Company: IPST
Filing Date: 2025-05-30
Form Type: PRE 14A
Source: 0001788230-25-000100
Chunk: 53

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-05-30
Form: PRE 14A
Chunk 53
---
 the Board approved the Plan Amendment, subject to approval of the stockholders. If the stockholders do not approve the Plan Amendment, the existing 2024 Plan will remain in effect and unchanged. If approved by stockholders, the Plan Amendment will be effective immediately, subject to any restrictions on the issuance of awards under the 2024 Plan because of a lack of available or reserved shares of common stock to underlie such awards.

Reason for the Proposal

As of May 30, 2025, no shares were available for grant under the 2024 Plan and 27,500 RSUs have already been granted and will be issued upon stockholder approval of this proposal. Having an adequate number of shares available for future equity compensation grants is necessary to promote our long-term success and the creation of stockholder value by:

• enabling us to continue to attract and retain the services of key service providers who would be eligible to receive grants;

• aligning participants’ interests with stockholders’ interests through incentives that are based upon the performance of the common stock; and

• motivating participants, through equity incentive awards, to achieve long-term growth in our business, in addition to short-term financial performance.

When the 2024 Plan was initially approved by the Board and proposed for approval by the stockholders, it was intended to constitute approximately 35% of our total outstanding stock upon issuance and when added to the then outstanding shares of common stock after giving effect to the sale of common stock in our initial public offering. However, following recent issuances of common stock by our Company, the initial 2,500,000 shares reserved for issuance under the 2024 Plan only constitutes approximately 17% if such shares were issued and added to the total issued and outstanding shares of common stock as of May 30, 2025, the Record Date for the Annual Meeting.

Therefore, the Board approved the Plan Amendment to authorize the reservation of up to 5,000,000 shares of common stock for issuance thereunder, subject to availability to permit us to have adequate shares available for issuance under the 2024 Plan. To the extent that there are no authorized and unreserved shares of common stock available, the awards underlying the 2024 Plan will not be issuable until such time, and from time to time, as shares of common stock are available to be reserved and in such amounts as are available. Assuming all 5,000,000 shares become available and we may issue the full amount of awards under the 2024 Plan, the number