HeartCore Signs 13th Go IPO Contract

Rhea-AI Summary

HeartCore Enterprises, Inc. (Nasdaq: HTCR) has signed a Consulting Agreement with PharmaBio for its 13th Go IPO consulting service win. HeartCore expects to generate $500,000 in initial fees and $300,000 in success fees. The Company also received a warrant to acquire 3% of PharmaBio's common stock. CEO Sumitaka Kanno Yamamoto highlighted the recent $9 million revenue from a Go IPO client's warrant sale, emphasizing its impact on long-term financial growth and M&A opportunities. HeartCore aims to capitalize on successful client listings on U.S. exchanges to drive revenue and solidify its position as a leading U.S. IPO advisory firm in Japanese markets.

Insights

Market Research Analyst

HeartCore Enterprises' recent agreement with PharmaBio represents a strategic move within the enterprise software and consulting services industry. The arrangement, particularly with the inclusion of a warrant for 3% of PharmaBio's common stock, signifies a potential upside for HeartCore that extends beyond the initial and success fees. This type of deal structure is indicative of a confident outlook on PharmaBio's prospects and aligns with HeartCore's revenue diversification strategy.

Moreover, the success of the 'Go IPO' service is a testament to HeartCore's growing influence in the U.S. IPO advisory market, especially among Japanese firms looking to list on major U.S. stock exchanges. The mention of a $9 million gain from a previous warrant sale underscores the financial impact of these services on HeartCore's bottom line. The cumulative effect of these deals could be substantial, potentially leading to increased investor confidence and a positive impact on HeartCore's stock valuation.

Financial Analyst

From a financial perspective, the deal's structure with PharmaBio is multifaceted. The $500,000 in initial fees and $300,000 in success fees are straightforward revenue streams that will bolster HeartCore's earnings in the short term. However, the warrant to acquire 3% of PharmaBio's stock introduces a variable component, tying HeartCore's future financial performance to that of PharmaBio post-IPO. The warrant is an instrument of equity interest that could lead to significant returns if PharmaBio's stock performs well after the listing.

Investors should note that while this deal can enhance HeartCore's earnings and provide potential capital for M&A activities, it also introduces an element of risk. The actual value realized from the warrant is contingent on PharmaBio's market performance, which can be unpredictable. Stakeholders should weigh this risk against the potential for high returns when considering the long-term implications of such agreements.

Legal Expert

Legally, the agreement between HeartCore and PharmaBio is notable for the inclusion of a warrant. This element of the deal underscores the need for a thorough understanding of the legal implications of equity-based compensation in consulting arrangements. A warrant provides a right, but not an obligation, to purchase stock at a predetermined price, which can be a complex legal instrument. The success of this agreement from a legal standpoint will depend on the precise terms of the warrant, such as the exercise price and expiration date and how those terms align with the regulatory requirements for public offerings on exchanges like Nasdaq or NYSE.

Furthermore, HeartCore's role in assisting PharmaBio with the IPO process, including the preparation of documentation and internal controls, highlights the importance of legal expertise in navigating the regulatory landscape of public listings. Compliance with SEC regulations and proper filing of the S-1 or F-1 is critical to avoid legal pitfalls that could delay or derail the IPO process.

NEW YORK and TOKYO, March 18, 2024 (GLOBE NEWSWIRE) -- HeartCore Enterprises, Inc. (Nasdaq: HTCR) (“HeartCore” or the “Company”), a leading enterprise software and consulting services company based in Tokyo, announced that it has signed an agreement (“Consulting Agreement”) with PharmaBio Corporation (“PharmaBio”) for its 13^th Go IPO consulting service win.

As compensation for its services, HeartCore expects to generate from PharmaBio an aggregate of $500,000 in initial fees and $300,000 in success fees. In addition, HeartCore has received a warrant to acquire 3% of PharmaBio’s common stock, on a fully diluted basis.

“I am pleased to announce our 13^th Go IPO contract win and our second contract for 2024,” said HeartCore CEO Sumitaka Kanno Yamamoto. “With the recent $9 million generated from the sale of a Go IPO client’s warrant, this business remains a pivotal driver for our long-term financial growth and our ability to pursue M&A opportunities within our software business. As our clients achieve successful listings on U.S. exchanges, HeartCore is poised to reach new heights, fueled by the revenue influx from the post-IPO sale of additional Go IPO client warrants. Our team’s reputation and services continue to solidify, establishing us as the preferred, go-to U.S. IPO advisory firm within the Japanese markets. We look forward to announcing our client’s successful listings and eagerly await the financial benefits that will help stabilize and propel the HeartCore business. Our team is confident that 2024 will be the strongest year in company history.”

As part of the Consulting Agreement, HeartCore will assist PharmaBio in its efforts to go public and list on the Nasdaq Stock Market (“Nasdaq”) or the New York Stock Exchange (“NYSE”). Through Go IPO, the Company services clients by assisting throughout the audit and legal firm hiring process, translating requested documents into English, assisting in the preparation of documentation for internal controls required for an initial public offering or de-SPAC, providing general support services, assisting in the preparation of the S-1 or F-1 filing, and more.

About HeartCore Enterprises, Inc.
Headquartered in Tokyo, Japan, HeartCore Enterprises is a leading enterprise software and consulting services company. HeartCore offers Software as a Service (SaaS) solutions to enterprise customers in Japan and worldwide. The Company also provides data analytics services that allow enterprise businesses to create tailored web experiences for their clients through best-in-class design. HeartCore’s customer experience management platform (CXM Platform) includes marketing, sales, service and content management systems, as well as other tools and integrations, which enable companies to enhance the customer experience and drive engagement. HeartCore also operates a digital transformation business that provides customers with robotics process automation, process mining and task mining to accelerate the digital transformation of enterprises. HeartCore’s GO IPO^SM consulting services helps Japanese-based companies go public in the U.S. Additional information about the Company's products and services is available at https://heartcore-enterprises.com/.

Forward-Looking Statements
All statements other than statements of historical facts included in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by words such as “believed,” “intend,” “expect,” “anticipate,” “plan,” “potential,” “continue,” or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks, and uncertainties are discussed in HeartCore’s filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond HeartCore’s control which could, and likely will materially affect actual results, and levels of activity, performance, or achievements. Any forward-looking statement reflects HeartCore’s current views with respect to future events and is subject to these and other risks, uncertainties, and assumptions relating to operations, results of operations, growth strategy, and liquidity. HeartCore assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. The contents of any website referenced in this press release are not incorporated by reference herein.

HeartCore Investor Relations Contact:
Gateway Group, Inc.
Matt Glover and John Yi
HTCR@gateway-grp.com
(949) 574-3860

FAQ

What is the latest Consulting Agreement signed by HeartCore Enterprises, Inc. (HTCR)?

HeartCore has signed a Consulting Agreement with PharmaBio for its 13th Go IPO consulting service win.

How much is HeartCore expecting to generate from PharmaBio for its services?

HeartCore expects to generate $500,000 in initial fees and $300,000 in success fees from PharmaBio.

What percentage of PharmaBio's common stock can HeartCore acquire?

HeartCore has received a warrant to acquire 3% of PharmaBio's common stock.

What financial benefit did HeartCore highlight from a recent client's warrant sale?

HeartCore highlighted a $9 million revenue generated from a recent client's warrant sale.

What services does HeartCore provide to clients through the Go IPO process?

HeartCore assists clients in audit and legal firm hiring, translating documents, preparing documentation for IPO or de-SPAC, providing general support services, and assisting in S-1 or F-1 filing.