Climate Change Data

Environmental Metrics

Social Achievements

• Launched Special Operations Salute line of spirits, donating $10 from each $125 bottle to support veterans and first responders. Sold over 6,000 bottles generating over $750,000 in revenue since launch in late October 2023.

Climate Goals & Targets

Environmental Challenges

• Recurring operating losses and negative cash flows since inception.
• Intense competition in the craft spirits market.
• Reliance on third-party distributors.
• Seasonality of sales.
• Potential for litigation from vendors for unpaid invoices.
• Material weaknesses in internal controls over financial reporting.
• Risks associated with the Tribal Beverage Network (TBN).
• Supply chain disruptions and raw material price fluctuations.
• Maintaining production and co-packing agreements.
• Risks associated with partnerships, co-branding, and licensing agreements.
• Potential for personal injury claims at facilities.
• Risks associated with cyberattacks.
• Risks associated with the use of Artificial Intelligence (AI).
• Risks related to data privacy and protection.
• Risks associated with global conflicts.
• Difficulties in replicating product flavor profiles.
• Minority ownership interest in another brand with uncertain value.
• Pledged future earnings from brand sale to secure past financings.
• Potential dilution from capital calls in minority-owned brand.
• Potential for public disparagement for not being authentically 'craft'.

Mitigation Strategies

• Seeking additional financing through this IPO.
• Focusing on high-margin products and expanding wholesale distribution.
• Developing alternative sourcing strategies.
• Hiring a CFO with public company experience to address material weaknesses.
• Implementing measures to remediate material weaknesses.
• Developing contingency plans for supply chain disruptions.
• Implementing new internal controls and procedures.
• Continuously reviewing organizational structure and operations.
• Maintaining insurance coverage for various risks.
• Testing and implementing new AI technology to improve marketing efficiency.
• Implementing measures to comply with data privacy and protection laws.
• Monitoring global conflicts and their potential impacts.
• Developing strategies to manage inventory levels effectively.
• Working to integrate Thinking Tree Spirits brands and operations.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Severe weather events
• Water scarcity

Awards & Recognition

• Numerous awards from the American Distilling Institute
• Double Gold Medal, Gold Medal, and Best of Category for Stiefel's Select
• Vodka of the Year for 2023 for Thinking Tree Spirits' Butterfly Pea Lavendar Vodka
• World's Best Flavored Whiskey for Flavored Bourbon (2018 and 2019)
• Best flavored whiskey in the West for Cocoa Bomb (Sunset Magazine)

Environmental Metrics

ESG Focus Areas

• Not disclosed

Environmental Achievements

• Not disclosed

Social Achievements

• Launched Special Operations Salute line of spirits, donating $10 from each bottle to support veterans and first responders; sold over 8,000 bottles in first months, generating over $1,000,000 in revenue.
• Partnership with Native American tribes through the Tribal Beverage Network (TBN) to create new sales, manufacturing, and distribution channels on tribal lands.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Cash constraints restricting ability to deliver on orders and delaying growth opportunities.
• Competition from established and new entrants in the craft spirits market.
• Maintaining and expanding distribution network.
• Managing growth effectively.
• Potential for litigation from vendors for unpaid invoices.
• Material weaknesses in internal controls over financial reporting.
• Seasonality of sales.
• Risks associated with TBN partnerships (sovereign immunity, product quality, etc.).
• Potential for reputational damage from non-profit partners.
• Inventory management challenges.
• Difficulty replicating flavor profiles.
• Long lead time for production.
• Risks associated with minority ownership in Flavored Bourbon LLC.
• Risks associated with AI tools (copyright, liability, etc.).
• Risks related to data privacy and protection.
• Risks associated with cyberattacks.
• Risks related to global conflicts.
• Risks related to intellectual property protection.
• Extensive government regulation.
• Potential for product recalls.
• Potential for agreements with partners to be perceived as de facto franchise relationships.
• Risks associated with direct-to-consumer shipping.
• State-specific regulatory risks (Oregon).
• Limited management experience with public company operations.

Mitigation Strategies

• Hiring a Chief Financial Officer with public company experience to address material weaknesses.
• Implementing measures to remediate material weaknesses.
• Focusing on higher-margin activities (Special Operations Salute, premium whiskeys).
• Expanding wholesale distribution footprint.
• Reaching agreements with vendors for payment of outstanding invoices.
• Developing and refining disclosure controls and procedures.
• Managing inventory levels to meet demand.
• Seeking waivers of sovereign immunity from tribal partners.
• Implementing quality control measures for TBN partners.
• Careful selection and monitoring of non-profit partners.
• Using data from direct-to-consumer sales to support wholesale growth.
• Continuously reviewing organizational structure and operations.
• Negotiating loan modification agreement with Silverview Credit Partners L.P. to improve compliance.
• Using AI tools to improve marketing efficiency.
• Implementing measures to comply with data privacy laws.
• Maintaining cyber risk insurance.
• Monitoring global conflicts and their potential impacts.
• Seeking trademark protection and trade secret protection.
• Maintaining compliance with laws and regulations.
• Implementing procedures to prevent product recalls.
• Reviewing licensing agreements to avoid de facto franchise issues.
• Using a three-tier compliant third-party retailer for direct-to-consumer shipping.
• Monitoring Oregon-specific regulatory changes.
• Developing and refining internal controls and procedures.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Numerous awards from the American Distilling Institute and other national and international spirits competitions.

Environmental Metrics

ESG Focus Areas

• Not disclosed

Environmental Achievements

• Not disclosed

Social Achievements

• Developing a national reach in the U.S. through its unique Tribal Beverage Network (TBN) sales channel, collaborating with Native American tribes to develop Heritage-branded distilleries, brands, and tasting rooms, creating social and economic benefits for tribal communities.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Most awarded craft distillery in North America by the American Distilling Institute for ten years in a row.

Environmental Metrics

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities