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What changed in Eightco Holdings Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Eightco Holdings Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+199 added−265 removedSource: 10-K (2025-04-15) vs 10-K (2024-04-02)

Top changes in Eightco Holdings Inc.'s 2024 10-K

199 paragraphs added · 265 removed · 142 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWhile strategic acquisitions may be considered for the Packaging Business and Forever 8 Business, management believes that organic growth is the key to success through continued sales efforts. The company is dedicated to maintaining a close partnership with customers, which will enable them to effectively focus their efforts and respond to changing demands.
Biggest changeThe Company is dedicated to maintaining a close partnership with customers, which will enable them to effectively focus their efforts and respond to changing demands. Management believes that by listening to customers and adapting to their needs and preferences, they can remain relevant in constantly evolving industries.
As a result, we believe that our current and other available suppliers will ensure that we obtain a sufficient supply of goods built to our specifications in a timely manner and on satisfactory economic terms. The main raw material used by our Packaging Business is corrugated cardboard.
As a result, we believe that our current and other available suppliers will ensure that we obtain a sufficient supply of goods built to our specifications in a timely manner and on satisfactory economic terms. The main raw material used by our Corrugated Packaging Business is corrugated cardboard.
Our reliance on independent party suppliers exposes us to vulnerability because of our dependence on a few sources of supply. We believe, however, that other sources of supply are available. In addition, we continually strive to develop relationships with other sources of supply in order to reduce our dependence on any one source of supply.
Our reliance on independent party suppliers exposes us to vulnerability because of our dependence on a few sources of supply. We believe, however, that other sources of supply are available. In addition, we continually strive to develop relationships with other sources of supply in order to reduce our dependence on any one source of supply.
Available Information Our website, www.8co.holdings , provides access, without charge, to our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with the Securities and Exchange Commission (“SEC”).
Our website is www.8co.holdings, Available Information Our website, www.8co.holdings , provides access, without charge, to our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with the Securities and Exchange Commission (“SEC”).
Packaging Business The Packaging Business, through Ferguson Containers, manufactures and sells custom packaging for a wide variety of products. In our experience, packaging has the capability to “tell” the products story, generating increased product awareness, promote brand image, and drive unit growth. Senior management has more than 100 years of combined experience marketing, producing and delivering packaging materials.
Corrugated Packaging Business The Corrugated Packaging Business, through Ferguson Containers, manufactures and sells custom packaging for a wide variety of products. In our experience, packaging has the capability to “tell” the products story, generating increased product awareness, promote brand image, and drive unit growth. Senior management has more than 100 years of combined experience marketing, producing and delivering packaging materials.
ITEM 1. BUSINESS Our company was established in 2021, initially composed of three businesses - the Web3 business, the BTC Mining Hardware Business and the Packaging Business, which we acquired from our former parent company, Vinco Ventures, Inc.
ITEM 1. BUSINESS Our company was established in 2021, initially composed of three businesses - the Web3 business, the BTC Mining Hardware Business and the Corrugated Packaging Business, which we acquired from our former parent company, Vinco Ventures, Inc. (the “Former Parent”).
Certain of our competitors may have more established brand names and stronger distribution channels than we do and have, or have through their owners, access to financial and marketing resources that are greater than we possess that may afford them the ability to invest more than we can in product development, intellectual property and marketing.
Certain of our competitors may have more established brand names and stronger distribution channels than we do and have, or have through their owners, access to financial and marketing resources that are greater than we possess that may afford them the ability to invest more than we can in product development, intellectual property and marketing. 6 Forever 8’s competitors include Clearco and Payoneer.
The Company intends to expand Forever 8’s market reach through strategic expansion while continuing to focus on revenue growth. Forever 8 generates revenue through the purchase and sale of products while the Packaging Business earns revenue from the sale of goods and related services. The Company plans to continually assess its businesses to allocate resources efficiently and maximize growth opportunities.
The Company intends to expand Forever 8’s market reach through strategic expansion while continuing to focus on revenue growth. Forever 8 generates revenue through the purchase and sale of products. The Company plans to continually assess its businesses to allocate resources efficiently and maximize growth opportunities.
The Company’s business has since been focused primarily on the Packaging Business and the business of Forever 8. Our corporate headquarters are located in Easton, Pennsylvania, and our common stock is listed on the Nasdaq Capital Market under the symbol “OCTO.” Forever 8 On October 1, 2022, the Company completed the acquisition of Forever 8, an e-commerce fintech company.
The Company’s business has since been focused primarily on the Corrugated Packaging Business and the Inventory Cash Flow Solutions business of Forever 8. Our corporate headquarters are located in Easton, Pennsylvania, and our common stock is listed on the Nasdaq Capital Market under the symbol “OCTO.” Forever 8 On October 1, 2022, the Company completed the acquisition of Forever 8.
These businesses had a more extended operating history than ours, and we include information related to their operations before our existence and acquisition in our discussions. On October 1, 2022, the Company completed the acquisition of Forever 8 Fund, LLC (“Forever 8”), an e-commerce fintech company that provides funding solutions for e-commerce businesses.
These businesses had a more extended operating history than ours, and we include information related to their operations before our existence and acquisition in our discussions. On October 1, 2022, the Company completed the acquisition of Forever 8 Fund, LLC (“Forever 8”), an inventory capital and management platform for e-commerce sellers.
The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments.
Segment Information The Company uses “the management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments.
Human Capital Resources As of April 1, 2024, the companies that comprise Eightco had 22 employees that perform various administrative, finance and accounting, technology, and corporate management functions. Of the 22 employees, 15 employees were employed by Ferguson Containers and 7 were employed by Forever 8. None of our employees are represented by a union in collective bargaining with us.
Human Capital Resources As of March 31, 2025, the companies that comprise Eightco had 23 employees that perform various administrative, finance and accounting, technology, and corporate management functions. Of the 23 employees, 14 employees were employed by Ferguson Containers and 9 were employed by Forever 8. None of our employees are represented by a union in collective bargaining with us.
Seasonality Our business is not seasonal and there are not large fluctuations with our operations between quarterly revenues based on the time of year. 6 Government Regulations Packaging and Inventory Solutions Businesses Like other manufacturers and distributors of consumer products, we are required to comply with a wide variety of federal, state, and international laws, rules, and regulations, including those related to consumer products and consumer protection, advertising and marketing, labor and employment, data protection and privacy, intellectual property, workplace health and safety, the environment, the import and export of products, and tax matters.
Government Regulations Corrugated Packaging and Inventory Solutions Businesses Like other manufacturers and distributors of consumer products, we are required to comply with a wide variety of federal, state, and international laws, rules, and regulations, including those related to consumer products and consumer protection, advertising and marketing, labor and employment, data protection and privacy, intellectual property, workplace health and safety, the environment, the import and export of products, and tax matters.
With a diverse range of industries and revenue sources, management believes they are well-positioned to navigate changing economic conditions and customer preferences. Eightco Holdings Inc. plans to expand through a combination of organic growth and strategic acquisitions.
With a diverse range of industries and revenue sources, management believes they are well-positioned to navigate changing economic conditions and customer preferences. Eightco plans to expand through a combination of organic growth and strategic acquisitions. While strategic acquisitions may be considered, management believes that organic growth is the key to success through continued sales efforts.
A backlog consists of orders for which purchase orders have been received and which are generally scheduled for shipment within six months or subject to capacity constraints, including lack of available products.
A backlog consists of orders for which purchase orders have been received and which are generally scheduled for shipment within six months or subject to capacity constraints, including lack of available products. We allow orders received that have not yet shipped to be cancelled; therefore, our backlog may not be indicative of future sales.
The Company’s chief operating decision maker is the Chairman and Chief Executive Officer (“CEO”) of the Company, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. The Company’s primary revenue streams include the sale of corrugated packaging materials and therefore the Company only identifies one reportable operating segment.
The Company’s chief operating decision maker is the Chairman and Chief Executive Officer (“CEO”) of the Company, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company.
As a result, we believe that our current and other available suppliers will ensure that we obtain a sufficient supply of goods built to our specifications in a timely manner and on satisfactory economic terms. Our BTC Mining Hardware Business is reliant on third-party suppliers.
As a result, we believe that our current and other available suppliers will ensure that we obtain a sufficient supply of goods built to our specifications in a timely manner and on satisfactory economic terms. 8 Backlog We currently do not have a material backlog of orders through our Corrugated Packaging Business.
Ferguson Containers does not have long-term agreements with its customers, and instead manufactures and sells its packaging products subject to purchase orders from its customers. In the fiscal years ended December 31, 2023 and 2022, the Packaging Business had revenue of $7,729,131 and $8,035,709, respectively.
Ferguson Containers does not have long-term agreements with its customers, and instead manufactures and sells its packaging products subject to purchase orders from its customers.
We compete, and plan to compete, primarily based upon innovation, performance, price, quality, reliability, durability, consumer brand awareness, and customer service and support. Our competitors include a large number of private companies that directly compete with a number of our brands.
