Heartcore Enterprises, Inc. current report, 02 May 2023

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Business Context and Reporting Period

HeartCore Enterprises, Inc. filed a Form 8-K reporting entry into a material definitive agreement on May 2, 2023. The company purchased a promissory note issued by ZEROSPO. The filing was signed on May 8, 2023.

Key Financial Terms

  • Principal amount: $300,000.
  • Interest rate: 8% per annum on outstanding principal.
  • Default interest: 12% per year, simple and non-compounding, on overdue amounts.
  • Expected accounting impact: The transaction represents a $300,000 investment or note receivable for HeartCore; the filing does not provide a broader balance-sheet or cash-flow impact.

Maturity and Repayment Terms

Principal and accrued interest are payable on the earliest of: (1) the closing of a ZEROSPO or affiliate debt or equity financing generating at least $300,000 in gross proceeds; (2) the completion of a transaction resulting in ZEROSPO ordinary shares being listed on Nasdaq, the NYSE, or a related exchange; or (3) 180 days after May 2, 2023. ZEROSPO may prepay the note, in whole or in part, at any time.

Changes, Outlook, and Risks

  • The filing does not report revenue, profit, operating cash flow, margins, debt balances, liquidity, or guidance.
  • The principal risk is repayment and credit exposure to ZEROSPO, including the possibility of an event of default.
  • Repayment timing depends on ZEROSPO completing specified financing, listing, or other maturity-triggering events, or reaching the 180-day outside maturity date.
  • The filing provides no management outlook or commentary beyond the agreement terms.

Important Facts to Verify

  • Whether the $300,000 note purchase was funded and recorded as a note receivable or investment.
  • ZEROSPO’s ability to repay principal and accrued interest and whether any default or prepayment occurred.
  • The applicable maturity date and whether a qualifying financing or listing event occurred before the 180-day outside date.
  • The note purchase agreement and promissory note filed as Exhibits 10.1 and 10.2.
  • Any subsequent filings disclosing collection, impairment, amendment, or settlement of the note.