Company: IPST
Filing Date: 2025-12-19
Form Type: S-1/A
Source: 0001213900-25-123872
Chunk: 126

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-12-19
Form: S-1/A
Chunk 126
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 as the brands grow and the TBN footprint expands, there will be an important synergy with increased adoption and growth through our wholesale channels in the regions where the TBN locations are driving trial and awareness. Similarly, as demand for our products grows through our wholesale channels, there should be a positive effect on the demand for the products produced by our tribal partners. On October23, 2025, in response to coming lease increases, recently -enactedstate tax increases on small businesses and pending wage increases, we announced that we would close our five owned and operated tasting rooms in Washington and Oregon effective December31, 2025, along with the transition of production to third -partycontract producers beginning in the first quarter of 2026. These actions, along with a significant reduction in headcount and overhead, are expected to result in significant reductions in net expenses with a resulting positive impact on our operating results. The elimination of in -houseproduction and the eventual termination of leases associated with operations is also expected to greatly reduce our unabsorbed overhead expense for every case of our product sold, thereby greatly improving margins. We will continue to sell spirits through distributors and direct to consumers online, and, through our TBN sales channel, will continue to work with Native American tribes to license the Heritage Distilling Company brand and our products for production and sale by tribes in HDC -brandedtasting rooms in or near their casino properties. Our Crypto and Related Business. In August 2025, we determined to focus our growing cryptocurrency efforts on the native cryptocurrency of the Story Network referred to as $IP Tokens. As part of this business segment, we established a new validator business related to $IP Tokens, staking 43.5million of the 53.2million $IP Tokens we acquired in the August15, 2025 PIPE transaction. To become a network validator, a holder of $IP Tokens is required to put up or “stake” $IP Tokens as collateral (like a security deposit) that shows the Story Network that it has “skin in the game.” A cryptocurrency validator is like a digital “notary” or “referee” in a blockchain network. Its job is to check that transactions on the network are real and follow the network rules. Validators are randomly selected to propose a new block of transactions to be added to the blockchain. When a participant attempts a transaction, that participant is required to pay a minimum “gas” fee. A participant also can opt to pay an additional fee to ensure that its transaction is added