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Updated Film Library Evaluation ($28,000,000) ~ .035 Per Share
FILM & TV LIBRARY (incl. VODWIZ)* 23,565,337
* HHSE Film Library Valuation is currently being updated to include over 145 DVD titles previously not listed in the 2010 report, along with 23 titles since expired or discontinued. No value has yet been assessed on the 2,215 titles under license for the VODWIZ streaming portal other than those capitalizedand otherwise recoupable amounts due to Company for mastering and preparation costs on titles.
http://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=177628 ; ;
Though a little wordy. In the HHSE Filing below, HHSE feels the new Film Library Evaluation should be $28,000,000. The Evaluators completing the New, Updated HHSE Film Library Evaluation determined it is worth more than $28,000,000.
Item 11 A1-A6 – Supplemental Disclosures.
i). The Company has completed the written and disclosure portions of a Form 10-12(g) Registration Statement, which was previously planned for filing with the Securities and Exchange Commission on or Jan. 15, 2016, subject to the completion of outside audits by a PCAOB licensed auditing firm. The Company has since engaged a qualifying auditing firm and participated in extensive interviews and reviews of filings, reports and back-up materials. As disclosed to shareholders on the HHSE Company blog site on January 30, 2016, the new auditors have made several determinations of material deficiencies in the financials for the Company, specifically, 1). The value of the Film Library relative to all other assets (and the issues of the five-year-aging of the prior Film Library Valuation report, the changing marketplace for physical video sales as compared to the growing market for digital streaming, and the significant exclusions of key titles from the prior Film Library) and 2). The need for Internal Controls and Compliance Documentation that would conform to standards prescribed under Sarbanes-Oxley Act 404. While technically not “advising” the Company on how to conduct internal controls or instructing the Company to conduct a more thorough and current Film Library Valuation Study, the new auditors did clarify that not addressing or rectifying these issues would result in significant comments by the auditors to the Form 10-12(g) audit portion, and this could result in commentary and non-compliance following S.E.C. review of the registration filing. Having the Company’s largest balance sheet asset reviewed under more recent valuation, and having the Company conform to widely accepted Internal Controls Procedures, would be a requirement for the auditors, unless the Company was willing to proceed with significant auditor’s footnote commentary on these issues. Rather than risk having another obstacle impact the S.E.C. acceptance of the Company’s registration, management has taken the steps to conform to these higher disclosure and operational standards.Company anticipates that the updated Form 10-12(g) Registration Filing, including 2-years of full-year audits and a revised and updated Film Library Valuation Report will be submitted to the S.E.C. in the near-term future, subject to the completion of the new Film Library Valuation (it should be noted that Company is seeking to obtain a lowered valuation than the initial figure determined by the new Library Evaluators, which contains sales forecasts for titles greater than Company Management’s estimates. It is Company’s position that a Library Valuation that is significantly higher than forecasts based on Company’s existing, internal self-distribution apparatus, could elevate shareholder expectations higher than management’s more conservative forecasts. While the higher sales values provided by the first Library Valuation report have as a premise the assumption that HHSE will align itself with one of the Major Studios in the coming year, there can be no assurance that such a deal will occur, and as such, management feels that the current Film Library Valuation should reflect existing distribution channels and revenues, and conform closer to management’s estimated current value of $28-mm. A review of sales activities at the Cannes Film Festival and Marche du Film and other relevant agenda items affecting the Company’s Film Library Valuation have occurred over the summer (2016) and the Company feels confident of having reached a consensus with the valuators on the current and anticipated value of each title, by media income stream.
Page 20
HHSE 10-Q For the three-month period ended: June 30, 2016:
http://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=161112 ; ;
Though Final Libary Valuation not released yet, safe to say $28,000,000 Minimum.
$28,000,000 / 799,000,000 = $.03504 = .035 Per Share
This is based on HHSE Film Library Valuation Alone. Does not include any Profits which HHSE has recorded every Quarter since Going Public in 2010.
HHSE
Regarding BEDROCK, due to breached commitments for funding the company that were the basis of a massive stock issuance by HHSE to Bedrock, HHSE counsel feels that this California judgment filing has a solid basis to be contested, adjudicated and won in Arkansas Courts.
Regarding JSJ INVESTMENTS, the refusal of JSJ to accept cash plus interest in full (per the terms of the note), but instead to sue for more than three-times the amount on the pretense that "they were always entitled to shares, not 'just' repayment" renders the note usurious and illegal under the laws of virtually every state. Counsel, therefore, feels that a motion to freeze collection efforts and to re-open the claim so that it can be adjudicated, is a likely result for HHSE.
HHSE has engaged the Law Firm of Steven H. Kay Associates in Fayetteville, Arkansas. Mr. Kay will be filing motions to initially "freeze" collection efforts by BEDROCK VENTURES and JSJ INVESTMENTS - based on the fraudulent nature of the underlying claims and the "foreign judgment" status that can be contested and adjudicated under Arkansas Law for foreign default judgments (i.e., defaults obtained in states other than Arkansas). HHSE Shareholders may recall that we pursued this same strategy with TCA Global Master Fund - a company that is often considered to be the nuclear bomb of Predatory Lenders - and HHSE prevailed under Arkansas Law.
New Ventures - With Sony and Cinedigm handling selected HHSE releases, our management time can be redirected towards theatrical releases, higher-end acquisitions (including productions) and our VODWIZ streaming venture. As will be seen in our 2017 filings, theatrical release activities are the engine that is now driving HHSE revenues in all other arenas. Theatrical titles get more shelf space and priority placement when released to home video; theatrical titles get larger license fees from Netflix and Television licensors; and theatrical titles provide two direct revenue streams for HHSE in the form of both servicing fees and revenue participations. The current mass merchant and key video retail support for "BATTLECREEK" evidences the sales boost that a targeted, limited theatrical release can deliver for the subsequent home video release.
NO DILUTION for 2.5+ YEARS
Release Activities: January will see the theatrical release of "BLOODFEAST" - delayed since July due to MPAA re-cut needs. February will see a massive placement of DVDs and BluRays for "BATTLECREEK" (street date Feb. 6). That same week, on Friday (Feb. 9), HHSE will commence the initial theatrical launch of "DEATH HOUSE" to theatres. In April, three titles will be released via Sony Pictures Home Entertainment (including "DAISY WINTERS"); in May, HHSE will release "THE RIOT ACT" to theatres and Cinedigm will release DVD's and BluRays of "THE LENNON PROJECT" for the Company. Other titles in queue for theatrical and / or home video during the first half of 2018 include "MUSE", "INSOMNIUM", "IDENTITY CRISIS", "SLEEPER CELL", "DINOSAURS OF THE JURASSIC" and "SACRED HEARTS" (all but the last title were planned for 2017, but delayed during the Crimson merger pursuit).
HHSE Corporate Governance: HHSE will be re-filing a Form 10 Registration with two full years of audits (2016 and 2017) early this coming year, during the first few weeks; the CPA review is already underway and much of the documentation and procedural steps for the audit were already assembled during 2017 while planning for the Crimson merger. We feel that a registration of the shares and the subsequent uplist to OTC:QB will attract more investors and some institutional funds... resulting in a higher anticipated daily trading volume, and a predicted much higher HHSE stock price (based on business results, industry fundamentals and the proven power of Shareholder Enthusiasm).
HHSE Third Quarter Financials: Revenues $351,252 Net Income $100,594
Revenues ---- $351,252
Net Income -- $100,594
Total Current Assets ----- $14,330,243
Total Of All Liabilities ---- $ 5,908,610
HHSE Q3 Quarterly Report - 1/8/18:
https://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=185294 ;
First of all, we'd like to point out that Hannover House is unlike most any other "OTC Pinksheet" listed company. We have been operating continuously since 1993 (24-years) and have been reporting to the OTC Markets since Dec. 2009 (8-years). Statistically, most OTC listed equities are flashes-in-the-pan time wise... lots of Stock Hype / I.R. Promotions, insider share dumps, and quick closures. That's definitely not HHSE.
THE RIOT ACT is based on the true story of romance, murder and revenge that occurred at the Van Buren Opera House in 1903. The film is planned for an APRIL 27, 2018 Theatrical Release through Hannover House, with top USA Markets targeted.
