Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 128

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 128
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,000 decrease                                                                                                   
 in legal fees was primarily the result of legal work in the nine months ended September 30, 2024 related to our IPO (that were not    
 otherwise deferred and subsequently capitalized) and general corporate purposes; compared to legal work in the nine months ended      
 September 30, 2023 related to the merger agreement for the proposed SPAC transaction, work associated with the preparation of related 
 filings with the SEC, and general corporate purposes.                                                                                 |

| ● | The approximately $277,000 increase                                                                                                          
 in other professional fees was primarily the result of the $180,000 media expense catch up in June 30, 2024 that was previously in deferred. |

Beginning in 2022, we began exploring funding
options, including preparations for the possible merger into a special purpose acquisition company (SPAC). While the costs directly associated
with this activity were capitalized and deferred to the balance sheet to be recognized as a cost of the transaction upon a successful
completion or other disposition, we also incurred certain other expenses related to preparing for the transaction that did not directly
qualify for capitalization and deferral, such as the preparation of audited consolidated financial statements, and certain expenses for
valuation and other financial services. In May 2023, we abandoned work on the proposed SPAC transaction, and as of December 31,
2023, we expensed the approximately $424,000 of related costs that had previously been capitalized and deferred to the balance sheet.

Interest Expense

Interest expense increased by approximately $4,000
to approximately $1,897,000 for the nine months ended September 30, 2024, compared to approximately $1,893,000 for the nine months
ended September 30, 2023. The increase was partly due to a loan agent fee for Silverwood of $25,000 for the nine months ended September
30, 2024, while no such fee was recorded for the nine months ended September 30, 2023. For the nine months ended September 30, 2024,
interest expense of 1% (or $17,000) was accrued on the PPP loan, while no such accrual was recorded for the nine months ended September
30, 2023. For the nine months ended September 30, 2024, interest and fees totaling $70,000 were accrued on Factoring Agreements and subsequently
converted to Preferred Stock in July and September 2024, which were classified as