Competition We operate and plan to operate in a competitive market and encounter competition from both domestic and foreign participants. We believe we can effectively compete with our present competitors. We compete, and plan to compete, primarily based upon innovation, performance, price, quality, reliability, durability, consumer brand awareness, and customer service and support.
These laws, rules, and regulations currently impose significant compliance requirements on our business, and more restrictive laws rules and regulations may be adopted in the future.
These laws, rules, and regulations currently impose significant compliance requirements on our business, and more restrictive laws rules and regulations may be adopted in the future. 7 For additional information about government regulation applicable to our business, see Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K.
Our competitors in the Web3 business will depend on what Web3 products we develop or acquire. Patents, Trademarks, and Copyrights We recognize the importance of innovation and protecting our intellectual property.
Competitors to our Corrugated Packaging Business include Sutherland Packaging, Acme Corrugated Box Company and Trenton Corrugated Products, Inc. Patents, Trademarks, and Copyrights We recognize the importance of innovation and protecting our intellectual property.
Forever 8’s unique approach directly purchases inventory on its customers’ behalf, applies a mark-up and collects the revenue as the products are sold. In the fiscal years ended December 31, 2023 and 2022, Forever 8 had revenue of $67,568,353 and $23,785,070, respectively.
Forever 8’s unique approach directly purchases inventory on its customers’ behalf, applies a mark-up and collects the revenue as the products are sold. The Company assumes the role of supplier and acts as a principal in these transactions, and therefore recognizes revenue on a gross basis.
Our principal executive office is located at 101 Larry Holmes Dr., Suite 313, Easton, PA 18042, and our telephone number is (866) 980-2818. Our website is www.8co.holdings, and the information included in, or linked to our website is not part of this Annual Report. We have included our website address in this Annual Report solely as a textual reference.
Our principal executive office is located at 101 Larry Holmes Dr., Suite 313, Easton, PA 18042, and our telephone number is (866) 980-2818.
There are currently no legal proceedings or claims asserted against the Company or its subsidiaries. Supply Chain and Production Our Packaging Business does not have long-term contractual arrangements with any of our suppliers that guarantee us production capacity, prices, lead times, or delivery schedules.
We compensate employees competitively relative to the industry and local labor market, and in accordance with all applicable federal, state and local wage, work hour, overtime and benefit laws. Supply Chain and Production Our Corrugated Packaging Business does not have long-term contractual arrangements with any of our suppliers that guarantee us production capacity, prices, lead times, or delivery schedules.
We utilize QuickBooks Enterprise and Xero Accounting as our ERP systems.
We utilize QuickBooks Enterprise and Xero Accounting as our ERP systems. Seasonality Our business is not seasonal and there are not large fluctuations with our operations between quarterly revenues based on the time of year.
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Web3 Business BlockHiro, LLC was formed in November 2021 to do business as a Web3 company. We had planned to launch a character driven virtual ecosystem, Freescape, comprised of themed interactive environments in 2022.
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At the time of entering into an agreement with the customer, Forever 8 takes title and assumes control of the inventory when it is purchased from its customers or directly from suppliers. This includes the responsibility for managing the inventory.
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Due to the current entertainment and gaming NFT market, we have decided to halt work on the Freescape project. 4 BTC Mining Hardware Business CW Machines, LLC, a Nevada limited liability company formed on October 2, 2021, was formed to hold the BTC Mining Hardware Business.
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Forever 8 has full discretion over the pricing of the inventory sold to its customers, established at the time of signing the agreement. Forever 8 also retains the right to liquidate inventory, exercising pricing discretion, particularly if certain sales thresholds are not met, which could result in selling below cost.
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The BTC Mining Hardware Business, CW Machines, LLC, through a joint venture with Wattum Management Inc. and BBA Technology Inc., is focused on bringing Bitcoin mining to the consumer level by offering Bitcoin mining equipment and co-location services. Eightco holds a 51% interest in CW Machines, LLC. CW Machines, LLC is a reseller of Bitcoin mining equipment and services.
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Forever 8 is not entitled to incremental fees from vendor customers for unsold inventory but its pricing model includes variable pricing based on aged inventory. The primary source of revenue is from the sale of inventory to its customers at a markup.
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The equipment sales primarily focus on Bitcoin mining equipment including Antminer S19s, Antminer S19 Pros, Whatsminer, and Canaan. Our Bitcoin mining services include reselling co-location services, which offer a physical location and ancillary services allowing Bitcoin miners to mine for Bitcoin. These services are provided by third-parties.
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Under the terms of the agreement, Forever 8 does not have an option to put or sell unsold inventory back to vendor customers. In the fiscal years ended December 31, 2024 and 2023, Forever 8 had revenue of $39,621,272 and $67,568,353, respectively.
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The BTC Mining Hardware Business does not currently have any material commitments for capital expenditures. As of the date of this Annual Report, the Company is not anticipating any future BTC mining equipment sales. Business Strategy Eightco Holdings Inc. is committed to driving revenue growth through its existing subsidiaries, Forever 8 and Ferguson Containers.
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On November 22, 2024, we entered into an Asset Purchase Agreement (the “APA”) among Ferguson Containers, Ferguson Containers, LLC (the “Buyer”) and Edward Reichard and Derick Reichard (the “Buyer’s Owners” and together with the Buyer, the “Buying Parties”). Pursuant to the APA, we agreed to sell certain assets (the “Purchased Assets”) constituting the business of Ferguson Containers to the Buyer.
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Management believes that by listening to customers and adapting to their needs and preferences, they can remain relevant in constantly evolving industries. 5 Competition We operate and plan to operate in a competitive market and encounter competition from both domestic and foreign participants. We believe we can effectively compete with our present competitors.
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The purchase price for the Purchased Assets will be (i) an aggregate of $557,835 in cash, (ii) $2,500,000 issued in the form of a seller note and (iii) the right to receive certain earnout consideration upon the achievement of certain milestones.
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Competitors to our Packaging Business include Sutherland Packaging, based in Andover, New Jersey, Acme Corrugated Box Company, based in Hatboro Pennsylvania, and Trenton Corrugated Products, Inc., based in Ewing, Pennsylvania. Competitors to our Inventory Solutions Business include Clearco and Payoneer. Competitors for our BTC Mining Hardware Business include Compass Mining, Miners Dep, and Alliance Miners.
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In December 2024, our shareholders approved the transactions contemplated by the APA and we are in the process of seeking to consummate such transactions. In the fiscal years ended December 31, 2024 and 2023, the Corrugated Packaging Business had revenue of $6,823,277 and $7,729,131, respectively. 5 Business Strategy Eightco is committed to driving revenue growth primarily through Forever 8.
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Web3 Business and BTC Mining Hardware Business The laws and regulations applicable to digital assets, including those we intend to produce under our Web3 Business and the Bitcoins mined by our BTC Mining Hardware Business customers, are evolving and subject to interpretation and change.
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Our competitors include a large number of private companies that directly compete with a number of our brands.
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Governments around the world have reacted differently to digital assets; certain governments have deemed them illegal, and others have allowed their use and trade without restriction, while in some jurisdictions, such as in the U.S., digital assets are subject to extensive, and in some cases overlapping, unclear and evolving regulatory requirements.
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The Company’s primary revenue streams include the sale of products under our inventory management solutions platform and corrugated packaging materials and therefore the Company has identified two reportable operating segments.
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As digital assets have grown in both popularity and market size, the U.S.
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Congress and a number of U.S. federal and state agencies, including FinCEN, the CFTC, the SEC, FINRA, the CFPB, the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS and state financial regulators, have been examining the operations of digital assets networks, digital assets users and digital assets exchange markets.
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Ongoing and future regulatory actions may alter, perhaps to a materially adverse extent, the nature of digital assets markets and our digital assets operations. Additionally, U.S. state and federal and foreign regulators and legislatures have taken responsive action against digital assets businesses or enacted restrictive regimes in response to hacks, consumer harm, or criminal activity stemming from digital assets activity.
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There is also increasing attention being paid by U.S. federal, state, and local energy regulatory authorities as the total electricity consumption of cryptocurrency-mining grows and potentially alters the supply and dispatch functionality of the wholesale grid and retail distribution systems. Many state legislative bodies are also actively reviewing the impact of cryptocurrency-mining in their respective states.
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Due to the relatively short history of Bitcoin and digital assets, and their emergence as a new asset class, government regulation of blockchain and digital assets is constantly evolving, with increased interest expressed by U.S. and international regulators.
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Government regulation of blockchains and digital assets is under active consideration by the United States federal government via its agencies and regulatory bodies, as well as by similar entities in other countries and transnational organizations. State and local regulations also may impact our activities and other activities in which we may participate in the future.
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Other governmental regulatory bodies have shown an interest in regulating or investigating companies engaged in blockchain or digital asset businesses.
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The effect of any regulatory change, either by the federal, state, local or foreign governments or any self-regulatory agencies on us is impossible to predict, but such change could be substantial and may have a material adverse effect on our business, financial condition, and results of operations.
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While we are unaware of significant adverse governmental or regulatory action adverse to Bitcoin mining in the United States, there is no guarantee that future regulation or adverse action will not take place and interpretation of existing regulations in a manner adverse to our business is possible.