GETTING GRACE - Hot on the heels of a major NYC Market festival SWEEP of all major awards, HHSE will be releasing this Faith-Based Comedy-Drama nationwide on February 10, 2018 - with an outreach campaign that includes mega-churches and a key-market BUS TOUR with star and director DANIEL ROEBUCK ("Matlock", "The Fugitive") to drive local market enthusiasm
DEATH HOUSE - A wild horror-comedy from the producer of "Bill & Ted's Bogus Journey" is building strong horror-market enthusiasm from conventions and specialty sites. Opens Jan. 19, 2018 in a yet-undetermined (but significant)
BLOODFEAST - Now that the MPAA has approved our fourth edit for "R-Rating Status" - we can FINALLY get mainstream theatres to book this picture. To be released in January...
Updated Film Library Evaluation ($28,000,000) ~ .035 Per Share
FILM & TV LIBRARY (incl. VODWIZ)* 23,565,337
* HHSE Film Library Valuation is currently being updated to include over 145 DVD titles previously not listed in the 2010 report, along with 23 titles since expired or discontinued. No value has yet been assessed on the 2,215 titles under license for the VODWIZ streaming portal other than those capitalizedand otherwise recoupable amounts due to Company for mastering and preparation costs on titles.
http://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=177628 ;
Though a little wordy. In the HHSE Filing below, HHSE feels the new Film Library Evaluation should be $28,000,000. The Evaluators completing the New, Updated HHSE Film Library Evaluation determined it is worth more than $28,000,000.
Item 11 A1-A6 – Supplemental Disclosures.
i). The Company has completed the written and disclosure portions of a Form 10-12(g) Registration Statement, which was previously planned for filing with the Securities and Exchange Commission on or Jan. 15, 2016, subject to the completion of outside audits by a PCAOB licensed auditing firm. The Company has since engaged a qualifying auditing firm and participated in extensive interviews and reviews of filings, reports and back-up materials. As disclosed to shareholders on the HHSE Company blog site on January 30, 2016, the new auditors have made several determinations of material deficiencies in the financials for the Company, specifically, 1). The value of the Film Library relative to all other assets (and the issues of the five-year-aging of the prior Film Library Valuation report, the changing marketplace for physical video sales as compared to the growing market for digital streaming, and the significant exclusions of key titles from the prior Film Library) and 2). The need for Internal Controls and Compliance Documentation that would conform to standards prescribed under Sarbanes-Oxley Act 404. While technically not “advising” the Company on how to conduct internal controls or instructing the Company to conduct a more thorough and current Film Library Valuation Study, the new auditors did clarify that not addressing or rectifying these issues would result in significant comments by the auditors to the Form 10-12(g) audit portion, and this could result in commentary and non-compliance following S.E.C. review of the registration filing. Having the Company’s largest balance sheet asset reviewed under more recent valuation, and having the Company conform to widely accepted Internal Controls Procedures, would be a requirement for the auditors, unless the Company was willing to proceed with significant auditor’s footnote commentary on these issues. Rather than risk having another obstacle impact the S.E.C. acceptance of the Company’s registration, management has taken the steps to conform to these higher disclosure and operational standards.Company anticipates that the updated Form 10-12(g) Registration Filing, including 2-years of full-year audits and a revised and updated Film Library Valuation Report will be submitted to the S.E.C. in the near-term future, subject to the completion of the new Film Library Valuation (it should be noted that Company is seeking to obtain a lowered valuation than the initial figure determined by the new Library Evaluators, which contains sales forecasts for titles greater than Company Management’s estimates. It is Company’s position that a Library Valuation that is significantly higher than forecasts based on Company’s existing, internal self-distribution apparatus, could elevate shareholder expectations higher than management’s more conservative forecasts. While the higher sales values provided by the first Library Valuation report have as a premise the assumption that HHSE will align itself with one of the Major Studios in the coming year, there can be no assurance that such a deal will occur, and as such, management feels that the current Film Library Valuation should reflect existing distribution channels and revenues, and conform closer to management’s estimated current value of $28-mm. A review of sales activities at the Cannes Film Festival and Marche du Film and other relevant agenda items affecting the Company’s Film Library Valuation have occurred over the summer (2016) and the Company feels confident of having reached a consensus with the valuators on the current and anticipated value of each title, by media income stream.
