PROSPECTUS SUPPLEMENT
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Filed
Pursuant to Rule 424(b)(5)
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To
prospectus dated September 30, 2016
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Registration
No. 333-212550
and 333-222015
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8,261,539 Series A Units consisting of One Share of Common Stock and One Series A
Warrant to Purchase One Share of Common Stock
969,230 Series B Units consisting of One Pre-Funded Series B Warrant to
Purchase One Share of Common Stock and One Series
A Warrant to
Purchase One Share of Common Stock
We are offering on a
“best-efforts” basis
8,261,539 Series A
units (the “Series A Units”), with each Series A Unit
consisting of (i) one share of common stock and (ii) one Series A
Warrant to purchase
one share of
common stock (the “Series A Warrants”). We are not
registering hereunder the shares of common stock issuable from time
to time upon exercise of the Series A Warrants.
We are also offering to those
purchasers whose purchase of Series A Units in this offering would
result in the purchaser, together with its affiliates and certain
related parties, beneficially owning more than 9.99% of our
outstanding common stock following the consummation of this
offering, in lieu of Series A Units that would otherwise result in
ownership in excess of 9.99% of our outstanding common stock,
969,230 Series B
units (the “Series B Units”, and together with the
“Series A Units”, the “Units”), with each
Series B Unit consisting of (i) one pre-funded Series B Warrant to
purchase one share of common stock (the “Series B
Warrants”, and together with the Series A Warrants, the
“Warrants”) and (ii) one Series A Warrant.
The Units will not be issued or
certificated. The shares of common stock, Series A Warrants and
Series B Warrants will all be immediately separable and issued
separately, but will be purchased together in this offering. This
prospectus supplement also relates to the offering of the shares of
common stock issuable upon exercise of the Series B
Warrants.
The
Series A Warrants will be initially exercisable on the first trading day following the one year anniversary of the date of
issuance and will expire five years from the date such Series A Warrants are first exercisable. Each Series B Warrant will be
exercisable at any time on or after the issuance date until the five-year anniversary of the issuance date. Each Series A
Warrant will be exercisable at a price of $7.25 per share of our common
stock, subject to adjustment. Each Series B Warrant will have an aggregate exercise price of
$6.50 per share of our common stock, all of which will be pre-funded
except for a nominal exercise price of $0.001 per share of our common stock, subject to adjustment.
For a more detailed description of
our common stock, Series A Warrants and Series B Warrants, see the
section entitled “Description of the Securities We are
Offering” beginning on page S-18 of this prospectus
supplement.
Our common stock trades on the
Nasdaq Capital Market under the symbol “HMNY”. The last
reported trading price of our common stock on December 12, 2017 was
$10.08 per share. There is no public trading market for the
Warrants, and we do not expect a market to develop. In addition, we
do not intend to apply for a listing of the Warrants on the Nasdaq
Capital Market, any other national securities exchange, or any
nationally recognized trading system.
Investing in our securities involves a high
degree of risk. See “Risk Factors” beginning on page
S-10 of this prospectus supplement and page 5 of the accompanying
prospectus.
Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of
these securities or passed on the adequacy or accuracy of this
prospectus supplement or the accompanying prospectus. Any
representation to the contrary is a criminal
offense.
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Offering
price
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$
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6.50
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$
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59,999,999
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Underwriting
discounts and commissions
(1)
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$
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0.3835
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$
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3,540,000
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Proceeds
to us before expenses
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$
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6.1165
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$
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56,459,999
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This offering is being completed on
a “best efforts” basis and the underwriters have no
obligation to buy any Series A Units or Series B Units from us or
to arrange for the purchase or sale of any specific number or
dollar amount of Series A Units or Series B Units.
The underwriters expect to deliver
the securities offered hereby on or about December
15
, 2017.
Sole Bookrunner
Canaccord Genuity
Co-Manager
Maxim
Group LLC
The date of this prospectus
supplement is December
13
, 2017.
TABLE OF
CONTENTS
Prospectus
Supplement
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ABOUT THIS PROSPECTUS SUPPLEMENT
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S-1
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DISCLOSURE REGARDING FORWARD-LOOKING
STATEMENTS
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S-2
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PROSPECTUS SUPPLEMENT SUMMARY
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S-3
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OUR BUSINESS
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S-3
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THE OFFERING
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S-7
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RISK FACTORS
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S-10
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USE OF PROCEEDS
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S-14
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MARKET PRICE OF OUR COMMON STOCK
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S-15
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CAPITALIZATION
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S-16
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DILUTION
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S-17
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DESCRIPTION OF THE SECURITIES WE ARE
OFFERING
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S-18
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UNDERWRITING
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S-20
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LEGAL MATTERS
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S-22
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EXPERTS
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S-22
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WHERE YOU CAN FIND MORE INFORMATION
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S-22
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INFORMATION INCORPORATED BY REFERENCE
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S-23
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Prospectus
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ABOUT THIS PROSPECTUS
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1
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DISCLOSURE REGARDING FORWARD-LOOKING
STATEMENTS
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2
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OUR BUSINESS
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3
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RISK FACTORS
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5
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USE OF PROCEEDS
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6
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DILUTION
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7
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DESCRIPTION OF SECURITIES THAT MAY BE
OFFERED
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8
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PLAN OF DISTRIBUTION
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12
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LEGAL MATTERS
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15
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EXPERTS
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15
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WHERE YOU CAN FIND MORE INFORMATION
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15
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INFORMATION INCORPORATED BY REFERENCE
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16
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i
ABOUT THIS PROSPECTUS
SUPPLEMENT
In this prospectus supplement, unless the context otherwise
requires, references to “we,” “us,”
“our,” “our company,” “the
Company” or “Helios” refer to Helios and Matheson
Analytics Inc. and its subsidiaries.
This prospectus supplement and the accompanying prospectus relate
to the offering of shares of our common stock and warrants to
purchase shares of our common stock. Before buying any of the
shares of common stock and warrants to purchase shares of our
common stock offered hereby, we urge you to carefully read this
prospectus supplement and the accompanying prospectus, together
with the information incorporated herein by reference as described
under the headings “Where You Can Find More
Information” and “Information Incorporated by
Reference”. These documents contain important information
that you should consider when making your investment decision. This
prospectus supplement contains information about the common stock
and warrants offered hereby and may add, update or change
information in the accompanying prospectus.
You should rely only on the information that we have provided or
incorporated by reference in this prospectus supplement and the
accompanying prospectus. Neither we nor the underwriters (nor any
of the underwriters’ affiliates) have authorized any other
person to provide you with different information. If anyone
provides you with different or inconsistent information, you should
not rely on it.
We and the underwriters are not making offers to sell or
solicitations to buy our securities in any jurisdiction in which an
offer or solicitation is not authorized or in which the person
making that offer or solicitation is not qualified to do so or to
anyone to whom it is unlawful to make an offer or solicitation. You
should assume that the information in this prospectus supplement
and the accompanying prospectus or any related free writing
prospectus is accurate only as of the date on the front of the
document and that any information that we have incorporated by
reference is accurate only as of the date of the document
incorporated by reference, regardless of the time of delivery of
this prospectus supplement, the accompanying prospectus or any
related free writing prospectus, or any sale of a security.
This document is in two parts. The first part is this prospectus
supplement, which adds to and updates information contained in the
accompanying prospectus. The second part is the accompanying
prospectus which provides more general information, some of which
may not apply to this offering. Generally, when we refer to this
prospectus supplement, we are referring to both parts of this
document combined. To the extent there is a conflict between the
information contained in this prospectus supplement and the
information contained in the accompanying prospectus, you should
rely on the information in this prospectus supplement.
This prospectus supplement and the accompanying prospectus contain
summaries of certain provisions contained in some of the documents
described herein, but reference is made to the actual documents for
complete information. All of the summaries are qualified in their
entirety by the actual documents. Copies of some of the documents
referred to herein have been or will be filed as exhibits to the
registration statement of which this prospectus supplement is a
part or as exhibits to documents incorporated by reference herein,
and you may obtain copies of those documents as described below
under the headings “Where You Can Find More
Information” and “Information Incorporated by
Reference”.
The industry and market data and other statistical information
contained in this prospectus supplement, the accompanying
prospectus and the documents we incorporate by reference are based
on management’s estimates, independent publications,
government publications, reports by market research firms or other
published independent sources, and, in each case, are believed by
management to be reasonable estimates. Although we believe these
sources are reliable, we have not independently verified the
information. None of the independent industry publications used in
this prospectus supplement, the accompanying prospectus or the
documents we incorporate by reference were prepared on our or our
affiliates’ behalf and none of the sources cited by us
consented to the inclusion of any data from its reports, nor have
we sought their consent.
S-1
DISCLOSURE REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus supplement and the accompanying prospectus,
including the documents that we incorporate by reference, may
contain forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended (the
“Securities Act”), and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”).
Forward-looking statements in this prospectus supplement and the
accompanying prospectus include, without limitation, statements
related to our plans, strategies, objectives, expectations,
intentions and adequacy of resources. Investors are cautioned that
such forward-looking statements involve risks and uncertainties
including, without limitation, the following: (i) our plans,
strategies, objectives, expectations and intentions are subject to
change at any time at our discretion; (ii) our plans and results of
operations will be affected by our ability to manage competition;
and (iii) other risks and uncertainties indicated from time to time
in our filings with the SEC. Important factors that could cause
actual results to differ materially from those indicated in the
forward-looking statements include, but are not limited to:
•
the ability of MoviePass to successfully develop its MoviePass
business model;
•
our capital requirements and whether or not we will be able to
raise capital when we need it;
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changes in local, state or federal regulations that will adversely
affect our business;
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our ability to retain our existing clients and market and sell our
services to new clients;
•
whether we will continue to receive the services of certain
officers and directors;
•
our ability to protect our intellectual property and operate our
business without infringing upon the intellectual property rights
of others;
•
our ability to effectively react to other risks and uncertainties
described from time to time in our SEC filings, such as fluctuation
of quarterly financial results, reliance on third party
consultants, litigation or other proceedings and stock price
volatility; and
•
other uncertainties, all of which are difficult to predict and many
of which are beyond our control.
In some cases, you can identify forward-looking statements by
terminology such as “may,’’
“will,’’ “should,’’
“could,’’ “expects,’’
“plans,’’ “intends,’’
“anticipates,’’ “believes,’’
“estimates,’’ “predicts,’’
“potential,’’ or “continue’’ or
the negative of such terms or other comparable terminology.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
We do not undertake any obligation to publicly update or review any
forward-looking statement.
S-2
PROSPECTUS SUPPLEMENT
SUMMARY
OUR BUSINESS
This is only a
summary and may not contain all the information that is important
to you. You should carefully read both this prospectus supplement
and the accompanying prospectus and any other offering materials,
together with the additional information described under the
heading “Where You Can Find More
Information”.
About Helios and
Matheson Analytics Inc.
About Helios and
Matheson Analytics Inc.
Since 1983, we have provided information technology services and
solutions including a range of technology platforms focusing on big
data, artificial intelligence, business intelligence, social
listening, and consumer-centric technology. More recently, to
provide greater value to our stockholders, we have sought to expand
our business primarily through acquisitions that leverage our
capabilities and expertise.
On November 9, 2016, we acquired Zone Technologies, Inc.
(“Zone”), a state-of-the-art mapping and spatial
analysis company, and on December 11, 2017 we completed our
acquisition of a majority interest in MoviePass Inc.
(“MoviePass”), the nation’s premier movie theater
subscription service.
Completion of the MoviePass Transaction
On December 11, 2017, we completed our acquisition of a majority
interest in MoviePass (such acquisition, the “MoviePass
Transaction”), pursuant to the previously announced
Securities Purchase Agreement, dated as of August 15, 2017, between
us and MoviePass (as amended, the “MoviePass SPA”), and
the Investment Option Agreement, dated October 11, 2017, between us
and MoviePass (the “MoviePass Option Agreement”).
At the closing of the MoviePass Transaction (the
“Closing”), MoviePass issued 81,542,016 shares of its
common stock to us representing 51.71% of its outstanding common
stock in exchange for the following consideration: (1) a
subordinated convertible promissory note in the principal amount of
$12,000,000, which is convertible into 4,000,001 shares of our
common stock; (2) a $5,000,000 promissory note issued to MoviePass;
and (3) the cancellation of a convertible promissory note issued by
MoviePass to us in an aggregate principal amount of
$11,500,000.
In addition, pursuant to the terms of the Note Purchase Agreement,
dated as of December 11, 2017, among us, MoviePass and Christopher
Kelly, a director, stockholder and noteholder of MoviePass
(“Kelly”), we agreed to purchase from Kelly, within two
business days after the Closing, MoviePass convertible promissory
notes in an aggregate principal amount of $1,000,000 for $1,000,000
in cash, which will automatically convert into 6,813,178 shares of
MoviePass’ common stock amounting to an additional 2% of the
outstanding shares of MoviePass common stock on a post-transaction
basis within two business days after the Closing, pursuant to a
Note Conversion Agreement.
Pursuant to the MoviePass Option Agreement, upon the Closing, the
outstanding convertible promissory notes issued by MoviePass to us
in an aggregate principal amount of $12,150,000 as of the closing
date were cancelled in exchange for 15,789,764 additional shares of
MoviePass’ common stock.
Upon completion of the above issuances, we will own approximately
57.8% of MoviePass’ issued and outstanding common stock,
which may be increased in connection with additional option
exercises following the Closing in accordance with the terms of the
MoviePass Option Agreement.
MoviePass
MoviePass was incorporated in Delaware in 2011 and is a movie
theater subscription service that allows members to see a new movie
every day in theaters nationwide for a monthly price of $9.95. Once
they sign up for the MoviePass service online, subscribers are
prompted to download the MoviePass application on their smart
phones and are then mailed a MoviePass debit card. The MoviePass
application shows subscribers the show times of all the movies that
are currently showing at their local movie theaters. Once they have
received their MoviePass debit card, subscribers can use the debit
card to purchase up to one movie ticket per day at any of the movie
theaters listed
S-3
in the MoviePass application without paying any additional costs.