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In addition, various foreign jurisdictions either have adopted, or may adopt, laws, regulations or directives that affect digital assets, digital asset networks, and their users and participants.
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Such laws, regulations or directives may conflict with those of the United States, may negatively impact the acceptance of digital assets by users, merchants, and service providers outside of the United States, and may therefore impede the growth of digital assets.
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Several Eastern European and Asian countries have a more restrictive posture toward digital assets and, thereby, have reduced the rate of expansion of digital asset use, as well as mining, in each of those countries.
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Presently, we do not believe any U.S. federal or state regulatory body has taken any action or position adverse to Bitcoin, with respect to its production, sale, and use as a medium of exchange; however, future changes to existing regulations or entirely new regulations may affect our business in ways it is not presently possible for us to predict with any reasonable degree of reliability. 7 We are unable to predict the effect that any future regulatory change, or any overlapping or unclear regulations, may have on us, but such change, overlap or lack of clarity could be substantial and make it difficult for us to operate our business or materially impact the market for digital assets that we mine or may mine in the future.
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FinCEN has issued guidance stating its position that it does not differentiate between fiat currency (which FinCEN calls “real currency”) and digital assets that are convertible into fiat currency or other forms of convertible virtual currencies (which FinCEN calls “virtual currency”) for purposes of determining whether a person or entity is engaging in “money transmission services”.
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Persons and entities engaging in virtual currency activities that amount to “money transmission services,” or otherwise cause them to be deemed a “money services business” under FinCEN’s regulations, must register with FinCEN as a money services business, implement an “effective” anti-money laundering program and comply with FinCEN’s reporting and recordkeeping requirements.
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In May 2019, FinCEN issued guidance relating to how the Bank Secrecy Act (“BSA”) and its implementing regulations relating to money services businesses apply to certain businesses that transact in convertible virtual currencies.
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Although the guidance generally indicates that certain mining and mining pool operations will not be treated as money transmission services, the guidance also addresses when certain activities, including certain services offered in connection with operating mining pools such as hosting convertible virtual currency wallets on behalf of pool members or purchasers of computer mining power, may be subject to regulation.
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Although we believe that our activities under the Web3 Business and the BTC Mining Hardware Business do not presently trigger FinCEN registration requirements under the BSA, if our activities cause us to be deemed a “money transmitter,” “money services business” or equivalent designation, under federal law, we may be required to cease certain of our operations.
Removed
Ceasing such operations could have a material adverse effect on our financial position, results of operations and cash flows. For additional information about government regulation applicable to our business, see Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K.
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We compensate employees competitively relative to the industry and local labor market, and in accordance with all applicable federal, state and local wage, work hour, overtime and benefit laws. Legal Proceedings During the normal course of its business, the Company may be subject to occasional legal proceedings and claims.
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We are a reseller and require the availability of the products we purchase, at wholesale, then distribute to final customers. We do not have long-term contractual arrangements with any of our suppliers that guarantee us adequate supply of Bitcoin mining equipment to satisfy the needs of our BTC Mining Hardware Business.
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Our main suppliers of Bitcoin mining equipment sold under the BTC Mining Hardware Business is Wattum Management, Inc. Backlog We currently do not have a material backlog of orders through our Packaging Business.
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We allow orders received that have not yet shipped to be cancelled; therefore, our backlog may not be indicative of future sales. 8 Segment Information The Company uses “the management approach” in determining reportable operating segments.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur auditors have expressed in the report of independent registered public accounting firm that there is substantial doubt about our ability to continue as a going concern; ● Loss of any or all of our key management personnel may present challenges; ● We could be adversely affected by declines in discretionary consumer spending, consumer confidence and general and regional economic conditions; ● We operate in highly competitive industries and our revenues, profits or market share could be harmed if we are unable to compete effectively; ● We may not be able to fund capital expenditures and investment in projects and offerings; ● A deterioration in the domestic and international economic environment, whether by way of current inflationary conditions or potential recessionary conditions, could adversely affect our operating results, cash flow and financial condition; ● Geopolitical risks, such as those associated with Russia’s invasion of Ukraine, could result in a decline in the outlook for the U.S. and global economies; ● Cyber security risks and the failure to maintain the integrity of internal, partner, and consumer data could result in damages to our reputation, the disruption of operations and/or subject us to costs, fines or lawsuits; ● Our insurance coverage may not be adequate to cover all possible losses that we could suffer and our insurance costs may increase; ● Our management has limited experience in operating a public company; ● The requirements of being a public company may strain our resources and distract management; and ● Our business plan may require additional liquidity and capital resources that might not be available on terms that are favorable to us, or at all. 9 Risks Related to Our Packaging Business ● We are subject to the costs and availability of raw materials, and we rely on a limited number of third-party suppliers of raw materials; and ● We may be affected by interruptions in the transportation of the materials we require to produce packaging.
Biggest changeOur auditors have expressed in the report of independent registered public accounting firm that there is substantial doubt about our ability to continue as a going concern; ● Loss of any or all of our key management personnel may present challenges; ● We could be adversely affected by declines in discretionary consumer spending, consumer confidence and general and regional economic conditions; ● We operate in highly competitive industries and our revenues, profits or market share could be harmed if we are unable to compete effectively; ● We may not be able to fund capital expenditures and investment in projects and offerings; ● A deterioration in the domestic and international economic environment, whether by way of current inflationary conditions or potential recessionary conditions, could adversely affect our operating results, cash flow and financial condition; ● Geopolitical risks, such as those associated with Russia’s invasion of Ukraine, could result in a decline in the outlook for the U.S. and global economies; ● Cyber security risks and the failure to maintain the integrity of internal, partner, and consumer data could result in damages to our reputation, the disruption of operations and/or subject us to costs, fines or lawsuits; ● Our insurance coverage may not be adequate to cover all possible losses that we could suffer and our insurance costs may increase; ● Our management has limited experience in operating a public company; ● The requirements of being a public company may strain our resources and distract management; and ● Our business plan may require additional liquidity and capital resources that might not be available on terms that are favorable to us, or at all.
With respect to the Packaging Business, our competitors include Sutherland Packaging, Acme Corrugated Box Company, and Trenton Corrugated Products, Inc. Competition in each of these areas may increase as a result of technological developments, changes in consumer preferences, economic conditions, changes in market structure, and other factors.
With respect to the Corrugated Packaging Business, our competitors include Sutherland Packaging, Acme Corrugated Box Company, and Trenton Corrugated Products, Inc. Competition in each of these areas may increase as a result of technological developments, changes in consumer preferences, economic conditions, changes in market structure, and other factors.
Wood fiber, including old corrugated containers (“OCC”), is the principal raw material in many parts of the paper and packaging industry, including the corrugated cardboard on which our Packaging Business relies. Wood fiber is a commodity, and prices historically have been cyclical and have varied on a regional basis.
Wood fiber, including old corrugated containers (“OCC”), is the principal raw material in many parts of the paper and packaging industry, including the corrugated cardboard on which our Corrugated Packaging Business relies. Wood fiber is a commodity, and prices historically have been cyclical and have varied on a regional basis.
The uncertain nature, magnitude, and duration of hostilities stemming from Russia’s recent military invasion of Ukraine, and the ongoing conflict between Israel and Hamas, including the potential effects of sanctions and retaliatory cyber-attacks on the world economy and markets, have contributed to increased market volatility and uncertainty, and such geopolitical risks could have an adverse impact on macroeconomic factors which affect our businesses, as well as our access to capital.
The uncertain nature, magnitude, and duration of hostilities stemming from Russia’s military invasion of Ukraine, and the ongoing conflict between Israel and Hamas, including the potential effects of sanctions and retaliatory cyber-attacks on the world economy and markets, have contributed to increased market volatility and uncertainty, and such geopolitical risks could have an adverse impact on macroeconomic factors which affect our businesses, as well as our access to capital.
Any additional capital raised through the sale of additional shares of our capital stock, convertible debt or other equity may dilute the ownership percentage of our stockholders. 13 Risks Related to Our Packaging Business An increase in the cost or a reduction in the availability of wood fiber, other raw materials, energy and transportation may have an adverse effect on our profitability and results of operations.
Any additional capital raised through the sale of additional shares of our capital stock, convertible debt or other equity may dilute the ownership percentage of our stockholders. 13 Risks Related to Our Corrugated Packaging Business An increase in the cost or a reduction in the availability of wood fiber, other raw materials, energy and transportation may have an adverse effect on our profitability and results of operations.
Disruptions to our Packaging Business could occur due to any number of circumstances, including prolonged power outages, mechanical or process failures, shortages of raw materials, natural catastrophes, disruptions in the availability of transportation, labor disputes, terrorism, changes in or non-compliance with environmental or safety laws, and the lack of availability of services from any of our facilities’ key suppliers.
Disruptions to our Corrugated Packaging Business could occur due to any number of circumstances, including prolonged power outages, mechanical or process failures, shortages of raw materials, natural catastrophes, disruptions in the availability of transportation, labor disputes, terrorism, changes in or non-compliance with environmental or safety laws, and the lack of availability of services from any of our facilities’ key suppliers.