Page 20
HHSE 10-Q For the three-month period ended: June 30, 2016:
http://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=161112 ;
Though Final Libary Valuation not released yet, safe to say $28,000,000 Minimum.
$28,000,000 / 799,000,000 = $.03504 = .035 Per Share
This is based on HHSE Film Library Valuation Alone. Does not include any Profits which HHSE has recorded every Quarter since Going Public in 2010.
HHSE
HHSE Third Quarter Financials: Revenues $351,252 Net Income $100,594
Revenues ---- $351,252
Net Income -- $100,594
Total Current Assets ----- $14,330,243
Total Of All Liabilities ---- $ 5,908,610
HHSE Q3 Quarterly Report - 1/8/18:
https://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=185294 ;
HHSE Third Quarter Financials: Revenues $351,252 Net Income $100,594
Revenues ---- $351,252
Net Income -- $100,594
Total Current Assets ----- $14,330,243
Total Of All Liabilities ---- $ 5,908,610
HHSE Q3 Quarterly Report - 1/8/18:
https://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=185294 ;
HHSE Third Quarter Financials: Revenues $351,252 Net Income $100,594
Revenues ---- $351,252
Net Income -- $100,594
Total Current Assets ----- $14,330,243
Total Of All Liabilities ---- $ 5,908,610
HHSE Q3 Quarterly Report - 1/8/18:
https://www.otcmarkets.com/ajax/showFinancialReportById.pdf?id=185294
New Ventures - With Sony and Cinedigm handling selected HHSE releases, our management time can be redirected towards theatrical releases, higher-end acquisitions (including productions) and our VODWIZ streaming venture. As will be seen in our 2017 filings, theatrical release activities are the engine that is now driving HHSE revenues in all other arenas. Theatrical titles get more shelf space and priority placement when released to home video; theatrical titles get larger license fees from Netflix and Television licensors; and theatrical titles provide two direct revenue streams for HHSE in the form of both servicing fees and revenue participations. The current mass merchant and key video retail support for "BATTLECREEK" evidences the sales boost that a targeted, limited theatrical release can deliver for the subsequent home video release.
CPA Lisa Lashley Higgins has been engaged to review the company's books, records and financial filings covering the years 2015, 2016 and 2017, and to verify compliance with the needs set forth by the company's auditors. Attorney Steven H. Kay has been engaged to provide general transactional legal counsel, as well as filings relating to the elimination of contestable debts and prior litigation matters.
Q4 filings will be completed by Monday and provided (along with full 2017 results) to the outside CPA firm conducting the Pre-audit review.
Release Activities: January will see the theatrical release of "BLOODFEAST" - delayed since July due to MPAA re-cut needs. February will see a massive placement of DVDs and BluRays for "BATTLECREEK" (street date Feb. 6). That same week, on Friday (Feb. 9), HHSE will commence the initial theatrical launch of "DEATH HOUSE" to theatres. In April, three titles will be released via Sony Pictures Home Entertainment (including "DAISY WINTERS"); in May, HHSE will release "THE RIOT ACT" to theatres and Cinedigm will release DVD's and BluRays of "THE LENNON PROJECT" for the Company. Other titles in queue for theatrical and / or home video during the first half of 2018 include "MUSE", "INSOMNIUM", "IDENTITY CRISIS", "SLEEPER CELL", "DINOSAURS OF THE JURASSIC" and "SACRED HEARTS" (all but the last title were planned for 2017, but delayed during the Crimson merger pursuit).
In other corporate governance matters, the company has renewed it's various corporate filings with the Secretary of State offices in Wyoming and Arkansas (an annual house-keeping matter of a simple filing). The company has also received confirmation from the IRS that the full payroll tax liabilities that were the subject of a prior lien have been fully paid, and that a reconciliation of the revised amount of interest and penalties (also paid) shall be issued shortly and submitted to all HHSE customers receiving levy letters. HHSE has since engaged a payroll service to handle the monthly 941 and tax paperwork filing requirements.
