Helios and Matheson Analytics (HMNY) DEF 14A Definitive proxy

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. ___)

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HELIOS & MATHESON NORTH AMERICA INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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April 30, 2009

Dear Shareholder:

You are cordially invited to attend Helios & Matheson North America Inc.’s Annual Meeting on May 28, 2009. The meeting will begin promptly at 10:00 a.m. at the offices of the Company’s counsel, Davis Polk & Wardwell, at 450 Lexington Avenue, New York, New York 10017.

The official Notice of Annual Meeting of Shareholders, proxy statement, proxy card and return envelope are included with this letter. Also enclosed is the Helios & Matheson North America Inc.’s Annual Report to shareholders for the year ended December 31, 2008. The matters listed in the Notice of the Annual Meeting of Shareholders are described in detail in the proxy statement.

The vote of every shareholder is important. Please review carefully the enclosed materials and then sign, date and promptly mail your proxy. If you sign and return your proxy card without giving any instruction, it will be voted as the Board of Directors recommends.

The Board of Directors and management look forward to greeting those shareholders who are able to attend.

Sincerely,

HELIOS & MATHESON NORTH AMERICA INC.
 

/s/ SALVATORE M. QUADRINO  

Salvatore M. Quadrino,Interim Chief Executive Officer and Chief Financial Officer

HELIOS & MATHESON NORTH AMERICA INC.
200 PARK AVENUE SOUTH
NEW YORK, NEW YORK 10003

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 28, 2009

To the Shareholders of HELIOS & MATHESON NORTH AMERICA INC.

PLEASE TAKE NOTICE that the Annual Meeting of Shareholders of Helios & Matheson North America Inc. (“Helios & Matheson” or the “Company”) will be held at 10:00 a.m. (local time), on May 28, 2009, at the offices of the Company’s counsel, Davis Polk & Wardwell, at 450 Lexington Avenue, New York, New York 10017 for the following purposes:

1. To elect the Board of Directors of the Company to serve until the Annual Meeting of Shareholders in 2010 and until their respective successors are duly elected and qualified;

2. To ratify the appointment of Mercadien P.C. as the independent auditor of the Company for the year ending December 31, 2009.

Only shareholders of record at the close of business on April 30, 2009 are entitled to notice of and to vote at this meeting and any adjournment or postponement thereof.

You may vote in person or by proxy. You may cast your vote by dating and signing the enclosed proxy exactly as your name appears thereon and promptly returning such proxy in the envelope provided. If you sign and return your proxy card without giving any instruction, it will be voted as the Board of Directors recommends.

You may revoke your proxy by voting in person at the meeting, by written notice to the interim Secretary of the Company or by executing and delivering a later-dated proxy by mail, prior to the closing of the polls. Attendance at the meeting does not by itself constitute revocation of a proxy. All shares that are entitled to vote and are represented by properly completed proxies timely received and not revoked will be voted as you direct. If you sign and return your proxy card without giving any instruction, it will be voted as the Board of Directors recommends.

You are cordially invited to attend the meeting. Whether or not you plan to attend the meeting, please complete, sign, date and return the enclosed proxy card promptly. This proxy statement and the accompanying form of proxy, together with the Company’s 2008 Annual Report to shareholders, are being mailed to shareholders on or about May 11, 2009. Your cooperation is appreciated since a majority of the outstanding shares entitled to vote must be represented, either in person or by proxy, to constitute a quorum for the purposes of conducting business at the meeting.

BY ORDER OF THE BOARD OF DIRECTORS
By:	/s/ Roxanne Weisbrot
	Roxanne Weisbrot
	Interim Secretary

New York, New York
April 30, 2009

TABLE OF CONTENTS

	Page
GENERAL INFORMATION		1
PROPOSAL 1: ELECTION OF DIRECTORS		3
CORPORATE GOVERNANCE		5
PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		11
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE		12
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE		12
INTERESTS OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON		12
COMPENSATION DISCUSSION AND ANALYSIS		13
Introduction		13
Compensation Objectives		13
Compensation Process		14
Primary Elements of Compensation		14
Employment Agreements		14
Impact of Tax and Accounting		15
DIRECTOR AND EXECUTIVE OFFICER COMPENSATION		15
Executive Officers		15
Summary Compensation Table for 2008 and 2007		17
Option Exercises for 2008		18
Outstanding Equity Awards at Fiscal Year End for 2008		18
Employment Agreements and Potential Post-Employment Payments and Benefits		19
Equity Compensation Plan Information		21
Director Compensation		21
SHAREHOLDER PROPOSALS		22
OTHER BUSINESS		22
MULTIPLE SHAREHOLDERS SHARING ONE ADDRESS		22

HELIOS & MATHESON NORTH AMERICA INC.
200 PARK AVENUE SOUTH
NEW YORK, NEW YORK 10003
(212) 979-8228

PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
To be Held on May 28, 2009

This proxy statement and the accompanying form of proxy are furnished in connection with the solicitation of proxies by the Board of Directors (the “Board of Directors”) of Helios & Matheson North America Inc., a New York corporation (“Helios & Matheson” or the “Company”), to be voted at its Annual Meeting of Shareholders which will be held at 10:00 a.m. (local time), on May 28, 2009 at the offices of the Company’s counsel, Davis Polk & Wardwell, at 450 Lexington Avenue, New York, New York 10017 and at any postponements or adjournments thereof (the “Annual Meeting”).

At the Annual Meeting, the Company’s shareholders will be asked (i) to elect Messrs. Rabin K. Dhoble, Daniel L. Thomas, Shri S. Jambunathan, Kishan Grama Ananthram, and Ms. Divya Ramachandran as directors of the Company to serve until the Annual Meeting of Shareholders in 2010 and until their respective successors are duly elected and qualified, and (ii) to ratify the appointment of Mercadien P.C. as the Company’s independent auditor for the year ending December 31, 2009.

This proxy statement and the accompanying form of proxy, together with the Company’s 2008 Annual Report to shareholders, are being mailed to shareholders on or about May 11, 2009.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be Held on May 28, 2009:

This proxy statement and the Company’s 2008 Annual Report to Shareholders are available for viewing, printing and downloading at www.hmna.com/About Helios & Matheson.

Copies of the Company’s Annual Report on Forms 10-K for the fiscal year ended December 31, 2008, as filed with the Securities and Exchange Commission (“SEC”), will be furnished without charge to any stockholder upon written request to Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, New Jersey, 07066, Attention: Ms. Roxanne Weisbrot, Interim Secretary. This proxy statement and the Company’s 2008 Annual Report on Forms 10-K for the fiscal year ended December 31, 2008 are also available on the SEC’s website at www.sec.gov.

GENERAL INFORMATION

PROXY SOLICITATION

Proxies may be solicited by mail, personal interview, telephone and facsimile transmission, and by directors, officers and employees of the Company (without special compensation). Since the Company is making this solicitation the expenses for the preparation of proxy materials and the solicitation of proxies for the Annual Meeting will be paid by the Company. The Company has retained Mellon Investor Services to assist in the solicitation. Expenses for the solicitation are estimated to be approximately $5,000 plus other reasonable expenses.

In accordance with the regulations of the Securities and Exchange Commission, the Company will reimburse, upon request, banks, brokers and other institutions, nominees and fiduciaries for their expenses incurred in sending proxies and proxy materials to the beneficial owners of the Company’s common stock.

REVOKING YOUR PROXY

A shareholder may revoke a proxy at any time before it is exercised by one of the three following ways:

• By filing with the interim Secretary of the Company a written revocation to the attention of Ms. Roxanne Weisbrot, Interim Secretary, Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, New Jersey 07066, Telephone: (732) 499-8228. We must receive your written revocation before the time of the Annual Meeting;

• By submitting a duly executed proxy bearing a later date than your original proxy. We must receive such later dated proxy before the time of the Annual Meeting; or

• By voting in person at the meeting. However, attendance at the Annual Meeting does not by itself constitute revocation of a proxy. A shareholder who holds shares through a broker or other nominee must bring a legal proxy ballot to the meeting if that shareholder desires to vote at the meeting.

VOTING YOUR SHARES

Shares represented by each properly executed and returned proxy card will be voted (unless earlier revoked) in accordance with the instructions indicated. If no instructions are indicated on the proxy card, all shares represented by valid proxies received pursuant to this solicitation (and not revoked before they are voted) will be voted “FOR” the election of the nominees for director named herein and “FOR” the ratification of the Company’s independent auditor.

