Company: IPST
Filing Date: 2025-06-04
Form Type: POS AM
Source: 0001641172-25-013501
Chunk: 310

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-06-04
Form: POS AM
Chunk 310
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recorded as a gain for the decrease in fair value of those convertible notes and related warrant liabilities for the period from December 31, 2023 to the date of the Company’s initial public offering (November 25, 2024), which is the date on which the contingent treatment of the liability associated with such convertible notes was relieved and they were reclassified to equity.

The aggregate fair value of the exchanged Whiskey Notes and related Warrants were reclassified from liabilities to equity under the terms of the Subscription Exchange Agreement (when the common stock and prepaid warrants were unconditionally issued in exchange for the Whiskey Notes and related Warrants) upon the closing of the Company’s IPO (which occurred on November 25, 2024) — which was the remaining prerequisite for the unconditional exchange of the Whiskey Notes and related Warrants for equity, at which time, the value of the shares and prepaid warrants was recorded as common stock at the IPO price (of $ 4.00per share), and the remaining fair value of the Convertible Notes was recognized as a gain in Change in Value of Convertible Notes on the Company’s consolidated statement of operations. (Calculated using the IPO price of $ 4.00per share.) Until such a time, the Whiskey Notes and related Warrant Liabilities remained on the Company’s balance sheet, and the change in their fair values also continued to be recognized as Other Income/(Expense) in the Company’s Statement of Operations.

Convertible Notes at fair value consisted of the following:

SCHEDULE OF CONVERTIBLE NOTES

| 2022 Convertible Promissory Notes                 |     | December 31, 2024 | — |     | December 31, 2023 |  18,801,206 |   |
|:--------------------------------------------------|:----|:------------------|:--|:----|:------------------|------------:|:--|
| 2023 Convertible Promissory Notes                 |     |                   | — |     |                   |  17,482,685 |   |
| Whiskey Special Ops 2023 Notes                    |     |                   | — |     |                   |   1,452,562 |   |
| Total Convertible Notes Payable                   |     | $                 | — |     | $                 |  37,736,453 |   |
| Less: Convertible Notes Payable, Current          |     |                   | — |     |                   | (36,283,891 | )