Company: IPST
Filing Date: 2025-05-07
Form Type: POS AM
Source: 0001641172-25-009076
Chunk: 279

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-05-07
Form: POS AM
Chunk 279
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 PLANS

The Company sponsors a traditional 401(k), Roth 401(k) and profit-sharing plan (the “Plan”), in which all eligible employees may participate after completing 3 months of employment. No contributions have been made by the Company during the years ended of December 31, 2024 and 2023.

NOTE 15 — 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 years ended December 31, 2024 and 2023, the Company expensed a management fee of $ 180,000and $ 180,000, respectively, 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 we 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-paid warrants to purchase common stock held by the party. As of December 31, 2024 the related party owned less than 4.99%of the outstanding common stock of the Company, but enough, when combined with their 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.

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Heritage Distilling Holding Company, Inc.

Notes to Consolidated Financial Statements

NOTE 15 — RELATED-PARTY TRANSACTIONS(cont.)

2022 and 2023 Convertible Notes

During 2022, the Company issued multiple unsecured convertible promissory notes under the terms of the 2022 Convertible Notes