Company: IPST
Filing Date: 2025-02-04
Form Type: 424B3
Source: 0001213900-25-010139
Chunk: 174

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-02-04
Form: 424B3
Chunk 174
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 tribes, including the recently announced agreement with the Tonto Apache Tribe in Arizona, which is working to open its tasting
room in early 2025 and its storage and bottling facility in 2025. In May 2024, we announced a landmark agreement with the Coquille Tribe
of Oregon after helping the Tribe navigate negotiations with the Oregon Liquor Control Board to allow for the first Tribal distillery
in Oregon. This is the first of such agreements between a Tribe and one of the 18 liquor control states in the United States. We have
additional agreements in place with several other tribes in Washington, Idaho, and Oklahoma, which will each be publicly announced based
on each Tribe’s own schedule. We are in discussions with several additional tribes in other states as we work to build out this
model.

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Pursuant to our multi-year agreement with the tribes,
we license portions of our intellectual property, including our brands, recipes, awards and programs, to the tribe for use at their branded
facility. We also assist the tribe with new product development, marketing, distribution, and tasting room operations, and Cask Club operations.
We also provide training, expertise and experience in the design, construction and operation of the tribe’s distillery. We earn
a monthly management fee from the tribe based on the monthly revenue of the tribe’s distillery, and receive a portion of the revenue
earned by the tribe, in each case, for retail operations related to distilled spirits sales and services on site and based on additional
production we bring to the facility. The parties can terminate the agreement under certain circumstances, including upon certain events
of default, including a material breach of the agreement, failure to achieve profitability after five years, changes in federal or
state laws related to alcohol, and a change of control of our company, among other limited events. We intend to enter into similar agreements
with other Native American tribes going forward.

We believe that membership in the TBN provides extensive
benefits to participating U.S. tribes, whether a tribe owns and operates a distributive facility or a localized distillery within
the network, including profit margins that are estimated to equal or exceed 80% on retail activities before fees are charged. Tribes also
enjoy unique benefits related to property and sales taxes associated with the production and sale of spirits on tribal trust land, including:

| ● | Tribes keep state and local liquor taxes on the sale of spirits                                          
 they produce and