During the four months after MoviePass’ announcement of the
new monthly subscription plan price in August 2017, MoviePass has
grown to over 1,000,000 total subscribers including those on either its monthly or annual
plans. This represents strong growth when compared to other
subscription-based companies, such as Spotify, Hulu, ClassPass and
Netflix, which achieved 1,000,000 subscribers in over 5, 10, 17 and 39
months, respectively, estimated based on information available publicly from various
news and other sources.
MoviePass is led by Mitch Lowe, its Chief Executive Officer, Stacy Spikes, its co-founder and Chief Operating Officer, Sanjay
Puri, its Chief Strategy Officer, and Chris Kelly, its Chairman.
The Company intends to strengthen our management team and combine
its data and artificial intelligence technology with
MoviePass’ technology. With our big data and artificial
intelligence platforms and other technologies that we own, we
believe we will be able to bring a significant technological
advantage to MoviePass.
Market Opportunity
Movie going is embedded in American society and enjoyed by people of
all races, ages and socio-economic levels. As noted below, the 2016
Theatrical Market Statistics Report issued by the Motion Picture
Association of America reports an annual average of 246 million
movie goers in North America spending $11.4 billion on tickets
annually. MoviePass intends to encourage increased attendance at
movie theaters with the subscription model by targeting the casual
movie goer (those who attend less than once a month) who represent
85% of the total movie going market. MoviePass conducted a study in
two test markets using data on movie goers before subscribing to
MoviePass and data for movie goers in the first year after having
MoviePass. The results from the study demonstrate that MoviePass
drove a 100% and 123% lift in movie attendance in each of these
markets.
Source: Motion Picture Association of America 2016 Theatrical
Market Statistics Report and Company Management.
Competition
The market for filmed entertainment ticketing services is intensely
competitive and subject to rapid change. MoviePass’ potential
competitors include Atom Tickets, MovieTickets.com, Fandango, AMC
Entertainment Holdings Inc.’s AMC Stubs program, Regal
Entertainment Group’s Regal Crown Club and Cinemark Holdings,
Inc.’s Movie Club, as well as other potential exhibitors
offering their own subscription services or loyalty programs.
AMC Stubs is a loyalty program offered by AMC Entertainment Holdings Inc. with
approximately 10.8 million household members. Movie goers can join the loyalty
program as either a basic member for free or a premiere member for
$15. The basic membership offers free popcorn refills, up to a $2
discount on tickets on Tuesdays, $5 rewards for every 5,000 points
(points are earned at a rate of 20 points for every $1 spent),
waived online ticket fees and free popcorn on the member’s birthday. Premiere members receive a $5 discount on tickets on
Tuesdays, earn 100 points for every $1 spent and all the other
benefits that come with the basic membership.
S-4
Regal Entertainment Group also offers a loyalty program with
approximately 14 million active members called the Regal Crown
Club. The program only has one membership option and is free to
join. Regal Crown Club members earn credits for every $1 they spend
on movie tickets and at concession stands. Points can be redeemed
for rewards via the use of a physical card or a virtual card with
Regal’s mobile app. Rewards include free concession items,
merchandise, movie tickets and more.
On December 5, 2017, Cinemark Holdings Inc. launched Movie Club.
Movie Club is a monthly subscription plan that allows subscribers
to buy one movie ticket a month for a discounted price of $8.99.
Members of Movie Club can roll over unused tickets from month
to month and receive a 20% discount on items bought at concession
stands. Movie Club membership is only valid at Cinemark
theaters.
Many of these competitors have longer operating histories, larger
customer bases, greater brand recognition and significantly greater
financial, marketing and other resources than MoviePass does. Some
of these competitors have adopted, and may continue to adopt,
aggressive pricing policies and devote substantially more resources
to marketing and website and systems development than MoviePass
does. In addition, MoviePass’ competitors may form or extend
strategic alliances with studios, exhibitors and distributors that
could affect adversely MoviePass’ ability to compete on
favorable terms.
MoviePass Intellectual
Property
MoviePass uses a combination of trademark, copyright and trade
secret laws and confidentiality agreements to protect its
proprietary intellectual property. MoviePass has a registered
trademark for the MoviePass name. MoviePass has filed applications
for several additional trademarks and two patents. MoviePass’
outstanding trademark and patent applications may not be allowed.
Even if these applications are allowed, they may not provide
MoviePass with a competitive advantage. To date, MoviePass has
relied primarily on proprietary processes and know-how to protect
its intellectual property related to its Web site, mobile
application and fulfillment processes. Competitors may challenge
successfully the validity and scope of MoviePass’
trademarks.
From time to time, MoviePass may encounter disputes over rights and
obligations concerning intellectual property. MoviePass believes
that its service offering does not infringe the intellectual
property rights of any third party. However, it cannot assure you
that MoviePass will prevail in any intellectual property
dispute.
Sale of Convertible
Promissory Notes
On August 16, 2017 and November 7, 2017, we issued convertible
promissory notes (the “Notes”) to institutional
investors pursuant to securities purchase agreements dated August
15, 2017 and November 6, 2017. As of December 11, 2017, we have
received a total of $26,145,908 from the sale of the Notes and
$977,142 from the exercise of a warrant issued to an institutional
investor in the August 16, 2017 offering of Notes. As the Notes are
structured, we have the potential to receive an additional
$82,874,092 in loan proceeds from the Notes. The proceeds from the
sale of the Notes have been used to increase the Company’s
ownership stake in MoviePass and for other general corporate
purposes.
Entry into Employment
Agreement
On December 11, 2017 (the “Effective Date”) we entered into an employment agreement with Theodore Farnsworth, our
Chief Executive Officer. The agreement has an initial term of five years and, following the expiration of the initial
term, will be automatically renewed for additional consecutive terms of one year, unless either the Company or Mr. Farnsworth
objects to the renewal upon at least 90 days prior to the commencement of the renewal term. The agreement includes the
following compensation provisions:
Base
Salary.
Pursuant to the agreement, Mr.
Farnsworth’s base salary will be $325,000 per year and will
be increased on each anniversary of the Effective Date in an amount
to be determined by the Board, but in no event less than
$15,000.
Annual
Bonus.
For 2017, Mr. Farnsworth will receive a year-end
cash bonus in the amount of $350,000 and an award of 53,255 shares
of our common stock that will vest on February 15, 2019. The common
stock has a value of $450,000, as determined by the last closing price of the common stock preceding the grant date (December 10, 2017). For each subsequent year of the term, Mr. Farnsworth will receive an annual bonus, made up of cash and shares of our common stock, as determined in the sole discretion of the Board based on its assessment
S-5
of our performance and individual performance in relation to
performance targets, a subjective evaluation of Mr.
Farnsworth’s performance or such other criteria as may be
established by the Board. The annual cash target bonus will be 25%
of Mr. Farnsworth’s base salary and the annual award of
shares of our common stock will have a value equal to 200% of his
base salary, also determined by the closing price of the common
stock on the grant date. Shares of common stock granted to Mr.
Farnsworth in each subsequent year of the term will vest ratably at
the end of each of the six calendar quarters subsequent to the
calendar quarter in which the grant is made.
Market Capitalization
Milestone Bonus.
Mr. Farnsworth will receive a stock
bonus based upon the Company’s achievement of certain market
capitalization milestones during the term of the agreement, as set
forth in the table below. Each award of common stock pursuant to a
market capitalization milestone will vest upon the later of
February 15, 2019 and the end of the applicable three-month period
following the applicable date of the grant. The Company’s
market capitalization for each applicable milestone and measurement
period will be determined based on the market capitalization
reported by Bloomberg LP.
Company Market Capitalization
Milestone
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$100,000,000
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3
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%
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$150,000,000
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3
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%
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$200,000,000
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4
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%
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$250,000,000
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4
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%
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$300,000,000
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5
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%
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$350,000,000
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5
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%
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$400,000,000
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7
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%
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$450,000,000
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7
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%
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$500,000,000
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9
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%
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every additional $100,000,000 thereafter
(cumulated with the applicable immediately preceding milestone)
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10
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%
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Each milestone above is a separate milestone for which Mr.
Farnsworth may earn the applicable percentage. Mr. Farnsworth will
be entitled to earn the applicable percentage for each milestone
only once.
Capital
Raise Bonus.
Mr. Farnsworth will receive a one-time bonus of $1,000,000 payable no later than December 29,
2017 for his efforts in bringing capital sources that have been critical to the Company’s needs during 2017. Mr. Farnsworth may, in his sole discretion, subject to the Company’s and Mr. Farnsworth’s
compliance with applicable legal and regulatory requirements, elect to accept unregistered shares of our common stock in lieu of
the cash bonus described above, valued based on the last closing price of the common stock on The Nasdaq Stock Market preceding
the execution of the Agreement.
Grant of Common
Stock.
In approving the employment agreement, the Board
approved the issuance of 2,000,000 shares of common stock to Mr.
Farnsworth, which have a market value of $16,900,000 based on the
last closing price of the common stock preceding the grant date
(December 10, 2017). The shares will vest in their entirety on
February 15, 2019, which is 18 months following August 15, 2017,
the date on which the Company entered into the MoviePass SPA.
Pursuant to the terms of the MoviePass SPA, the Company was
required to enter into a 5-year employment agreement with Mr.
Farnsworth prior to the closing of the acquisition transaction contemplated by the MoviePass SPA, which occurred on December 11, 2017.
Each grant of common stock discussed above will be subject to
approval by our stockholders to the extent required by the Listing
Rules of The Nasdaq Stock Market, including Listing Rule 5635(c).
We anticipate seeking stockholder approval during the first half of
2018.
For information regarding additional provisions included in Mr.
Farnsworth’s employment agreement, please see the Current
Report on Form 8-K we filed on December 12, 2017.
S-6
MoviePass/Fandor/Costco
Subscription Offer
On December 12, 2017, MoviePass and Fandor, the streaming service
with the largest collection of independent films, documentaries,
international features and shorts; announced that both companies
are partnering with Costco Wholesale Corporation (“Costco”) to offer a one-year subscription plan
for a flat fee of $89.99. The subscription plan for both services
will be available exclusively to Costco members and will cover a
year of membership for both MoviePass and Fandor. The offer will
only be available online at Costco.com for one week, from December
12 to December 18, 2017.
Current Outstanding
Debt
We have outstanding, as of December 11, 2017, debt in the amount of
$21,843,042.
Corporate
Information
Our executive offices are located at The Empire State Building, 350
Fifth Avenue, New York, New York 10118, and our telephone number is
(212) 979-8228. Additional information about us is available on our
website at
www.hmny.com
.
The information contained on or that may be obtained from our
website is not, and shall not be deemed to be, a part of this
prospectus supplement. Our common stock, par value $0.01 per share,
is currently traded on the Nasdaq Capital Market under the ticker
symbol “HMNY”.
For a description of our business, financial condition, results of
operations and other important information regarding us, we refer
you to our filings with the SEC incorporated by reference in this
prospectus supplement. For instructions on how to find copies of
these documents, see “
Where You Can Find
More Information
.”
S-7
THE OFFERING
Series A Units offered by us
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8,261,539
Series A Units with each Series A Unit consisting of (i) one share
of common stock and (ii) one Series A Warrant.
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Series B Units offered by us
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|
969,230
Series B Units with each Series B Unit consisting of (i) one
pre-funded Series B Warrant and (ii) one Series A
Warrant.
|
|
|
|
Offering Price
|
|
$6.50
per Unit.
|
|
|
|
Common stock outstanding after the
offering
|
|
23,481,253
shares of common stock (assuming all of the pre-funded Series B
Warrants and none of the Series A Warrants issued in the offering are
exercised)
(1)
|
|
|
|
Warrants offered by us
|
|
Series A Warrants to purchase up to
9,230,769 shares of
common stock. Each Series A Warrant will be exercisable for our
common stock at a price of $7.25 per share,
subject to adjustment. Each Series A Warrant will be exercisable at
any time on or after the first trading day following the one year
anniversary of the date of issuance until the fifth anniversary of
the initial exercise date.
|
|
|
|
|
|
Series B Warrants to purchase up to 969,230 shares of
common stock. Each Series B Warrant will have an aggregate exercise price of $6.50 per
share of our common stock, all of which will be pre-funded except for a nominal exercise price of $0.001 per share of our common
stock, subject to adjustment.
