Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 288

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 288
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 occurred subsequent to September 30, 2024). Assuming all of them settle into common
stock we would expect to book an expense of $2,674,995 at the fair grant values per RSU for the total 243,089 awards as of September 30,
2024.

Equity-classified warrants— The
Company estimates the fair values of equity warrants using the Black-Scholes option-pricing model on the date of issuance. During the
nine months ended September 30, 2024 and 2023, the Company issued 197,013 and zero warrants, respectively, (of which, 60,563
and 0 were to a related party) to purchase common stock. As of September 30, 2024 and December 31, 2023, there were outstanding
and exercisable warrants to purchase 337,495 and 116,928, respectively, shares of common stock. As of September 30, 2024, the weighted-average
remaining contractual term was 4.20 years for the outstanding and exercisable warrants.

Deferred Compensation — Beginning
in May 2023, certain senior level employees elected to defer a portion of their salary until such time as the Company completed a
successful public registration of its stock (which occurred subsequent to September 30, 2024, on November 25, 2024). Upon success of the
Company’s initial public offering, each employee will then be paid their deferred salary plus $2 dollars in RSUs or stock options
(under the new 2024 Plan noted above) for every $1 dollar of deferred salary. As of September 30, 2024, the Company recorded approximately
$787,653 including employer tax obligation of such deferred payroll expense, in accrued liabilities. Accordingly, as of September 30,
2024 the Company has also committed to issue approximately $1,339,006 in equity compensation related to the deferred compensation.

<div align='center'>F-31

Heritage Distilling Holding Company, Inc.
Notes to Condensed Consolidated Financial Statements
(unaudited)</div>

NOTE 10 — ACQUISITION OF THINKING TREE SPIRITS

Business Combinations — On
February 21, 2024, the Company purchased all the outstanding stock of Thinking Tree Spirits, Inc. (“TTS”), which was
accounted for as a business combination, requiring assets and liabilities assumed to be measured and recorded at their acquisition date
fair values as of acquisition date.