Under the Company’s By-Laws, the presence at the Annual Meeting, in person or by duly authorized proxy, of the holders of a majority of the total number of outstanding shares of common stock, voting as a single class, entitled to vote, constitutes a quorum for the transaction of business. Shares of our common stock represented in person or by proxy (regardless of whether the proxy has authority to vote on all matters), as well as abstentions and broker non-votes, will be counted for purposes of determining whether a quorum is present at the meeting.

An “abstention” is the voluntary act of not voting by a stockholder who is present at a meeting and entitled to vote. “Broker non-votes” are shares of voting stock held in record name by brokers and nominees concerning which: instructions have not been received from the beneficial owners or persons entitled to vote, and (i) the broker or nominee does not have discretionary voting power under applicable rules or the instrument under which it serves in such capacity or (ii) the record holder has indicated on the proxy or has executed a proxy and otherwise notified us that it does not have authority to vote such shares on that matter.

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VOTES REQUIRED FOR APPROVAL

Shares Entitled to Vote.Only holders of record of the Company’s common stock at the close of business on April 30, 2009 (the “Record Date”) are entitled to notice, to attend and to vote at the Annual Meeting with each share entitled to one vote. As of the close of business on April 30, 2009, the Company had 2,396,707 shares of common stock outstanding.

Quorum.New York’s Business Corporation Law and the Company’s By-Laws provide that, a quorum being present, nominees for the office of director are to be elected by a plurality of votes cast at the meeting by holders of shares represented either in person or by proxy entitled to vote in the election. Only shares affirmatively voted in favor of a nominee will be counted toward the achievement of a plurality. Votes withheld (including broker non-votes) are counted as present for the purpose of determining a quorum but are not counted as votes cast in determining a plurality.

Votes Required.The votes required on each of the proposals are as follows:

Proposal 1: Election of Directors	The five nominees for director who receive the most votes will be elected. This is called a “plurality”. If you indicate “withhold authority to vote” for a particular nominee on your proxy card, your vote will not count either for or against the nominee.
Proposal 2: Ratification of Selection of Independent Registered Public Accounting Firm	The affirmative vote of a majority of the votes cast at the Annual Meeting is required to ratify the Audit Committee’s selection of the independent registered public accounting firm. If you abstain from voting, your abstention will not count as a vote cast for or against the proposal.

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PROPOSAL 1

ELECTION OF DIRECTORS

Pursuant to the Company’s By-Laws, the Board of Directors shall be comprised of not less than three and not more than twelve directors. The exact number of directors shall be set by a resolution of the Board of Directors. On March 18, 2008, the Board of Directors established the size of the Board at five members. At each Annual Meeting of Shareholders, directors shall be elected for the ensuing year.

Each director will be elected to serve for a one-year term, unless he/she resigns or is removed before his term expires, or until his replacement is elected and qualified. Each of the nominees listed are currently a member of the Board of Directors and each of them has consented to serve as a director if elected. There is detailed information about each of the nominees available in the section of this proxy statement titled “Nominees Standing for Election”.

If any of the nominees cannot serve for any reason, the Board of Directors may designate a substitute nominee or nominees. If a substitute is nominated, we will vote all valid proxies for the election of the substitute nominee or nominees. Alternatively, the Board of Directors may also decide to leave the Board seat or seats open until a suitable candidate or candidates are nominated, or it may decide to reduce the size of the Board.

Nominees Standing for Election

The following nominees are standing for election to serve as directors until the Annual Meeting of Shareholders in 2010 and until their respective successors are duly elected and qualified:

Name	Age		Position
Shri S. Jambunathan		70	Chairman and Director
Daniel L. Thomas		59	Director
Rabin K. Dhoble		47	Director
Kishan Grama Ananthram		45	Director
Divya Ramachandran		29	Director

Srinivasaiyer (“Shri”) S. Jambunathanhas been a director of the Company since August 22, 2006 and Chairman of the Board since April 1, 2008. Mr. Jambunathan was named Vice Chairman of the Board of Directors on November 8, 2006 and Lead Director on April 25, 2007. Mr. Jambunathan is the Chairman of the Nominating and Corporate Governance Committee and the Executive Committee as well as a member of the Audit Committee. Mr. Jambunathan is a director for Patel Engineering Company Limited and Inventure Growth and Securities Private Limited, Mumbai. Since January 2001, Mr. Jambunathan has served as non-executive Chairman of First Policy Insurance Pvt. Ltd. From November 2003 to May 2007, Mr. Jambunathan was a director of JSW Steel Ltd. Mr. Jambunathan served as a director of the Bombay Stock Exchange, and thereafter, Bombay Stock Exchange Limited for a total period of six years until 2006. Mr. Jambunathan was also the non-executive Chairman of Bombay Stock Exchange from March 2003 to August 2005. From March 2005 to August 2005 Mr. Jambunathan also served as non-executive Chairman of Provogue India Ltd., a men’s designer wear and fashion apparel company. Mr. Jambunathan was Chairman of the local Advisory Board, State Bank of Mauritius from 1996 to 2001.

Daniel L. Thomashas been a director of the Company since June 5, 2006. Mr. Thomas is the Chairman of the Audit Committee, as well as a member of the Executive Committee, the Nominating and Corporate Governance Committee and the Transformation Committee. Mr. Thomas has over 30 years of public accounting and financial experience. Mr. Thomas is currently a partner with Thomas & Associates, a CPA firm, which he started in February 2002. From October 1999 to February 2002 he was the Audit Partner in Charge with Corbin & Wertz, a CPA firm. Mr. Thomas’ experience includes part-time CFO services, fraud prevention and investigation, acquisition consulting, transaction due diligence, internal control review and systems implementation. Mr. Thomas is a Certified Public Accountant and a Certified Fraud Examiner. Mr. Thomas is the past president of the Orange County Chapter of the Association of Certified Fraud Examiners and he has served on the Board of Directors for the Orange County Head Start program. Mr. Thomas also spent five years as a Reserve Deputy Sheriff for the Orange County Sheriff’s Department.

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Rabin K. Dhoblehas been a director of the Company since February 2006. Mr. Dhoble is a member of the Audit Committee, the Compensation Committee, the Executive Committee and the Transformation Committee. Mr. Dhoble is currently the President of Diversified Agency Services Healthcare, Omnicom. Since 1998, Mr. Dhoble has been a senior executive within the healthcare communications practice of Diversified Agency Services, the specialty communications unit of Omnicom Group. Mr. Dhoble specializes in the development of business strategies and the management of cross-functional teams that support the global commercialization of biotechnology and pharmaceutical brands.

Kishan Grama Ananthramhas been a director of the Company since August 22, 2006. Mr. Ananthram is the Chairman of the Compensation Committee, the Chairman of the Transformation Committee and a member of the Executive Committee. Mr. Ananthram has served as the Founder, Chairman and Chief Executive Officer of IonIdea, Inc., a software product and engineering outsourcing company since January 1994. Mr. Ananthram has over 20 years of entrepreneurial, management, sales and technology experience. Prior to founding IonIdea, Inc. Mr. Ananthram held various technical and management positions with NUS, Sprint, GTE, Fannie Mae and Hughes.

Divya Ramachandranhas been a director of the Company since August 22, 2006. Ms. Ramachandran is a member of the Executive Committee, the Nominating and Corporate Governance Committee, the Compensation Committee and the Transformation Committee. Since February 2004, Ms. Ramachandran has been an Associate Vice President at Helios & Matheson Information Technology Ltd., the parent of the Company, focusing on mergers and acquisitions. From June 2003 to January 2004, Ms. Ramachandran was Program Director for General Management Programs at the Indian School of Business. From July 2002 to January 2003, Ms. Ramachandran was a Senior Manager, Strategy and Restructuring Cell for Lupin Limited, one of India’s leading pharmaceutical companies. From June 2000 to 2001, Ms. Ramachandran was an associate with Arthur Andersen LLP.

Voting Requirements to Adopt the Proposal

The affirmative vote of the holders of a plurality of the outstanding shares of our common stock who are present in person or represented by proxy and entitled to vote at the Annual Meeting is required to approve Proposal No. 1.

