Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 136

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 136
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 approximately $117,000 decrease in rentals and leases                               
 expenses was primarily due to the closure of our Ballard retail location in March 2023. |

| ● | The approximately $274,000 decrease in sales and marketing                                                                                
 expenses included: an increase in radio and television production expense, which was offset by decreases in sponsorships and print and    
 web advertising as we shifted to a new third-party e-commerce platform. Two large sports sponsorships that were put under contract before 
 COVID-19 shutdowns went into effect were reinstated in 2022 and 2023. In 2023, those contracts alone exceeded $1 million and could not    
 be canceled. Those contracts are not being renewed for 2024 or beyond.                                                                    |

| ● | The approximately $282,000 increase in other sales and marketing                                                                         
 expenses included increases in: professional fees for contracted Chief Revenue Officer services and e-commerce distribution services     
 and travel; software for an improved point-of-sale software upgrade; location utilities and insurance; and a net increase in other sales 
 and marketing expenses.                                                                                                                  |

General and Administrative Expenses

General and administrative expenses were approximately
$7,477,000 for the year ended December 31, 2023, compared to approximately $7,598,000 for the year ended December 31, 2022. This approximately
$121,000 decrease included:

|                          | General and Administrative Expense | Years Ended December 31, 
 (rounded to $000’s)      |      2023 |     |   |      2022 |     |   |   Change |   |
|:-------------------------|:-----------------------------------|:-------------------------|----------:|:----|:--|----------:|:----|:--|---------:|:--|
| Personnel                |                                    | $                        | 1,961,000 |     | $ | 2,010,000 |     | $ |  (49,000 | ) |
| Recruiting and retention |                                    |                          |   163,000 |     |   |    55,000 |     |   |  108,000 |   |
| Professional Fees        |                                    |                          | 2,220,000 |     |   | 1,677,000 |     |   |  543,000 |   |
| Leases and Rentals       |                                    |                          |   658,000 |     |   | 1,253,000 |     |   |