Company: IPST
Filing Date: 2025-08-26
Form Type: S-1
Source: 0001213900-25-080839
Chunk: 160

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-26
Form: S-1
Chunk 160
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, and as we increase our sales of higher margin items, we expect this Products gross margin to increase significantly ( See also below our comments related to this in more detail in Non -GAAP Financial Measures).

95

Sales and Marketing Expenses Sales and marketing expenses were approximately $6,039,000 for the year ended December 31, 2024 compared to approximately $5,938,000 for the year ended December 31, 2023. This approximately $101,000 decrease included:

| Sales and Marketing Expense                
 2024                                       |     | Years Ended December 31, 
 (rounded to $000’s)      |      2023 |     |   |    Change |     |   |          |   |
|:-------------------------------------------|:----|:-------------------------|----------:|:----|:--|----------:|:----|:--|---------:|:--|
| Personnel – Cash Wages and Related Expense |     | $                        | 2,903,000 |     | $ | 3,259,000 |     | $ | (356,000 | ) |
| Personnel – Share-Based Compensation       |     |                          |   730,000 |     |   |         — |     |   |  730,000 |   |
| Tasting Room                               |     |                          |   144,000 |     |   |   119,000 |     |   |   25,000 |   |
| Leases and Rentals                         |     |                          |   740,000 |     |   |   712,000 |     |   |   28,000 |   |
| Sales and Marketing Expenses               |     |                          |   503,000 |     |   | 1,006,000 |     |   | (503,000 | ) |
| Other                                      |     |                          | 1,019,000 |     |   |   842,000 |     |   |  177,000 |   |
|                                            |     | $                        | 6,039,000 |     | $ | 5,938,000 |     | $ |  101,000 |   |

•The approximately $356,000 decrease in personnel expense was primarily a result of a decrease of five full -timemarketing and retail administration staff in May 2023. •The approximately $730,000 of non -cashshare -basedcompensation expense recognized in