HHSE -- NO DILUTION in over 2.5 years!
1). Hannover House has Not Issued any Shares in 2.5-years. See the chart below. For the company's first two years as a public equity, the stock structure was quite stable. For the past 2-1/2 years, the stock structure has also been stable. But in 2013 and 2014, the company got involved in some ugly predatory lender situations, most notably TCA Global and JSJ, which precipitated a rapid growth in share issuances. The business model for both TCA and JSJ - as exercised against HHSE and many other borrowers - is to make repayment with cash as difficult as possible, in order to force a "conversion of the debt" into freely trading shares of the issueer at a dramatic discount-to-market. Such returns grossly exceed the legal usury law limitations in all states, and this general business practice is operating in a legally dubious space. JSJ, for instance, refused to accept repayment from HHSE via a bank wire transfer (including all applicable, legal interest per the note), preferring instead to file a lawsuit (in Texas?!), in order to try to force repayment via shares at 200% or more interest. These predatory lenders generally prey on companies that are unable to defend themselves, and therefore are forced to allow the lenders to squeeze out profits far in excess of lending laws through toxic-conversions; most of the time, these small borrowers are ultimately forced out of business. However, this was not the case with Hannover House - as the company has a operating business that is unaffected by fluctuations of our stock price and not dependent on the issuance of shares for capital. These toxic dilutions from 2013 and 2014 definitely hurt our shareholders, and hurt our "market cap," as demonstrated in the charts. So, the Board voted to cease such forms of borrowing, and as a result, HHSE has not issued any new shares in 2.5-years. Anyone predicting on a chat board or anywhere else that a "big dilution is coming" is mistaken.
