Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 172

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 172
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, “Control
States”), and as a result, all spirits products in such states are sold and distributed through state liquor warehouses and state
owned or controlled stores. In those jurisdictions, distributors function like brokers, increasing product awareness to gain placement
in retail and on-premises outlets. We also utilize sales managers who handle regional and local sales for specific stores. Sales managers
are responsible for all activities related to the sales, distribution and marketing of our brands to the retail partners and distribution
network.

As for our DtC channel, we have started to utilize
new technologies and collaborations with the goal of reaching consumers in more than 46 states in 2024. This direct-to-consumer opportunity
allows us to sell products to consumers in more states and enables the collection of consumer data and supports growth in product demand,
which helps our distributors sell branded products in more states.

Tribal Beverage Network (TBN)

In addition to our traditional distribution channels,
we have formed the TBN, which we believe will become an important production, sales and marketing channel over time, while helping to
build our overall brand. This network was formed in collaboration with Native American tribes interested in entering a new business line
that became available to them for the first time in 2018. In 2018, Justin Stiefel, our Co-Founder, Chairman and Chief Executive Officer,
worked to lobby the U.S. Congress to pass legislation that overturned a 184-year federal law prohibiting spirits production on tribal
lands. As a result of this landmark legislation, Native American tribes have a new economic opportunity and we are working with several
Native American tribes on the development of our branded distilleries and tasting rooms, as well as the sale of our products and the creation
of brands unique to participating tribes.

Today, Native American tribes that sell spirits
to visitors at their casinos, restaurants, golf courses, hotels, resorts and shops are the largest sales accounts for spirits, wine and
beer in each county in which they are present. Accordingly, we believe the potential revenue for participating Native American tribes
is significant. As of December 31, 2023, there were approximately 245 Native American tribes in the U.S. with 524 tribal casinos
in 29 states that generated annual revenues of approximately $32 billion. Not all tribes own casinos and several do not permit the
sale of alcohol on their tribal lands. Each tribal casino that serves alcoholic beverages is the largest beer, wine and spirits account
in the county or state in