Each Series B Warrant will be exercisable at any time on or after
the issuance date until the fifth anniversary of the issuance
date.
|
|
|
|
|
|
This prospectus supplement relates to the
offering of the shares of our common stock issuable upon exercise
of the Series B Warrants. We are not registering hereunder the
shares of common stock issuable from time to time upon exercise of
the Series A Warrants.
|
|
|
|
|
|
There is no established public trading market
for the Warrants and we do not expect a market to develop. We do
not intend to apply for a listing of the Warrants on any national
securities exchange. Without an active market, the liquidity of the
Warrants will be limited.
|
|
|
|
Best
Efforts
|
|
We have agreed to issue and sell the Series A
Units and Series B Units offered hereby to the public through the
underwriters, and the underwriters have agreed to offer and sell
such securities on a “best efforts” basis. The
underwriters are not required to sell any specific number or dollar
amount of the securities offered hereby, but will use their best
efforts to sell such securities. See “Underwriting” on
page S-20.
|
|
|
|
Risk
Factors
|
|
Investing in our common stock and warrants
involves a high degree of risk. See “Risk Factors”
beginning on page S-10, as well as the other information included
in or incorporated by reference in this prospectus supplement and
the accompanying prospectus, for a discussion of risks you should
carefully consider before investing in our securities.
|
|
|
|
Use
of Proceeds
|
|
We may use the net proceeds from the sale of the
common stock and warrants offered by us under this prospectus
supplement to increase the Company’s ownership stake in
MoviePass or to support the MoviePass operations; to satisfy a
portion or all of the amounts payable in connection with the
convertible notes issued on August 16, 2017 and November 7, 2017,
to the extent that they remain outstanding; and for general
corporate purposes and transaction expenses. We may also use the
proceeds to make other acquisitions, although a specific
acquisition target has not yet been identified. See “Use of
Proceeds” on page S-14.
|
|
|
|
Nasdaq Capital Market Symbol
|
|
“HMNY”.
|
S-8
•
885,000 shares of common stock
available for issuance pursuant to the Helios and Matheson
Analytics Inc. 2014 Equity Incentive Plan, as of December 11,
2017;
•
374,446 shares of common stock that
may be issued upon the exercise of warrants by Palladium Capital
Advisors LLC;
•
288,640 shares of common stock
reserved for the issuance of warrants to Palladium Capital Advisors
LLC;
•
192,991 shares reserved for an
institutional investor to be issued in exchange for the waiver of
certain rights;
•
5,533,755 shares of common stock
reserved for issuance to various officers and
consultants;
•
4,000,001 shares of common stock
issuable to MoviePass upon receipt of stockholder approval and
conversion of the MoviePass Note; and
•
11,106,443 shares of common stock
issuable upon the conversion of our outstanding convertible
debt.
S-9
RISK FACTORS
Investing in our
common stock involves a high degree of risk. Please see the risk
factors set forth in Part I, Item 1A of our most recent Annual
Report on Form 10-K and in Part II, Item 1A of our Quarterly
Reports on Form 10-Q and other filings we make with the SEC, which
are incorporated by reference into this prospectus supplement. Before making
an investment decision, you should carefully consider these risks
as well as other information we include or incorporate by reference
in this prospectus supplement. The risks and uncertainties we have
described are not the only ones we face. Additional risks and
uncertainties not presently known to us or that we currently deem
immaterial may also affect our business operations. These risks
could materially affect our business, results of operations or
financial condition and cause the value of our securities to
decline.
Risks Related to our
Business, this Offering and our Common Stock and
Warrants
From the closing of the acquisition of MoviePass until its first
anniversary, we are entitled to anti-dilution protection if our
ownership percentage in MoviePass would decrease below 51%. After
the first anniversary, we do not have any further anti-dilution
protection and, therefore, we may own less than 51% of
MoviePass’ outstanding common stock.
From the closing of our acquisition of MoviePass until its first
anniversary, if MoviePass issues and/or sells any shares of
MoviePass’ common stock, including upon exercise or
conversion of any common stock equivalents, MoviePass will promptly
issue to us such number of shares as is necessary for us to
maintain an ownership percentage of 51% of the then outstanding
shares of MoviePass’ common stock. If we sell or otherwise
transfer any of the MoviePass shares during the period from the
Closing until the first anniversary of the Closing the above 51%
ownership percentage will be adjusted to reflect the MoviePass
shares transferred.
We issued a total of $10,300,000 in convertible promissory notes on
August 16, 2017 and $100,000,000 in convertible promissory notes on
November 7, 2017. If all of the principal, interest and Make-Whole
Amounts (as defined in the convertible promissory notes) is
converted into shares of our common stock, the ownership of our
stockholders will be substantially diluted.
On August 16, 2017 we issued convertible promissory notes in the
aggregate principal amount of $10,300,000 in exchange for a cash
payment of $220,000 and a promissory note from the investor in the
amount of $8,800,000. On November 7, 2017 we issued convertible
promissory notes in the aggregate principal amount of $100,000,000
in exchange for an aggregate cash payment of $5,000,000 and a
promissory note from each investor (the “investor
notes”) totaling in the aggregate $95,000,000. As of December
11, 2017, the holder of the August notes has converted $5,862,435
in principal amount and $49,253.05 in interest into an aggregate
1,482,639 shares of our common stock. Assuming that the notes
issued by the investors are paid in full, we will owe to the holder
of the notes issued in August a total of $4,624,773, including
principal and interest, and we will owe the holders of the notes
issued in November a total of $120,000,000, including principal,
interest and Make-Whole Amounts. The holder of the notes issued in
August may convert the amount we owe into shares of common stock at
a price of $4.00 per share. The holders of the notes issued in
November may convert the amount we owe into shares of our common
stock at a price of $12.06 per share. If the holder of the August
notes converted the entire $4,624,773 into shares of our common
stock, we would be required to issue to the holder a total of
1,156,194 shares of our common stock. If the holders of the
November notes converted the entire $120,000,000 into shares of our
common stock, we would be required to issue to the investors, on a
pro-rata basis, a total of 9,950,249 shares of our common stock.
This amount of shares represents almost 70% of the number of shares
we had outstanding on December 11, 2017. If we issue all of these
shares, the ownership of our current stockholders will be
substantially diluted.
The sale of shares issued to the investors in the August 16, 2017
and November 7, 2017 offerings of convertible promissory notes
could have a material adverse effect on the market price of our
common stock.
We have registered a portion of the shares of common stock
underlying the convertible promissory notes and the warrant we
issued on August 16, 2017.
While the shares of common stock we may issue to the investors in
the November 7, 2017 offering of convertible promissory notes are
not required to be registered, they may be sold pursuant to Rule
144 six months from that date, assuming that we meet the public
information requirement of Rule 144. Furthermore, the shares
S-10
of common stock underlying the convertible promissory notes we
issued on August 16, 2017 that have not been registered will be
available for sale pursuant to Rule 144 on February 16, 2018.
Sales of substantial amounts of our common stock in the public
market, or the perception that these sales could occur, could have
a material adverse effect the price of our common stock and could
impair our ability to raise capital through the sale of additional
shares.
In connection with the acquisition of MoviePass, we issued a
$12,000,000 convertible promissory note. If converted into shares
of our common stock, the ownership of our stockholders will be
substantially diluted.
On December 11, 2017, in connection with the acquisition of
MoviePass, we issued the MoviePass Note in the principal amount of
$12,000,000 as partial consideration for the acquisition of a
majority of the stake in MoviePass. Upon receipt of approval from
our stockholders in accordance with Nasdaq Listing Rule 5635, the
entire unpaid and outstanding principal amount and any accrued
unpaid interest thereon under the MoviePass Note will convert
automatically into an aggregate of 4,000,001 shares of our common
stock. This amount of shares represents approximately 28% of the
number of shares we had outstanding on December 11, 2017. If we
obtain stockholder approval and issue these shares, the ownership
of our current stockholders will be substantially diluted.
There currently is no market for MoviePass’ common stock and
a market for such securities may not develop, which could adversely
affect the liquidity and value of such securities.
We own a majority of the outstanding equity of MoviePass,
consisting of common stock. There currently is no market for the
MoviePass common stock. However, MoviePass may apply for listing of
its common stock on the Nasdaq Stock Market or the New York Stock
Exchange in the future. There can be no assurance that the
MoviePass common stock will become listed. If the MoviePass common
stock does become listed, an active trading market for such
securities may not develop in the near term, if at all, or if it
does develop, it may not be sustained. If an active trading market
for the MoviePass common stock does develop, the market for such
securities may be subject to price and volume volatility. In that
case, or if MoviePass does not become listed, we may be unable to
liquidate our investment in the MoviePass common stock at a time of
our choosing. If we are unable to liquidate our investment in
MoviePass at a time of our choosing, our financial position and the
value of our common stock may be materially and adversely
affected.
We have incurred and will continue to incur significant transaction
costs in connection with the MoviePass transaction.
We have incurred significant costs in connection with the MoviePass transaction and expect to incur additional expenses in
connection with the acquisition, including legal,
accounting, financial consulting, and related fees. We may also
incur fees and costs related to formulating integration plans. We
may be unable to realize financial benefits with the acquisition
that would allow us, over time, to offset the costs incurred in
connection with the acquisition.
The price of our common stock has been volatile, and the market
price of our common stock may decrease.
The per share price of our common stock has been volatile. Since
January 1, 2017 the per share closing price of our common stock has
been as low as $2.23 on May 16, 2017 and as high as $32.90 on
October 11, 2017. Market prices for securities of technology
companies have historically been particularly volatile. The factors
that may cause the market price of our common stock to fluctuate
include, but are not limited to:
•
progress, or lack of progress, in developing and commercializing
Zone’s RedZone Map technology;
•
our ability to recruit and retain qualified IT personnel;
•
our ability to derive financial benefits from our investment in
MoviePass;
•
changes in the perception of investors and securities analysts
regarding the risks to our business or the condition of our
business;
S-11
•
changes in our relationships with key clients;
•
changes in the market valuation or earnings of our competitors or
companies viewed as similar to us;
•
changes in key personnel;
•
changes in our capital structure, such as future issuances of
securities or the incurrence of debt;
•
the granting or exercise of employee stock options or other equity
awards; and
•
general market and economic conditions.
In addition, the equity markets have experienced significant price
and volume fluctuations that have affected the market prices for
the securities of technology companies for a number of reasons,
including reasons that may be unrelated to our business or
operating performance. These broad market fluctuations may result
in a material decline in the market price of our common stock and
you may not be able to sell your shares at prices you deem
acceptable. In the past, following periods of volatility in the
equity markets, securities class action lawsuits have been
instituted against public companies. Such litigation, if instituted
against us, could result in substantial cost and the diversion of
management attention.
While we are no longer a controlled company, Helios and Matheson
Information Technology Ltd. and Theodore Farnsworth, our two
largest stockholders (the “Principal Stockholders”),
together, as of the date of this prospectus supplement, own approximately 23.2% of our issued and outstanding
voting securities. This concentration of stock ownership gives them
substantial influence over us and could delay or prevent a change
in corporate control.
As the holders of approximately 23.2% of our common stock, the
Principal Stockholders may substantially influence the outcome of
matters submitted to our stockholders for approval, including the
election of directors and any merger, consolidation or sale of all
or substantially all of our assets. In addition, the Principal
Stockholders have significant influence over our management and
affairs, particularly Mr. Farnsworth, who is our Chief Executive
Officer and the Chairperson of our Board of Directors. This
concentration of ownership might harm the market price of our
common stock by:
•
delaying, deferring or preventing a change in control;
•
impeding a merger, consolidation, takeover or other business
combination involving us; or
•
discouraging a potential
acquirer from making a tender offer or otherwise attempting to
obtain control of us.
Our ongoing investment in new technology is inherently risky, and
could disrupt our business.
To remain competitive and grow we must continue to invest in new
products and technologies and explore strategic investments. There
is no assurance that these investment endeavors will be successful
or that the products and technologies developed by these
investments will be well received by the users. As our competitors
use or develop new technologies, competitive pressures may force us
to invest in developing or implementing new technologies at a
substantial cost. We cannot be certain that we will be able to
develop or implement technologies on a timely basis or at a cost
that is acceptable to us. If we fail to develop or implement new
technologies in a cost-effective manner, our operations and
financial condition may be adversely affected.
You will experience immediate and substantial dilution in the book
value per share of the common stock you purchase.
Because the price per share of our common stock being offered will
be higher than the book value per share of our common stock, you
will suffer substantial dilution in the net tangible book value of
the securities you purchase in this offering. See the section
titled “Dilution” below for a more detailed discussion
of the dilution you will incur if you purchase common stock and
warrants in this offering.
S-12
There is no public market for the Warrants to purchase shares of
our common stock being offered in this offering.
There is no public trading market for the Warrants being offered in
this offering, and we do not expect a market to develop. In
addition, we do not intend to apply to list the Warrants on any
national securities exchange or other nationally recognized trading
system, including The Nasdaq Capital Market. Without an active
market, the liquidity of the Warrants will be limited. In addition
the shares of common stock underlying the Series A Warrants will
not be registered and may not be sold upon exercise unless we file
a registration statement covering the sale of such shares of common
stock or there is an available exemption from registration upon
exercise.
Holders of our Warrants will have no rights as a common stockholder
until such holders exercise their Warrants and acquire our common
stock.
Until holders of the Warrants acquire shares of our common stock
upon exercise of the Warrants, holders of Warrants will have no
rights with respect to the shares of our common stock underlying
such Warrants.
Because our management will have broad discretion and flexibility
in how the net proceeds from this offering are used, we may use the
net proceeds in ways in which you disagree.
We currently intend to use the
net proceeds from this offering to increase our ownership stake in
MoviePass or to support the MoviePass operations; to satisfy a
portion or all of the amounts payable in connection with the
convertible notes issued on August 16, 2017 and November 7, 2017,
to the extent that they remain outstanding; and for general
corporate purposes and transaction expenses. We have not allocated
specific amounts of the net proceeds from this offering for any of
the foregoing purposes. Accordingly, our management will have
significant discretion and flexibility in applying the net proceeds
of this offering. You will be relying on the judgment of our
management with regard to the use of these net proceeds, and you
will not have the opportunity, as part of your investment decision,
to assess whether the net proceeds are being used appropriately. It
is possible that the net proceeds will be invested in a way that
does not yield a favorable, or any, return for us. The failure of
our management to use such funds effectively could have a material
adverse effect on our business, financial condition, operating
results and cash flow.
This offering is being conducted on a “best efforts”
basis.
The underwriters are offering the Series A Units and Series B Units
on a “best efforts” basis, and the underwriters are
under no obligation to purchase any Series A Units or Series B
Units for their own account. The underwriters are not required to
sell any specific number or dollar amount of securities in this
offering but will use their best efforts to sell the securities
offered in this prospectus supplement. As a “best
efforts” offering, there can be no assurance that the
offering contemplated hereby will ultimately be consummated.
