Company: IPST
Filing Date: 2025-12-23
Form Type: 424B3
Source: 0001213900-25-125341
Chunk: 305

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-12-23
Form: 424B3
Chunk 305
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 carrying amount of the reporting unit are considered when measuring the goodwill impairment loss, if applicable.

F-16 Heritage Distilling Holding Company, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited) NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.) Intangible Digital Assets— The Company holds intangible digital assets in the form of $IP Tokens. Substantially all of the digital assets are held for investment purposes. The Company does not engage in regular trading of these assets but may stake them. Intangible digital assets that are held for investment are initially recorded at cost and are subsequently remeasured to fair value at the end of each reporting period, with changes in fair value recognized in Change in Fair Value of Intangible Digital Assets in the condensed consolidated statements of operations. Fair value is measured using quoted intangible digital asset prices within the Company’s principal market at the time of measurement. The Company considers Coinbase to be its principal market for the valuation and reporting of digital assets, as Coinbase has the highest trading volume of $IP Tokens and is the market in which the Company transacts in $IP Tokens. Realized gains and losses on dispositions are recognized on a specific identification basis for $IP Tokens held for investment. Cash inflow from dispositions of intangible digital assets held for investment are reflected in cash flows from investing activities in the condensed consolidated statement of cash flows. The Company receives $IP Tokens as blockchain rewards in its validator operations, with such intangible digital assets converted to cash nearly immediately. Intangible digital assets earned in the Company’s validator operations are initially recorded at the fair value of the $IP Tokens received at contract inception as an addition to intangible digital assets and in Crypto and Related Revenue in the consolidated statement of operations. The intangible digital assets are subsequently remeasured to fair value at the end of each reporting period, with changes in fair value recognized in Change in Fair Value of Intangible Digital Assets in the condensed consolidated statements of operations. Fair value is measured using quoted intangible digital asset prices within the Company’s principal market at the time of measurement. Realized revenues on disposition are recognized on a first -in - first-outbasis. Cash flows from dispositions of intangible digital assets earned in the Company’s validator operations are reflected in cash flows used in operating activities. Finite -Lived Intangible Assets— Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition