Company: IPST
Filing Date: 2025-12-23
Form Type: 424B3
Source: 0001213900-25-125341
Chunk: 23

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-12-23
Form: 424B3
Chunk 23
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. We base our operating expense budgets on expected revenue trends and strategic objectives. Many of our expenses, such as office leases and certain personnel costs, are relatively fixed. We may be unable to adjust spending quickly enough to offset any unexpected shortfall in our cash flow. Accordingly, we may be required to take actions to pay expenses, such as selling $IP Tokens or using proceeds from equity or debt financings, some of which could cause significant variation in operating results in any quarter. 12 Based on the above factors, we believe quarter -to -quartercomparisons of our operating results are not a good indication of our future performance. It is possible that in one or more future quarters, our operating results may be below the expectations of public market analysts and investors. In that event, the market price of our common stock may fall. Risks associated with our net operating loss (“NOL”) carryforwards, tax liabilities and fluctuations between reporting periods could adversely affect our results of operations and financing costs and the market price of our common stock. As of September30, 2025, we recorded a provision for income taxes of 21% and a deferred income tax liability of $49.4million based on our 2025 year -to-datenet income before income taxes. In recording the deferred tax liability, we fully reserved against our net operating loss carryforwards without assuming the use of any of our accrued loss carryforwards at this time. We are awaiting the completion of a Section 382 NOL review to determine to what extent past NOLs can be used in the future, and if so, how much and over what period of time they can be used. As of December31, 2024, we had $61.2million of federal NOL carryforwards, some or all of which could be used to offset the currently -bookednet income to reduce any possible tax liability. The need for the Section 382 review was triggered by the size of our August15, 2025 private placement of Pre -FundedWarrants, the total number of new shares of common stock that are issuable as a result of such offering relative to our previously outstanding shares of common stock and the potential ownership changes that would result from the issuance of such shares. We anticipate the Section 382 report will be finalized prior to December31, 2025, which would allow for a full -yeartax and NOL reconciliation taking into account the value of our $IP Tokens as of December31, 2025