Recommendation

The Nominating Committee has nominated each of the director nominees set forth in Proposal 1. The Board of Directors recommends that shareholders voteFOReach of the nominees.

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CORPORATE GOVERNANCE

Board of Directors Meetings and Committees

During the year ended December 31, 2008, the Board of Directors met five times, including regular and special meetings. The Board of Directors has an Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, an Executive Committee and a Transformation Committee. During 2008, the Audit Committee held four meetings, the Nominating and Corporate Governance Committee held one meeting, the Compensation Committee held two meetings and the Executive Committee held fourteen meetings. The Transformation Committee was formed on April 7, 2008 and held seven meetings during 2008. During 2008, each director, except for Messr. Ananthram and Ms. Ramachandran, attended 75% or more of the aggregate number of meetings of the Board of Directors and committees on which such directors served. During 2008, Messr. Ananthram attended 68% and Ms. Ramachandran attended 66% of the aggregate number of meetings of the Board of Directors and committees on which they served. Each of the committees of the Board of Directors, except for the Transformation Committee, acts pursuant to a separate written charter adopted by the Board of Directors.

It is anticipated that each member of the Board of Directors will attend the Company’s 2009 Annual Meeting of Shareholders. At the Company’s 2008 Annual Meeting of Shareholders, three of the five directors were in attendance. The Company does not have a formal policy with respect to directors’ attendance at the Annual Meeting of Shareholders.

Controlled Company

On March 30, 2006, Helios & Matheson Information Technology Ltd. (“Helios & Matheson Parent”), an IT services organization with its corporate headquarters in Chennai, India, purchased 1,024,697 shares of the Company’s common stock from Mr. BenTov and his family members, which represented approximately 43% of the Company’s outstanding common stock. On September 5, 2006, Helios & Matheson Parent increased their ownership to approximately 52%. Helios & Matheson Parent is a publicly listed company on three stock exchanges in India, the National Stock Exchange (NSE), the Stock Exchange Mumbai (BSE) and Madras Stock Exchange (MSE), and is included in the Bombay Stock Exchange 500 Stock Index.

The Board of Directors has determined that Helios & Matheson is a “Controlled Company” for purposes of the NASDAQ listing requirements. A “Controlled Company” is 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: (i) that a majority of its Board of Directors must be comprised of “independent” directors as defined in NASDAQ’s rules; and (ii) that 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. The Board of Directors has determined that Helios & Matheson is a “Controlled Company” based on the fact that Helios & Matheson Parent holds more than 50% of the voting power of the Company.

Independent Directors

Upon consideration of the criteria and requirements regarding director independence set forth in NASDAQ Rule 5605, the Board of Directors has determined that each of Messrs. Jambunathan, Thomas and Dhoble meet NASDAQ independence standards.

Audit Committee

Audit Committee.The Audit Committee is authorized to engage the Company’s independent auditor and review with such auditors (i) the scope and timing of their audit services and any other services they are asked to perform, (ii) their report on the Company’s financial statements following completion of their audit and (iii) the Company’s policies and procedures with respect to internal accounting and financial controls. As of April 30, 2009, the Audit Committee is comprised of Messrs. Thomas (Chairman), Dhoble and Jambunathan. The Board of Directors has determined that Mr. Thomas qualifies as an “audit committee financial expert.” The Board of Directors has determined that each of the members of the Audit Committee is independent (as independence is defined in NASDAQ Rule 5605(a)(2) and in Rule 10A-3(b)(1) of the Securities and Exchange Act of 1934, as amended). During the year ended December 31, 2008, the Audit Committee held four meetings. The Audit Committee Charter is posted at the Company’s website, www.hmna.com, under Corporate — Investors. Any person may obtain a copy of the Audit Committee Charter without charge by calling 732-499-8228 or by writing to Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, NJ 07066, Attention Ms. Roxanne Weisbrot, Interim Secretary.

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Compensation Committee

Compensation Committee.The Compensation Committee is authorized and empowered to approve appointments and promotions of executive officers of the Company and fix salaries for such officers, provided that all actions of the Compensation Committee must be ratified by the full Board of Directors within six months of the subject action. The Compensation Committee is also authorized to administer the Company’s Amended and Restated 1997 Stock Option and Award Plan. As of April 30, 2009, the Compensation Committee is comprised of Messrs. Ananthram (Chairman), Dhoble and Ms. Ramachandran. The Board of Directors has determined that Messr. Dhoble is an independent member of the Compensation Committee (as independence is defined in NASDAQ Rule 5605(a)(2)). During the year ended December 31, 2008, the Compensation Committee held two meetings. The Compensation Committee Charter is posted at the Company’s website, www.hmna.com, under About Helios & Matheson — Management.

Nominating and Corporate Governance Committee

Nominating and Corporate Governance Committee.The Nominating and Corporate Governance Committee is authorized to nominate new candidates to the Board of Directors. As of April 30, 2009, the Nominating and Corporate Governance Committee is comprised of Messrs. Jambunathan (Chairman), Thomas and Ms. Ramachandran. The Board of Directors has determined that Messrs. Jambunathan and Thomas are independent members of the Nominating and Corporate Governance Committee (as independence is defined in NASDAQ Rule 5605(a)(2)). The Nominating and Corporate Governance Committee Charter is posted at the Company’s website, www.hmna.com, under About Helios & Matheson — Management. During the year ended December 31, 2008, the Nominating and Corporate Governance Committee met one time.

The Nominating and Corporate Governance Committee receives recommendations for director nominees from a variety of sources, including from shareholders, management and members of the Board of Directors. Shareholders may recommend any person to be a director of the Company by writing to the Company’s interim Secretary. Each submission must include (i) a brief description of the candidate, (ii) the candidate’s name, age, business address and residence address, (iii) the candidate’s principal occupation and the number of shares of the Company’s capital stock beneficially owned by the candidate and (iv) any other information that would be required under the SEC rules in a proxy statement listing the candidate as a nominee for director.

The Nominating and Corporate Governance Committee generally reviews all recommended candidates at the same time and subjects all candidates to appropriate review criteria. Members of the Board of Directors should be qualified, dedicated, ethical and highly regarded individuals who have experience relevant to the Company’s operations and understand the complexities of the Company’s business environment. The Nominating and Corporate Governance Committee evaluates candidates in the context of the current composition of the Board of Directors, and these recommendations are submitted to the Board of Directors for review and approval. In conducting this assessment, the Nominating and Corporate Governance Committee considers diversity, age, skills and such other factors as it deems appropriate, given the current needs of the Board of Directors and its committees. In addition, pursuant to NASDAQ Rules, the Company must have an Audit Committee composed of at least three members, each of whom must satisfy specified independence and qualification criteria. The Nominating and Corporate Governance Committee is also responsible for providing a leadership role in shaping and monitoring the corporate governance practices of the Company.

Executive Committee

Executive Committee.The Executive Committee has all the powers of the Board of Directors except as limited by Section 712 of the Business Corporation Law of New York and except for the matters that have been explicitly delegated by the Board of Directors to the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. The objectives of the Executive Committee include: (i) focusing on business development, (ii) assisting in formulating business strategies, (iii) monitoring the Company’s progress on a monthly basis (actual vs. planned performance), (iv) controlling expenditures, (v) when necessary, taking appropriate corrective action, (vi) formulating plans for the future, (vii) helping management improve performance and sanctioning actions by management to do so, (viii) periodically reviewing in consultation with the Company’s Chief Executive Officer the Company’s management succession planning and (ix) other actions consistent with applicable law and the Company’s governing documents that the Executive Committee or the Board deems appropriate. As of April 30, 2009, the Executive Committee is comprised of Messrs. Jambunathan (Chairman), Dhoble, Thomas, Ananthram and Ms. Ramachandran. During the year ended December 31, 2008, the Executive Committee held fourteen meetings.

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Other Committees

On April 7, 2008, the Transformation Committee was formally established as a committee with the purpose of working with management and effecting the transformation of the Company to one that is capable of delivering a higher percentage of its services through outsourcing and offshoring solutions. The Transformation Committee is exploring the appropriateness of moving functions such as recruiting, solutions delivery, finance and administration offshore in an effort to enable the Company to become more price competitive while maintaining high quality client services. As of April 30, 2009, the Transformation Committee is comprised of Messrs. Ananthram (Chairman), Dhoble, Thomas and Ms. Ramachandran. Since its inception, the Transformation Committee has held seven meetings.

