Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 273

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 273
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 exercise price of the 197,013 warrants was fixed at $4.00 per share. (See Note 16.) The Warrants will expire June 15, 2029. At any time after June 15, 2027, the Warrants shall automatically exercise on a cashless basis if the common stock has traded for 5 consecutive trading days at or above 125% of the Exercise Price.

NOTE 8 — FAIR VALUE MEASUREMENT

The following table presents information about the Company’s financial liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the valuation as of September 30, 2024 and December 31, 2023 under Level 3.

|                                         |     | Fair Value        
 Measurement as of 
 2024              | September 30, |     | 2023 | December 31, |
|:----------------------------------------|:----|:------------------|--------------:|:----|:-----|-------------:|
| 2022 and 2023 Convertible Notes         |     | $                 |    18,482,353 |     | $    |   36,283,891 |
| Whiskey Special Ops 2023 Notes          |     |                   |    14,283,752 |     |      |    1,452,562 |
| Warrant Liabilities 2022 and  2023      |     |                   |       856,614 |     |      |      794,868 |
| Warrant Liabilities Whiskey Special Ops |     |                   |        18,658 |     |      |    1,512,692 |
| Acquisition Contingency Liabilities     |     |                   |       127,076 |     |      |            — |
| Total Liabilities at Fair Value         |     | $                 |    33,768,453 |     | $    |   40,044,013 |

In November of 2023, the Convertible Notes were exchanged (contingent upon the consummation of the Company’s initial public offering) for common stock and prepaid warrants effective as of June 30, 2023. (See Note 5.) As of September 30, 2024, the $415,265 decrease in fair value of the 2022 and 2023 Convertible Notes, is included as a gain in the change in fair value of convertible notes in the Company’s condensed consolidated statement