Company: IPST
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001788230-25-000126
Chunk: 99

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 99
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 (i) when the common stock closes at $1.50 per share or higher during a regular trading day or (ii) on the 3 month anniversary of the warrant issuance date; and, 3,886,139 prepaid warrants with an exercise price of $0.01 per share that are exerciseable for common stock at the earlier of (i) when the common stock closes at $2.00 per share or higher during a regular trading day or (ii) on the 6 month anniversary of the warrant issuance date.) (See also Note 7.)In conjunction with the August 11, 2025 Subscription Agreement discussed above,the Company also negotiated restructurings and settlement agreements with outstanding secured notes and unsecured payables as discussed in more detail below.Negotiated Restructurings and Settlement Agreements with Outstanding Secured Notes and Unsecured Payables -- In July 2025, the Company negotiated terms with its secured notes payable creditor and a number of its unsecured creditors (the “Negotiated Settlements”), whereby, contingent and effective only upon the occurrence of: a) the closing of a financing transaction between the Company and third party private investors in excess of $75 million dollars and involving a tradable cryptocurrency, token or other similar digital asset (the “Trigger Date”); b) the approval of Company’s stockholders of such transaction at a duly called Special Meeting; and c) effectiveness of a registration statement related to such transaction filed with the Securities and Exchange Commission in accordance with the Securities Act of 1933, as amended, that the Company will pay agreed upon cash amounts due to the respective obligees, as agreed, in 

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Table of ContentsHeritage Distilling Holding Company, Inc.Notes to Condensed Consolidated Financial Statements(unaudited)NOTE 14 — SUBSEQUENT EVENTS (cont.)

cash and or equity, in settlement of amounts owed to such obligees. The equity portion of the Negotiated Settlements is in the form of warrants to purchase common stock at $0.01 per share, exercisable at the earlier of (i) 6-months or (ii) the day following the issue date of the respective warrants on which the closing price of the common stock equals or exceeds $1.50 per share, which were valued based on a Black Scholes valuation (the “Settlement Equity”). The result of the Negotiated Settlements with the secured and unsecured creditors was: a) $8,989,438 of the Company’s secured notes