Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 299

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 299
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2023, the related party agreed
to exchange its then held 2022 and 2023 Convertible Promissory Notes for 1,717,559 shares of common stock. (See Note 5 — Exchange of 2022 and 2023 Convertible Promissory Notes.)

As of September 30, 2024, $3,247,425 of Whiskey
Special Ops 2023 Notes were held by the related party, plus 254,562 warrants to purchase common stock, calculated using a then estimated
IPO price of $5.00 per share. As of December 31, 2023, $800,000 in principal of the Whiskey Special Ops 2023 Notes were held by the
related party, plus 91,200 warrants to purchase common stock, calculated using a then estimated IPO price of $5.00 per share. On February 29,
2024, the related party agreed to exchange its then held Whiskey Notes and related warrants for 1,203,783 shares of common stock under
the terms of the most recent round of 2023 Convertible Notes and the aforementioned warrants were terminated. (See Note 5.)

2023 Barrel Production Contract

During 2023, the Company entered into a distilled
spirits barreling production agreement with the related party for production of 1,200 barrels of distilled spirits over time. There was
a prepayment of $1,000,000 made in January 2023. In March 2024, the agreement was amended to 600 barrels for $500,000, with
the then $500,000 excess prepayment used to purchase a Whiskey Note in the principal amount of $672,500 and subsequently exchanged (contingent
upon the consummation of the Company’s initial public offering) under the terms of a Subscription Exchange Agreement for common
stock in conjunction with the February 29, 2024 exchange of Whiskey Notes for common stock.

Factoring Agreement(s)

In May 2024, the Company raised $100,000
under the terms of an accounts receivable factoring arrangement with the related party, with fees of 10% (or $10,000) and $1,000 for every
2 weeks payment remains overdue. Payment under the factoring agreement is due the earlier of: within 3 days of receipt of payment
under the factored accounts receivable; the achievement of certain fundraising milestones; or June 15, 202