MoviePass Parent Seeks $1.2 Billion Amid Cash Crunch

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The parent company to movie ticket subscription provider MoviePass, Helios and Matheson Analytics (HMNY), has now filed a statement with the Securities and Exchange Commission (SEC) which could net the company up to $1.2 billion. That's according to a recent announcement from the firm and follows substantial money troubles for the tech company. If the SEC approves the universal shelf registration statement, HMNY would be granted the ability to effectively sell off equity and debt securities over a three year period. The company says it would then have the 'flexibility' to offer common stock, preferred stock, debt securities, warrants, subscription rights, units or a combination of those on an as-needed basis. Details of those would be presented when and if the company decides to take advantage of the shelf registration.

There are no guarantees HMNY would be able to raise up to the limit of $1.2 billion but the move would serve as a buffer. The purpose of that would be to enable stability as it works toward growth, particularly where MoviePass and associated properties are concerned. The company's prior business model had been responsible for significant downturns in profitability, resulting in losses. In response, HMNY and MoviePass have taken steps to adjust its business model over the past few months. Most recently, the company increased pricing for specific movie passes during peak operating times. That was followed by a new deal with Samsung which gave new owners of the Samsung Galaxy S9 devices access to two MoviePass one-year subscriptions. Both of those new strategies have happened within the past month, indicating that HMNY is actively pursuing changes to how it operates in order to address problems with MoviePass. More changes are likely on the horizon if and when the SEC declares the shelf registration statement effective.

In the meantime, any sales stemming from the shelf registration statement will need to pass through Helios and Matheson's stockholders first. Specifically, HMNY says that an 'affirmative vote' of stockholders will be required at an upcoming meeting set to increase authorized common stock or 'effect a combination of outstanding common stock.' So with or without the approval of the SEC, MoviePass is still facing a relatively high level of uncertainty for the time being.

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