Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 222

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 222
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the five trading days preceding the dividend payment date is at or above the Series B Conversion Price.

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Voting Rights. Holders of the Series B Preferred
Stock have no voting rights except in connection with a proposed amendment to the terms of the Series B Preferred Stock or as required
by law.

Optional Conversion. Each share of Series
B Preferred Stock may be converted at any time after the six-month anniversary of the date of issuance at the election of the holder into
a number of shares of common stock determined by dividing (a) an amount equal to 110% of the sum of (i) the Series B Stated Value plus
(ii) the amount of all accrued and unpaid dividends, by (b) the then applicable Series B Conversion Price of such shares of Series B Preferred
Stock. The “Series B Conversion Price” for a share of Series B Preferred Stock is the fixed price equaling the volume weighted
average price of our common stock on the trading day preceding the date of issuance of such share of Series B Preferred Stock, or $1.10
per share for the outstanding shares of Series B Preferred Stock. However, a holder (together with its affiliates) may not convert any
of such holder’s shares of Series B Preferred Stock to the extent that the holder (together with its affiliates) would own more
than 4.99% (or, at the election of the holder, 9.99%) of our outstanding shares of common stock immediately after conversion, as such
percentage ownership is determined in accordance with the terms of the Series B Preferred Stock. Notwithstanding the terms of the Series
B Preferred Stock, we and the Investor have entered into a letter agreement dated January 23, 2025 under which the Investor has agreed
that it will not convert shares of Series B Preferred Stock owned by it for a number of shares of common stock that would give it and
its affiliates beneficial ownership of an amount of common stock greater than 1% of the total outstanding common stock after giving effect
to such conversion.

Mandatory Conversion. Each share of Series
B Preferred Stock will automatically be converted on the third anniversary of the date of issuance of such share of Series B Preferred
Stock, or January 23, 2028 in the case of the outstanding shares of Series B Preferred Stock, into a number of shares of common stock
determined by dividing (a) an amount equal to 110% of the sum of (i)