Company: IPST
Filing Date: 2025-10-16
Form Type: S-1/A
Source: 0001213900-25-099309
Chunk: 375

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-10-16
Form: S-1/A
Chunk 375
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 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Concentrations of credit risk — Financial instruments potentially subjecting the Company to concentrations of credit risk consist primarily of accounts receivable, accounts payable and bank demand deposits that may, from time to time, exceed Federal Depository Insurance Corporation (“FDIC”) insurance limits. To mitigate the risks associated with FDIC insured limits the Company recently opened an Insured Cash Swap (“ICS”) service account at its primary bank. Under terms of the ICS, when the bank places funds for the Company using ICS, the deposit is sent from the Company’s transaction account into deposit accounts at other ICS Network banks in amounts below the standard FDIC insured maximum of $ for overnight settling. If the Company’s account exceeds the FDIC limit of $ at the end of the business day, funds are automatically swept out by the Company’s bank and spread among partner banks in accounts, each totaling less than $. This makes the Company’s funds eligible for FDIC insurance protection each day. The funds are then swept back into the Company’s account at the beginning of the next business day. The aggregate limit that can be protected for the Company under this program is approximately million.

The Company considers the concentration of credit risk associated with its accounts receivable to be commercially reasonable and believes that such concentration does not result in the significant risk of near-term severe adverse impacts. As of December 31, 2024 and December 31, 2023, the Company had customers that individually represented 10% or more of the Company’s accounts receivable. There were two and two individual customers that together represented % and % of total accounts receivable, as of December 31, 2024 and December 31, 2023, respectively. There were five and four individual customer accounts that together represented % and % of total revenue for the years ended December 31, 2024 and 2023, respectively. There were two and three individual suppliers that together represented % and % of total accounts payable, as of December 31, 2024 and December 31, 2023, respectively.

Concentration of Revenues

|            |     | For the Years Ended 
        December 31, |   |     |      |   |
|            |     |                2024 |   |     | 2023 |   |
| Customer A |     |                  23 | % |     |   11 | % |
| Customer B |     |                  10 |