Summary

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7		-==== Business Overview ====
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9	9	The company provide high quality information technology, or IT, services and solutions including a range of technology platforms focusing on big data, business intelligence, and consumer-centric technology. More recently, to provide greater value to stockholders, the Company has sought to expand its business primarily through acquisitions that leverage its capabilities and expertise.
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11	11	As of March 31, 2018, the Company owned 81.2%, and as of the date of this report the Company owns 91.8%, of the outstanding shares of MoviePass (excluding outstanding MoviePass options and warrants). MoviePass is the premiere movie theater subscription service in the United States which provides its subscribers the ability to view up to one new movie title per day for one monthly subscription price. The company's more than 2 million subscribers have access to see films in over 91% of U.S movie theaters.
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43	43	Lastly, MoviePass Ventures, the Company’s wholly-owned subsidiary, has consummated two strategic transactions in films: “American Animals” and “Gotti”. Through these two transactions, MoviePass Ventures is entitled to participate in revenues from the theatrical window, rentals and other downstream and ancillary revenue streams: subscription-video-on-demand (SVOD), transactional-video-on-demand (TVOD), airline, and foreign sales. The Company expects that these transactions will also result in paid marketing services arrangements for MoviePass. MoviePass Ventures' investments in American Animals and Gotti have garnered international media attention and the company believe, continue to bolster MoviePass' brand recognition.
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45		-==== Recent Developments ====
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47	47	In January 2018, pursuant to a securities purchase agreement entered into by the Company and an institutional investor (the “Investor”), the company sold and issued senior convertible notes in the aggregate principal amount of $60,000,000, consisting of (i) a Series A-1 Senior Bridge Subordinated Convertible Note in the aggregate principal amount of $25,000,000 and (ii) a Series B-1 Senior Secured Bridge Convertible Note in the aggregate principal amount of $35,000,000 for consideration consisting of (i) a cash payment in the aggregate amount of $25,000,000, and (ii) a secured promissory note payable by the Investor to the Company in the aggregate principal amount of $35,000,000.
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59	59	The above discussion does not purport to be a complete description of the Purchase Agreement, Lock-Up Agreement or Registration Rights Agreement and is qualified in its entirety by reference to the full text of the Purchase Agreement, Lock-Up Agreement and Registration Agreement.
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61		-==== Future Liquidity and Capital Resources ====
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63	63	The company's primary sources of liquidity are cash on hand, proceeds from subscription revenues and proceeds from its equity offerings. As of March 31, 2018 the company had cash on hand of $42.5 million and approximately $24.4 million in accounts receivable mostly related to subscription revenues. In addition, in the three months ended March 31, 2018 the company issued common stock and warrant units and received proceeds of approximately $96.9 million, net of associated expenses. The company filed with the SEC, and the SEC declared effective, a universal shelf registration statement of up to $400.0 million worth of registered equity securities, of which the company utilized approximately $105.0 million and $30.3 million in offerings in February and April of 2018, respectively. Under this effective registration statement, the company may issue registered securities, from time to time, in one or more separate offerings or other transactions with the size, price and terms to be determined at the time of issuance. In April 2018, the company entered into an Equity Distribution Agreement (the “Sales Agreement”) with Canaccord Genuity LLC (“Canaccord”) pursuant to which the company may issue and sell from time to time shares of Common Stock having aggregate sales proceeds of up to $150.0 million through an “at the market” equity offering program under which Canaccord acts as its sales agent. Helios and Matheson Analytics is required to pay Canaccord a commission of 5% of the gross proceeds from the sale of shares of Common Stock under the Sales Agreement.
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73	73	The Company has experienced net losses and significant cash outflows from cash used in operating activities over periods presented in this report. As of and for the three months ended March 31, 2018, the Company had an accumulated deficit of $184.3 million, a loss from operations of $107.7 million, and net cash used in operating activities of $68.4 million. As of and for the three months ended March 31, 2017, the Company had an accumulated deficit of $49.8 million, a loss from operations of $4.4 million, and net cash used in operating activities of $2.5 million.
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75	75	The Company expects to continue to incur net losses and have significant cash outflows for at least the next twelve months. The attainment of profitable operations is dependent on future events, including obtaining adequate financing to fulfill the Company’s growth and operating activities and generating a level of revenues adequate to support the Company’s cost structure. Management has evaluated the significance of the conditions described above in relation to the Company’s ability to meet its obligations and concluded that, without additional funding, the Company will not have sufficient funds to meet its obligations within one year from the date the condensed consolidated financial statements were issued. These factors raise substantial doubt about the Company’s ability to continue as a going concern. While management plans to raise additional capital from sources such as sales of its debt or equity securities or loans in order to meet operating cash requirements, there is no assurance that management’s plans will be successful.
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