The Board of Directors may establish additional standing or ad hoc committees from time to time.

Shareholder Communication with the Board

Correspondence from the Company’s shareholders to the Board of Directors or any individual directors or officers should be sent to the Company’s interim Secretary. Correspondence addressed to either the Board of Directors as a body, or to any director individually, will be forwarded by the Company’s interim Secretary to the Chairman of the Nominating and Corporate Governance Committee or to the individual director, as applicable. The Company’s interim Secretary will regularly provide to the Board of Directors a summary of all shareholder correspondence that the interim Secretary receives on behalf of the Board of Directors. This process has been approved by the Company’s Board of Directors.

All correspondence should be sent to Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, NJ 07066, Attention: Ms. Roxanne Weisbrot, Interim Secretary.

Compensation Committee Interlocks and Insider Participation

As of April 30, 2009, the Compensation Committee is comprised of Messrs. Ananthram (Chairman), Dhoble and Ms. Ramachandran. None of the members of the Compensation Committee has ever been an officer or employee of the Company.

Kishan Grama Ananthram, a member of the Company’s Board of Directors, is the Chief Executive Officer of IonIdea and Mr. Ananthram and his spouse own all of the outstanding capital stock of IonIdea. The Company currently uses professional services and equipment provided by IonIdea. For additional information, please see “Certain Relationships and Related Transactions”.

Code of Business Conduct and Ethics

The Board of Directors has adopted a code of ethics designed, in part, to deter wrongdoing and to promote honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships, full, fair, accurate, timely and understandable disclosure in reports and documents that the Company files with or submits to the Securities and Exchange Commission and in the Company’s other public communications, compliance with applicable governmental laws, rules and regulations, the prompt internal reporting of violations of the code to an appropriate person or persons, as identified in the code and accountability for adherence to the code. The code of ethics applies to all directors, executive officers and employees of the Company. The Company will provide a copy of the code to any person without charge, upon request to Ms. Jeannie Lovastik, Human Resources Generalist by calling (732) 499-8228 or by writing to Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, New Jersey, 07066, Attention: Ms. Jeannie Lovastik.

The Company intends to disclose any amendments to or waivers of its code of ethics as it applies to directors or executive officers by filing them on Form 8-K.

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PROPOSAL 2

RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Board of Directors has recommended to the Board of Directors of the Company the selection of Mercadien, P.C. to be the independent auditor of the Company for the year ending December 31, 2009.

Mercadien has served as the principal accountant for the Company since April 7, 2005.

Audit Fees

For the years ended December 31, 2008 and 2007, the aggregate fees paid or expected to be paid to Mercadien P.C. for the audit of the Company’s financial statements for such years and the review of the Company’s interim financial statements were $151,520 and $155,250, respectively.

Audit-Related Fees

During the years ended December 31, 2008 and 2007, there were no audit-related fees paid to Mercadien P.C.

Tax Fees

For the years ended December 31, 2008 and 2007, the aggregate fees paid or expected to be paid to Mercadien P.C. for tax compliance, tax advice and tax planning services were $25,000 and $23,500, respectively.

All Other Fees

During the years ended December 31, 2008 and 2007, there were no fees paid to Mercadien P.C. for professional services other than audit, audit-related and tax services.

Audit Committee Policies and Procedures

The Audit Committee reviews the independence of the Company’s auditors on an annual basis and has determined that Mercadien, P.C. is independent. In addition, the Audit Committee pre-approves all work and fees, which are performed by the Company’s independent auditor.

8

Report of the Audit Committee of the Board of Directors

The following is the report of the Audit Committee with respect to the Company’s audited financial statements for the fiscal year ended December 31, 2008. The information contained in this report shall not be deemed to be “soliciting material” or to be “filed” with the Securities and Exchange Commission, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates it by reference in such filing.

REVIEW WITH MANAGEMENT. The Audit Committee has reviewed and discussed the Company’s audited financial statements with management.

REVIEW AND DISCUSSIONS WITH INDEPENDENT ACCOUNTANTS. The Audit Committee has discussed with Mercadien P.C., the Company’s independent accountants for the fiscal year ended December 31, 2008, the matters required to be discussed by SAS 61 (Communication With Audit Committees), as amended by SAS 90 (Audit Committee Communications) that includes, among other items, matters related to the conduct of the audit of the Company’s financial statements. The Audit Committee has received from Mercadien P.C. the required written communication, as required by Independence Standards Board Standard No. 1 (that relates to the accountants’ independence from the Company and its related entities), and has discussed with the independent audit firm, that firm’s independence.

CONCLUSION. Based on the review and discussions with management and Mercadien P.C. referred to above, the Audit Committee recommended to the Board of Directors that the Company’s audited financial statements be included in the Company’s Annual Report of Form 10-K for the fiscal year ended December 31, 2008.

AUDIT COMMITTEE:
Daniel L. Thomas, Chairman
Rabin K. Dhoble
Shri S. Jambunathan

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Accountants’ Attendance at the Annual Meeting

A representative of Mercadien P.C., the independent accountants of the Company for the year ending December 31, 2008, is expected to be present at the Annual Meeting. The representative will be given the opportunity to make a statement at the Annual Meeting and is expected to be available to respond to appropriate questions.

Voting Requirements to Adopt the Proposal

The affirmative vote of the holders of a majority of the outstanding shares of the Company’s common stock, who are present in person or represented by proxy and entitled to vote at the Annual Meeting, is required to approve Proposal No. 2. Pursuant to the Sarbanes-Oxley Act of 2002, the Audit Committee has the sole right to appoint the Company’s independent auditor and the appointment of the independent auditor is not contingent upon obtaining shareholder approval. However, the Board of Directors is affording the Company’s shareholders the opportunity to express their opinions with regard to the selection of the Company’s auditors for fiscal year 2009. This vote is neither required nor binding, but is being solicited by the Board of Directors in order to determine if shareholders would approve the Audit Committee’s selection. If this Proposal does not receive the affirmative vote of a majority of the votes cast for this Proposal at the Annual Meeting, in person or by proxy, the Audit Committee will take such vote into consideration in determining whether to retain its independent auditor. Not withstanding its selection, the Audit Committee, in its discretion, may appoint another independent registered public accounting firm at any time during the year if the Audit Committee believes that such a change would be in the best interest of the Company.

Recommendation

The Board of Directors recommends that the shareholdersRATIFYthe selection of Mercadien P.C. to be the independent auditor of the Company for the year ending December 31, 2009.

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SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the number of shares of common stock beneficially owned as of April 30, 2009 by (i) each of the Company’s directors, (ii) each of the executive officers named in the Summary Compensation Table, (iii) all directors and executive officers of the Company as a group and (iv) each person known by the Company to own beneficially more than 5% of the common stock. As of April 30, 2009, 2,396,707 shares of the Company’s common stock were outstanding. Unless otherwise indicated in the table below, the address of each stockholder is c/o Helios & Matheson North America Inc., 77 Brant Avenue, Suite 320, Clark, NJ 07066.

	Shares of
	Common Stock
	Beneficially Owned(1)
Name	Number of Shares			Percent of Ownership
Helios & Matheson Information Technology Ltd.		1,244,546	(2)		52	%
Salvatore M. Quadrino, interim CEO and CFO		10,000	(3)		*
Shmuel BenTov, former Chairman, Director, CEO & President		—	(4)		*
Michael Prude, COO(5)		26,875	(6)		*
Shri S. Jambunathan, Chairman and Director		250	(7)		*
Daniel L. Thomas, Director		500	(8)		*
Rabin K. Dhoble, Director		500	(9)		*
Kishan Grama Ananthram, Director		250	(10)		*
Divya Ramachandran, Director		250	(11)		*
All Directors and Executive Officers as a group (8 Persons)		38,625	(12)		52	%

(1)	As used in the tables above, “beneficial ownership” means the sole or shared power to vote or direct the voting or to dispose or direct the disposition of any security. A person is deemed to have “beneficial ownership” of any security that such person has a right to acquire within 60 days of April 30, 2009. Any security that any person named above has the right to acquire within 60 days is deemed to be outstanding for purposes of calculating the ownership of such person but is not deemed to be outstanding for purposes of calculating the ownership percentage of any other person. Unless otherwise noted, the Company believes each person listed has the sole power to vote, or direct the voting of, and power to dispose, or direct the disposition of, all such shares. The table is based upon information supplied by officers, directors and principal stockholders and Schedules 13D and 13G, if any, filed with the Securities and Exchange Commission.
(2)	Helios & Matheson Information Technology Ltd.’s, principal executive offices are located at #9 Nungambakkam High Road, Chennai 600034 India.
(3)	Consists of 10,000 shares of common stock issuable upon exercise of currently exercisable options.
(4)	Effective with the expiration of his employment agreement on March 31, 2008, Mr. BenTov, the former Chairman, Director, CEO and President of the Company, retired from all his positions with the Company and no longer serves in any capacity with the Company. Pursuant to the terms of his employment agreement, Mr. BenTov’s outstanding stock options expired on June 30, 2008.
(5)	Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, his final day with the Company will be April 30, 2009. As of May 1, 2009, the Company will have only one named executive officer.
(6)	Consists of 26,875 shares of common stock issuable upon exercise of currently exercisable options.
(7)	Consists of 250 shares of common stock issuable upon exercise of currently exercisable options.
(8)	Consists of 500 shares of common stock issuable upon exercise of currently exercisable options.

