Mail Stop 3-8
June 15, 2005
By Facsimile and U.S. Mail
Mr. Mitchell Rubenstein
Chairman of the Board and
Chief Executive Officer
Hollywood Media Corp.
2255 Glades Road
Suite 221A
Boca Raton, FL 33431
Re: Hollywood Media Corp.
Form 10-K for the Year Ended
December 31, 2004
Filed March 31, 2005
File No. 1-14332
Dear Mr. Rubenstein:
We have reviewed the above referenced filing and have the
following comments. Where indicated, we think you should revise
your
document in response to these comments. If you disagree, we will
consider your explanation as to why our comment is inapplicable or
a
revision is unnecessary. Please be as detailed as necessary in
your
explanation. In some of our comments, we may ask you to provide
us
with information so we may better understand your disclosure.
After
reviewing this information, we may raise additional comments.
Please understand the purpose of our review is to assist you
in
your compliance with the applicable disclosure requirements and to
enhance the overall disclosure in your filing. We look forward to
working with you in these respects. We welcome any questions you
may
have about our comments or any other aspect of our review. Feel
free
to call us at the telephone numbers listed at the end of this
letter.
Cover
1. Our records show your File Number is 1-14332, rather than file
number 0-22908 that appears on the cover pages of your Forms 10-K,
10-K/A 10-Q, NT 10-Q, DEF 14A and 8-K. Please make the
appropriate
revisions.
Item 7. Management`s Discussion and Analysis of Financial
Condition
and Results of Operation, page 20
Net Revenues, page 24
2. We do not understand why you have recorded $993,917 in non-cash
revenues and expenses in connection with the NATO contract which
is
no longer in effect. Please tell us when the contract terminated
and
the circumstances for recognition of income and expense after the
contractual period.
Audit Fees and Other, page 35
3. Tell us the nature of the increase in audit, review and
consulting
fees in fiscal 2004. Fees associated with the audit or review of
your financial statements should be disclosed as audit fees while
fees related to internal control review and compliance are
required
to be disclosed as audit related fees. See Item 9(e)(1) of
Schedule
14A. Please advise or revise your disclosures on pages 29 and 35
of
Form 10-K and the Definitive Schedule 14A filed on April 29, 2005.
Notes to the Consolidated Financial Statements, page 42
3. Summary of Significant Accounting Policies, page 44
401(K) Plan, page 50
4. We note that you contribute common shares to your 401(K)
savings
plan. Please tell us why you have not filed a Form 11-K for your
401(K) savings plan. See Regulation 15(d) of the Exchange Act.
5. Acquisitions and Other Capital Transactions, page 55
5. Please tell us the results of your independent valuation and
allocation of $4.1 million of excess purchase price consideration
to
goodwill and other definite lived intangible assets in connection
with the acquisition of Studio Systems, Inc.
9. Goodwill and Intangible Assets, page 59
6. Please tell us the results of your annual goodwill impairment
analysis for your internet ad sales reporting segment. In your
response include your calculation of the reporting unit`s
estimated
fair value, the methodology used to assign assets and liabilities
to
the carrying value of the reporting unit and the results when
comparing the estimated fair value to the carrying value of the
reporting unit. Tell us why the basis used to measure fair value
is
the most appropriate in estimating the reporting unit`s fair
value.
We may have further comments.
11. Debt, page 60
CEO Commitments, page 61
7. Please tell us and disclose in future filings the amount, if
any,
of outstanding obligations under the commitment of the CEO and
Vice-
Chairman and President as of your most recent balance sheet date.
14. Offering of Securities, page 64
8. Please tell us how you determined $2.3 million of estimated
fair
value in cancelled options is equal to the fair value of 520,682
shares of restricted common stock issued on January 2, 2002
considering the closing price of your common stock was $6.19 per
share on that date.
9. Please tell us how you accounted for the amended exercise price
of
the Series A warrant form $6.44 per share to $5.25 per share.
10. Tell us how you accounted for the issuance of the common
shares
and warrants on February 13, 2004. It appears your common stock
was
trading at a value of $3.21 on the date of issuance.
Item 9A. Controls and Procedures, page 83
11. Revise to provide the information required by Item
304(a)(1)(v)
of Regulation S-K, regarding any reportable event (i.e. internal
control weakness, etc.) the former accountant advised the company
of
during the two most recent fiscal years and subsequent interim
period
through the date of termination.
Describe in detail the nature of each material weakness and the
amounts involved, as applicable. Also, tell us:
* in what period each material weakness and accounting error or
misapplication of GAAP occurred;
* the amount of each accounting error and misapplication of GAAP;
* the reason(s) for each error or misapplication of accounting;
* whether or not you intend to restate any prior period for any
adjustments. If not, tell us why not; and
* in detail, all the steps you have taken (or plan to take) and
procedures you have implemented (or plan to implement) to correct
each concern.
Please provide us with a schedule of your fiscal year end fourth
quarter adjustments to close the books, or adjustments recorded in
connection with or as a result of the audit. Clearly explain the
reason for each adjustment. For each adjustment, show us the
impact
on pre-tax net loss. Quantify the net effect of all adjustments
on
pre-tax net income (loss). Also, tell us why none of the
adjustments
relate to prior period. Explain in detail why you believe the
timing
of each adjustment is appropriate.
Provide us with any letter or written communication to and from
the
former accountants regarding any disagreements or reportable
events
to management or the Audit Committee.
Please respond to these comments within 10 business
days,
or tell us when you will provide us with a response. Please
provide
us with a response letter that keys your responses to our comments
and provides any requested information. Detailed letters greatly
facilitate our review. File your response on EDGAR as a
correspondence file. Please understand that we may have
additional
comments after reviewing your responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:
* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.
You may contact Brian V. McAllister at (202) 551-3341
or,
in his absence to the undersigned at (202) 551-3841 if you have
any
questions regarding comments on the financial statements and
related
matters.
Sincerely,
Michael Moran
Accounting Branch
Chief
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Mr. Mitchell Rubenstein
Hollywood Media Corp.
June 15, 2005
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