Company: IPST
Filing Date: 2025-06-13
Form Type: S-1
Source: 0001641172-25-015121
Chunk: 155

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-06-13
Form: S-1
Chunk 155
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 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 sell to consumers 
 on their lands, which allows tribes to generate strong profitability.                       |

| ● | Tribal                                                                                       
 land is sovereign land, so tribes control their own zoning and permitting, which enables     
 them to substantially reduce the time and expense required to begin construction as compared 
 to building on non-tribal land.                                                              |

| ● | Tribes                                                                                        
 pay no sales tax on purchases of equipment or construction of distilleries and tasting rooms, 
 which lowers start-up costs as compared to non-tribal locations.                              |

| ● | Tribes                                                                                       
 also pay no state or county property tax, inventory tax, personal property tax or ad valorem 
 tax, which lowers their overall cost of operations compared to operations set up outside     
 of the tribal land.                                                                          |

In addition to the revenue generated by spirits produced on-site, we plan to create a member-based rebate for each tribe participating in the TBN based upon the production and sale of products on tribal lands and the overall growth of the brands produced on tribal lands and benefitting from marketing support at tribal casinos and entertainment districts. We believe this rebate will encourage more tribes to enter the TBN and will enable participating