THREAD BREAKS on my Happy 1201

First check thread tension. Wrapping the thread twice around the tension wheel will increase the tension if it is loose. Look at the back of a piece to see if you have the proper balance of 1/3. If the thread is balanced on the back, the tension spring is touching the brass sensor.
Check the thread tension spring. This spring is adjustable by loosening the small allen screw and putting a screwdriver into the split tension screw and turning it counter clockwise. The spring will show a thread break sensor error (Red light) if the tension spring touches the brass. By applying more tension, the spring will only touch the sensor when a real thread break occurs. Don't over do it. If excessive resistance is applied, the sensor will never be hit when the thread breaks. Try small increments until you reach a happy medium.
Hope this helps.

Let me know how it works out. I sent you an email too.