We operate in highly competitive industries and our revenues, profits or market share could be harmed if we are unable to compete effectively. Each of the Eightco Businesses will face competition from existing competitors. Our competitors in the Inventory Management Solutions business include Clearco.
We operate in highly competitive industries and our revenues, profits or market share could be harmed if we are unable to compete effectively. Each of the Eightco businesses will face competition from existing competitors. Our competitors in the Inventory Management Solutions business include Clearco and Payoneer.
As a result, we may not be able to compete successfully against such competitors. We may not be able to fund capital expenditures and investment in projects and offerings. A principal competitive factor for a large portion of the Eightco Businesses is the originality and perceived quality of our products and offerings.
As a result, we may not be able to compete successfully against such competitors. 11 We may not be able to fund capital expenditures and investment in projects and offerings. A principal competitive factor for a large portion of the Eightco businesses is the originality and perceived quality of our products and offerings.
Eightco Holdings Inc. was formed on September 21, 2021, in the State of Nevada and converted to a Delaware corporation on March 9, 2022. Our Packaging Business was formed in 1966, however the rest of our businesses were recently started.
Eightco Holdings Inc. was formed on September 21, 2021, in the State of Nevada and converted to a Delaware corporation on March 9, 2022. Our Corrugated Packaging Business was formed in 1966. However the rest of our businesses were recently started.
Certain of our Packaging Business customers provide goods that are discretionary items for consumers. Therefore, their business, and in turn our Packaging Business, depends on the strength of the retail, commercial, and industrial sectors of the economy in various parts of the world, and trends therein.
Certain of our Corrugated Packaging Business customers provide goods that are discretionary items for consumers. Therefore, their business, and in turn our Corrugated Packaging Business, depends on the strength of the retail, commercial, and industrial sectors of the economy in various parts of the world, and trends therein.
Increases in costs may need to be passed on to our customers, and ultimately may negatively affect our business. 14 Disruptions in transportation could adversely affect our supply of raw materials and could have an adverse effect on our results of operations, profitability, and liquidity.
Increases in costs may need to be passed on to our customers, and ultimately may negatively affect our business. Disruptions in transportation could adversely affect our supply of raw materials and could have an adverse effect on our results of operations, profitability, and liquidity.
These provisions are expected to include, among others: ● rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; ● the right of Eightco’s board of directors to issue preferred stock without stockholder approval; ● the ability of Eightco’s directors, and not stockholders, to fill vacancies (including those resulting from an enlargement of the board of directors) on Eightco’s board of directors; ● the division of Eightco’s board of directors into three classes of directors, with each class serving a staggered term; and ● a provision that directors serving on a classified board may be removed by stockholders only for cause.
These provisions include, among others: ● rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; ● the right of Eightco’s board of directors to issue preferred stock without stockholder approval; ● the ability of Eightco’s directors, and not stockholders, to fill vacancies (including those resulting from an enlargement of the board of directors) on Eightco’s board of directors; ● the division of Eightco’s board of directors into three classes of directors, with each class serving a staggered term; and ● a provision that directors serving on a classified board may be removed by stockholders only for cause.
We cannot ensure that any efforts we might undertake to adapt our product offerings to such changes would be successful or sufficient. Because we service customers in a variety of industries, we may be particularly impacted by general economic downturns. Our Packaging Business provides packaging for third-party customers in a variety of industries, including pharmaceutical and e-commerce companies.
We cannot ensure that any efforts we might undertake to adapt our product offerings to such changes would be successful or sufficient. 14 Because we service customers in a variety of industries, we may be particularly impacted by general economic downturns. Our Corrugated Packaging Business provides packaging for third-party customers in a variety of industries, including pharmaceutical and e-commerce companies.
Our executive officers have limited experience in the management of a publicly traded company. Our management team may not successfully or effectively manage its transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws.
Our management has limited experience in operating a public company. Our executive officers have limited experience in the management of a publicly traded company. Our management team may not successfully or effectively manage its transition to a public company that will be subject to significant regulatory oversight and reporting obligations under federal securities laws.
One of our companies, Ferguson Containers, has material weaknesses in its controls over financial reporting, which could negatively impact investor confidence in the accuracy and completeness of our financial reports, and cause the price of our common stock to decline.
Ferguson Containers has material weaknesses in its controls over financial reporting, which could negatively impact investor confidence in the accuracy and completeness of our financial reports, and cause the price of our common stock to decline.
If we are unable to list on Nasdaq, we would likely be more difficult to trade in or obtain accurate quotations as to the market price of our common stock.
If we are unable to remain listed on Nasdaq, it would likely be more difficult to trade in or obtain accurate quotations as to the market price of our common stock.
In the future, your percentage ownership in our company may be diluted because of equity issuances for warrant exercises, acquisitions, strategic investments, capital market transactions, or otherwise, including equity compensation awards that we grant to our directors, officers and employees. Our Compensation Committee can be expected to grant additional equity compensation awards to our employees after the Separation.
In the future, your percentage ownership in our company may be diluted because of equity issuances for warrant exercises, acquisitions, strategic investments, capital market transactions, or otherwise, including equity compensation awards that we grant to our directors, officers and employees.
See “Description of Capital Stock—Preferred Stock.” 21 Our common stock will be subordinate to all of our future indebtedness and any series of preferred stock, and effectively subordinated to all indebtedness and preferred equity claims against our subsidiaries. Shares of our common stock will rank junior to all of our future indebtedness and other liabilities.
Our common stock will be subordinate to all of our future indebtedness and any series of preferred stock, and effectively subordinated to all indebtedness and preferred equity claims against our subsidiaries. Shares of our common stock will rank junior to all of our future indebtedness and other liabilities.
Our ability to acquire new customers could be materially harmed if we are unable to enter into or maintain these relationships on terms that are commercially reasonable to us, or at all.
We rely on relationships with marketplaces and enterprises to obtain and maintain customers. Our ability to acquire new customers could be materially harmed if we are unable to enter into or maintain these relationships on terms that are commercially reasonable to us, or at all.
For a discussion of the anti-takeover provisions, See “Description of Capital Stock – Anti-Takeover Provisions.” Our Certificate of Incorporation provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Our Certificate of Incorporation provides that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.
Please also read carefully the section below entitled “Special Note Regarding Forward-Looking Statements.” Summary of our Risk Factors Risks Related to Our Business Generally ● We are a recently formed entity, led by management that has limited experience operating a public company, with little track record and limited historical financial information available; ● The Company has limited financial resources.
Please also read carefully the section below entitled “Cautionary Note Regarding Forward-Looking Statements and Summary Risk Factors.” 9 Summary of our Risk Factors Risks Related to Our Business Generally ● We are a recently formed entity with little track record and limited historical financial information available; ● The Company has limited financial resources.
These anti-takeover provisions may also limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. These anti-takeover provisions may also limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.
Any of these factors could have a material adverse effect on our stockholders’ investment in our securities, and our securities may trade at prices significantly below the price they paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.
Any of these factors could have a material adverse effect on our stockholders’ investment in our securities, and our securities may trade at prices significantly below the price they paid for them.
For Ferguson Containers’ fiscal years ended December 31, 2023 and 2022, respectively, Ferguson Containers had the following material weakness in internal controls over financial reporting: ● Primarily due to the small size of Ferguson Containers, it does not maintain sufficient segregation of duties to ensure the processing, review and authorization of all transactions including non-routine transactions. ● Ferguson Containers’ processes lacked timely and complete reviews and analysis of information used to prepare its financial statements and disclosures in accordance with accounting principles generally accepted in the United States of America.
For Ferguson Containers’ fiscal years ended December 31, 2024 and 2023, respectively, Ferguson Containers had the following material weakness in internal controls over financial reporting: ● Primarily due to the small size of Ferguson Containers, it does not maintain sufficient segregation of duties to ensure the processing, review and authorization of all transactions including non-routine transactions. ● Ferguson Containers’ processes lacked timely and complete reviews and analysis of information used to prepare its financial statements and disclosures in accordance with accounting principles generally accepted in the United States of America. 17 The material weaknesses of Ferguson Containers’ internal control over financial reporting could negatively impact investor confidence in the accuracy and completeness of our financial reports, which could cause the price of our common stock to decline.
If our common stock is delisted from trading on Nasdaq, and we are not able to list our common stock on another exchange or to have it quoted on Nasdaq, our securities could be quoted on the OTC Bulletin Board or on the “pink sheets.” As a result, we could face significant adverse consequences including, without limitation: ● a limited availability of market quotations for our securities; ● a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; ● a limited amount of news and analyst coverage for our Company; and ● a decreased ability to issue additional securities (including pursuant to short-form registration statements on Form S-3 or obtain additional financing in the future).
