Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 345

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 345
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 the consummation of this offering) for
common stock. The then outstanding $26,797,284 in aggregate fair value ($8,678,433 of principal amount, including accrued interest; $6,630,870
of proceeds) of the Whiskey Notes and related Warrants (Warrant Liability) in accordance with a Subscription Exchange Agreement, exchanged
(contingent upon the consummation of this offering) for a total of 2,399,090 shares of our common stock and 546,927 prepaid warrants to
purchase our common stock. The Whiskey Notes and related warrants were exchanged (contingent upon the consummation of this offering) for
common stock; however, the Whiskey Notes and related Warrant Liabilities remain on our balance sheet until subsequent to December 31,
2023 (upon the effectiveness of the Company’s anticipated IPO — which is the remaining prerequisite for the unconditional
exchange of the outstanding indebtedness and related warrants for equity). (See Note 16.)

The following table presents information about the
Company’s financial liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy of the
valuation as of December 31, 2023 and 2022 under Level 3.

<div align='center'>F-64

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

NOTE 8 — FAIR VALUE MEASUREMENT

| 2022 and 2023 Convertible Notes         |     | Fair Value        
 Measurement as of 
 December 31,      
 2023              | 36,283,891 |     | December 31, 
 2022         | 8,041,000 |
|:----------------------------------------|:----|:------------------|-----------:|:----|:-------------|----------:|
| Whiskey Special Ops 2023 Notes          |     |                   |  1,452,562 |     |              |         — |
| Warrant Liabilities 2022 and 2023       |     |                   |    794,868 |     |              |   433,000 |
| Warrant Liabilities Whiskey Special Ops |     |                   |  1,512,692 |     |              |         — |
| Total Liabilities at Fair Value         |     | $                 | 40,044,013 |     | $            | 8,474,000 |

In November of 2023, the aggregate fair