S-13
USE OF
PROCEEDS
We estimate the net proceeds
to us from the sale of the Units offered hereby, after deducting
the underwriting discounts and commissions and estimated offering
expenses payable by us, will be approximately
$55,490,000
. The Series A Warrants are exercisable on or after
the first trading day following the one year anniversary of the
issue date and the Series B Warrants are exercisable on or after
the issue date. We cannot predict when or if the Warrants will be
exercised; it is possible that the Warrants may expire and may
never be exercised.
We
may use the net proceeds from the sale of Units offered by us under this prospectus supplement to increase our ownership stake
in MoviePass or to support the MoviePass operations, and for general corporate purposes and transaction expenses. We may also
use the proceeds to make other acquisitions, although a specific acquisition target has not yet been identified.
Palladium Capital Advisors, LLC acted as a financial advisor to the Company in connection with the offering
and will receive a financial advisory fee of $720,000 from the proceeds.
It
is also possible that we may use a portion of the proceeds from this offering to satisfy a portion or all of the amounts payable
in connection with the convertible notes issued on August 16, 2017 and November 7, 2017, to the extent that they remain outstanding.
As of December 11, 2017, there remained outstanding $4,571,440 in
principal amount, plus $53,333 in interest that accrues at the rate
of 6% per year, of the convertible notes issued on August 16, 2017.
These notes will become due and payable on April 16, 2018. The
proceeds from these notes were used primarily to increase our loan
to MoviePass, thereby increasing the number of shares of common
stock that were issued to us when the transaction closed.
As of December 11 2017, there is outstanding $17,125,908 in
principal amount of the convertible notes issued on November 7,
2017. These notes accrue interest at the rate of 10% per year and
become due and payable on November 7, 2019. The holders of the
notes have an optional redemption right in the event the Company
completes an equity or equity linked financing or at any time
following the seven month anniversary of the issue date of the
notes. Upon redemption or conversion of the notes, the noteholders
are entitled to the total amount of interest that would have
accrued with respect to the total amount being converted or
redeemed from the applicable date of conversion or redemption
through the maturity date. The proceeds received to date from these
notes were used to exercise the investment option granted to us by
MoviePass and for general corporate purposes.
The amounts and timing of our actual expenditures will depend on
numerous factors, including the factors described under “Risk
Factors” in this prospectus supplement, the accompanying
prospectus and in the documents incorporated by reference herein,
as well as the amount of cash used in our operations. We may find
it necessary or advisable to use the net proceeds for other
purposes, and our management will have significant flexibility in
applying the net proceeds of this offering. Until the funds are
used as described above, we intend to invest the net proceeds from
this offering in short-term, interest-bearing instruments or other
investment-grade securities.
S-14
MARKET PRICE OF OUR
COMMON STOCK
Our common stock is listed on the Nasdaq Capital Market under the
symbol “HMNY”.
The following table sets forth the quarterly range of high and low
sale prices of our common stock since January 1, 2015 as reported
by Nasdaq. As of December 11, 2017, we had 14,250,484 shares of
common stock outstanding and approximately 16 stockholders of
record.
|
|
|
|
|
2017
|
|
|
|
|
|
|
October 1, 2017 through December 12,
2017
|
|
$
|
32.90
|
|
$
|
7.74
|
July 1, 2017 through September 30,
2017
|
|
$
|
12.69
|
|
$
|
2.41
|
April 1, 2017 through June 30, 2017
|
|
$
|
3.81
|
|
$
|
2.23
|
January 1, 2017 through March 31,
2017
|
|
$
|
4.35
|
|
$
|
2.45
|
2016
|
|
|
|
|
|
|
October 1, 2016 through December 31,
2016
|
|
$
|
9.90
|
|
$
|
3.30
|
July 1, 2016 through September 30,
2016
|
|
$
|
13.70
|
|
$
|
7.12
|
April 1, 2016 through June 30, 2016
|
|
$
|
15.56
|
|
$
|
1.03
|
January 1, 2016 through March 31,
2016
|
|
$
|
1.99
|
|
$
|
1.20
|
2015
|
|
|
|
|
|
|
October 1, 2015 through December 31,
2015
|
|
$
|
2.20
|
|
$
|
1.31
|
July 1, 2015 through September 30,
2015
|
|
$
|
2.54
|
|
$
|
2.05
|
April 1, 2015 through June 30, 2015
|
|
$
|
3.53
|
|
$
|
2.16
|
January 1, 2015 through March 31,
2015
|
|
$
|
4.80
|
|
$
|
1.43
|
During the years 2016 and 2015, we did not declare any dividends.
We last declared a dividend of $0.08 per share to stockholders of
record on February 18, 2014. The payment of dividends is at the
discretion of our Board of Directors, who review many factors,
including but not limited to profitability expectations, liquidity
and financing needs, before making a determination that dividends
will be paid. There is no guarantee that our Board of Directors
will declare dividends in the future.
S-15
CAPITALIZATION
The following table sets forth our capitalization as of September
30, 2017:
•
on an actual basis;
•
on a pro forma basis to give effect to our acquisition of
MoviePass;
•
on a pro forma, as adjusted basis to give effect to our receipt of
net proceeds of approximately $55.3 million
from the sale of Series A Units and Series B Units that we are
offering after deducting underwriting discounts and commissions and
estimated offering expenses payable by us.
This capitalization table should be read in conjunction with
management’s discussion and analysis of results of operations
and our consolidated financial statements and related notes
included in our Annual Report on Form 10-K for the year ended
December 31, 2016 and in our Quarterly Report on Form 10-Q for the
quarter ended September 30, 2017.
|
|
As of September 30, 2017
(unaudited)
|
|
|
|
Actual
|
|
|
Pro forma (as
adjusted for
MoviePass
transaction)
|
|
|
Pro forma
(as adjusted for the
offering)
(1)
|
|
Cash and cash equivalents
|
|
$
|
1,663,879
|
|
|
$
|
2,955,126
|
|
|
$
|
58,245,125
|
|
Preferred
stock, $.01 par value; 2,000,000 shares
authorized; no shares issued and outstanding, actual and as adjusted, as of
September 30, 2017
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Common
stock, $.01 par value; 100,000,000 shares authorized; 8,544,554 issued and outstanding actual, and 22,616,574 issued and
outstanding, as adjusted, as of September 30, 2017
(2)
|
|
$
|
85,445
|
|
|
$
|
125,445
|
|
|
$
|
217,753
|
|
Additional paid-in-capital
|
|
$
|
72,445,147
|
|
|
$
|
108,493,492
|
|
|
$
|
163,691,183
|
|
Accumulated deficit
|
|
$
|
(98,593,770
|
)
|
|
$
|
(104,200,709
|
)
|
|
$
|
(104,200,709
|
)
|
Accumulated other comprehensive loss – foreign currency translation
|
|
$
|
(113,057
|
)
|
|
$
|
(113,057
|
)
|
|
$
|
(113,057
|
)
|
Non Controlling Interest
|
|
$
|
—
|
|
|
$
|
19,054,611
|
|
|
$
|
19,054,611
|
|
Total stockholders’ equity (deficit)
|
|
$
|
(26,176,235
|
)
|
|
$
|
23,359,782
|
|
|
$
|
78,649,781
|
|
The total number of shares of common stock
to be outstanding immediately after this offering assumes no exercise of the Series A Warrants included in the Units and is based
on 8,544,554 shares of common stock issued and outstanding as of September 30, 2017, plus an additional 4,000,001 shares of common
stock issuable following the conversion of the MoviePass Note, and 841,250 shares issued and outstanding as of September 30, 2017
that could have been put back to the Company in exchange for a Senior Secured Convertible Note as of September 30, 2017 (the
right was terminated October 23, 2017 pursuant to the Third Amendment and Exchange Agreement entered into between the Company and
the investor); but does not include the following:
•
374,446 shares of common stock that may be issued upon the exercise
of warrants by Palladium Capital Advisors LLC;
•
288,640 shares of common stock reserved for the issuance of
warrants to Palladium Capital Advisors LLC;
•
192,991 shares reserved for an institutional investor to be issued
in exchange for the waiver of certain rights;
•
5,533,755 shares of common stock reserved for issuance to various
officers and consultants; and
•
11,106,443 shares of common stock issuable upon the conversion of our outstanding convertible debt.
S-16
DILUTION
A purchaser of Units in this offering will be diluted immediately
to the extent of the difference between the public offering price
per Unit and our pro forma net tangible book value per share after
this offering. We calculate net tangible book value per share by
dividing our net tangible book value, which is tangible assets less
total liabilities, by the number of outstanding shares of our
common stock.
Our
net tangible book value as of September 30, 2017 was approximately $(35.7) million, or $(3.80) per share. After giving
effect to our acquisition of MoviePass, our pro forma net tangible book value as of September 30, 2017 was approximately
$(85.3) million, or $(6.38) per share. After giving effect to the sale by us of 8,261,539 Series A Units and
969,230 Series B Units at the public offering price of $6.50 per Unit (which per Unit price assumes the exercise of all
pre-funded Series B Warrants being offered in this offering for $0.001 per share), and after deducting the underwriting
discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as
of September 30, 2017 would have been approximately $(30.1) million, or
$(1.33) per share. This represents an immediate increase in as adjusted net
tangible book value of $5.05 per share to existing stockholders and
an immediate dilution of $7.83 per share to new investors of Units in
this offering. The following table illustrates the per share dilution to investors of Units in this offering:
Public offering price per Unit
|
|
|
|
|
|
$
|
6.50
|
|
Historical net tangible book value per share as of September 30, 2017
|
|
$
|
(3.80
|
)
|
|
|
|
|
Pro forma increase in net tangible book value per share as of September 30, 2017 attributable to the MoviePass acquisition
|
|
$
|
(2.58
|
)
|
|
|
|
|
Pro forma net tangible book value per share as of September 30, 2017 before giving effect to this offering
|
|
$
|
(6.38
|
)
|
|
|
|
|
Increase in pro forma net tangible book value per share after this offering
|
|
$
|
5.05
|
|
|
|
|
|
As adjusted pro forma net tangible book value per share as of September 30, 2017, after giving effect to this offering
|
|
|
|
|
|
$
|
(1.33
|
)
|
Dilution per share to new investors
|
|
|
|
|
|
$
|
7.83
|
|
The
foregoing table does not take into account further dilution to new investors that could occur upon the exercise of outstanding
options, restricted stock units and warrants having a per share exercise price less than the per Unit offering price to the public
in this offering.
For purposes of calculating pro forma
net tangible book value, the above table is based on 8,544,554 shares of our common stock issued and outstanding as of
September 30, 2017, plus an additional 4,000,001 shares issuable to MoviePass upon the conversion of the MoviePass Note, and
841,250 shares issued and outstanding as of September 30, 2017 that could have been put back to the Company in exchange for a
Senior Secured Convertible Note as of September 30, 2017 (the right was terminated October 23, 2017 pursuant to the Third
Amendment and Exchange Agreement entered into between the Company and the investor) and assumes the exercise of all of the
pre-funded Series B Warrants for the purchase of 969,230 shares of our common stock included in the Units being offered and
does not include the following:
•
885,000 shares of common stock available for issuance pursuant to
the Helios and Matheson Analytics Inc. 2014 Equity Incentive Plan,
as of September 30, 2017;
•
374,446 shares of common stock that may be issued upon the exercise
of warrants by Palladium Capital Advisors LLC;
•
288,640 shares of common stock reserved for the issuance of
warrants to Palladium Capital Advisors, LLC;
•
192,991 shares reserved for an institutional investor to be issued
in exchange for the waiver of certain rights;
•
5,533,733 shares of common stock reserved for issuance to various
officers and consultants;
•
11,106,443 shares of common stock issuable upon the conversion of
our outstanding convertible debt; and
•
9,230,769 shares of common stock issuable upon the exercise of the Series A Warrants.
S-17
DESCRIPTION OF THE
SECURITIES WE ARE OFFERING
We are offering 8,261,539 Series A
Units consisting of one share of our common stock and one Series A
Warrant to purchase
one share of
our common stock and
969,230 Series B
Units consisting of one pre-funded Series B Warrant to purchase one
share of common stock and one Series A Warrant to purchase one share of our common stock, at
a public offering price of
$6.50 per Unit.
This prospectus supplement also includes the offering of the shares
of common stock issuable upon exercise of the Series B Warrants but
does not include the shares of common stock issuable upon exercise
of the Series A Warrants.
Common Stock
The material terms and provisions of our common stock are described
under the caption “Description of the Securities that may be
Offered/Description of Common Stock” beginning on page 8 of
the accompanying prospectus, subject to the following modification. We have 102,000,000 shares of capital stock authorized under our certificate of incorporation, consisting
of 100,000,000 shares of common stock, $0.01 par value, and 2,000,000 shares of preferred stock, $0.01 par value.
Warrants
The following is a brief summary of certain terms and conditions of
the Warrants included in the Units we are offering and is subject
in all respects to the provisions contained in the Warrants.
Series A Warrants
Form.
The
Series A Warrants will be issued as individual warrant agreements
issued to purchasers.
Amount.
Each
purchaser of a Series A Unit will receive a Series A Warrant
exercisable into one share
of common stock for each share of common stock included in the
Series A Unit.
Exercisability.
The
Series A Warrants are exercisable on or after the first trading day
following the one year anniversary of the date of issuance and will
expire five years after their initial exercise date. The Series A
Warrants will be exercisable, at the option of each holder, in
whole or in part by delivering to us a duly executed exercise
notice and by payment in full in immediately available funds for
the number of shares of common stock purchased upon such exercise.
The holder may, in its sole discretion, elect to exercise the
Series A Warrant through a cashless exercise if a registration
statement covering the issuance or resale of the warrant shares is
not available for the issuance or resale of such warrant shares, in
which case the holder would receive upon such exercise the net
number of shares of common stock determined according to the
formula set forth in the Series A Warrant.
Exercise
Limitation.