As a result, we could face significant adverse consequences including, without limitation: ● a limited availability of market quotations for our securities; ● a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; ● a limited amount of news and analyst coverage for our Company; and ● a decreased ability to issue additional securities (including pursuant to short-form registration statements on Form S-3 or obtain additional financing in the future). 22
Risks Related to Forever 8 and its Operations ● Our stockholders may experience substantial dilution from the issuance of equity consideration in the Forever 8 acquisition and may not realize a benefit from the Forever 8 acquisition commensurate with the ownership dilution they may experience in connection with the acquisition; ● Our business depends on our strong and trusted brand, and failure to maintain and protect our brand, or any damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results of operations; ● We are dependent upon consumers continued and unimpeded access to the internet, and upon their willingness to use the internet for commerce; and ● Our results of operations may be adversely affected by changes in foreign currency exchange rates.
Risks Related to Forever 8 and its Operations ● Our business depends on our strong and trusted brand, and failure to maintain and protect our brand, or any damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results of operations; ● We are dependent upon consumers continued and unimpeded access to the internet, and upon their willingness to use the internet for commerce; and ● Our results of operations may be adversely affected by changes in foreign currency exchange rates.
Although our common stock is listed on the Nasdaq under the trading symbol “OCTO,” an active trading market for our common stock may never develop or be sustained.
An active, liquid trading market for our common stock may not develop, which may limit your ability to sell your shares. Although our common stock is listed on the Nasdaq under the trading symbol “OCTO,” an active trading market for our common stock may never develop or be sustained.
In addition, our Certificate of Incorporation authorizes our board of directors to create and issue, without the approval of our stockholders, one or more series of preferred stock having such powers, preferences, and rights, if any, and such qualifications, limitations, and restrictions, if any, as established by our board of directors.
From time to time, we may issue additional equity compensation awards to our employees under our employee benefits plans. 21 In addition, our Certificate of Incorporation authorizes our board of directors to create and issue, without the approval of our stockholders, one or more series of preferred stock having such powers, preferences, and rights, if any, and such qualifications, limitations, and restrictions, if any, as established by our board of directors.
Because we subject the above listed reduced reporting requirements, investors may not be able to compare us to other companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies. Your percentage ownership in our company may be diluted in the future.
Because we subject the above listed reduced reporting requirements, investors may not be able to compare us to other companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies. We may not receive the desired benefits of selling Ferguson Containers.
There can be no assurance that our insurance will be sufficient to cover the full extent of all losses or liabilities for which we are insured, and we cannot guarantee that we will be able to obtain insurance policies on favorable terms, or at all. 12 Our management has limited experience in operating a public company.
We seek to maintain comprehensive insurance coverage at commercially reasonable rates. There can be no assurance that our insurance will be sufficient to cover the full extent of all losses or liabilities for which we are insured, and we cannot guarantee that we will be able to obtain insurance policies on favorable terms, or at all.
We may face various security threats, including cyber security attacks on our data (including our vendors’ and customers’ data) and/or information technology infrastructure. Although we utilize various procedures and controls to monitor and mitigate these threats, there can be no assurance that these procedures and controls will be sufficient to prevent penetrations or disruptions to our systems.
Although we utilize various procedures and controls to monitor and mitigate these threats, there can be no assurance that these procedures and controls will be sufficient to prevent penetrations or disruptions to our systems.
For continued listing on Nasdaq, we will be required to comply with the continued listing requirements, including the minimum market capitalization standard, the corporate governance requirements and the minimum closing bid price requirement, among other requirements.
For continued listing on Nasdaq, we are required to comply with the continued listing requirements, including the minimum market capitalization standard, the corporate governance requirements and the minimum closing bid price requirement, among other requirements. In the event that we fail to satisfy any of the listing requirements of Nasdaq, our common stock may be delisted.
We also rely on accounting, financial and operational management information technology systems to conduct our operations. If these information technology systems suffer severe damage, disruption or shutdown and our business continuity plans do not effectively resolve the issues in a timely manner, our business, financial condition and results of operations could be materially adversely affected.
If these information technology systems suffer severe damage, disruption or shutdown and our business continuity plans do not effectively resolve the issues in a timely manner, our business, financial condition and results of operations could be materially adversely affected. 12 We may face various security threats, including cyber security attacks on our data (including our vendors’ and customers’ data) and/or information technology infrastructure.
Our brand promotion activities may not generate customer awareness or increase revenue, and even if they do, any increase in revenue may not offset the expenses we incur in building our brand.
Our brand promotion activities may not generate customer awareness or increase revenue, and even if they do, any increase in revenue may not offset the expenses we incur in building our brand. If we fail to successfully promote and maintain our brand or if we incur excessive expenses in this effort, our business could be materially and adversely affected.
These awards would have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock. From time to time, we may issue additional equity compensation awards to our employees under our employee benefits plans.
These awards would have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock.
Anti-takeover provisions contained in our Certificate of Incorporation and Bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
In such circumstances, the trading price of our securities may not recover and may experience a further decline. 18 Anti-takeover provisions contained in our Certificate of Incorporation and Bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
We cannot assure you that our operations will be able to generate sufficient cash flow to fund such costs, or that we will be able to obtain sufficient financing on adequate terms, or at all, which could cause us to delay or abandon certain projects or plans. 11 A deterioration in the domestic and international economic environment, whether by way of current inflationary conditions or potential recessionary conditions, could adversely affect our operating results, cash flow and financial condition.
We cannot assure you that our operations will be able to generate sufficient cash flow to fund such costs, or that we will be able to obtain sufficient financing on adequate terms, or at all, which could cause us to delay or abandon certain projects or plans.
The failure of an active and liquid trading market to develop and continue would likely have a material adverse effect on the value of our common stock, and you may not be able to sell your shares of our common stock. 18 We may issue shares of preferred stock in the future, which could make it difficult for another company to acquire us or could otherwise adversely affect holders of our common stock, which could depress the price of our common stock.
The failure of an active and liquid trading market to develop and continue would likely have a material adverse effect on the value of our common stock, and you may not be able to sell your shares of our common stock.
In addition, we may become subject to exchange control regulations that restrict or prohibit the conversion of our foreign revenue currencies into United States dollars. Any of these factors could decrease the value of revenues and earnings we derive from our international operations and have a material adverse effect on our business.
In addition, we may become subject to exchange control regulations that restrict or prohibit the conversion of our foreign revenue currencies into United States dollars.
Our stockholders may experience substantial dilution from the issuance of such shares of our common stock. Our business depends on our strong and trusted brand, and failure to maintain and protect our brand, or any damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results of operations.
It could also cause the market price of our securities to decline. 15 Risks Related to Forever 8 and its Operations Our business depends on our strong and trusted brand, and failure to maintain and protect our brand, or any damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results of operations.
Current inflationary conditions in the United States and other parts of the world have increased some of our costs, including our cost of materials and labor.
A deterioration in the domestic and international economic environment, whether by way of current inflationary conditions or potential recessionary conditions, could adversely affect our operating results, cash flow and financial condition. Current inflationary conditions in the United States and other parts of the world have increased some of our costs, including our cost of materials and labor.
Any performance failure on the part of our suppliers could interrupt production of our products, which would have a material adverse effect on our business. 15 Risks Related to Forever 8 and its Operations Our stockholders may experience substantial dilution from the issuance of equity consideration in the Forever 8 acquisition and may not realize a benefit from the Forever 8 acquisition commensurate with the ownership dilution they will experience in connection with the Acquisition.
Any performance failure on the part of our suppliers could interrupt production of our products, which would have a material adverse effect on our business. We may not achieve the desired benefits of selling Ferguson Containers. We have entered into the APA to sell Ferguson Containers.
Our Certificate of Incorporation authorizes us to issue one or more series of preferred stock.
We may issue shares of preferred stock in the future, which could make it difficult for another company to acquire us or could otherwise adversely affect holders of our common stock, which could depress the price of our common stock. Our Certificate of Incorporation authorizes us to issue one or more series of preferred stock.
Removed
We seek to maintain comprehensive insurance coverage at commercially reasonable rates.
Added
Risks Related to Our Corrugated Packaging Business ● We are subject to the costs and availability of raw materials, and we rely on a limited number of third-party suppliers of raw materials; and ● We may be affected by interruptions in the transportation of the materials we require to produce packaging.
Removed
In connection with the acquisition, we may issue shares of our common stock as consideration to Forever 8’s former owners, including the issuance of shares of our common stock upon the exercise of a put right on certain preferred membership interests of Forever 8 and upon the achievement of certain earnout targets.
Added
We also rely on accounting, financial and operational management information technology systems to conduct our operations.
Removed
If we fail to successfully promote and maintain our brand or if we incur excessive expenses in this effort, our business could be materially and adversely affected. 16 We rely on relationships with marketplaces and enterprises to obtain and maintain customers.
Added
If we consummate the sale of Ferguson Containers pursuant to the APA, we may not achieve the expected benefits of such sale and may incur additional expenses related thereto. This may have a negative impact on our business and results of operations.
Removed
Climate change and environmental issues could adversely affect our operations, business, customers and partners. Concerns over the risks associated with climate change and environmental matters have been growing in recent years and are at the center of rapidly evolving rule-making in the United States and abroad.
Added
Any of these factors could decrease the value of revenues and earnings we derive from our international operations and have a material adverse effect on our business. 16 Risks Related to Our Securities and other General Risks We currently do not intend to pay dividends on our common stock.
