Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 68

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 68
---
, brand’s or entity’s intellectual property, or that the finished product was also
provided by the AI tool to other persons, brands, entities or businesses who may or may not be in competition with us. The use of similar
finished products in marketing, branding, advertising, strategies, or tactics could cause confusion in the marketplace or open us up to
accusation of plagiarism or the violation of another’s intellectual property rights. Such accusations, if proven true, could cause
disruptions for us, cause us to have to change tactics or strategies resulting in fewer sales and less revenue, or subject us to liability
for monetary compensation.

There is also a risk that the work product coming
from AI tools we use may result in a finished product that is based on the biases of the inputs of the creators, programmers or engineers
of such AI tools. Further, such biases could be built into how the algorithms driving such AI are constructed, altering the outputs in
a way that makes our use of the finished work product less effective or not consistent with our company or our brand objectives.

There is a risk that competitors, members of the public or others who want to hurt our company or our brand, begin to post on social media about our company or our brands that causes a backlash among consumers, or use AI to create false narratives about our company. There is also a risk that social media influencers, pundits or public personalities who may be viewed as controversial attempt to align themselves with our company or our brands that causes a backlash among consumers.

AI tools are being used to create fake video clips
and fake images. Some AI tools can also allow users to create videos in which it appears someone is doing or saying something that never
took place. These videos are becoming very difficult, if not impossible, to identify as fake. There is a risk that someone could create
videos or clips purporting to show one of our employees, executives, directors, contractors, suppliers, vendors, partners, influencers
or other party or affiliate associated with our company saying something offensive, hurtful, defamatory, or otherwise designed in such
a way as to harm our reputation or the reputation of our brands. In such cases, the resulting public backlash or boycotts of our products,
the potential for cancelled partnerships, or the removal of our products or brands from distribution, bars, restaurants, retail shelves
or other locations where they are sold and served, could cause us to lose sales and revenue and impact our operations or business prospects.
Such actions could also cause