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(9)	Consists of 500 shares of common stock issuable upon exercise of currently exercisable options.
(10)	Consists of 250 shares of common stock issuable upon exercise of currently exercisable options.
(11)	Consists of 250 shares of common stock issuable upon exercise of currently exercisable options.
(12)	Includes 38,625 shares of common stock that may be acquired upon the exercise of currently exercisable options.
*	Indicates less than 1%.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s directors, executive officers and certain beneficial owners of the Company’s equity securities (the “Section 16 Reporting Persons”) to file with the SEC reports regarding their ownership and changes in ownership of the Company’s equity securities. The Company believes that, during fiscal year 2008, its Section 16 Reporting Persons complied with all Section 16(a) filing requirements.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Transactions with Related Persons, Promoters and Certain Control Persons

On September 4, 2008, the Company entered into a Statement of Work with IonIdea, Inc. to provide certain professional services, workstation facilities and communication equipment to the Company and its wholly-owned subsidiary Helios & Matheson Global Services Private Limited. The Statement of Work commenced on August 1, 2008, and continues through July 31, 2010. Prior to September 4, 2008, the Company had been using the same professional services, workstation facilities and communication equipment from IonIdea without a contract since July 1, 2007. Kishan Grama Ananthram, a member of the Company’s Board of Directors, is the Chief Executive Officer of IonIdea and Mr. Ananthram and his spouse own all of the outstanding capital stock of IonIdea. The total amount paid to IonIdea is based upon the number of Company employees using workstation facilities and communication equipment and, from January 1, 2008 through December 31, 2008, the amount paid to IonIdea was $153,468. Approximately, nineteen Company employees currently use IonIdea workstation facilities and communication equipment.

Helios & Matheson Parent, an IT services organization with corporate headquarters in Chennai, India is the owner of approximately 52% of the Company’s outstanding common stock. Helios & Matheson Parent is the only parent of the Company.

INTERESTS OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON

As the holder of approximately 52% of the Company’s outstanding voting securities, Helios & Matheson Parent will have significant influence on matters requiring stockholder approval, and will control matters which require only majority shareholder approval which includes the election of directors and approval of certain corporate transactions.

Helios & Matheson Parent does not have any contractual rights to appoint directors or officers of the Company or to cause the resignation of any existing Company directors or officers.

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COMPENSATION DISCUSSION AND ANALYSIS

Introduction

The following compensation discussion and analysis summarizes the Company’s philosophy and objectives regarding the compensation of its named executive officers, including how the Company determines elements and amounts of executive compensation. The following discussion and analysis should be read in connection with the tabular disclosures regarding the compensation of named executive officers for the fiscal year ended December 31, 2008.

In this section, we will discuss the details of the Company’s compensation program as it relates to (i) the Company’s former Chief Executive Officer, (ii) the Company’s interim Chief Executive Officer and Chief Financial Officer and (iii) the Company’s Chief Operating Officer. These three individuals were the only executive officers of the Company during 2008. We will refer to these three persons throughout this discussion with regards to compensation as “named executive officers”. These named executive officers were deemed to be the only key employees of the Company and their performance had or has the potential to substantially impact the short and long- term success of the Company. On March 31, 2008, effective with the expiration of his employment agreement, Shmuel BenTov retired from his position as Chief Executive Officer of the Company and from all other positions he held with the Company. On May 9, 2008, the Board of Directors entered into an agreement with Salvatore M. Quadrino, the Company’s Chief Financial Officer, to serve in an additional capacity as interim Chief Executive Officer.

Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, his final day with the Company will be April 30, 2009. As of May 1, 2009, the Company will have only one named executive officer.

The Compensation Committee (the “Committee”) was established by the Board of Directors to appoint, promote and administer compensation packages for executive officers of the Company. The Compensation Committee may delegate its authority to subcommittees or the Chairman of the Compensation Committee when it deems it appropriate and in the best interests of the Company.

In an attempt to balance retention with sensitivity to the recent economic crisis and the impact this crisis has had on the Company’s results of operations, the Board of Directors of the Company requested that all named executive officers agree to accept pay reductions. As a result, effective January 1, 2009, both Mr. Quadrino’s and Mr. Prude’s annual salaries were reduced.

Compensation Objectives

The Company’s executive officer compensation program is intended to attract and retain highly qualified professionals who will assist the Company in meeting its financial and strategic goals. By offering competitive compensation, the Company seeks to promote a long-term commitment from its executive officers. The primary goals of the Company’s compensation program are to:

• align long-term interests of executives with shareholders;

• reward individual performance while maintaining cost efficiency;

• improve overall business performance and

• develop mutually beneficial long-term relationships between executive officers and the Company.

The Company seeks to accomplish these objectives through a combination of base salary, long-term incentive compensation (stock options), cash bonuses and perquisites. The Compensation Committee uses its discretion in determining compensation levels as there are no set guidelines for compensation.

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Compensation Process

At the end of each year, the Compensation Committee reviews and assesses the effectiveness of the past compensation criteria and approves the policies and plans for the next year. The Compensation Committee takes into consideration the performance of each of the named executive officers and measures such individual performance against the performance level of the Company. The named executive officers from time to time have had meetings with the Compensation Committee to discuss their compensation plan and performance. There may be occasions where the Compensation Committee requests to meet with the executive officer to gain clarification with regards to the fulfillment of certain performance criteria. In determining the amount of compensation for the named executive officers, the Compensation Committee may seek information from Human Resources on current market evaluations. Subject to approval from the full Board of Directors, the Compensation Committee makes the final decisions on executive compensation plans.

Primary Elements of Compensation

The Company’s compensation program includes both short and long-term compensation in the form of base salary, long-term incentive compensation (stock options) and cash bonus as detailed below.

Base Salary.The Compensation Committee utilizes its knowledge and general experience of the industry to determine the base salaries for its executive officers. Competitive salary levels are influenced by such factors as professional experience, accomplishments, duties, market comparisons and individual performance. The Company’s named executive officer’s primary source of compensation is derived from base salary.

Long-Term Incentive Compensation.The Compensation Committee in its discretion may award stock options to the Company’s named executive officers as a part of their initial compensation plan and upon annual review of their individual performance. The exercise price per share of a stock option is established by the Committee, in its discretion, but may not be less than the fair market value of a share of common stock as of the date of grant. The aggregate fair market value of the shares of common stock with respect to which “incentive” stock options are exercisable for the first time by an individual to whom an “incentive” stock option is granted during any calendar year may not exceed $100,000. There were no stock options awarded to any named executive officers during the year ended December 31, 2008.

Cash Bonus.The Compensation Committee in its discretion may award cash bonuses to the Company’s executive officers based upon an annual review of the Company’s overall performance, individual performance and available cash resources. There were no cash bonuses awarded to the Company’s named executive officers for the year ended December 31, 2008.

Retirement Plans.The Company’s compensation program includes a tax deferred savings plan. The Company’s named executive officers can participate in the Company’s 401(k)Tax Deferred Savings Plan (“the 401(k) plan”). For 2008, contributions can be made for up to 70% per pay cycle with an annual cap of $15,500. In addition for those individuals over the age of 50, a “Catch-Up Deferral” contribution can be made up to but not exceeding $5,000. The Company does not offer a matching contribution for any of its employees including named executive officers. The named executive officers participate in the 401(k) plan on the same terms as all other employees.