Removed
Customers, investors, partners, and other stakeholders are increasingly focused on environmental, social and governance (“ESG”) practices.
Added
We have entered into the APA to sell Ferguson Containers. If we consummate the sale of Ferguson Containers pursuant to the APA, we may not achieve the expected benefits of such sale and may incur additional expenses related thereto. This may have a negative impact on our business and results of operations.
Removed
While we have not yet identified a material impact on our results and operations, we acknowledge that physical events, such as extreme weather and natural disasters, could disrupt our operations or those of our customers, partners, or third parties on which we rely, and may result in market volatility, shift in customer purchasing behaviors and travel patterns, and subsequently adversely impact our business.
Added
It could also cause the market price of our securities to decline. Your percentage ownership in our company may be diluted in the future.
Removed
In addition, current and emerging ESG-related regulation, such as mandated disclosures or requirements to reduce carbon footprint, may result in increased compliance requirements, which may increase our costs. 17 Risks Related to Our Securities We currently do not intend to pay dividends on our common stock.
Added
If our common stock is delisted from trading on Nasdaq, and we are not able to list our common stock on another exchange or to have it quoted on Nasdaq, our securities could be quoted on the OTC Markets.
Removed
The material weaknesses of Ferguson Containers’ internal control over financial reporting could negatively impact investor confidence in the accuracy and completeness of our financial reports, which could cause the price of our common stock to decline. An active, liquid trading market for our common stock may not develop, which may limit your ability to sell your shares.
Removed
A reverse stock split may decrease the liquidity of the shares of our common stock.
Removed
On October 5, 2022, we received a letter from the Listing Qualifications Department of Nasdaq indicating that, based upon the closing bid price of the Company’s common stock for the 31 consecutive business day period between August 22, 2022, through October 4, 2022, the Company did not meet the minimum bid price of $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2).
Removed
In order to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company may effect a reverse stock split.
Removed
The liquidity of the shares of our common stock may be affected adversely by our reverse stock split given the reduced number of shares that are outstanding following the reverse stock split, especially if the market price of our common stock does not increase proportionately as a result of the reverse stock split.
Removed
On March 15, 2023, a Special Meeting of Security Holders was held to vote upon the proposal to approve an amendment to the Certificate of Incorporation to effect, at the discretion of the Board but prior to the one-year anniversary of the date on which the reverse stock split is approved by the Company’s stockholders, a reverse stock split of all of the outstanding shares of Common Stock at a ratio in the range of 1-for-2 to 1-for-50, with such ratio to be determined by the Board in its discretion and included in a public announcement (the “Reverse Stock Split Proposal”).
Removed
On April 3, 2023, the Company filed a Certificate of Amendment to the Company’s Certificate of Incorporation with the Secretary of State of Delaware (1) to effect a 1-for-50 reverse stock split of the shares of the Company’s common stock, par value $0.001 per share, either issued and outstanding or held by the Company as treasury stock (the “Reverse Stock Split”) and (2) to change the name of the Company from “Cryptyde, Inc.” to “Eightco Holdings Inc.” (the “Name Change”).
Removed
Both the Reverse Stock Split and the Name Change were effective as of 4:05 p.m., New York time, on April 3, 2023. The Common Stock began trading on a reverse stock split-adjusted basis on the Nasdaq Capital Market on April 4, 2023.
Removed
The trading symbol for the Common Stock following the Reverse Stock Split and the Name Change is “OCTO.” The new CUSIP number for the Common Stock following the Reverse Stock Split and the Name Change is 22890A203.
Removed
Following a reverse stock split, the resulting market price of our common stock may not attract new investors, including institutional investors, and may not satisfy the investing requirements of those investors. Consequently, the trading liquidity of our common stock may not improve.
Removed
Following our reverse stock split, we believe that a higher market price of our common stock will result and may help generate greater or broader investor interest However, we cannot assure you that our reverse stock split will result in a share price that will attract new investors.
Removed
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. In addition, an acquisition or further issuance of Eightco’s stock could trigger the application of Section 355(e) of the Code. For a discussion of Section 355(e), see the section entitled “Material United States Federal Income Tax Consequences of the Distribution”.
Removed
On September 29, 2023, we received a letter from the Listing Qualifications Department of Nasdaq indicating that, based upon the closing bid price of the Company’s common stock for the 31 consecutive business day period between August 16, 2023, through September 28, 2023, the Company did not meet the minimum bid price of $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2).
Removed
The letter also indicated that the Company has a compliance period of 180 calendar days, or until March 27, 2024 (the “Compliance Period”), in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A).
Removed
In the event that we fail to satisfy any of the listing requirements of Nasdaq or fail to regain compliance with Nasdaq’s minimum bid price requirement within the Compliance Period, our common stock may be delisted.
Removed
On March 28, 2024, we received a letter from the Listing Qualifications Department of Nasdaq indicating that the Company has not regained compliance with Nasdaq Listing Rule 5810(c)(3)(A) and is not eligible for a second 180 day period. The Company has not regained compliance with the Rule and is not eligible for a second 180 day period.
Removed
Specifically, the Company does not comply with the $5,000,000 minimum stockholders’ equity initial listing requirement for The Nasdaq Capital Market.
Removed
Accordingly, unless the Company requests an appeal of this determination as described in further detail below, we have determined that the Company’s securities will be scheduled for delisting from The Nasdaq Capital Market and will be suspended at the opening of business on April 8, 2024, and a Form 25-NSE will be filed with the Securities and Exchange Commission (the “SEC”), which will remove the Company’s securities from listing and registration on The Nasdaq Stock Market.
Removed
We intend on appealing the Staff’s determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. A hearing request will stay the suspension of the Company’s securities and the filing of the Form 25-NSE pending the Panel’s decision. 22 ITEM 1B. UNRESOLVED STAFF COMMENTS None.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor more information, please see the section entitled “Risk Factors” in this Annual Report on Form 10-K. Governance Related to Cybersecurity Risks Our Senior Director of Information Technology (IT) is responsible for the strategic leadership and direction of our cybersecurity program. The Senior Director of IT has nearly 15 years of experience as an information technology professional.
Biggest changeFor more information, please see the section entitled “Risk Factors” in this Annual Report on Form 10-K. Governance Related to Cybersecurity Risks Our audit committee has oversight over cybersecurity risks . Our management provides periodic presentations to the audit committee on our cybersecurity program, including updates on cybersecurity risks and related cybersecurity strategy, as applicable .
Our audit committee has oversight over cybersecurity risks. Our management provides periodic presentations to the audit committee on our cybersecurity program, including updates on cybersecurity risks and related cybersecurity strategy, as applicable. The audit committee provides updates regarding our cybersecurity program to the board of directors when material.
The audit committee provides updates regarding our cybersecurity program to the board of directors when material. 23

Item 2. Properties

Properties — owned and leased real estate

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Biggest changePROPERTIES The following table summarizes pertinent details of our properties as of December 31, 2023: Location Owned or Leased Lease Expiration Primary Function 909 New Brunswick Avenue Phillipsburg, NJ 08865 Leased Month-to-Month Principal Executive Office 20 Industrial Road Alpha, NJ 08865 Leased Month-to-Month Packaging and Logistics Center 234 5th Ave, Suite 511 New York, NY 10001 Leased Month-to-Month Office space Keizersgracht 482, 1017 EG Amsterdam, Netherlands Leased Month-to-Month Office space 23
Biggest changePROPERTIES The following table summarizes pertinent details of our properties as of December 31, 2024: Location Owned or Leased Lease Expiration Primary Function 101 Larry Holmes Drive, Suite 313, Easton, PA 18042 Leased April 2025 Principal Executive Office 909 New Brunswick Avenue Phillipsburg, NJ 08865 Leased Month-to-Month Office space 20 Industrial Road Alpha, NJ 08865 Leased Month-to-Month Packaging and Logistics Center 234 5th Ave, Suite 511 New York, NY 10001 Leased Month-to-Month Office space Keizersgracht 482, 1017 EG Amsterdam, Netherlands Leased Month-to-Month Office space We believe that our existing properties are adequate for the current operating requirements of our business and that additional space will be available as needed.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS During the normal course of its business, the Company may be subject to occasional legal proceedings and claims. There are currently no legal proceedings or claims asserted against the Company or its subsidiaries. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS During the normal course of its business, the Company may be subject to occasional legal proceedings and claims. There are currently no legal proceedings or claims asserted against the Company or its subsidiaries. ITEM 4. MINE SAFETY DISCLOSURES Not Applicable. 24 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information On June 30, 2022, our common stock began trading on the Nasdaq under the symbol of “TYDE.” On April 4, 2023, we changed the symbol of our common stock to “OCTO” in conjunction with our name change.
Biggest changeOn June 30, 2022, our common stock began trading on the Nasdaq under the symbol of “TYDE.” On April 4, 2023, we changed the symbol of our common stock to “OCTO” in conjunction with our name change. Holders of Record The Company had approximately 75 holders of record of our common stock as of March 31, 2025.
