Item
1.01
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Entry
into a Material Definitive Agreement.
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On December 13, 2017,
Helios and Matheson Analytics Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting
Agreement”) with Canaccord Genuity Inc., on behalf of itself and as representative of the underwriters named therein (the
“Underwriters”), pursuant to which the Company agreed to issue and sell to the Underwriters in a best-efforts underwritten
public offering (the “Offering”) of up to approximately $60 million in gross proceeds of securities of the Company
including (A) 8,261,539 Series A units (the “Series A Units”), with each Series A Unit consisting of (i) one share
(the “Shares”) of the Company’s common stock, par value $0.01 per share (the “Common Stock”), and
(ii) one Series A warrant to purchase one share of Common Stock (the “Series A Warrants”); and for those purchasers
whose purchase of Series A Units would result in the purchaser, together with its affiliates and certain related parties, beneficially
owning more than 9.99% of the Company’s outstanding Common Stock following the consummation of the Offering, (B) 969,230
Series B units (the “Series B Units”, and together with the “Series A Units”, the “Units”),
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 Shares, Series A Warrants and
Series B Warrants are immediately separable. The Units were sold at a price to the public equal to $6.50 per Unit.
Each Series A Warrant
will be initially exercisable on the first trading day following the one year anniversary of the date of issuance (the “Initial
Exercisability Date”) and will expire five years from the date such Series A Warrant is 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 Common Stock, subject to adjustment. Each Series B Warrant
will have an aggregate exercise price of $6.50 per share of Common Stock, all of which will be pre-funded except for a nominal
exercise price of $0.001 per share of Common Stock, subject to adjustment. The Warrants will not be listed on The Nasdaq Capital
Market or any other securities exchange.
The Company
expects to issue and deliver the securities sold in the Offering to the Underwriters against payment therefore on or about
December 15, 2017, subject to the satisfaction of customary closing conditions. The Company expects to receive approximately
$55,490,000 in net proceeds from the sale of the Units, after deducting underwriting discounts and
commissions equal to $3.54 million and estimated offering expenses of approximately $250,000 assuming no exercise of the
Warrants. In addition, Palladium Capital Advisors, LLC acted as financial advisor in connection with the Offering and will
receive a financial advisory fee equal to $720,000. The Company intends to use the net proceeds of the Offering to increase
the Company’s ownership stake in MoviePass Inc., its majority-owned subsidiary (“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.
The exercise price
of and number of shares of Common Stock underlying the Warrants are subject to adjustment upon the issuance by the Company of stock
dividends, stock splits, and other corporate events. In addition, the Series A Warrants are subject to adjustment of the applicable
exercise price then in effect, if, as of the Initial Exercisability Date, the quotient determined by dividing (x) the sum of the
VWAP (as defined in the Series A Warrants) of the Common Stock for each trading day during the ten (10) consecutive trading day
period ending and including the trading day immediately preceding the Initial Exercisability Date, divided by (y) ten (10) (all
such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction
during such period) (the “Adjustment Price”), is less than the applicable exercise price. If the Adjustment Price is
less than the applicable exercise price as of the Initial Exercisability Date, then the exercise price shall be automatically adjusted
to be equal to the Adjustment Price.
Holders
of the Warrants shall be entitled to any purchase rights granted to Common Stock holders and the Company shall not enter into
any fundamental transaction unless the successor entity assumes the obligations of the Company under the Warrants. Notwithstanding,
in the event of a fundamental transaction, as described in the Warrants and generally including any merger with or into another
entity, sale of all or substantially all of the Company’s assets, tender offer or exchange offer, or reclassification of
Common Stock, the Company or any successor entity will pay, at the holder’s option, an amount of cash equal to the value
of the Warrant as determined in accordance with the Black Scholes option pricing model and the terms of the Warrants. The terms
of the Warrants prohibit a holder from exercising its Warrants if doing so would result in such holder (together with its affiliates
and other persons acting as a group) beneficially owning more than 4.99%, or if elected by the holder, 9.99%, of the outstanding
shares of Common Stock after giving effect to such exercise.
If, a registration
statement relating to the issuance of the shares underlying the Warrants is not effective or available, the Warrants may be exercised
on a cashless basis. No fractional shares of Common Stock will be issued in connection with the exercise of a Warrant. In lieu
of a fractional share, the Company will round up to the next whole share.
The Offering is being
made pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-212550), which was declared effective
by the Securities and Exchange Commission (the “SEC”) on September 30, 2016 and the related registration statement
(File No. 333-222015) filed on December 13, 2017 in accordance with Rule 462(b) of the Securities Act of 1933, as amended. A preliminary
prospectus supplement and the accompanying prospectus relating to the Offering was filed with the SEC on December 12, 2017, and
a final prospectus supplement and the accompanying prospectus relating the Offering will be filed with the SEC on or about December
13, 2017.
The Underwriting Agreement
is included as an exhibit to this Current Report on Form 8-K (this “Current Report”) to provide investors and security
holders with information regarding its terms. It is not intended to provide any other factual information about the Company. The
representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such agreement
and as of specific dates, were solely for the benefit of the parties to the Underwriting Agreement, and may be subject to limitations
agreed upon by the parties, including being qualified by confidential disclosures exchanged between the parties in connection with
the execution of the Underwriting Agreement.
The Underwriting Agreement,
form of Series A Warrant and form of Series B Warrant are filed herewith as Exhibits 1.1, 4.1 and 4.2, respectively, and are incorporated
herein by reference. The foregoing description of the Underwriting Agreement, the Series A Warrants and the Series B Warrants does
not purport to be complete and is qualified in its entirety by reference to such exhibits.
The legal opinion,
including the related consent, of Mitchell Silberberg & Knupp LLP is filed as Exhibit 5.1 and 23.1 to this Current Report.
This
Current Report contains forward-looking statements that involve risk and uncertainties, such as statements related to the anticipated
closing of the Offering and the amount of net proceeds expected from the Offering. The risks and uncertainties involved include
the Company’s ability to satisfy certain conditions to closing on a timely basis or at all, as well as other risks detailed
from time to time in the Company’s SEC filings.