HHSE Corporate Governance: HHSE will be re-filing a Form 10 Registration with two full years of audits (2016 and 2017) early this coming year, during the first few weeks; the CPA review is already underway and much of the documentation and procedural steps for the audit were already assembled during 2017 while planning for the Crimson merger. We feel that a registration of the shares and the subsequent uplist to OTC:QB will attract more investors and some institutional funds... resulting in a higher anticipated daily trading volume, and a predicted much higher HHSE stock price (based on business results, industry fundamentals and the proven power of Shareholder Enthusiasm).
It Doesn't Take Much to Double or Triple the HHSE Share Price - Look at the market-cap spike for HHSE stock earlier this year (seen as June, 2017). This increase in PPS was due to shareholder excitement about the prospect that a merger with Crimson Forest would provide HHSE with high-profile films to distribute. The growth in PPS was not based on any increase in revenues (in fact, the time-distraction of the Crimson merger caused many 2017 releases to be delayed). The PPS spike was driven solely by enthusiasm.
HHSE WHAT IS OUR PLAN FOR GROWTH IN 2018 AND BEYOND?
* We believe that HHSE is "one film away" from being a major independent studio. All it takes is any one of the many titles in our current release queue to become a surprise box officer performer such as "Lady Bird" or "Get Out" and we are suddenly a $100-MM company.
* We have an impressive slate of titles for 2018 and 2019 - and two terrific distribution partners for North America (Cinedigm Entertainment and Sony Pictures Home Entertainment) - as well as our direct relationships with all of the major theatre exhibition chains. Our "lower-end" titles are much higher profile than in past years... and our higher-end titles are now genuine theatrical caliber contenders. We are positioned for the proverbial lucky break that happens when the right film is released at the right time...
* Our recently re-focused Theatrical Release model is delivering huge benefits to our ancillary revenues... and our new partnerships with indie labels is providing access for the VODWIZ streaming venture, which truly could become "the tail that wagged the dog" for HHSE shareholders
It Doesn't Take Much to Double or Triple the HHSE Share Price - Look at the market-cap spike for HHSE stock earlier this year (seen as June, 2017). This increase in PPS was due to shareholder excitement about the prospect that a merger with Crimson Forest would provide HHSE with high-profile films to distribute. The growth in PPS was not based on any increase in revenues (in fact, the time-distraction of the Crimson merger caused many 2017 releases to be delayed). The PPS spike was driven solely by enthusiasm.
NO DILUTION for 2.5+ YEARS
Regarding JSJ INVESTMENTS, the refusal of JSJ to accept cash plus interest in full (per the terms of the note), but instead to sue for more than three-times the amount on the pretense that "they were always entitled to shares, not 'just' repayment" renders the note usurious and illegal under the laws of virtually every state. Counsel, therefore, feels that a motion to freeze collection efforts and to re-open the claim so that it can be adjudicated, is a likely result for HHSE.
Regarding BEDROCK, due to breached commitments for funding the company that were the basis of a massive stock issuance by HHSE to Bedrock, HHSE counsel feels that this California judgment filing has a solid basis to be contested, adjudicated and won in Arkansas Courts.
HHSE has engaged the Law Firm of Steven H. Kay Associates in Fayetteville, Arkansas. Mr. Kay will be filing motions to initially "freeze" collection efforts by BEDROCK VENTURES and JSJ INVESTMENTS - based on the fraudulent nature of the underlying claims and the "foreign judgment" status that can be contested and adjudicated under Arkansas Law for foreign default judgments (i.e., defaults obtained in states other than Arkansas). HHSE Shareholders may recall that we pursued this same strategy with TCA Global Master Fund - a company that is often considered to be the nuclear bomb of Predatory Lenders - and HHSE prevailed under Arkansas Law.
In other corporate governance matters, the company has renewed it's various corporate filings with the Secretary of State offices in Wyoming and Arkansas (an annual house-keeping matter of a simple filing). The company has also received confirmation from the IRS that the full payroll tax liabilities that were the subject of a prior lien have been fully paid, and that a reconciliation of the revised amount of interest and penalties (also paid) shall be issued shortly and submitted to all HHSE customers receiving levy letters. HHSE has since engaged a payroll service to handle the monthly 941 and tax paperwork filing requirements.
