Company: IPST
Filing Date: 2025-08-18
Form Type: PRE 14A
Source: 0001788230-25-000134
Chunk: 37

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-18
Form: PRE 14A
Chunk 37
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 believes that the potential increase in stock price may reduce the risk of market manipulation of our common stock, which we believe is enhanced when our stock trades below $1.00 per share. By reducing market manipulation risk, we may also thereby potentially decrease the volatility of our stock price.

For the foregoing reasons, the Board believes that the Reverse Stock Split is in the best interests of our Company and our stockholders to maintain Nasdaq listing compliance, facilitate capital raising and enhance the marketability and liquidity of our common stock, among other reasons.

Criteria to be Used for Determining Whether to Implement the Reverse Stock Split

This proposal gives the Board discretion to select a Reverse Stock Split ratio from within a range between and including 1:5 to 1:20, any time prior to the one-year anniversary of the Special Meeting, based on the Board’s then-current assessment of the factors below, and in order to maximize Company and stockholder interests. In determining whether to implement the Reverse Stock Split, and which ratio to implement, if any, the Board may consider, among other factors: the historical trading price and trading volume of our common stock; the then-prevailing trading price and trading volume of our common stock and the expected impact of the Reverse Stock Split on the trading market in the short-and long-term; the continued listing requirements for our common stock on Nasdaq or other exchanges; the expected stability of the per share price of our common stock following the Reverse Stock Split; the number of shares of common stock outstanding; which Reverse Stock Split ratio would result in the least administrative cost to us; our contractual requirements; advice from our financial advisors; and prevailing industry, market, and economic conditions.

Certain Risks and Potential Disadvantages Associated with the Reverse Stock Split

If completed, the Reverse Stock Split may not result in the intended benefits described above, the market price of our common stock may not increase (proportionately to the reduction in the number of shares of our common stock outstanding after the Reverse Stock Split or otherwise) following the Reverse Stock Split, and the market price of our common stock may decrease in the future. Although reducing the number of outstanding shares of our common stock through the Reverse Stock Split is intended, absent other factors, to increase the per share market price of our common stock, the effect of the Reverse Stock Split on our stock price cannot be predicted with any certainty. In addition, the history of reverse stock splits for other companies is varied, particularly since some investors may view a reverse stock split negatively