A holder will not have the right to
exercise any portion of the Series A Warrant if the holder
(together with its affiliates and any other persons acting as a
group within such holder) would beneficially own in excess of 4.99%, or 9.99%,
if selected by the purchaser, of the number of shares of our common stock outstanding immediately
after giving effect to the exercise, as such percentage ownership
is determined in accordance with the terms of the Series A
Warrants. However, any holder may increase or decrease such
percentage to any other percentage not in excess of 9.99% upon at
least 61 days’ prior notice from the holder to us.
Exercise
Price.
The exercise price per whole share of common
stock purchasable upon exercise of the Series A Warrants is $7.25 per share
of common stock. The exercise price is subject to appropriate
adjustment in the event of certain stock dividends and
distributions, stock splits, stock combinations, reclassifications
or similar events affecting our common stock and also upon any
distributions of assets, including cash, stock or other property to
our stockholders.
Transferability.
Subject
to applicable laws, the Series A Warrants may be offered for sale,
sold, transferred or assigned without our consent.
Exchange
Listing.
We do not plan on applying to list the Series
A Warrants on The Nasdaq Capital Market, any other national
securities exchange or any other nationally recognized trading
system.
Adjustment.
If, as of
the initial exercisability date, the Adjustment Price is less than the exercise price then in effect, the exercise price will
automatically adjust to the Adjustment Price. The Adjustment Price is calculated by dividing the quotient obtained by
dividing (x) the sum of the VWAP of our common stock for each trading day during the 10 consecutive trading day period ending
and including the trading day immediately prior to the initial exercisability date, by (y) 10.
S-18
Fundamental
Transactions.
In the event of a fundamental
transaction, as described in the Series A Warrants and generally
including any reorganization, recapitalization or reclassification
of our common stock, the sale, transfer or other disposition of all
or substantially all of our properties or assets, our consolidation
or merger with or into another person, the acquisition of more
than 50% of our outstanding common stock, or any person or group
becoming the beneficial owner of 50% of the voting power
represented by our outstanding common stock, the holders of the Series A Warrants will be entitled to receive
upon exercise of the Series A Warrants the kind and amount of
securities, cash or other property that the holders would have
received had they exercised the Series A Warrants immediately prior
to such fundamental transaction.
Rights as a
Stockholder.
Except as otherwise provided in the Series
A Warrants or by virtue of such holder’s ownership of shares
of our common stock, the holder of a Series A Warrant does not have
the rights or privileges of a holder of our common stock, including
any voting rights, until the holder exercises the Series A
Warrant.
Waivers and
Amendments
. The terms of a Series A Warrant may be
amended or waived with the written consent of the Company and the
holders of a majority of the then outstanding Series A
Warrants.
Fractional
Shares.
No fractional shares will be issued upon
exercise of the Series A Warrants. The Series A Warrants do not
confer upon holders any voting or other rights as stockholders of
the Company.
Series B Warrants
The pre-funded Series B Warrants will have an aggregate exercise price of $6.50 per
share of our common stock, all of which will be pre-funded except for a nominal exercise price of $0.001 per share of our common
stock, subject to adjustment. They will be exercisable
immediately and will expire on the five year anniversary of the
issuance date. The holder will not have the right to exercise any
portion of the Series B Warrant if the holder, together with its
affiliates, would, subject to certain limited exceptions,
beneficially own in excess of 9.99% of our common stock outstanding
immediately after the exercise. The Series B Warrants include customary
adjustment provisions that are substantially similar to the ones
contained in the Series A Warrants.
S-19
UNDERWRITING
Canaccord Genuity Inc. is acting as the representative of the
underwriters named below. We have entered into an underwriting
agreement with the representative dated as of the date of this
prospectus supplement. Subject to the terms and conditions of the
underwriting agreement, we have agreed to offer and sell to the
public through the underwriters, and the underwriters have agreed,
severally and not jointly, to sell up to the respective number of
Series A Units and Series B Units shown opposite its name below at
the public offering price shown on the cover page of this
prospectus supplement on a best efforts basis.
|
|
|
|
|
Canaccord
Genuity Inc.
|
|
7,022,309
|
|
823,846
|
Maxim
Group LLC
|
|
1,239,230
|
|
145,384
|
Total
|
|
8,261,539
|
|
969,230
|
This offering is being completed on a “best efforts”
basis and the underwriters have no obligation to buy any Series A
Units or Series B Units from us or to arrange for the purchase or
sale of any specific number or dollar amount of Series A Units or
Series B Units. As a “best efforts” offering, there can
be no assurance that the offering contemplated hereby will
ultimately be consummated.
Each underwriter proposes to
offer the Units directly to the public at the public offering price
per Unit set forth on the cover page of this prospectus supplement.
After the offering, these figures may be changed by the
underwriters.
The securities we are offering are being offered by the
underwriters subject to certain conditions specified in the
underwriting agreement.
Underwriting Discount
and Expenses
The following table shows the per Unit and total underwriting
commission we will pay to the underwriters:
Per Unit
|
|
$
|
0.3835
|
Total
|
|
$
|
3,540,000
|
We estimate that the total expenses of the offering payable by us,
not including the underwriting commission, will be approximately
$250,000. We have
also agreed to reimburse the underwriters for certain of their fees and
expenses, including the expenses of counsel to the underwriters, in
an amount not to exceed $200,000 in the
aggregate and to pay a financial advisory fee to Palladium Capital Advisors, LLC of $720,000.
Lock-up
Agreements
Our officers and directors and certain of our stockholders holding
at least 5% of our outstanding shares of common stock, and each of
their respective affiliates and associated partners, have agreed
with the underwriters to be subject to a lock-up period of 90 days
following the date of this prospectus supplement. This means that,
during the applicable lock-up period, such persons may not offer
for sale, contract to sell, sell, distribute, grant any option,
right or warrant to purchase, pledge, hypothecate or otherwise
dispose of, directly or indirectly, any shares of our common stock
or any securities convertible into, or exercisable or exchangeable
for, shares of our common stock. Certain limited transfers are
permitted during the lock-up period if the transferee agrees to
these lock-up restrictions. We have also agreed, in the
underwriting agreement, to similar lock-up restrictions on the
issuance and sale of our securities for 90 days following the date
of this prospectus supplement, although we will be permitted to
issue stock options or stock awards to directors, officers and
employees under our existing equity incentive plan and other
customary carve outs to be set forth in the underwriting agreement.
Canaccord Genuity Inc., as the representative of the underwriters,
may, in its sole discretion and without notice, waive the terms of
any of these lock-up agreements.
Listing; Transfer Agent
and Registrar
Our common stock is listed on the Nasdaq Capital Market under the
symbol “HMNY”. We do not intend to list the Series A
Warrants or Series B Warrants to be sold in this offering on any
securities exchange.
The transfer agent for our common stock is Computershare. Our
transfer agent’s address is 350 Indiana Street, Suite 750,
Golden, Colorado 80401.
S-20
Stabilization, Short
Positions and Penalty Bids
The underwriters may engage in transactions that stabilize,
maintain or otherwise affect the price of our common stock.
Specifically, the underwriters may sell more shares of common stock
than they are obligated to purchase under the underwriting
agreement, creating a short position. The underwriters must close
out any short position by purchasing shares of common stock in the
open market. A short position may be created if the underwriters
are concerned that there may be downward pressure on the price of
the common stock in the open market after pricing that could
adversely affect investors who purchased in this offering. As an
additional means of facilitating this offering, the underwriters
may bid for, and purchase, shares of our common stock in the open
market to stabilize the price of the common stock. These activities
may raise or maintain the market price of our common stock above
independent market levels or prevent or slow a decline in the
market price of our common stock. The underwriters are not required
to engage in these activities, and may end any of these activities
at any time.
Electronic Delivery of
Prospectus Supplements
A prospectus supplement in electronic format may be delivered to
potential investors by the underwriters participating in this
offering. The prospectus supplement in electronic format will be
identical to the paper version of such prospectus supplement. Other
than the prospectus supplement in electronic format, the
information on any underwriter’s web site and any information
contained in any other web site maintained by any underwriter is
not part of the prospectus supplement or the registration statement
of which this prospectus supplement forms a part.
Indemnification
We have agreed to indemnify the underwriters against certain
liabilities, including certain liabilities arising under the
Securities Act, or to contribute to payments that the underwriters
may be required to make for these liabilities.
Other
Transactions
From time to time in the ordinary course of its businesses, the
underwriters and certain of their affiliates have engaged, and may
in the future engage, in commercial banking or investment banking
transactions with us and our affiliates for which they have
received, or in the future may receive, customary fees.
Offer Restrictions
Outside the United States
Other than in the United States, no action has been taken by us or
the underwriters that would permit a public offering of the
securities offered by this prospectus supplement in any
jurisdiction where action for that purpose is required. The
securities offered by this prospectus supplement may not be offered
or sold, directly or indirectly, nor may this prospectus supplement
or any other offering material or advertisements in connection with
the offer and sale of any such securities be distributed or
published in any jurisdiction, except under circumstances that will
result in compliance with the applicable rules and regulations of
that jurisdiction. Persons into whose possession this prospectus
supplement comes are advised to inform themselves about and to
observe any restrictions relating to the offering and the
distribution of this prospectus supplement. This prospectus
supplement does not constitute an offer to sell or a solicitation
of an offer to buy any securities offered by this prospectus
supplement in any jurisdiction in which such an offer or a
solicitation is unlawful.
S-21
LEGAL MATTERS
The validity of the issuance of the securities offered hereby will
be passed upon for us by Mitchell Silberberg & Knupp LLP, Los
Angeles, California. The underwriters are being represented in
connection with this offering by Goodwin Procter LLP, New York, New
York.
EXPERTS
Rosenberg Rich Baker Berman & Company, independent registered
public accounting firm, has audited our consolidated financial
statements included in our Annual Report on Form 10-K for the years
ended December 31, 2016 and 2015, as set forth in their report,
which is incorporated by reference in this prospectus supplement
and elsewhere in the registration statement in which this
prospectus supplement is included. Our consolidated financial
statements for the years ended December 31, 2016 and 2015 are
incorporated by reference in reliance on Rosenberg Rich Baker
Berman & Company’s report, given on their authority as
experts in accounting and auditing.
The balance sheet of Zone Technologies, Inc. as of December 31,
2015, and the related statements of operations, stockholders’
deficit, and cash flows for the period then ended, have been
audited by EisnerAmper LLP, independent registered public
accounting firm, as stated in their report which is incorporated by
reference from the Company’s Form 8-K/A, Amendment No. 1,
filed with the Securities and Exchange Commission on September 20,
2016, which report includes an explanatory paragraph about the
existence of substantial doubt concerning Zone Technologies,
Inc.’s ability to continue as a going concern. Such financial
statements have been incorporated herein by reference in reliance
on the report of such firm given upon their authority as experts in
accounting and auditing.
The balance sheets of MoviePass Inc. as of December 31, 2016 and
2015, and the related statements of operations, stockholders’
equity, and cash flows for each of the years then ended, have been
audited by EisnerAmper LLP, independent registered public
accounting firm, as stated in their report which is incorporated by
reference from the Company’s Form 8-K filed with the
Securities and Exchange Commission on November 30, 2017 which
report includes an explanatory paragraph about the existence of
substantial doubt concerning MoviePass Inc.’s ability to
continue as a going concern. Such financial statements have been
incorporated herein by reference in reliance on the report of such
firm given upon their authority as experts in accounting and
auditing.
WHERE YOU CAN FIND MORE
INFORMATION
We have filed with the SEC a registration statement on Form S-3
under the Securities Act, with respect to the securities covered by
this prospectus supplement. This prospectus supplement, which is a
part of the registration statement, does not contain all of the
information set forth in the registration statement or the exhibits
and schedules filed therewith. For further information with respect
to us and the securities covered by this prospectus supplement,
please see the registration statement and the exhibits filed with
the registration statement. A copy of the registration statement
and the exhibits filed with the registration statement may be
inspected without charge at the Public Reference Room maintained by
the SEC, located at 100 F Street, N.E., Washington, D.C. 20549.
Please call the SEC at 1-800-SEC-0330 for more information about
the operation of the Public Reference Room. The SEC also maintains
an Internet website that contains reports, proxy and information
statements and other information regarding registrants that file
electronically with the SEC. The address of the website is
http://www.sec.gov
.
We are subject to the information and periodic reporting
requirements of the Exchange Act and, in accordance therewith, we
file periodic reports, proxy statements and other information with
the SEC. Such periodic reports, proxy statements and other
information are available for inspection and copying at the Public
Reference Room and website of the SEC referred to above. We
maintain a website at
http://www.hmny.com
.
You may access our Annual Reports on Form 10-K, Quarterly Reports
on Form 10-Q, Current Reports on Form 8-K and amendments to those
reports filed pursuant to Sections 13(a) or 15(d) of the Exchange
Act with the SEC free of charge at our website as soon as
reasonably practicable after such material is electronically filed
with, or furnished to, the SEC. Our website and the information
contained on that site, or connected to that site, are not
incorporated into and are not a part of this prospectus
supplement.