Perquisites and Other Benefits.In comparison to base salary, perquisites and other benefits represent only a small portion of the named executive officer’s compensation. The primary perquisites are use of a company car or an automobile allowance and life insurance. The Compensation Committee has approved these perquisites and other benefits as reasonable components of the Company’s executive officer compensation.

Employment Agreements

The Company has entered into employment agreements with its named executive officers as described below under “Director and Executive Compensation — Employment Agreements and Potential Post-Employment Payments and Benefits”.

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Impact of Tax and Accounting

As a general matter, the Compensation Committee considers the various tax and accounting implications of compensation vehicles employed by the Company.

Section 162(m) of the code generally prohibits any publicly held corporation from taking a federal income deduction for compensation paid in excess of $1 million in any taxable year to the Chief Executive Officer and the next three highest compensated officers (other than the Chief Financial Officer). Exceptions are available for qualified performance-based compensation, among other things that are approved by independent directors within the meaning of Section 162(m).

When determining amounts of long-term incentive grants to executives and employees, the Compensation Committee examines the accounting cost associated with the grants. Under Statement of Financial Accounting Standards 123R (“SFAS 123R”), grants of options, restricted stock, restricted stock units and other share-based payments result in an accounting charge for the Company. The accounting charge is equal to the fair value of the instruments being issued. For restricted stock, the cost is equal to the fair value of the stock on the date of grant multiplied by the number of shares granted. For options, the cost is equal to the Black-Scholes value on the date of grant multiplied by the number of shares granted. This expense is amortized over the requisite service period, or vesting period of the instruments. Option grants and awards of performance-based restricted stock are intended to be performance-based under Section 162(m) of the code.

DIRECTOR AND EXECUTIVE OFFICER COMPENSATION

Executive Officers⁽¹⁾

The Company’s named executive officers, their ages and positions as of April 30, 2009 are:

Name	Age		Title
Salvatore M. Quadrino		62	Interim Chief Executive Officer and Chief Financial Officer
Michael Prude(2)		46	Chief Operating Officer

(1)

Effective with the expiration of his employment agreement on March 31, 2008, Mr. BenTov, the former Chairman, Director, Chief Executive Officer and President of the Company, retired from all his positions with the Company and no longer serves in any capacity with the Company. No payments were made to Mr. BenTov in connection with the expiration of his employment agreement or after March 31, 2008. Mr. Quadrino, the Company’s Chief Financial Officer, is currently serving as interim Chief Executive Officer.

(2)

Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, his final day with the Company will be April 30, 2009. Mr. Prude is entitled to nine months of severance totaling $155,250 which will be paid out monthly beginning May 2009. As of May 1, 2009, the Company will have only one named executive officer.

15

Salvatore M. Quadrinohas been the Chief Financial Officer of the Company since May 1, 2006 and Secretary from April 26, 2006 through May 9, 2008. In addition, on May 9, 2008, the Company offered and Mr. Quadrino accepted the position of interim Chief Executive Officer of the Company, to serve in this dual capacity. Mr. Quadrino will not serve as the Secretary of the Company for so long as he serves the Company in the capacity of interim Chief Executive Officer. From January 2004 through May 1, 2006, Mr. Quadrino served as an independent consultant providing finance and accounting solutions to clients as either interim Chief Financial Officer or Project Manager. From 2002 to 2004, Mr. Quadrino served as Chief Financial Officer for Con Edison Communications, Inc. From 2000 to 2001 Mr. Quadrino served as the Chief Financial Officer for Submit Order Inc. Prior to 2000, Mr. Quadrino served as Chief Financial Officer for Medical Logistics Inc., COVISTA Communications Inc. and Erols Internet, Inc. From 1990 to 1996, Mr. Quadrino was employed by Suburban Propane Partners LP, initially as Chief Financial Officer, then as President and Chief Executive Officer. In the role of President and Chief Executive Officer, Mr. Quadrino led Suburban Propane in its successful initial public offering and listing on the New York Stock Exchange. Mr. Quadrino is a Certified Public Accountant.

Michael Prudewas the Chief Operating Officer of the Company from June 5, 2006 through April 30, 2009. Mr. Prude has been a full-time employee of Helios & Matheson since 1993, and prior to his promotion to Chief Operating Officer, he held various positions within the Company, the last of which was as Chief Technology Officer, pursuant to which he had responsibilities for sales, recruiting and project delivery. Mr. Prude has over 20 years of experience providing business technology solutions to Fortune 1,000 clients. He began his career managing development projects for Long Island Trust Co. and has delivered technology solutions for numerous financial services organizations such as Citibank and Barclays. Prior to joining Helios & Matheson, Mr. Prude formed his own consulting company which provided services to organizations such as Chase Manhattan Bank, First Boston, Manufacturers Hanover Trust and CCH Legal.

Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, with which the Company intends to comply, his final day with the Company will be April 30, 2009. Mr. Prude is entitled to nine months of severance totaling $155,250 which will be paid out monthly beginning May 2009. As of May 1, 2009, the Company will have only one named executive officer.

16

Summary Compensation Table for 2008 and 2007

The following table sets forth certain information regarding compensation for services rendered in all capacities during the year ended December 31, 2008 and 2007 by our named executive officers. Compensation for each of 2008 and 2007 includes not only compensation earned in 2008 and 2007, but in the case of stock option awards and option awards, compensation recognized for financial statement reporting purposes with respect to such fiscal years.

Summary Compensation Table for 2008 and 2007

							Non-Equity
					Stock		Incentive Plan			All Other
Name and Principal Position		Salary			Options(a)		Compensation			Compensation(b)		Total
Salvatore M. Quadrino	2008	$	233,333	(1)	$	19,488	$	—		$	—	$	252,821
Interim Chief Executive Officer and Chief Financial Officer	2007	$	180,000		$	19,399	$	—		$	—	$	199,399
Shmuel BenTov(2)	2008	$	90,000		$	1,889	$	—		$	5,529	$	97,418
Former Chairman, Director, Chief Executive Officer and President	2007	$	360,000		$	7,555	$	—		$	4,015	$	371,570
Michael Prude	2008	$	237,000		$	8,128	$	75,973	(4)	$	12,000	$	333,101
Chief Operating Officer	2007	$	231,000	(3)	$	11,848	$	19,807	(4)	$	—	$	262,655

(a)	This column represents the dollar amount recognized for financial statement reporting purposes under SFAS 123R with respect to stock options granted in prior fiscal years. The values in this column represent the accounting expense values incurred during the year and may not be equivalent to the actual value recognized by the named executive officer. The assumptions used in calculating these amounts are set forth in Note 1 to the Company’s Financial Statements for the fiscal years ended December 31, 2008 and 2007, respectively, which is located on pages F-9 to F-10 of the Company’s 2008 Annual Report on Form 10-K and pages F-9 to F-10 of the Company’s 2007 Annual Report on Form 10-K.
(b)	Includes payments with respect to life insurance and car allowance.
(1)	Includes prorated portion ($60,000) from January 1, 2008 through April 30, 2008 of an annual salary of $180,000 plus a prorated portion ($133,333) from May 1, 2008 through December 31, 2008 of an annual salary of $200,000 for Mr. Quadrino’s role as Chief Financial Officer plus a prorated portion ($40,000) from May 1, 2008 through December 31, 2008 for his additional role as Interim Chief Executive Officer.
(2)	Effective with the expiration of his employment agreement on March 31, 2008, Mr. BenTov, the former Chairman, Director, Chief Executive Officer and President of the Company, retired from all his positions with the Company and no longer serves in any capacity with the Company. No payments were made to Mr. BenTov in connection with the expiration of his employment agreement or after March 31, 2008. Mr. Quadrino, the Company’s Chief Financial Officer, is currently serving as interim Chief Executive Officer.
(3)	Includes prorated portion ($112,500) from January 1, 2007 through June 30, 2007 of an annual salary of $225,000 plus a prorated portion ($118,500) from July 1, 2007 through December 31, 2007 of an annual salary of $237,000.
(4)	Includes amounts earned for Sales Commission.

