The deal is structured as a reverse merger where HSCS is the surviving public entity but DCG/Fortitude will hold ~94% voting control. The proxy statement explicitly warns that if the deal fails, HeartSciences has limited ability to continue operations and may need to liquidate. Monitor the November 19 vote — holders of >50% of Series C Preferred have already signed support agreements to vote in favor, making approval highly likely. Post-close, the stock will trade under TUDE and reflect Fortitude's Zcash mining economics, not HeartSciences' healthcare business.
Price Chart
Executive Summary
HeartSciences Inc. (HSCS) is seeking shareholder approval at a November 19, 2026 special meeting for a reverse merger with Fortitude Mining Holdings, Inc., a Zcash-focused digital asset mining platform wholly-owned by Digital Currency Group (DCG). Under the complex Up-C structure, Fortitude Seller will contribute its business and $2 million in cash/Zcash in exchange for ~94% of the combined company's voting power, while existing HeartSciences shareholders will be diluted to ~6% ownership. The HeartSciences Board unanimously recommends approval, citing the company's financial distress, Nasdaq compliance challenges, and the lack of viable alternatives.
Key Financial Metrics
Key Facts
- Existing HeartSciences shareholders will be diluted to approximately 6% of the combined company's voting and economic interests.
- Fortitude Seller (DCG) will own ~94% of the combined company's voting power through Class V Common Stock (no economic rights) and Class A Common Stock.
- Fortitude Seller contributes $2,000,000 in cash or Zcash for Class A Common Stock at the Closing VWAP.
- Exchange Ratio is fixed at 19.00 (or 21.22 if the 20-day VWAP is >= $7.50), meaning the value of consideration to Fortitude Seller fluctuates with HSCS stock price.
- HeartSciences had ~$4.5 million of outstanding indebtedness as of the Merger Agreement date, with significant near-term maturities and redemption requirements.
- HeartSciences was non-compliant with Nasdaq's minimum stockholders' equity rule as of April 30, 2026 ($0.2 million vs $2.5 million minimum).
- Houlihan Capital provided a fairness opinion to the Special Committee, concluding the aggregate consideration is fair from a financial point of view.
- HeartSciences would owe a $2,500,000 termination fee to Fortitude Seller if the deal terminates under certain circumstances.
- The combined company will be renamed Fortitude Mining Group, Inc. and trade under the ticker symbol 'TUDE'.
- Series C and Series D Preferred Stock will convert into Class A Common Stock at closing.
Financial Impact
Existing HSCS shareholders face massive dilution from ~94% to ~6% ownership. Fortitude Seller contributes $2M cash/Zcash. HeartSciences had ~$4.5M debt and $0.2M shareholders' equity.
Risk Factors
- Massive dilution for existing HSCS shareholders (94% ownership loss).
- If the transaction fails, HeartSciences may be forced to liquidate with likely no distribution to common shareholders.
- The combined company's success depends on volatile Zcash prices and the digital asset mining industry.
- DCG's controlling interest (94% voting) creates significant governance risks for minority shareholders.
- Nasdaq initial listing approval for the combined company is a condition to closing and not guaranteed.
- The Up-C structure and Tax Receivable Agreement create complex tax obligations that could consume cash flow.
Investment Themes
Documents Analyzed
This report is based on 4 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| DEFM14A Filing (Primary) | 0001213900-26-110484 |
| Document: 0001213900-26-110484-index-headers.html | 0001213900-26-110484 |
| Document: 0001213900-26-110484-index.html | 0001213900-26-110484 |
| Document: 0001213900-26-110484.txt | 0001213900-26-110484 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 26, 2026 today | DEFA14A | $3.18 | awaiting T+1 | — | $3.18 (+0.00%) |
Oct 26, 2026 today | DEFA14A | $3.14 | awaiting T+1 | — | $3.18 (+1.27%) |
Oct 23, 2026 3d ago | SC 13D/A | $3.41 | awaiting T+1 | — | $3.18 (−6.74%) |
Oct 21, 2026 5d ago | DEFA14A | $3.17 $3.14 | ▼ −0.95% | ▼ −0.42% | $3.18 (+0.32%) |
Oct 19, 2026 7d ago | DEFA14A | $3.13 $3.56 | ▲ +13.74% | ▲ +13.21% | $3.18 (+1.60%) |
Oct 19, 2026 7d ago | DEFA14A | $3.07 $3.13 | ▲ +1.95% | ▲ +1.62% | $3.18 (+3.58%) |
Oct 19, 2026 7d ago | DEFM14A | $3.07 $3.13 | ▼ −1.95% | ▼ −1.62% | $3.18 (−3.58%) |
Oct 15, 2026 11d ago | DEFA14A | $3.02 $3.07 | ▲ +1.66% | ▲ +1.23% | $3.18 (+5.30%) |
Oct 9, 2026 17d ago | 424B5 | $3.30 $3.09 | ▲ +6.36% | ▲ +6.35% | $3.18 (+3.64%) |
Oct 6, 2026 20d ago | DEFA14A | $3.49 $3.04 | ▼ −12.89% | ▼ −12.47% | $3.18 (−8.88%) |
US Market Status
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