Recent Sales of Unregistered Securities, Uses of Proceeds and Issuer Purchases of Equity Securities Except as set forth below, during the period covered by this Annual Report, we have not sold any equity securities that were not registered under the Securities Act that were not previously reported in a quarterly report on Form 10-Q or in a current report on Form 8-K.
Recent Sales of Unregistered Securities, Uses of Proceeds and Issuer Purchases of Equity Securities During the period covered by this Annual Report, we have not sold any equity securities that were not registered under the Securities Act that were not previously reported in a quarterly report on Form 10-Q or in a current report on Form 8-K. ITEM 6. [RESERVED]
The declaration, amount and payment of any future dividends on shares of our common stock, if any, will be at the sole discretion of our board of directors.
The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition. The declaration, amount and payment of any future dividends on shares of our common stock, if any, will be at the sole discretion of our board of directors.
Holders of Record The Company had approximately 336 holders of record of our common stock as of April 1, 2024. Dividends We have not historically declared dividends on our common stock, and we do not currently intend to pay dividends on our common stock.
We believe our common stock are held by more than 300 beneficial owners. Dividends We have not historically declared cash dividends on our common stock, and we do not currently intend to pay cash dividends on our common stock in the future.
Removed
On January 17, 2023, the Company declared a dividend of one one-thousandth of a share of Series A Preferred Stock, par value $0.001 per share, for each outstanding share of the Company’s common stock, to stockholders of record at 5:00 p.m. Eastern Time on January 27, 2023 (the “Record Date”).
Added
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is currently listed on the Nasdaq Capital Markets.
Removed
Securities Authorized for Issuance under Equity Compensation Plans The Company’s executive compensation program consists of stock-based awards issued under an equity incentive plan.
Added
Further, any indebtedness we incur in the future may limit our ability to declare dividends in the future. Securities Authorized for Issuance under Equity Compensation Plans Information required by Item 5 of Form 10-K regarding equity compensation plans is incorporated herein by reference to Item 12 of Part III of this Annual Report on Form 10-K.
Removed
The Company determines the appropriate level for compensation under the equity incentive plan based in part, but not exclusively, on its view of internal equity and consistency, individual performance, the Company’s performance, and other information deemed relevant and timely.
Removed
On November 10, 2023, the Company issued 25,000 shares of its common stock to a consultant for services rendered on behalf of the Company. 24 ITEM 6. [RESERVED]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

66 edited+39 added−61 removed40 unchanged
Biggest changeThe following table sets forth a summary of cash flows for the periods presented: For the Years Ended December 31, 2023 2022 Cash (used in) provided by: Operating Activities $ (6,399,079 ) $ (16,719,389 ) Investing Activities (295,150 ) 468,419 Financing Activities 6,361,634 20,920,207 Net increase in cash and restricted cash $ (332,595 ) $ 4,669,237 Operating Activities Net cash (used in) operating activities was ($6,399,079) during the year ended December 31, 2023, which consisted primarily of a net loss of $68,320,414 offset by non-cash depreciation expense of $3,044,531, amortization of debt issuance costs of $8,109,078, impairment charges of 292,748, share based compensation of ($358,937), loss on issuance of warrants of $46,928,815 and changes in assets and liabilities of $3,899,203.
Biggest changeNet cash (used in) operating activities was ($6,399,079) during the year ended December 31, 2023, which consisted primarily of a net loss of $68,320,414 offset by non-cash depreciation expense of $3,044,531, amortization of debt issuance costs of $8,109,078, impairment charges of $292,748, share-based compensation of ($358,937), loss on issuance of warrants of $46,928,815 and changes in assets and liabilities of $3,899,203.
The principal balance of the Initial Loan Advance and each Subsequent Draw shall bear interest thereon from the Closing Date and applicable Advance Date, respectively, at 15.00% per annum.
The principal balance of the Initial Loan Advance and each Subsequent Draw shall bear interest thereon from the Closing Date and applicable Advance Date, respectively, at 15.00% per annum.
In the event any payment is not paid on or within five (5) Business Days of the scheduled payment date, an amount equal to two percent (2.00%) of the past due amount shall be payable on demand, in addition to interest accruing.
In the event any payment is not paid on or within five (5) Business Days of the scheduled payment date, an amount equal to two percent (2.00%) of the past due amount shall be payable on demand, in addition to interest accruing.
In the event any payment is not paid on or within five (5) Business Days of the scheduled payment date, an amount equal to two percent (2.00%) of the past due amount shall be payable on demand, in addition to interest accruing.
In the event any payment is not paid on or within five (5) Business Days of the scheduled payment date, an amount equal to two percent (2.00%) of the past due amount shall be payable on demand, in addition to interest accruing.
In the event any interest is not paid when due hereunder, delinquent interest shall be added to principal and shall bear interest on interest, compounded.
In the event any interest is not paid when due hereunder, delinquent interest shall be added to principal and shall bear interest on interest, compounded.
The Preferred Members have a put right, on terms and conditions set forth in Section 7.01 of the Operating Agreement, to cause Eightco to redeem the Preferred Units as follows: (a) starting on the later of (i) six (6) months following the Closing and (ii) the Threshold Date (as defined in the Subordination Agreement), one (1) Eightco Share per Initial Base Preferred Unit being redeemed up to a maximum of 6,281,949 Initial Base Preferred Units; (b) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the Closing and (iii) the occurrence of the Threshold Date, one (1) Eightco Share per Initial Base Preferred Units that could not be converted due to the 6,281,949 unit limit in Section 7.01(a) of the Operating Agreement (such shares being an aggregate of 718,051 Initial Base Preferred Units being defined as the “Extra Initial Base Preferred Units”) being redeemed, and one (1) OCTO Share per Additional Base Preferred Unit being redeemed; (c) if Shareholder Approval is not obtained on or before June 30, 2023, subject to both (i) six (6) months following the Closing and (ii) the terms of the Subordination Agreement, a cash payment equal to the difference between $3.07 minus the Additional Base Preferred Unit VWAP (as defined in the Purchase Agreement with it being subject to a $2.00 floor) (such difference being the “Additional Base Preferred Unit Cash Catch Up Amount”) with the Additional Base Preferred Unit Cash Catch Up Amount being multiplied by each Extra Initial Base Preferred Unit and each Additional Base Preferred Unit being redeemed; (d) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the first Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout One Unit being redeemed; (e) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout One Unit is earned under Section 1.04 of Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $15,000,000 divided by the number of Earnout One Units (the “Earnout One Unit Redemption Amount”) with such Earnout One Unit Redemption Amount then being multiplied by each Earnout One Unit being redeemed; (f) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the second Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout Two Unit being redeemed; (g) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout Two Unit is earned under Section 1.04 of the Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $12,000,000 divided by the number of Earnout Two Units (the “Earnout Two Unit Redemption Amount”) with such Earnout Two Unit Redemption Amount then being multiplied by each Earnout Two Unit being redeemed; (h) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the third Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout Three Unit being redeemed; 33 (i) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout Three Unit is earned under Section 1.04 of the Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $10,000,000 divided by the number of Earnout Three Units (the “Earnout Three Unit Redemption Amount”) with such Earnout Three Unit Redemption Amount then being multiplied by each Earnout Three Unit being redeemed.
The Preferred Members have a put right, on terms and conditions set forth in Section 7.01 of the Operating Agreement, to cause Eightco to redeem the Preferred Units as follows: (a) starting on the later of (i) six (6) months following the Closing and (ii) the Threshold Date (as defined in the Subordination Agreement), one (1) Eightco Share per Initial Base Preferred Unit being redeemed up to a maximum of 6,281,949 Initial Base Preferred Units; (b) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the Closing and (iii) the occurrence of the Threshold Date, one (1) Eightco Share per Initial Base Preferred Units that could not be converted due to the 6,281,949 unit limit in Section 7.01(a) of the Operating Agreement (such shares being an aggregate of 718,051 Initial Base Preferred Units being defined as the “Extra Initial Base Preferred Units”) being redeemed, and one (1) OCTO Share per Additional Base Preferred Unit being redeemed; 30 (c) if Shareholder Approval is not obtained on or before June 30, 2023, subject to both (i) six (6) months following the Closing and (ii) the terms of the Subordination Agreement, a cash payment equal to the difference between $3.07 minus the Additional Base Preferred Unit VWAP (as defined in the Purchase Agreement with it being subject to a $2.00 floor) (such difference being the “Additional Base Preferred Unit Cash Catch Up Amount”) with the Additional Base Preferred Unit Cash Catch Up Amount being multiplied by each Extra Initial Base Preferred Unit and each Additional Base Preferred Unit being redeemed; (d) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the first Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout One Unit being redeemed; (e) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout One Unit is earned under Section 1.04 of Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $15,000,000 divided by the number of Earnout One Units (the “Earnout One Unit Redemption Amount”) with such Earnout One Unit Redemption Amount then being multiplied by each Earnout One Unit being redeemed; (f) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the second Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout Two Unit being redeemed; (g) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout Two Unit is earned under Section 1.04 of the Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $12,000,000 divided by the number of Earnout Two Units (the “Earnout Two Unit Redemption Amount”) with such Earnout Two Unit Redemption Amount then being multiplied by each Earnout Two Unit being redeemed; (h) upon the satisfaction of (i) the receipt of Shareholder Approval on or prior to June 30, 2023, (ii) six (6) months following the time a Preferred Unit issued in connection with the third Earn-Out Target is earned under Section 1.04 of the Purchase Agreement and (iii) the occurrence of the Threshold Date, one (1) OCTO Share per Earnout Three Unit being redeemed; (i) if Shareholder Approval has not been obtained on or before June 30 2023, subject to both (i) six (6) months following the time an Earnout Three Unit is earned under Section 1.04 of the Purchase Agreement and (ii) the terms of the Subordination Agreement, a cash payment equal to the amount of $10,000,000 divided by the number of Earnout Three Units (the “Earnout Three Unit Redemption Amount”) with such Earnout Three Unit Redemption Amount then being multiplied by each Earnout Three Unit being redeemed.