S-22
INFORMATION INCORPORATED
BY REFERENCE
The SEC and applicable law permits us to “incorporate by
reference” into this prospectus supplement information that
we have or may in the future file with or furnish to the SEC. This
means that we can disclose important information by referring you
to those documents. You should read carefully the information
incorporated herein by reference because it is an important part of
this prospectus supplement. We hereby incorporate by reference the
following documents into this prospectus supplement:
•
our Annual Report on Form 10-K for the fiscal year ended December
31, 2016, as filed with the SEC on April 14, 2017;
•
our Quarterly Reports on Form 10-Q for the quarters ended March 31,
2017, June 30, 2017 and September 30, 2017, as filed with the SEC
on May 19, 2017, August 11, 2017 and November 14, 2017;
•
our Current Reports on Form 8-K filed with the SEC on January 4,
2017, January 17, 2017, January 23, 2017 (other than the portions
of the filing that were furnished rather than filed), February 7,
2017, February 10, 2017, March 14, 2017, May 23, 2017 (other than
the portions of the filing that were furnished rather than filed),
June 5, 2017 (other than the portions of the filing that were
furnished rather than filed), July 13 2017, August 15, 2017 (other
than the portions of the filing that were furnished rather than
filed), August 18, 2017, August 22, 2017, August 28, 2017,
September 7, 2017, September 14, 2017, September 20, 2017, October
5, 2017, October 11, 2017 (other than the portions of the filing
that were furnished rather than filed), October 17, 2017, October
23, 2017, October 24, 2017; October 31, 2017, November 6, 2017,
November 13, 2017, November 17, 2017, November 20, 2017, November
22, 2017, November 24, 2017, November 30, 2017, December 1, 2017,
December 11, 2017, December 12, 2017 and December 13, 2017;
•
the description of our common stock included in our Current Report
on Form 8-K filed with the SEC on July 12, 2016;
•
the financial statements of Zone Technologies, Inc. for the period
ended December 31, 2015 and the interim period ended June 30, 2016
included in our Current Report on Form 8-K/A filed with the SEC on
September 20, 2016; and
•
the financial statements of MoviePass Inc. for the year ended
December 31, 2016 and the interim period ended September 30, 2017
included in our Current Report on Form 8-K filed with the SEC on
November 30, 2017.
Additionally, all documents filed by us with the SEC under Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act (other than any
portions of filings that are furnished rather than filed pursuant
to Items 2.02 and 7.01 of a Current Report on Form 8-K), after the
date of this prospectus supplement and before the termination or
completion of this offering shall be deemed to be incorporated by
reference into this prospectus supplement from the respective dates
of filing of such documents. Any information that we subsequently
file with the SEC that is incorporated by reference as described
above will automatically update and supersede any previous
information that is part of this prospectus supplement.
Upon written or oral request, we will provide you without charge, a
copy of any or all of the documents incorporated by reference,
other than exhibits to those documents unless the exhibits are
specifically incorporated by reference in the documents. Please
send requests to Helios and Matheson Analytics Inc., Attn: Chief
Executive Officer, The Empire State Building, 350 Fifth Avenue, New
York, New York 10118, telephone number is (212) 979-8228.
S-23
PROSPECTUS
$50,000,000
Common Stock
Preferred Stock
Warrants
Units
Subscription Rights
______________
By this prospectus and an accompanying prospectus supplement, we
may from time to time offer and sell, in one or more offerings, up
to $50,000,000 in any combination of common stock, preferred stock,
warrants, and units.
We will provide you with more specific terms of these securities in
one or more supplements to this prospectus. You should read this
prospectus and the applicable prospectus supplement carefully
before you invest.
We may offer these securities from time to time in amounts, at
prices and on other terms to be determined at the time of the
offering. We may offer and sell these securities to or through
underwriters, dealers or agents, or directly to investors, on a
continuous or delayed basis. The supplements to this prospectus
will provide the specific terms of the plan of distribution. The
price to the public of such securities and the net proceeds we
expect to receive from such sale will also be set forth in a
prospectus supplement.
Our common stock is listed on the Nasdaq Capital Market under the
symbol “HMNY.” On September 20, 2016, the closing price
of our common stock as reported by the Nasdaq Capital Market was
$8.00 per share. On September 20, 2016, the aggregate market value
of our voting and nonvoting common equity securities held by
non-affiliates totaled $4,392,688. During the 12 month period prior
to and including the date of this prospectus, we did not offer any
securities pursuant to General Instruction I.B.6 of Form S-3.
An investment in our
common stock involves a high degree of risk. See “Risk
Factors” on page 5 of this prospectus for more information on
these risks.
Neither the Securities
and Exchange Commission nor any state securities commission has
approved or disapproved of these securities, or passed upon the
adequacy or accuracy of this prospectus. Any representation to the
contrary is a criminal offense.
The date of this prospectus is
September 30, 2016.
______________
TABLE OF
CONTENTS
|
|
|
ABOUT THIS PROSPECTUS
|
|
1
|
DISCLOSURE REGARDING FORWARD-LOOKING
STATEMENTS
|
|
2
|
OUR BUSINESS
|
|
3
|
RISK FACTORS
|
|
5
|
USE OF PROCEEDS
|
|
6
|
DILUTION
|
|
7
|
DESCRIPTION OF SECURITIES THAT MAY BE
OFFERED
|
|
8
|
PLAN OF DISTRIBUTION
|
|
12
|
LEGAL MATTERS
|
|
15
|
EXPERTS
|
|
15
|
WHERE YOU CAN FIND MORE INFORMATION
|
|
15
|
INFORMATION INCORPORATED BY REFERENCE
|
|
16
|
i
ABOUT THIS
PROSPECTUS
This prospectus is part of a registration statement filed with the
Securities and Exchange Commission (the “SEC”) using a
“shelf” registration process. Under this shelf process,
we may sell the securities described in this prospectus in one or
more offerings. This prospectus provides you with a general
description of the securities which may be offered. Each time we
offer securities for sale, we will provide a prospectus supplement
that contains specific information about the terms of that
offering. Any prospectus supplement may also add or update
information contained in this prospectus. You should read both this
prospectus and any prospectus supplement together with additional
information described below under “Where You Can Find More
Information” and “Information Incorporated by
Reference”.
The registration statement that contains this prospectus (including
the exhibits thereto) contains additional important information
about us and the securities we may offer under this prospectus.
Specifically, we have filed certain legal documents that establish
the terms of the securities offered by this prospectus as exhibits
to the registration statement. We will file certain other legal
documents that establish the terms of the securities offered by
this prospectus as exhibits to reports we file with the SEC. You
may obtain copies of that registration statement and the other
reports and documents referenced herein as described below under
the heading “Where You Can Find More Information”.
You should rely only on the information contained or incorporated
by reference in this prospectus and in any prospectus supplement.
We have not authorized any other person to provide you with
different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not
making offers to sell or solicitations to buy the securities in any
jurisdiction in which an offer or solicitation is not authorized or
in which the person making that offer or solicitation is not
qualified to do so or to anyone to whom it is unlawful to make an
offer or solicitation. You should not assume that the information
in this prospectus or any prospectus supplement, as well as the
information we file or previously filed with the SEC that we
incorporate by reference in this prospectus or any prospectus
supplement, is accurate as of any date other than its respective
date. Our business, financial condition, results of operations and
prospects may have changed since those dates.
In this prospectus, unless the context otherwise requires,
references to “we,” “us,”
“our,” “our company”, “the
Company” or “Helios” refer to Helios and Matheson
Analytics Inc. and its subsidiaries.
1
DISCLOSURE REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus and any accompanying prospectus supplement,
including the documents that we incorporate by reference, may
contain forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended (the
“Securities Act”), and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”).
Forward-looking statements in this prospectus and any accompanying
prospectus supplement include, without limitation, statements
related to our plans, strategies, objectives, expectations,
intentions and adequacy of resources. Investors are cautioned that
such forward-looking statements involve risks and uncertainties
including, without limitation, the following: (i) our plans,
strategies, objectives, expectations and intentions are subject to
change at any time at our discretion; (ii) our plans and results of
operations will be affected by our ability to manage competition;
and (iii) other risks and uncertainties indicated from time to time
in our filings with the SEC. Important factors that could cause
actual results to differ materially from those indicated in the
forward-looking statements include, but are not limited to,
•
our ability to consummate the transactions contemplated by the
Agreement and Plan of Merger, dated as of July 7, 2016, among us,
our subsidiary Zone Acquisition Inc. and Zone Technologies, Inc.,
as amended;
•
our capital requirements and whether or not we will be able to
raise capital when we need it;
•
changes in local, state or federal regulations that will adversely
affect our business;
•
our ability to retain our existing clients and market and sell our
services to new clients;
•
whether we will continue to receive the services of certain
officers and directors;
•
our ability to protect our intellectual property and operate our
business without infringing upon the intellectual property rights
of others;
•
our ability to effectively react to other risks and uncertainties
described from time to time in our SEC filings, such as fluctuation
of quarterly financial results, reliance on third party
consultants, litigation or other proceedings and stock price
volatility; and
•
other uncertainties, all of which are difficult to predict and many
of which are beyond our control.
In some cases, you can identify forward-looking statements by
terminology such as ‘‘may,’’
‘‘will,’’
‘‘should,’’
‘‘could,’’
‘‘expects,’’
‘‘plans,’’
‘‘intends,’’
‘‘anticipates,’’
‘‘believes,’’
‘‘estimates,’’
‘‘predicts,’’
‘‘potential,’’ or
‘‘continue’’ or the negative of such terms
or other comparable terminology. Although we believe that the
expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity,
performance or achievements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date hereof. We do not undertake any obligation to
publicly update or review any forward-looking statement.
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OUR BUSINESS
This is only a
summary and may not contain all the information that is important
to you. You should carefully read both this prospectus and any
accompanying prospectus supplement and any other offering
materials, together with the additional information described under
the heading “Where You Can Find More
Information”.
About Helios and
Matheson Analytics Inc.
Since 1983, we have provided high quality IT services and solutions
to Fortune 1000 companies and other large organizations.
Rapid technological advances and the wide acceptance and use of the
Internet as a driving force in commerce accelerated the growth of
the IT industry. These advances, including more powerful and less
expensive computer technology, fueled the transition from
predominantly centralized mainframe computer systems to open and
distributed computing environments and the advent of capabilities
such as relational databases, imaging, software development
productivity tools, and web-enabled software. These advances expand
the benefits that users can derive from computer-based information
systems and improve the price-to-performance ratios of such
systems. As a result, an increasing number of companies are
employing IT in new ways, often to gain competitive advantages in
the marketplace, and IT services have become an essential component
of many companies’ long-term growth strategies. The same
advances that have enhanced the benefits of computer systems
rendered the development and implementation of such systems
increasingly complex, popularizing the partnering with IT service
providers like us for application development, support and related
services.
In the past 6 to 8 years, we have seen a significant change in the
volume, velocity and variety of data due to emerging technologies
in computing power and with the proliferation and use of smart
phones. This has unleashed the potential of Big Data, a collection
of data sets so large and complex that it becomes difficult to
process using on-hand database management tools or traditional data
processing applications. The amount of data in the world is growing
fast. Traditional digital databases are challenged to capture,
store, search, share, analyze, and visualize this data deluge.
Companies are relentlessly innovating to satisfy the increasingly
demanding 21
st
century customer who lives many lives at once — online,
mobile, global, local, blurring the lines between work and play,
spoilt for choice and hungry for meaning and connection. It is now
essential for business and IT organizations to work hand-in-hand to
truly leverage the potential of Big Data — deepen customer
engagement, realize operational efficiencies and essentially
institutionalize data driven decision making.
We endeavor to provide high-quality, value-based offerings in the
areas of application value management, application development,
integration, independent validation, infrastructure and information
management and analytics services. We believe that our integrated
service of Big Data technology, advanced analytics and data
visualization empowers our clients to unlock the value of data to
make better decisions.
Our clients consist primarily of Fortune 1000 companies and other
large organizations. Our clients and prospective clients operate in
a diverse range of industries and historically have been
concentrated in the banking, financial services, insurance and
healthcare industries. Our goal is to realize consistent growth and
competitive advantage through the following strategic
initiatives:
•
Expand Existing
Client Market Share.
We are endeavoring to expand our
penetration and market share within our existing client base
through client focused sales and marketing initiatives allowing us
to offer existing clients a broad suite of technology and analytics
services.
•
Expand Client
Base.
One of our goals is to expand our client base,
particularly in the financial services sector. We are endeavoring
to broaden the geography of our client base by offering services to
many of our existing clients in their offices outside New York and
New Jersey and using such contacts as a gateway into new
geographies. During the second quarter of 2016, we began working
with credit unions in Silicon Valley, California to transform their
current systems to include data analytics and insights that will
enhance the customer experience and modernize their legacy systems.
We are also working with Terafina to implement an Omni Channel
Sales and Service platform for the largest credit union in
southeastern Washington state to help grow the credit union’s
membership and enhance its relationships with its existing
members.
3
•
Global
Delivery.
We are dedicated to providing a flexible
delivery model to our clients, which allows for dynamically
configurable “right shoring” of service delivery based
on each client’s needs.
•
Operational
Efficiency.
We keep a tight rein on discretionary
expenditures and selling, general and administrative expenses to
enhance our competitiveness.
•
Merger with Zone
Technologies, Inc.
Through the merger with Zone
Technologies, Inc., we intend to leverage our artificial
intelligence capabilities, and deep learning and analytics
expertise to enable RedZone Maps, a fully functioning app available
in the App Store, to further enhance and expand its crime mapping
capabilities globally. We believe that integrating our technology
with RedZone Maps will allow for a faster, more accurate and more
precise mapping application. We intend to employ the latest tools
to ingest crime data and to classify, normalize and unify the data
as single source of truth (SSOT) to be analyzed using deep machine
learning and artificial intelligence techniques to generate context
related signals and draw insights.
Controlled
Company
Helios and Matheson Information Ltd. is an information technology
services organization with corporate headquarters in Chennai, India
and the beneficial owner of approximately 75% of our outstanding
common stock. Our Board of Directors has determined that we meet
the definition of a “controlled company” as defined by
Rule 5615(c) of the Nasdaq Listing Rules. A “controlled
company” is defined in Rule 5615(c) as a company of which
more than 50% of the voting power for the election of directors is
held by an individual, group or another company. Certain Nasdaq
requirements do not apply to a “controlled company”,
including requirements that: (i) a majority of its Board of
Directors must be comprised of “independent” directors
as defined in Nasdaq’s rules; and (ii) the compensation of
officers and the nomination of directors be determined in
accordance with specific rules, generally requiring determinations
by committees comprised solely of independent directors or in
meetings at which only the independent directors are present.
