Company: IPST
Filing Date: 2025-06-13
Form Type: S-1
Source: 0001641172-25-015121
Chunk: 321

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-06-13
Form: S-1
Chunk 321
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. The fair value of the warrant liabilities at the issuance dates in April 2024 was approximately $ 48,889, of which $ 26,706was associated with the related party warrant liabilities. The warrant liabilities are subsequently remeasured to fair value at each reporting date with changes in fair value recognized as a component of total other income (expense) in the consolidated statements of operations. The Company recorded a net gain of $ 1,814,712(of which $ 406,774was to a related party) resulting from the change in fair value of the warrant liabilities to $ 0(of which $ 0was to a related party) for the year ended December 31, 2024. The Company recorded a net gain of $ 108,835(of which $ 29,267was to a related party) resulting from the change in fair value of the warrant liabilities to $ 1,512,692(of which $ 406,774was to a related party) for the year ended December 31, 2023.

In April 2024, the Whiskey Notes (including 755,919related warrants) were exchanged (contingent upon the consummation of the Company’s initial public offering) for common stock. The then outstanding $ 23,311,063in aggregate fair value ($ 8,678,433of principal amount, including accrued interest; $ 6,630,870of proceeds) of the Whiskey Notes and related Warrants (Warrant Liability) in accordance with a Subscription Exchange Agreement, exchanged for a total of 2,399,090shares of common stock and 546,927prepaid warrants to purchase common stock. The Whiskey Notes and related warrants were exchanged (contingent upon the consummation of the Company’s initial public offering) for common stock; however, the Whiskey Notes and related Warrant Liabilities remained on the Company’s balance sheet until the closing of the Company’s IPO (which occurred on November 25, 2024) — which was the remaining prerequisite for the unconditional exchange of the outstanding indebtedness and related warrants for equity).

As of November 25, 2024, as part of the Series A Preferred Stock offering, the holders of the Series A Preferred Stock had received warrants entitling its holder to purchase an aggregate of 197,013of shares of common stock determined by (a) 25% of the Subscription Amount of such Investor divided by (b) $5.00, and having an