Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 170

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 170
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eries in Washington and Oregon. We are also in the process of licensing out our
brand, products and programs under our TBN model to several tribes for HDC branded tasting room facilities in or next to their casino
operations. More information on our TBN effort is detailed in the next section.

As part of our innovation cycle, we utilize our
owned distilleries and tasting rooms in the Pacific Northwest and partner tasting rooms to test products and trial and sell directly to
consumers. In our tasting rooms, consumers can try new products as well as the mainstay or limited-production branded spirits and cocktails
while they experience the excitement of drinking in a differentiated environment. We have developed a strong membership base across our
facilities with over 2,500 active members, many of whom participate in our surveys on trends and taste preferences. These members are
either part of our Cask Club, which allows them to develop custom products selected from a list of pre-approved recipes in our portfolio
and to age them in their own 10-liter casks in our facility, or they are members of our Spirits Club, receiving regular shipments of spirits
throughout the year.

We also rely upon, and intend to increasingly grow,
the wholesale distribution of our products. SGWS, the leading U.S. spirits distributor with an approximately 34.6% market share across
the U.S. in 2021, distributes our original mainstream products in Washington, Oregon and Alaska. For the years ended December 31,
2023 and 2022, SGWS represented over 10% of our revenues. In July 2021, we began a distribution arrangement with RNDC, the second
largest U.S. spirits distributor with an approximate 20.3% market share in 2021, covering 39 of the 50 states in the U.S. plus
Canada. In February 2024, we launched wholesale distribution in Oklahoma through the MillerCoors beer network and added distribution in
the third quarter of 2024 in Kansas, Kentucky and portions of Colorado. We supplement the work of our distributors with a direct sales
force of individuals assigned to specific sales territories. These individuals manage the relationships with the applicable distributor’s
sales teams, who themselves have teams of varying sizes selling products to accounts. This team works directly with retailers and on-premises
operators to build demand and support their needs for marketing and other Heritage-specific information. In the nine-month period ended
September 30, 2024, we sold approximately