Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 33

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 33
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 their own standard of living, putting upward labor costs on our company before we have achieved some or
all of our growth plans. Our management continues to focus on cost containment and is monitoring the risks associated with inflation
and will continue to do so for the foreseeable future. However, sustained or increasing inflation could adversely impact our operations,
results of operations and financial condition.

Higher interest rates could adversely affect our ability to obtain debt financing and our operating results.

Interest rates rose substantially between March
2022 and July 2023, and there is uncertainty as to when and the rate at which interest rates will decline. If interest rates continue
to rise or remain higher than we have experienced in recent history, there is a risk it will cost more for us to conduct our business
or to get access to credit. There is also a risk that consumers may feel increased economic pressure and not be willing to spend on our
goods or services. Management continues to focus on interest rates and their impact on our business, the cost of borrowing and the potential
impacts on our future capital-raising efforts.

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Small Business Association (“SBA”) Paycheck Protection Program (“PPP”) loan repayment risk and timing.

In April 2022, we were advised we may have
received a PPP loan over the amount we were qualified for in Round 1 of that program, and in April 2023, we received a similar notification
for our Round 2 PPP loan. Those loans were part of the federal government’s relief package in response to the COVID-19 pandemic.
The SBA had forgiven both loans as we had followed all rules associated with the use of proceeds under that program. It is possible that
the SBA may determine that we must repay some of the amounts we received as PPP loans. If a demand is made by the SBA for some repayment,
it is unclear at this time what the payment term length would be for such repayment and there is a risk that the SBA may require immediate
payment or payment on a timeline that is shorter than we anticipate. Any demand for repayment could reduce our working capital and available
cash in a way that adversely impacts on our ability to execute our business and operating plans. If the SBA demands that we repay any
amounts owed more than the amount of our available cash, it could force us to raise new capital under less than favorable terms that
could be dilutive to stockholders, or to take on debt that could have higher borrowing costs. As of