Company: IPST
Filing Date: 2025-11-18
Form Type: 10-Q
Source: 0001788230-25-000175
Chunk: 163

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-11-18
Form: 10-Q
Item: Part I, Item 1
Chunk 163
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(a)(36) of the Small Business Act for $3,776,100. The proceeds from the PPP loan could only be used to retain workers 

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and maintain payroll or make mortgage interest, lease and utility payments and all or a portion of the loan could be forgiven if the proceeds are used in accordance with the terms of the program within the eight or 24-week measurement period. The loan terms required the principal balance and 1% interest to be paid back within two years of the date of the note. In June 2021, our 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 During the year ended of December 31, 2021, the forgiveness was partially rescinded by the SBA and we recognized $1,506,644 as other income in the consolidated statements of operations, resulting in $2,269,456 in PPP debt. Under the terms of the PPP loan, we have also recorded interest on the PPP loan at the rate of 1%, for a total of $124,229 as of September 30. We are currently in the process of disputing a portion if not all of the difference. The terms of the agreement state that we have 18-24 months to repay the PPP loan. Following the date of the forgiveness, the remaining principal balance of the PPP loan of $2,269,456 is expected to be repaid in the next 12 months with our general assets.

As part of our acquisition of Thinking Tree Spirits we inherited a HUD/City of Eugene loan with a balance of $389,875. We have since paid down $85,058 of that loan, leaving a balance of $304,817 at September 30, 2025. That loan is scheduled to be paid off by May 1, 2028 unless paid off sooner. It carries an annual interest rate of 5%

Cash Flows

The following table sets forth a summary of cash flows for the periods presented:

Summary of Cash FlowsFor the Nine Months EndedSeptember 30,(rounded to $000’s)20252024Net Cash Used in Operating Activities$(7,822,000)$(6,228,000)Net Cash Provided by Investing Activities(20,947,000)(27,000)Net Cash Provided by Financing Activities29,990,000 6,210,000 Net increase / (decrease) in cash$1,222,000 $(45,000)

Net Cash Used in Operating Activities

During the nine months