Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 341

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 341
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 Security Act (the “CARES Act”), section 7(a)(36) of the Small Business Act for $3,776,100.
The proceeds from the PPP loan may only be used to retain workers and maintain payroll or make mortgage interest, lease and utility payments
and all or a portion of the loan may be forgiven if the proceeds are used in accordance with the terms of the program within the 8 or
24-week measurement period. The loan terms require the principal balance and 1% interest to be paid back within two years of the
date of the note. In June 2021, the Company’s bank approved forgiveness of the loan of $3,776,100. During the year ended of
December 31, 2021, the forgiveness was partially rescinded by the SBA and the Company recognized $1,506,644 as other income in the
consolidated statements of operations, resulting in $2,269,456 in debt. Under the terms of the PPP loan, the Company has also recorded
interest on the PPP loan at the rate of 1%, for a total of $84,561 as of December 31, 2023. The Company is currently in the process of
disputing a portion if not all of the difference. The terms of the agreement state that the Company has 18-24 months to repay
the PPP loan. Following the date of the forgiveness, the remaining balance of the PPP loan of $2,269,456 is expected to be repaid in the
next 12 months with the Company’s general assets.

<div align='center'>F-62

Heritage Distilling Holding Company, Inc.
Notes to Consolidated Financial Statements</div>

NOTE 6 — BORROWINGS (cont.)

In January 2022, the Company entered into an
unsecured business loan and security agreement with Channel Partners Capital, LLC (the “2022 Channel Partners Loan”) for an
aggregate borrowing capacity of $250,000. The Channel Partners Loan matured on June 26, 2023 and accrued interest at a fixed rate
of 13.982%. Principal of $16,528 plus interest is payable monthly. The Company had an option to prepay the Channel Partners Loan with
a prepayment discount of 5.0%. As of December 31, 2023 and 2022, the outstanding balance of the 2022 Channel Partners Loan was $0
and $82,887, respectively.