HHSE Corporate Governance: HHSE will be re-filing a Form 10 Registration with two full years of audits (2016 and 2017) early this coming year, during the first few weeks; the CPA review is already underway and much of the documentation and procedural steps for the audit were already assembled during 2017 while planning for the Crimson merger. We feel that a registration of the shares and the subsequent uplist to OTC:QB will attract more investors and some institutional funds... resulting in a higher anticipated daily trading volume, and a predicted much higher HHSE stock price (based on business results, industry fundamentals and the proven power of Shareholder Enthusiasm).
Release Activities: January will see the theatrical release of "BLOODFEAST" - delayed since July due to MPAA re-cut needs. February will see a massive placement of DVDs and BluRays for "BATTLECREEK" (street date Feb. 6). That same week, on Friday (Feb. 9), HHSE will commence the initial theatrical launch of "DEATH HOUSE" to theatres. In April, three titles will be released via Sony Pictures Home Entertainment (including "DAISY WINTERS"); in May, HHSE will release "THE RIOT ACT" to theatres and Cinedigm will release DVD's and BluRays of "THE LENNON PROJECT" for the Company. Other titles in queue for theatrical and / or home video during the first half of 2018 include "MUSE", "INSOMNIUM", "IDENTITY CRISIS", "SLEEPER CELL", "DINOSAURS OF THE JURASSIC" and "SACRED HEARTS" (all but the last title were planned for 2017, but delayed during the Crimson merger pursuit).
HHSE Corporate Governance: HHSE will be re-filing a Form 10 Registration with two full years of audits (2016 and 2017) early this coming year, during the first few weeks; the CPA review is already underway and much of the documentation and procedural steps for the audit were already assembled during 2017 while planning for the Crimson merger. We feel that a registration of the shares and the subsequent uplist to OTC:QB will attract more investors and some institutional funds... resulting in a higher anticipated daily trading volume, and a predicted much higher HHSE stock price (based on business results, industry fundamentals and the proven power of Shareholder Enthusiasm).
Q4 filings will be completed by Monday and provided (along with full 2017 results) to the outside CPA firm conducting the Pre-audit review.
Q3 filings will be submitted to the OTC Markets tomorrow - this should restore the company's "current" status.
UPDATE: THURS., JAN. 4 - The annual HHSE subscription to the OTC Markets had expired and had to be renewed (which occurred on Tuesday); However, OTC MARKETS client services told HHSE this morning that the company's access to post reports (currently Q3), will be activated within the next day or two.
Hannover House, Inc. (OTC: HHSE) has engaged two professional service advisors to assist in general operational needs and other activities and reporting requirements relating to the company's upcoming filing of a Form 10 Registration Statement with the Securities and Exchange Commission.
CPA Lisa Lashley Higgins has been engaged to review the company's books, records and financial filings covering the years 2015, 2016 and 2017, and to verify compliance with the needs set forth by the company's auditors. Attorney Steven H. Kay has been engaged to provide general transactional legal counsel, as well as filings relating to the elimination of contestable debts and prior litigation matters.
Hannover House, Inc. shares are currently traded on the OTC Pinksheets market. Upon acceptance of the company's registration statement by the Securities and Exchange Commission, the company anticipates that its shares will be elevated for exchange under the OTC: QB moniker. Contemporaneously with the registration filing, Hannover House will take steps to have its shares cleared under DTC electonic means, which management feels is a further step towards improving access and liquidity to the company's shares.
Regarding JSJ INVESTMENTS, the refusal of JSJ to accept cash plus interest in full (per the terms of the note), but instead to sue for more than three-times the amount on the pretense that "they were always entitled to shares, not 'just' repayment" renders the note usurious and illegal under the laws of virtually every state. Counsel, therefore, feels that a motion to freeze collection efforts and to re-open the claim so that it can be adjudicated, is a likely result for HHSE.
Regarding BEDROCK, due to breached commitments for funding the company that were the basis of a massive stock issuance by HHSE to Bedrock, HHSE counsel feels that this California judgment filing has a solid basis to be contested, adjudicated and won in Arkansas Courts.