of investors that have proven their power through Reddit and through “punch-the-powers-that-be” in the face with rallies behind GAMESTOP, AMC and other stocks.

Some of the dinosaur trading platforms - especially E-Trade - have purposely created obstacles for traders to buy stocks such as HHSE… as they stack the rules to favor their institutional clients and short sellers. But WEBULL believes in the democracy of trading access — and they are reaching a broad base and new generation of investors: the sort of people that recognize the huge upside of a streaming service such as MYFLIX, and the benefit of owning major feature productions and Television Series programs. 

HHSE and WEBULL are a perfect fit to enable smaller fund traders to benefit from what media stock analysts have predicted will be a meteoritic rise for HHSE in the coming weeks and months. If you don’t already have a trading account with WEBULL, check it out! They are offering sign-up incentives in the form of free stocks!

www.WeBull.com

Go HHSE!

In other news, HHSE mourns the death this week of Elspeth  Tavares (center) - editor and publisher of BUSINESS OF FILM. Elspeth was a friend and business colleague of HHSE C.E.O. ERIC PARKINSON, for over 30-years. 

HHSE Streaming Titles on "Advertiser" Platforms - Delivering a TEN-FOLD Revenue Increase!

Greetings HHSE Friends - over the past six months, the video-on-demand revenues for Hannover House titles have increased by a factor greater than ten-fold over comparable reporting periods. This improvement can be attributed to one simple factor:  "Advertising" Supported Video-On-Demand sites, specifically TUBI and ROKU.

Under the AVOD model, consumers can watch movies for free, but the programs contain advertising breaks (such as has existed since 1950 with the Network TV broadcast model). 

These ad breaks can be annoying to film aficionados... but are not objected to by many viewers (who are either used to seeing ads, or use the ad breaks to get a refreshment or bathroom break).  As high-end SUBSCRIPTION sites fight for top dollar viewers, there's a massive audience in America that doesn't want to spend hundreds of dollars each month to have access to Disney+, HBO-Max, Netflix, Apple and other monthly subscription services. Many simply can't afford these subscription fees... and this has created the same sort of programming-value-gold-rush as existed in the mid '2000's when Walmart, Target and Best Buy pioneered the BUDGET DVD Bins to meet the pricing needs of a large customer base. 

Hannover House currently owns or controls the streaming rights to approx. 180-titles (out of 455 total items for other media formats and rights).  Of these titles, currently twenty are available through TUBI and ROKU... and HHSE has just added six additional titles that will go live in July and August on these sites.  Additional titles are being mastered / formatted for the specific delivery needs, and the company expects to have at least sixty titles on these key AVOD Platforms by the end of October.

Placing these items onto AVOD sites does not impact their suitability and placement for MyFlix... as the vast majority of MyFlix titles are also available on other platforms. The marketing theory behind MyFlix, Roku and Tubi is to give the viewers the broadest selection of titles possible once they've landed onto the site... to minimize the incentive to navigate away to other streaming sites. MyFlix is like a major retail store chain, with "storefronts" where program suppliers want their films to be placed. 

Anyway, during this final quiet period prior to the Form 10 filing, some shareholders have reached out to HHSE and asked what can be done to help?  Well, as HHSE gets paid for EVERY VIEWING of movies on TUBI and ROKU, we suppose that letting our shareholders know about these placements and the availability to watch for free (which generates cash for HHSE), is a worthy endeavor.  Listed below are the current top seven titles from HHSE on these services.  To view these films, simply go to TubiTV.com or Roku.com and in the SEARCH bar, type the name of the film. 

More to follow!