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Option Exercises for 2008

Aggregated Option Exercises in the Year Ended December 31, 2008 and Fiscal Year End Option Values

					Number of Securities
					Underlying Unexercised		Value of Unexercised In-
	Shares Acquired				Options Held at		the-Money Options at
	Acquired on		Value		December 31, 2008		December 31, 2008
Name	Exercise		Realized		Exercisable/Unexercisable		Exercisable/Unexercisable
Salvatore M. Quadrino		—		—		10,000/10,000	$	0/$0
Shmuel BenTov		—		—		0/0	$	0/$0
Michael Prude		—		—		26,875/0	$	0/$0

Outstanding Equity Awards at Fiscal Year End for 2008

The following table provides certain information about all equity compensation awards held by the named executive officers as of December 31, 2008.

	Option Awards
	Number of								Number of
	Securities								Securities
	Underlying								Underlying
	Unexercised				Option		Option		Unexercised
	Options				Exercise		Expiration		Options Not
Name	Exercisable		Grant Date		Price		Date		Vested (a)
Salvatore M. Quadrino		10,000		5/1/2006	$	5.82		5/1/2016		10,000
Shmuel BenTov		—		—		—		—		—
Michael Prude		7,500		3/31/2004	$	3.36		3/31/2009		—
		7,500		12/7/2004		5.90		12/7/2009		—
		1,875		12/15/2001		1.20		12/15/2011		—
		10,000		10/9/2002		1.41		10/9/2012		—

^(a) Option Awards vest as follows:

	Vesting Date
	May 1,		May 1,
Name	2009		2010
Salvatore M. Quadrino		5,000		5,000
Shmuel BenTov		—		—
Michael Prude		—		—

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Employment Agreements and Potential Post-Employment Payments and Benefits

The Company entered into an employment agreement with Shmuel BenTov, its former Chairman, Director, Chief Executive Officer and President, which terminated on March 31, 2008. The contract called for a salary of $360,000 per year, and contained non-competition, non-disclosure and non-solicitation covenants. The contract also contained an annual bonus, subject to the approval of the non-employee members of the Company’s Compensation Committee and further subject to the Company meeting certain financial performance criteria, in an amount to be determined by the non-employee members of the Compensation Committee.

Effective with the expiration of his employment agreement on March 31, 2008, Mr. BenTov retired from the Company on that date and no longer serves as the Company’s Chairman, Director, Chief Executive Officer and President or in any other capacity with the Company. No payments were made to Mr. BenTov in connection with the expiration of his employment agreement or after March 31, 2008.

On April 26, 2006, the Company entered into an employment agreement with its Chief Financial Officer, Salvatore M. Quadrino (the “2006 Quadrino Employment Agreement”). The 2006 Quadrino Employment Agreement was effective as of May 1, 2006, had a term of two years and would automatically renew for subsequent one-year terms, unless and until terminated by either party upon 30 days notice. The 2006 Quadrino Employment Agreement called for a salary of $180,000 per year, a discretionary annual bonus, participation in the Company’s stock option and award plan, with an initial grant of 20,000 options to purchase shares of the Company’s common stock, and use of a Company car.

On May 9, 2008, the Company entered into an amended employment agreement with Mr. Salvatore M. Quadrino (the “Amended Quadrino Agreement”) whereby Mr. Quadrino continues to be employed as the Chief Financial Officer of the Company. In addition, the Company offered and Mr. Quadrino has accepted the responsibility of interim Chief Executive Officer of the Company, to serve in this additional capacity.

The Amended Quadrino Agreement is dated as of May 9, 2008 and is effective as of May 1, 2008, expires on June 30, 2009 and shall automatically renew for subsequent one-year terms, unless and until terminated by either party with at least 30 days notice. The Amended Quadrino Agreement provides Mr. Quadrino with an annual base salary of $200,000 for his role as Chief Financial Officer and an additional $60,000 per year for his role as interim Chief Executive Officer. In addition to his annual base salary, Mr. Quadrino is eligible to receive a performance-based bonus, to continue to participate in the Company’s stock option and award plan and to continue to use a Company car.

The Amended Quadrino Agreement provides that in the event of termination by the Company without “Cause” (as defined in the Amended Quadrino Agreement), or due to Mr. Quadrino’s death or disability or by Mr. Quadrino for “Sufficient Reason,” (as defined in the Amended Quadrino Agreement), Mr. Quadrino will receive a severance allowance in an amount equal to six months of Mr. Quadrino’s then-current base salary. In the event the Company terminates Mr. Quadrino without cause within six months after the appointment of a new Chief Executive Officer, Mr. Quadrino will receive an additional severance allowance in an amount equal to three months of Mr. Quadrino’s then-current base salary. The Quadrino Agreement includes a one-year non-compete (and non-solicit) covenant commencing on termination of employment.

Effective January 1, 2009, the Board of Directors of the Company requested that all members of the senior management team agree to accept pay reductions. As a result, effective January 1, 2009, the additional $60,000 per year for Mr. Quadrino’s role as interim Chief Executive Officer was eliminated and Mr. Quadrino’s annual base salary was adjusted from $200,000 to $220,000.

On July 1, 2007, the Company entered into an employment agreement with its Chief Operating Officer, Michael Prude (the “Prude Employment Agreement”). The Prude Employment Agreement was effective July 1, 2007, has a term of two years, and shall automatically renew for subsequent one-year terms, unless and until terminated by either party upon 60 days notice. The Prude Employment Agreement provides Mr. Prude with an annual base salary of $237,000, a discretionary annual bonus, participation in the Company’s stock option and award plan and a $1,000 per month allowance for car-related expenses. The Prude Employment Agreement provides that during the initial term of the Agreement in the event of termination by the Company without cause, or due to Mr. Prude’s death or disability or by Mr. Prude for “Sufficient Reason”, as defined in the Agreement, Mr. Prude will receive a severance allowance in an amount equal to nine months of Mr. Prude’s then-current base salary. The agreement includes a one-year non-compete covenant commencing on termination of employment.

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Effective January 1, 2009, the Board of Directors of the Company requested that all members of the senior management team agree to accept pay reductions. As a result, effective January 1, 2009, Mr. Prude’s base salary was reduced by $30,000 from $237,000 to $207,000.

Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, his final day with the Company will be April 30, 2009. Mr. Prude is entitled to nine months of severance totaling $155,250 which will be paid out monthly beginning May 2009. As of May 1, 2009, the Company will have only one named executive officer.

The following table sets forth the potential payments if termination of employment or a change in control for each named executive officer had occurred on December 31, 2008. The values in this table reflect estimated payments associated with various termination scenarios. Mr. BenTov, the Company’s former Chairman, Director, Chief Executive Officer and President, retired from the Company effective with the expiration of his employment agreement on March 31, 2008. No payments were made to Mr. BenTov in connection with the expiration of his employment agreement or after March 31, 2008.

	Termination			Termination with
Benefits and Payments	without cause or			cause or for		Change in		Death or
upon Termination	for good reason(a)			good reason		control		Disability(a)
Salvatore M. Quadrino
Severance payment	$	130,000	(1)	$	—	$	—	$	130,000
Stock options(2)		—			—		—		—
Total(3)	$	130,000		$	—	$	—	$	130,000
Michael Prude
Severance payment	$	177,750		$	—	$	—	$	177,750
Total (4)	$	177,750		$	—	$	—	$	177,750

(a)	These represent rights that Mr. Quadrino and Mr. Prude would have under employment agreements discussed in more detail above.
(1)	In the event the Company terminates Mr. Quadrino without cause within six months after the appointment of a new Chief Executive Officer, Mr. Quadrino is entitled to an additional severance allowance in an amount equal to three months of Mr. Quadrino’s then-current base salary.
(2)	In accordance with his employment agreement, 20,000 stock options become immediately vested and exercisable at an exercise price of $5.82. Because the closing stock price on December 31, 2008 was $0.23, there was no value associated with such accelerated vesting.
(3)	Effective January 1, 2009, the Board of Directors of the Company requested that all members of the senior management team agree to accept pay reductions. As a result, effective January 1, 2009, the additional $60,000 per year for Mr. Quadrino’s role as interim Chief Executive Officer was eliminated and Mr. Quadrino’s annual base salary was adjusted from $200,000 to $220,000. Based on Mr. Quadrino’s current salary, Mr. Quadrino is entitled to severance of $165,000 if terminated without cause within six months after the appointment of a new Chief Executive Officer or $110,000 if terminated without cause but not within six months of such appointment.
(4)	Effective January 1, 2009, the Board of Directors of the Company requested that all members of the senior management team agree to accept pay reductions. As a result, effective January 1, 2009, Mr. Prude’s annual base salary was reduced by $30,000 from $237,000 to $207,000. Effective February 23, 2009, the Board of Directors of the Company and Mr. Prude agreed that Mr. Prude would be terminating his employment with the Company and that his responsibilities would be redistributed to the remaining members of the Company’s senior management team. Under the terms of Mr. Prude’s employment agreement, his final day with the Company will be April 30, 2009. Mr. Prude is entitled to nine months of severance totaling $155,250 which will be paid out monthly beginning May 2009.