Corporate
Information
Our executive offices are located at The Empire State Building, 350
Fifth Avenue, New York, New York 10118, and our telephone number is
(212) 979-8228. Additional information about us is available on our
website at
www.hmny.com
.
The information contained on or that may be obtained from our
website is not, and shall not be deemed to be, a part of this
prospectus. Our common stock, par value $0.01 per share, is
currently traded on The Nasdaq Capital Market under the ticker
symbol “HMNY”.
For a description of our business, financial condition, results of
operations and other important information regarding us, we refer
you to our filings with the SEC incorporated by reference in this
prospectus. For instructions on how to find copies of these
documents, see “
Where You Can Find
More Information
.”
4
RISK FACTORS
Investing in our
common stock involves a high degree of risk. Please see the risk
factors set forth in Part I, Item 1A of our most recent Annual
Report on Form 10-K and Part II, Item 1A of our most recent
Quarterly Report on Form 10-Q and other filings we make with the
SEC, which are incorporated by reference in this prospectus.
Additional risk factors may be included in a prospectus supplement
relating to a particular offering of securities. Before making an
investment decision, you should carefully consider these risks as
well as other information we include or incorporate by reference in
this prospectus. The risks and uncertainties we have described are
not the only ones we face. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial may also
affect our business operations. These risks could materially affect
our business, results of operations or financial condition and
cause the value of our securities to decline.
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USE OF
PROCEEDS
Unless we state otherwise in an accompanying prospectus supplement,
we intend to use the net proceeds from the sale of the securities
offered by us under this prospectus and any related prospectus
supplement for general corporate purposes of Helios and, if the
Merger is consummated, of Zone. These purposes may include capital
expenditures and additions to working capital. When a particular
series of securities is offered, the prospectus supplement relating
to that series will set forth our intended use for the net proceeds
we receive from the sale of the securities. Pending the application
of the net proceeds, we may invest the proceeds in short-term,
interest-bearing instruments or other investment-grade
securities.
6
DILUTION
We will set forth in a prospectus supplement the following
information regarding any material dilution of the equity interests
of investors purchasing securities sold by the Company in an
offering under this prospectus:
•
the net tangible book value per share of our equity securities
before and after the offering;
•
the amount of the increase in such net tangible book value per
share attributable to the cash payments made by purchases in the
offering; and
•
the amount of the immediate dilution from the public offering price
which will be absorbed by such purchasers.
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DESCRIPTION OF THE
SECURITIES THAT MAY BE OFFERED
Description of Common
Stock
The following summary of the rights of our common stock is not
complete and is subject to and qualified in its entirety by
reference to our certificate of incorporation and bylaws, copies of
which are filed as exhibits to our registration statement on Form
S-3, of which this prospectus forms a part. See “Where You
Can Find More Information”.
We have 32,000,000 shares of capital stock authorized under our
certificate of incorporation, consisting of 30,000,000 shares of
common stock, $0.01 par value, and 2,000,000 shares of preferred
stock, $0.01 par value.
As of September 20, 2016 we had 2,330,438 shares of common stock
outstanding. Our authorized but unissued shares of common stock are
available for issuance without further action by our stockholders,
unless such action is required by applicable law or the rules of
any stock exchange or automated quotation system on which our
securities may be listed or traded.
Holders of our common stock are entitled to such dividends as may
be declared by our board of directors out of funds legally
available for such purpose, subject to any preferential dividend
rights of any then outstanding preferred stock. The shares of
common stock are neither redeemable or convertible. Holders of
common stock have no preemptive or subscription rights to purchase
any of our securities.
Each holder of our common stock is entitled to one vote for each
such share outstanding in the holder’s name. No holder of
common stock is entitled to cumulate votes in voting for
directors.
In the event of our liquidation, dissolution or winding up, the
holders of our common stock are entitled to receive pro rata our
assets which are legally available for distribution, after payments
of all debts and other liabilities and subject to the prior rights
of any holders of preferred stock then outstanding. All of the
outstanding shares of our common stock are fully paid and
non-assessable. The shares of common stock offered by this
prospectus will also be fully paid and non-assessable.
Our common stock is listed on the Nasdaq Capital Market under the
symbol “HMNY”. On September 20, 2016, the last sale
price of our common stock was $8.00 per share. The transfer agent
and registrar for our common stock is Computershare. Its address is
250 Royall Street, Canton, Massachusetts 02021.
Description of Preferred
Stock
Our certificate of incorporation permits us to issue up to
2,000,000 shares of preferred stock in one or more series and with
rights and preferences that may be fixed or designated by our board
of directors without any further action by our stockholders. We
currently have no shares of preferred stock outstanding.
Subject to the limitations prescribed in our certificate of
incorporation and under Delaware law, our certificate of
incorporation authorizes the board of directors, from time to time
by resolution and without further stockholder action, to provide
for the issuance of shares of preferred stock, in one or more
series, and to fix the designation, powers, preferences and other
rights of the shares and to fix the qualifications, limitations and
restrictions thereof.
Description of
Warrants
Warrants to Purchase
Common Stock or Preferred Stock
We may issue warrants for the purchase of our preferred stock or
common stock, which we refer to in this prospectus as “equity
warrants”. As explained below, each equity warrant will
entitle its holder to purchase our equity securities at an exercise
price set forth in, or to be determined as set forth in, the
related prospectus supplement. Equity warrants may be issued
separately or together with equity securities. The equity warrants
are to be issued under equity warrant agreements.
The particular terms of each issue of equity warrants and the
equity warrant agreement relating to the equity warrants will be
described in the applicable prospectus supplement, including, as
applicable:
•
the title of the equity warrants;
•
the initial offering price;
8
•
the aggregate number of equity warrants and the aggregate number of
shares of the equity security purchasable upon exercise of the
equity warrants;
•
if applicable, the designation and terms of the equity securities
with which the equity warrants are issued, and the number of equity
warrants issued with each equity security;
•
the date on which the right to exercise the equity warrants will
commence and the date on which the right will expire;
•
if applicable, the minimum or maximum number of the equity warrants
that may be exercised at any one time;
•
anti-dilution provisions of the equity warrants, if any;
•
redemption or call provisions, if any, applicable to the equity
warrants;
•
any additional terms of the equity warrants, including terms,
procedures and limitations relating to the exchange and exercise of
the equity warrants; and
•
the exercise price.
Holders of equity warrants will not be entitled, solely by virtue
of being holders, to vote, to receive dividends, to receive notice
as stockholders with respect to any meeting or written consent of
stockholders for the election of directors or any other matter, or
to exercise any rights whatsoever as a holder of the equity
securities purchasable upon exercise of the equity warrants.
Description of
Units
We may, from time to time, issue units comprised of one or more of
the other securities described in this prospectus in any
combination. A prospectus supplement will describe the specific
terms of the units offered under that prospectus supplement, and
any special considerations applicable to investing in those units.
You must look at the applicable prospectus supplement and any
applicable unit agreement for a full understanding of the specific
terms of any units. We will incorporate by reference into the
registration statement of which this prospectus is a part the form
of unit agreement, including a form of unit certificate, if any,
that describes the terms of the series of units we are offering
before the issuance of the related series of units. While the terms
we have summarized below will generally apply to any units that we
may offer in the future under this prospectus, we will describe the
particular terms of any series of units that we may offer in more
detail in the applicable prospectus supplement and incorporated
documents. The terms of any units offered under a prospectus
supplement may differ from the terms described below.
General
We may issue units consisting of common stock, preferred stock,
warrants or any combination thereof. Each unit will be issued so
that the holder of the unit is also the holder of each security
included in the unit. Thus, the holder of a unit will have the
rights and obligations of a holder of each included security. The
unit agreement under which a unit is issued may provide that the
securities included in the unit may not be held or transferred
separately, at any time, or at any time before a specified
date.
We will describe in the applicable prospectus supplement and any
incorporated documents the terms of the series of units, including
the following:
•
the designation and terms of the units and of the securities
comprising the units, including whether and under what
circumstances those securities may be held or transferred
separately;
•
any unit agreement under which the units will be issued; and
•
any provisions for the issuance, payment, settlement, transfer, or
exchange of the units or of the securities comprising the
units.
9
The provisions described in this section, as well as those
described under “Description of Common Stock,”
“Description of Preferred Stock,” and
“Description of Warrants” will apply to each unit and
to any common stock, preferred stock, or warrant included in each
unit, respectively.
Issuance in
Series
We may issue units in such amounts and in such numerous distinct
series as we determine.
Enforceability of Rights
by Holders of Units
Each unit agent will act solely as our agent under the applicable
unit agreement and will not assume any obligation or relationship
of agency or trust with any holder of any unit. A single bank or
trust company may act as unit agent for more than one series of
units. A unit agent will have no duty or responsibility in case of
any default by us under the applicable unit agreement or unit,
including any duty or responsibility to initiate any proceedings at
law or otherwise, or to make any demand upon us. Any holder of a
unit, without the consent of the related unit agent or the holder
of any other unit, may enforce by appropriate legal action its
rights as holder under any security included in the unit.
Title
We, the unit agent, and any of their agents may treat the
registered holder of any unit certificate as an absolute owner of
the units evidenced by that certificate for any purposes and as the
person entitled to exercise the rights attaching to the units so
requested, despite any notice to the contrary.
Description of
Subscription Rights
We may issue subscription rights to purchase common stock,
preferred stock, or other securities. These subscription rights may
be issued independently or together with any other security offered
hereby and may or may not be transferable by the stockholder
receiving the subscription rights in such offering. In connection
with any offering of subscription rights, we may enter into a
standby arrangement with one or more underwriters or other
purchasers pursuant to which the underwriters or other purchasers
may be required to purchase any securities remaining unsubscribed
for after such offering.
The applicable prospectus supplement will describe the specific
terms of any offering of subscription rights for which this
prospectus is being delivered, including the following:
•
the price, if any, for the subscription rights;
•
the exercise price payable for each share of common stock,
preferred stock, or other securities upon the exercise of the
subscription rights;
•
the number of subscription rights issued to each stockholder;
•
the number and terms of the shares of common stock, preferred
stock, or other securities which may be purchased per each
subscription right;
•
the extent to which the subscription rights are transferable;
•
any other terms of the subscription rights, including the terms,
procedures and limitations relating to the exchange and exercise of
the subscription rights;
•
the date on which the right to exercise the subscription rights
shall commence, and the date on which the subscription rights shall
expire;
•
the extent to which the subscription rights may include an
over-subscription privilege with respect to unsubscribed
securities; and
•
if applicable, the material terms of any standby underwriting or
purchase arrangement entered into by us in connection with the
offering of subscription rights.
10
The description in the applicable prospectus supplement of any
subscription rights we offer will not necessarily be complete and
will be qualified in its entirety by reference to the applicable
subscription rights certificate, which will be filed with the SEC
if we offer subscription rights. For more information on how you
can obtain copies of any subscription rights certificate if we
offer subscription rights, see “Where You Can Find More
Information”. We urge you to read the applicable subscription
rights certificate and any applicable prospectus supplement in
their entirety.
Anti-Takeover Effects of
Certain Provisions of Delaware Law and Our Charter
Documents
The following is a summary of our certificate of incorporation and
our bylaws. This summary does not purport to be complete and is
qualified in its entirety by reference to our certificate of
incorporation and bylaws. Our certificate of incorporation states
that we expressly elect not to be governed by Section 203 of the
General Corporation Law of the State of Delaware.
Our charter documents include provisions that may have the effect
of discouraging, delaying or preventing a change in control or an
unsolicited acquisition proposal that a stockholder might consider
favorable, including a proposal that might result in the payment of
a premium over the market price for the shares held by our
stockholders. These provisions are summarized in the following
paragraphs.
Effects of authorized
but unissued common stock and blank check preferred
stock.
One of the effects of the existence of
authorized but unissued common stock and undesignated preferred
stock may be to enable our board of directors to make more
difficult or to discourage an attempt to obtain control of our
company by means of a merger, tender offer, proxy contest or
otherwise, and thereby to protect the continuity of management. If,
in the due exercise of its fiduciary obligations, the board of
directors were to determine that a takeover proposal was not in our
best interest, such shares could be issued by the board of
directors without stockholder approval in one or more transactions
that might prevent or render more difficult or costly the
completion of the takeover transaction by diluting the voting or
other rights of the proposed acquirer or insurgent stockholder
group, by putting a substantial voting block in institutional or
other hands that might undertake to support the position of the
incumbent board of directors, by effecting an acquisition that
might complicate or preclude the takeover, or otherwise.
In addition, our certificate of incorporation grants our board of
directors broad power to establish the rights and preferences of
authorized and unissued shares of preferred stock. The issuance of
shares of preferred stock could decrease the amount of earnings and
assets available for distribution to holders of shares of common
stock. The issuance also may adversely affect the rights and
powers, including voting rights, of those holders and may have the
effect of delaying, deterring or preventing a change in control of
our company.
Cumulative
Voting.
Our certificate of incorporation does not
provide for cumulative voting in the election of directors which
would allow holders of less than a majority of the stock to elect
some directors.
Vacancies.
Section
223 of the Delaware General Corporation Law and our bylaws provide
that all vacancies, including newly created directorships, may be
filled by the affirmative vote of a majority of directors then in
office, even if less than a quorum.
Special Meeting of
Stockholders.
A special meeting of stockholders may be
called by our board of directors or the Chairman of our board of
directors and at the request in writing of holders of record of a
majority of our outstanding capital stock entitled to vote. The
requirement that a majority of our outstanding capital stock is
required to call a special meeting means that small stockholders
will not have the power to call a special meeting to, for example,
elect new directors.
