Company: IPST
Filing Date: 2025-12-19
Form Type: S-1/A
Source: 0001213900-25-123872
Chunk: 362

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-12-19
Form: S-1/A
Chunk 362
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(unaudited) NOTE 13 — RELATED-PARTY TRANSACTIONS Management Agreement On October 6, 2014, the Company entered into a management agreement with Summit Distillery, Inc., an Oregon corporation, to open a new Heritage Distilling Company location in Eugene, Oregon. The Company engaged Summit Distillery, Inc. to manage the Eugene location for an annual management fee. The principals and sole owners of Summit Distillery, Inc., are also shareholders of HDHC. For each of the nine months ended September 30, 2025 and 2024, the Company expensed a management fee of $ 90,000that was paid to Summit Distilling, Inc. The fee is based upon a percentage of the Company’s trailing twelve months earnings before interest, taxes and depreciation expense, as defined in the management agreement. Other Related Party Transactions Beginning in 2022, the Company began a series of financings with a party that is considered a related party for the years ended December 31, 2024 and 2023 by virtue of the number of common stock shares and pre -paidwarrants to purchase common stock held by the party. As of September 30, 2025, the related party owned less than 4.99% of the outstanding common stock of the Company, but enough, that when combined with its prepaid warrants, would exceed the 4.99% reporting threshold if all such prepaid warrants were to be exercised into common stock. The prepaid warrants contain a 4.99% blocker prohibiting the exercise of such warrants if it would put the party’s ownership over the 4.99% reporting threshold. The related party is not required to report the number of prepaid warrants held. Below are details of the transactions with the related party, including those related to notes payable, equity transactions and other activities. 2023 Barrel Production Contract During 2023, the Company entered into a distilled spirits barreling production agreement with the related party for production of 1,200barrels of distilled spirits over time. There was a prepayment of $ 1,000,000made in January 2023. In March 2024, the agreement was amended to 600barrels for $ 500,000, with the then $ 500,000excess prepayment used to purchase a Whiskey Note in the principal amount of $ 672,500and subsequently exchanged (contingent upon the consummation of this offering, which occurred on November 25, 202