Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 297

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 297
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 in such financings in the amount of 150% of their subscription amount for an aggregate of
approximately $24,495,000. See Note 5 — Payment Upon Sale of Flavored Bourbon, LLC.

In July 2024, three Thinking Tree Spirits shareholders
served their notice to exercise dissenters’ rights under Oregon law Dissenters’ rights statutes. (See Note 16.)

The Company maintains operating leases for various
facilities. See Note 11, Leases, for further information.

Litigation —From time
to time, the Company may become involved in various legal proceedings in the ordinary course of its business and may be subject to third-party
infringement claims.

In the normal course of business, the Company
may agree to indemnify third parties with whom it enters into contractual relationships, including customers, lessors, and parties to
other transactions with the Company, with respect to certain matters. The Company has agreed, under certain conditions, to hold these
third parties harmless against specified losses, such as those arising from a breach of representations or covenants, other third-party
claims that the Company’s products when used for their intended purposes infringe the intellectual property rights of such other
third parties, or other claims made against certain parties. It is not possible to determine the maximum potential amount of liability
under these indemnification obligations due to the Company’s limited history of prior indemnification claims and the unique facts
and circumstances that are likely to be involved in each claim.

As of September 30, 2024 and December 31,
2023, the Company has not been subject to any pending litigation claims.

Management Fee —The Company
is required to pay a monthly management fee to Summit Distillery, Inc (see Note 14).

NOTE 13 — RETIREMENT PLAN

The Company sponsors a traditional 401(k), Roth
401(k) and profit-sharing plan (the “Plan”), in which all eligible employees may participate after completing 3 months
of employment. No contributions have been made by the Company during the nine months ended September 30, 2024 and 2023.

NOTE 14 — RELATED-PARTY TRANSACTIONS

Management Agreement

On October 6, 2014, the Company entered into
a management agreement with Summit Distillery, Inc., an Oregon corporation, to open a new Heritage Distilling Company location in Eugene,
Oregon. The Company engaged Summit Distillery, Inc., to manage the Eugene location for an annual management fee