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PLAN OF
DISTRIBUTION
We may offer and sell the securities in any one or more of the
following ways:
•
to or through underwriters, brokers or dealers;
•
directly to one or more other purchasers;
•
through a block trade in which the broker or dealer engaged to
handle the block trade will attempt to sell the securities as
agent, but may position and resell a portion of the block as
principal to facilitate the transaction;
•
through agents on a best-efforts basis;
•
in “at the market” offerings, as defined in Rule 415
under the Securities Act, at negotiated prices, at prices
prevailing at the time of sale or at prices related to such
prevailing market prices, including sales made directly on the
Nasdaq Capital Market or sales made through a market maker other
than on an exchange or other similar offerings through sales
agents; or
•
otherwise through any other method permitted by applicable law or a
combination of any of the above methods of sale.
In addition, we may enter into option, share lending or other types
of transactions that require us to deliver shares of common stock
to an underwriter, broker or dealer, who will then resell or
transfer the shares of common stock under this prospectus. We may
also enter into hedging transactions with respect to our
securities. For example, we may:
•
enter into transactions involving short sales of the shares of
common stock by underwriters, brokers or dealers;
•
sell shares of common stock short and deliver the shares to close
out short positions;
•
enter into option or other types of transactions that require the
delivery of shares of common stock to an underwriter, broker or
dealer, who will then resell or transfer the shares of common stock
under this prospectus; or
•
loan or pledge the shares of common stock to an underwriter, broker
or dealer, who may sell the loaned shares or, in the event of
default, sell the pledged shares.
We may enter into derivative transactions with third parties, or
sell securities not covered by this prospectus to third parties in
privately negotiated transactions. If the applicable prospectus
supplement indicates, in connection with those derivatives, the
third parties may sell securities covered by this prospectus and
the applicable prospectus supplement, including in short sale
transactions. If so, the third party may use securities pledged by
or borrowed from us or others to settle those sales or to close out
any related open borrowings of stock, and may use securities
received from us in settlement of those derivatives to close out
any related open borrowings of stock. The third party in such sale
transactions will be an underwriter and, if not identified in this
prospectus, will be identified in the applicable prospectus
supplement (or a post-effective amendment). In addition, we may
otherwise loan or pledge securities to a financial institution or
other third party that in turn may sell the securities short using
this prospectus. Such financial institution or other third party
may transfer its economic short position to investors in our
securities or in connection with a concurrent offering of other
securities.
Each time we sell securities, we will provide a prospectus
supplement that will name any underwriter, dealer or agent involved
in the offer and sale of the securities. Any prospectus supplement
will also set forth the terms of the offering, including:
•
the purchase price of the securities and the proceeds we will
receive from the sale of the securities;
•
any underwriting discounts and other items constituting
underwriters’ compensation;
•
any public offering or purchase price and any discounts or
commissions allowed or re-allowed or paid to dealers;
12
•
any commissions allowed or paid to agents;
•
any other offering expenses;
•
any securities exchanges on which the securities may be listed;
•
the method of distribution of the securities;
•
the terms of any agreement, arrangement or understanding entered
into with the underwriters, brokers or dealers; and
•
any other information we think is important.
If underwriters or dealers are used in the sale, the securities
will be acquired by the underwriters or dealers for their own
account. The securities may be sold from time to time by us in one
or more transactions:
•
at a fixed price or prices, which may be changed;
•
at market prices prevailing at the time of sale;
•
at prices related to such prevailing market prices;
•
at varying prices determined at the time of sale; or
•
at negotiated prices.
Such sales may be effected:
•
in transactions on any national securities exchange or quotation
service on which the securities may be listed or quoted at the time
of sale;
•
in transactions in the over-the-counter market;
•
in block transactions in which the broker or dealer so engaged will
attempt to sell the securities as agent but may position and resell
a portion of the block as principal to facilitate the transaction,
or in crosses, in which the same broker acts as an agent on both
sides of the trade;
•
through the writing of options; or
•
through other types of transactions.
The securities may be offered to the public either through
underwriting syndicates represented by one or more managing
underwriters or directly by one or more of such firms. Unless
otherwise set forth in the prospectus supplement, the obligations
of underwriters or dealers to purchase the securities offered will
be subject to certain conditions precedent and the underwriters or
dealers will be obligated to purchase all the offered securities if
any are purchased. Any public offering price and any discount or
concession allowed or reallowed or paid by underwriters or dealers
to other dealers may be changed from time to time.
The securities may be sold directly by us or through agents
designated by us from time to time. Any agent involved in the offer
or sale of the securities in respect of which this prospectus is
delivered will be named, and any commissions payable to such agent
will be set forth in, the prospectus supplement. Unless otherwise
indicated in the prospectus supplement, any such agent will be
acting on a best efforts basis for the period of its
appointment.
Offers to purchase the securities offered by this prospectus may be
solicited, and sales of the securities may be made by us directly
to institutional investors or others, who may be deemed to be
underwriters within the meaning of the Securities Act with respect
to any resale of the securities. The terms of any offer made in
this manner will be included in the prospectus supplement relating
to the offer.
Some of the underwriters, dealers or agents used by us in any
offering of securities under this prospectus may be customers of,
engage in transactions with, and perform services for us or
affiliates of ours in the ordinary course of business.
Underwriters, dealers, agents and other persons may be entitled to
indemnification against and contribution toward certain civil
liabilities, including liabilities under the Securities Act, and to
be reimbursed for certain expenses.
13
Subject to any restrictions relating to debt securities in bearer
form, any securities initially sold outside the United States may
be resold in the United States through underwriters, dealers or
otherwise.
Any underwriters to which offered securities are sold by us for
public offering and sale may engage in transactions that stabilize,
maintain or otherwise affect the price of the common shares during
and after this offering, but those underwriters will not be
obligated to do so and may discontinue any market making at any
time. Specifically, the underwriters may over-allot or otherwise
create a short position in the common shares for their own accounts
by selling more common stock than have been sold to them by us. The
underwriters may elect to cover any such short position by
purchasing common stock in the open market or by exercising the
over-allotment option granted to the underwriters. In addition, the
underwriters may stabilize or maintain the price of the common
stock by bidding for or purchasing common stock in the open market
and may impose penalty bids. If penalty bids are imposed, selling
concessions allowed to syndicate members or other broker-dealers
participating in the offering are reclaimed if common stock
previously distributed in the offering are repurchased, whether in
connection with stabilization transactions or otherwise. The effect
of these transactions may be to stabilize or maintain the market
price of the common stock at a level above that which might
otherwise prevail in the open market. The imposition of a penalty
bid may also affect the price of the common stock to the extent
that it discourages resales of the common stock. The magnitude or
effect of any stabilization or other transactions is uncertain.
These transactions may be effected on the Nasdaq Capital Market or
otherwise and, if commenced, may be discontinued at any time.
In connection with this offering, the underwriters and selling
group members may also engage in passive market making transactions
in our common stock. Passive market making consists of displaying
bids on the Nasdaq Capital Market limited by the prices of
independent market makers and effecting purchases limited by those
prices in response to order flow. Rule 103 of Regulation M
promulgated by the SEC limits the amount of net purchases that each
passive market maker may make and the displayed size of each bid.
Passive market making may stabilize the market price of the common
shares at a level above that which might otherwise prevail in the
open market and, if commenced, may be discontinued at any time.
We are subject to the applicable provisions of the Exchange Act and
the rules and regulations under the Exchange Act, including
Regulation M. This regulation may limit the timing of purchases and
sales of any of the shares of common stock offered in this
prospectus by any person. The anti-manipulation rules under the
Exchange Act may apply to sales of shares in the market and to the
activities of us.
The anticipated date of delivery of the securities offered by this
prospectus will be described in the applicable prospectus
supplement relating to the offering.
Any broker-dealer participating in the distribution of the shares
of common stock may be deemed to be an “underwriter”
within the meaning of the Securities Act with respect to any
securities such entity sells pursuant to this prospectus.
To comply with the securities laws of some states, if applicable,
the securities may be sold in these jurisdictions only through
registered or licensed brokers or dealers. In addition, in some
states the securities may not be sold unless they have been
registered or qualified for sale or an exemption from registration
or qualification requirements is available and is complied
with.
14
LEGAL MATTERS
The validity of the issuance of the securities offered hereby will
be passed upon for us by Mitchell Silberberg & Knupp LLP, 11377
W. Olympic Boulevard, Los Angeles, California.
EXPERTS
Rosenberg Rich Baker Berman & Company, independent registered
public accounting firm, has audited our consolidated financial
statements included in our Annual Report on Form 10-K for the year
ended December 31, 2015, as set forth in their report, which is
incorporated by reference in the prospectus and elsewhere in this
registration statement. Our consolidated financial statements for
the year ended December 31, 2015 are incorporated by reference in
reliance on Rosenberg Rich Baker Berman & Company’s
report, given on their authority as experts in accounting and
auditing. Mercadien, P.C., Certified Public Accountants,
independent registered public accounting firm, has audited our
consolidated financial statements included in our Annual Report on
Form 10-K for the year ended December 31, 2014, as set forth in
their report, which is incorporated by reference in the prospectus
and elsewhere in this registration statement. Our consolidated
financial statements for the year ended December 31, 2014 are
incorporated by reference in reliance on Mercadien, P.C.’s
report, given on their authority as experts in accounting and
auditing. EisnerAmper LLP, independent registered public accounting
firm, has audited the financial statements of Zone Technologies,
Inc. included in our Current Report on Form 8-K/A for the year
ended December 31, 2015, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the
registration statement in which this prospectus is included. The
financial statements of Zone Technologies, Inc. for the year ended
December 31, 2015 are incorporated by reference in reliance on
EisnerAmper LLP’s report, given on their authority as experts
in accounting and auditing.
WHERE YOU CAN FIND MORE
INFORMATION
We have filed with the SEC a registration statement on Form S-3
under the Securities Act, with respect to the securities covered by
this prospectus. This prospectus, which is a part of the
registration statement, does not contain all of the information set
forth in the registration statement or the exhibits and schedules
filed therewith. For further information with respect to us and the
securities covered by this prospectus, please see the registration
statement and the exhibits filed with the registration statement. A
copy of the registration statement and the exhibits filed with the
registration statement may be inspected without charge at the
Public Reference Room maintained by the SEC, located at 100 F
Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for more information about the operation of the
Public Reference Room. The SEC also maintains an Internet website
that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the
SEC. The address of the website is
http://www.sec.gov
.
We are subject to the information and periodic reporting
requirements of the Exchange Act and, in accordance therewith, we
file periodic reports, proxy statements and other information with
the SEC. Such periodic reports, proxy statements and other
information are available for inspection and copying at the Public
Reference Room and website of the SEC referred to above. We
maintain a website at
http://www.hmny.com
.
You may access our Annual Reports on Form 10-K, Quarterly Reports
on Form 10-Q, Current Reports on Form 8-K and amendments to those
reports filed pursuant to Sections 13(a) or 15(d) of the Exchange
Act with the SEC free of charge at our website as soon as
reasonably practicable after such material is electronically filed
with, or furnished to, the SEC. Our website and the information
contained on that site, or connected to that site, are not
incorporated into and are not a part of this prospectus.
15
INFORMATION INCORPORATED
BY REFERENCE
The SEC and applicable law permits us to “incorporate by
reference” into this prospectus information that we have or
may in the future file with or furnish to the SEC. This means that
we can disclose important information by referring you to those
documents. You should read carefully the information incorporated
herein by reference because it is an important part of this
prospectus. We hereby incorporate by reference the following
documents into this prospectus:
•
Our Annual Report on Form 10-K for the fiscal year ended December
31, 2015, as filed with the SEC on March 28, 2016;
•
Amendment No. 1 to our Annual Report on Form 10-K for the fiscal
year ended December 31, 2015, as filed with the SEC on April 29,
2016;
•
Our Quarterly Reports on Form 10-Q for the quarters ended March 31,
2016 and June 30, 2016, as filed with the SEC on May 16, 2016 and
August 15, 2016, respectively;
•
Our Current Reports on Form 8-K filed with the SEC on March 4,
2016, March 10, 2016, April 6, 2016, May 25, 2016, June 6, 2016
(other than the portions of such filings that were furnished rather
than filed), July 12, 2016 (other than the portions of the filing
that were furnished rather than filed), as amended on September 20,
2016, July 20, 2016, July 26, 2016 (other than the portions of the
filing that were furnished rather than filed), August 31, 2016,
September 8, 2016, and September 22, 2016.
•
The description of our common stock included in our Current Report
on Form 8-K filed with the SEC on July 12, 2016.
Additionally, all documents filed by us with the SEC under Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act (other than any
portions of filings that are furnished rather than filed pursuant
to Items 2.02 and 7.01 of a Current Report on Form 8-K), after the
date of this prospectus and before the termination or completion of
this offering (including all such documents filed with the SEC
after the date of the initial registration statement and prior to
the effectiveness of the registration statement) shall be deemed to
be incorporated by reference into this prospectus from the
respective dates of filing of such documents. Any information that
we subsequently file with the SEC that is incorporated by reference
as described above will automatically update and supersede any
previous information that is part of this prospectus.
Upon written or oral request, we will provide you without charge, a
copy of any or all of the documents incorporated by reference,
other than exhibits to those documents unless the exhibits are
specifically incorporated by reference in the documents. Please
send requests to Helios and Matheson Analytics Inc., Attn: Chief
Executive Officer, The Empire State Building, 350 Fifth Avenue, New
York, New York 10118, telephone number is (212) 979-8228.
16
HELIOS AND MATHESON ANALYTICS
INC.
8,261,539
Series A Units consisting of One Share of Common Stock and One Series A
Warrant to Purchase
One Share of Common
Stock
969,230
Series B Units consisting of One Pre-Funded Series B Warrant to
Purchase One Share of Common Stock and One Series A Warrant to
Purchase One Share of Common Stock
______________
PROSPECTUS
SUPPLEMENT
______________
Sole Bookrunner
Canaccord Genuity
Co-Manager
Maxim
Group LLC