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Equity Compensation Plan Information

Equity Compensation Plan Information

The equity compensation plan information as of December 31, 2008 was as follows:

					Number of securities
					remaining available for future
					issuance under equity
					compensation plans
	Number of securities to be		Weighted-average		(Excluding securities to be
	issued upon exercise of		exercise price of		issued upon exercise of
	outstanding options,		outstanding options,		outstanding options, warrants
	warrants and rights as of		warrants and rights as of		and rights as of December 31,
Plan Category	December 31, 2008		December 31, 2008		2008)
Equity compensation plans approved by security holders		107,375	$	4.17		352,625
Equity compensation plans not approved by security holders		—		—		—
Total		107,375	$	4.17		352,625

Director Compensation

The following table sets forth certain information regarding compensation for services rendered by the Company’s non-employee directors during the year ended December 31, 2008. During 2008, there were no stock awards granted to directors and no other compensation was earned (including in the form of nonqualified deferred compensation earnings).

	Total Fees
	Earned or
Name	Paid(a)
Shri S. Jambunathan	$	24,000
Daniel L. Thomas	$	24,000
Rabin K. Dhoble	$	24,000
Kishan Grama Ananthram	$	24,000
Divya Ramachandran	$	24,000

^(a) Each director received non-employee directors’ compensation of $6,000 per quarter during 2008. Each director is reimbursed for travel and other reasonable expenses incurred as related to the business of the Company.

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SHAREHOLDER PROPOSALS

Pursuant to Rule 14a-8 under the Exchange Act, proposals by Shareholders that are intended for inclusion in our proxy statement and proxy card and to be presented at our next annual meeting must be received by us no later than the close of business on January 4, 2010 in order to be considered for inclusion in our proxy materials relating to the next annual meeting. Such proposals shall be addressed to our interim Secretary at our corporate headquarters and may be included in next year’s annual meeting proxy materials if they comply with rules and regulations of the Securities and Exchange Commission (“SEC”) governing stockholder proposals.

For any proposal that is not submitted for inclusion in our proxy statement, but is instead sought to be presented directly at the 2010 annual meeting, the Company’s By-Laws require that such proposal be mailed and received by, or delivered to, the interim Secretary of the Company at 77 Brant Avenue, Suite 320, Clark, New Jersey 07066, Attention: Ms. Roxanne Weisbrot, Interim Secretary not later than the close of business on the 90^th day prior to the anniversary date of the 2009 annual meeting which is expected to be March 1, 2010.

OTHER BUSINESS

The Board of Directors of the Company is not aware of any other matters to come before the Annual Meeting. If any other matter should come before the meeting, the persons named in the enclosed proxy intend to vote the proxy according to their best judgment.

MULTIPLE SHAREHOLDERS SHARING ONE ADDRESS

In accordance with Rule 14a-3 (e)(1) under the Exchange Act, one proxy statement will be delivered to two or more shareholders who share an address, unless we have received contrary instructions from one or more of the shareholders. We will deliver promptly upon written or oral request a separate copy of the proxy statement to a shareholder at a shared address to which a single copy of the proxy statement was delivered. Requests for additional copies of the proxy statement, and requests that in the future separate proxy statements be sent to shareholders who share an address, should be directed to Helios & Matheson North America Inc., Attn: Ms. Roxanne Weisbrot, 77 Brant Avenue, Suite 320, Clark, New Jersey 07066, (732)499-8228. In addition, shareholders who share a single address but receive multiple copies of the proxy statement may request that in the future they receive a single copy by contacting us at the address and phone number set forth in the prior sentence.

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A COPY OF THE 2008 ANNUAL REPORT TO SHAREHOLDERS ACCOMPANIES THIS PROXY STATEMENT. COPIES OF THE COMPANY’S FORM 10-K REPORT FOR FISCAL YEAR 2008, INCLUDING EXHIBITS, CONTAINING INFORMATION ON OPERATIONS AND THE COMPANY’S FINANCIAL STATEMENTS AND THE FINANCIAL STATEMENT SCHEDULES, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, ARE AVAILABLE UPON WRITTEN REQUEST WITHOUT CHARGE FOR REQUESTORS WHO INCLUDE IN THEIR WRITTEN REQUEST A GOOD FAITH REPRESENTATION THAT, AS OF APRIL 30, 2009, SUCH REQUESTOR WAS A BENEFICIAL OWNER OF THE COMPANY’S COMMON STOCK. PLEASE WRITE TO:

HELIOS & MATHESON NORTH AMERICA INC.
77 BRANT AVENUE
SUITE 320
CLARK, NJ 07066
ATTENTION: ROXANNE WEISBROT, INTERIM SECRETARY

COPIES MAY ALSO BE OBTAINED WITHOUT CHARGE THROUGH THE SEC’S WORLD WIDE WEB SITE AT
http://www.sec.gov

23

HELIOS & MATHESON NORTH AMERICA INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS

The undersigned hereby appoints Shri S. Jambunathan, Chairman of, and Salvatore M. Quadrino, interim Chief Executive Officer of, Helios & Matheson North America Inc., a New York corporation (the “Company”) and each of them as proxy for the undersigned, with full power of substitution, for and in the name of the undersigned to act for the undersigned and to vote, as designated below, all of the shares of common stock, $0.01 par value per share, of the Company that the undersigned is entitled to vote at the 2009 Annual Meeting of Shareholders of the Company, to be held on May 28, 2009, at 10:00 a.m. (local time), at the offices of the Company’s counsel, Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017 and at any adjournments or postponements thereof, in accordance with the directions as follows with respect to the following matters (and with discretionary authority as to any and all other):

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF YOU SIGN AND RETURN THIS PROXY WITHOUT GIVING ANY INSTRUCTION, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL OF THE NOMINEES NAMED BELOW AND FOR ALL OTHER PROPOSALS OR OTHERWISE IN ACCORDANCE WITH THE RECOMMENDATION OF THE BOARD OF DIRECTORS.

Address Change/Comments
(Mark the corresponding box on the reverse side)

BNY MELLON SHAREOWNER SERVICES
P.O. BOX 3550
SOUTH HACKENSACK, NJ 07606-9250

▲ FOLD AND DETACH HERE ▲

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1 AND 2.

	FOR ALL NOMINEES listed below (except as marked to the contrary below)	WITHHOLD AUTHORITY to vote for all nominees listed below	*EXCEPTIONS
1. Election of Directors     Nominees:	o	o	o

01 Shri S. Jambunathan
02 Daniel L. Thomas
03 Rabin K. Dhoble
04 Kishan Grama Ananthram
05 Divya Ramachandran

(INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark the “Exceptions” box and write that nominee’s name in the space provided below.)

*Exceptions

Please mark
your votes as
indicated in
this example x

	FOR	AGAINST	ABSTAIN
2.   To ratify the appointment of Mercadien P.C., as independent public accounting firm of the Company for the fiscal year ending December 31, 2009.	o	o	o
3.   In his or her discretion, the proxy is authorized to vote upon such other matters as may properly come before the meeting.

Mark Here for Address
Change or Comments
SEE REVERSE o

Signature	Signature	Date
NOTE: Please sign exactly as the name appears on this card. When shares are held by two or more persons, both should sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person.

▲ FOLD AND DETACH HERE ▲

HELIOS & MATHESON
NORTH AMERICA INC.

Important notice regarding the Internet availability of proxy materials for the Annual Meeting of Shareholders The Proxy Statement, Annual Report and other Proxy Materials are available at:http://www.hmna.com