Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 263

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 263
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 terms of the Subscription Exchange Agreement (when the common stock and prepaid warrants are unconditionally issued in exchange for the Whiskey Notes and related Warrants) upon the closing of the Company’s IPO (which occurred subsequent to September 30, 2024, on November 25, 2024) — which is the remaining prerequisite for the unconditional exchange of the Whiskey Notes and related Warrants for equity, at which time, the value of the shares and prepaid warrants will be recorded as common stock at the IPO price(of $4.00 per share), and the remaining fair value of the Convertible Notes will be recognized as a gain in Change in Value of Convertible Notes on the Company’s condensed consolidated statement of operations. (Calculated using an IPO price of $4.00 per share.) Until such a time, the Whiskey Notes and related Warrant Liabilities will remain on the Company’s balance sheet, and the change in their fair values will also continue to be recognized as Other Income/(Expense) in the Company’s Statement of Operations.

Convertible Notes at fair value consisted of the following:

| 2022 Convertible Promissory Notes                 |     | September 30, 
 2024          |   9,356,815 |   |     | December 31, 
 2023         |  18,801,206 |   |
|:--------------------------------------------------|:----|:--------------|------------:|:--|:----|:-------------|------------:|:--|
| 2023 Convertible Promissory Notes                 |     |               |   9,125,538 |   |     |              |  17,482,685 |   |
| Whiskey Special Ops 2023 Notes                    |     |               |  14,283,752 |   |     |              |   1,452,562 |   |
| Total Convertible Notes Payable                   |     | $             |  32,766,105 |   |     | $            |  37,736,453 |   |
| Less: Convertible Notes Payable, Current          |     |               | (18,482,353 | ) |     |              | (36,283,891 | ) |
| Convertible Notes Payable, net of Current Portion |     | $             |  14,283,752 |   |     | $            |   1,452,562 |   |

NOTE 6 — BOR