Under the terms of the Series C Agreement, the Lender will make available to Borrower, in an amount not to exceed its respective Commitment, a Loan Advance amount to be determined by the Lender (as such amount may be increased, the “Aggregate Commitment”) in the aggregate, of which (x) a certain amount will be deposited into an account of the Borrower in accordance with its written instructions (the “Initial Loan Advance”) and (y) the remaining balance of the Aggregate Commitment after deducting the Initial Loan Advance shall be deposited into the Escrow Account (the “Escrow Funds”).
Under the terms of the Series C Agreement, the lender will make available to Borrower, in an amount not to exceed its Commitment, a Loan Advance amount to be determined by the lender (as such amount may be increased, the “Aggregate Commitment”) in the aggregate, of which (x) a certain amount will be deposited into an account of the Borrower in accordance with its written instructions (the “Initial Loan Advance”) and (y) the remaining balance of the Aggregate Commitment after deducting the Initial Loan Advance shall be deposited into the Escrow Account (the “Escrow Funds”).
A significant percentage of the Company’s’ long term assets are intangibles assets and therefore, estimates regarding the fair value of these assets have a material impact on our financial statements. Goodwill Goodwill is recorded for the difference between the fair value of the purchase consideration over the fair value of the net identifiable tangible and intangible assets acquired.
A significant percentage of the Company’s’ long term assets are intangibles assets and therefore, estimates regarding the fair value of these assets have a material impact on our financial statements. 33 Goodwill Goodwill is recorded for the difference between the fair value of the purchase consideration over the fair value of the net identifiable tangible and intangible assets acquired.
Forever 8 additionally entered into an Intercreditor Agreement (the “Intercreditor Agreement”) with the lenders party thereto and the collateral agent for such lenders. As of the date of this filing, a total of $250,000 has been committed by a Lender. As of the date of this filing, $600,000 has been committed by the Lenders.
Forever 8 additionally entered into an Intercreditor Agreement (the “Intercreditor Agreement”) with the lenders party thereto and the collateral agent for such lenders. As of the date of this filing, a total of $250,000 has been committed by the lender.
The Borrower may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”). The Borrower issued a Promissory Note (the “Note”) to each of the Lenders in the amount of the Lender’s respective Initial Loan Advance.
The Borrower may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”). The Borrower issued a Promissory Note to each of the lenders in the amount of the lender’s respective Initial Loan Advance.
In addition, upon the occurrence and during the continuation of an Event of Default hereunder, the Initial Loan Advance and all Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the Lenders, bear interest at the Interest Rate, plus five (5) percentage points.
In addition, upon the occurrence and during the continuation of an Event of Default hereunder, the Initial Loan Advance and all Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the lender, bear interest at the Interest Rate, plus five (5) percentage points.
The Borrower shall pay the Lender, according to its Applicable Percentage, an unused commitment fee on the actual daily amount of the Unused Commitment Amount during the immediately preceding calendar quarter at the rate of five percent (5.00%) per annum (the “Unused Commitment Fee”).
The Borrower shall pay the lender, according to its Applicable Percentage, an Unused Commitment Fee on the actual daily amount of the Unused Commitment Amount during the immediately preceding calendar quarter at the rate of five percent (5.00%) per annum .
As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower grants to Lender a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing (collectively, the “Collateral”).
As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower granted to the lender a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing.
The Borrower shall pay each Lender, according to its Applicable Percentage, an unused commitment fee on the actual daily amount of the Unused Commitment Amount during the immediately preceding calendar quarter at the rate of five percent (5.00%) per annum (the “Unused Commitment Fee”).
The Borrower shall pay the Lender, according to its Applicable Percentage, an Unused Commitment Fee on the actual daily amount of the Unused Commitment Amount during the immediately preceding calendar quarter at the rate of five percent (5.00%) per annum .
As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower grants to Lender a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing (collectively, the “Collateral”).
As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower granted to the lenders a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing.
The Company expects that its current cash and cash equivalents, approximately $500,000 as of the date of this annual report, will not be sufficient to support its projected operating requirements for at least the next 12 months from this date. The Company expects to need additional capital in order to increase revenues above current levels.
The Company expects that its current cash and cash equivalents, approximately $0.2 million as of the date of this annual report, will not be sufficient to support its projected operating requirements for at least the next 12 months from this date. The Company expects to need additional capital in order to increase revenues above current levels.
If Eightco elects to issue additional Preferred Units upon the achievement of any Earn-Out Target and the VWAP of Eightco’s common stock for the 15 trading days preceding the date that any Earn-Out Target is achieved (the “Earn-Out VWAP”) is (A) with respect to the first Earn-Out Target, less than $5.00, (B) with respect to the second Earn-Out Target, less than $6.00 or (C) with respect to the third Earn-Out Target, less than $5.00, then Sellers shall be entitled to receive an additional number of additional Preferred Units (the “True-up Units” and together with the additional Preferred Units, the “Total Additional Preferred Units”) such that the Total Additional Preferred Units multiplied by the Earn-Out VWAP equals (x) $15 million for the first Earn-Out Target, (y) $12 million for the second Earn-Out Target and (z) $10 million for the third Earn-Out Target; provided that in no event shall more than 4.5 million True-up Units be issued for the first Earn-Out Target, in no event shall more than 4.0 million True-up Units be issued for the Second Earn-Out Target and in no event shall more than 3.0 million True-up Units be issued for the Third Earn-Out Target. 32 In accordance with the Purchase Agreement, the Company’s existing operating agreement was amended and restated.
If Eightco elects to issue additional Preferred Units upon the achievement of any Earn-Out Target and the VWAP of Eightco’s common stock for the 15 trading days preceding the date that any Earn-Out Target is achieved (the “Earn-Out VWAP”) is (A) with respect to the first Earn-Out Target, less than $5.00, (B) with respect to the second Earn-Out Target, less than $6.00 or (C) with respect to the third Earn-Out Target, less than $5.00, then Sellers shall be entitled to receive an additional number of additional Preferred Units (the “True-up Units” and together with the additional Preferred Units, the “Total Additional Preferred Units”) such that the Total Additional Preferred Units multiplied by the Earn-Out VWAP equals (x) $15 million for the first Earn-Out Target, (y) $12 million for the second Earn-Out Target and (z) $10 million for the third Earn-Out Target; provided that in no event shall more than 4.5 million True-up Units be issued for the first Earn-Out Target, in no event shall more than 4.0 million True-up Units be issued for the Second Earn-Out Target and in no event shall more than 3.0 million True-up Units be issued for the Third Earn-Out Target.
Upon the Closing, Eightco issued the Promissory Notes. The Promissory Notes bear interest at the rate per annum equal to (i) ten (10%) for the first twelve (12) months of the Promissory Notes and (ii) twelve percent (12%) thereafter until the maturity date of the Promissory Notes (the “Note Maturity Date”).
The Promissory Notes bear interest at the rate per annum equal to (i) ten (10%) for the first twelve (12) months of the Promissory Notes and (ii) twelve percent (12%) thereafter until the maturity date of the Promissory Notes (the “Note Maturity Date”).
May 2023 Debt Exchange On May 30, 2023, the Forever 8 Fund, LLC (the “Borrower”) entered into a Debt Exchange Agreement (the “Debt Agreement”) with two Lenders for funds advanced to the Borrower pursuant to secured promissory notes (the “Old Notes”), executed by the Borrower in favor of the Lenders during 2021.
May 2023 Debt Exchange On May 30, 2023, the Borrower entered into a Debt Exchange Agreement (the “Debt Agreement”) with two Lenders for funds advanced to the Borrower pursuant to secured promissory notes (the “Old Notes”), executed by the Borrower in favor of the Lenders during 2021.
These factors raise substantial doubts about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. As of December 31, 2023, the Company had approximately $5.2 million in cash and cash equivalents as compared to $5.6 million at December 31, 2022.
These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. As of December 31, 2024, the Company had approximately $0.2 million in cash and cash equivalents as compared to $5.2 million at December 31, 2023.
On April 3, 2023, the Company changed its name to Eightco Holdings Inc. from Cryptyde, Inc. and its stock symbol to “OCTO.” The Company is comprised of two main businesses, Forever 8 Inventory Cash Flow Solution and our Packaging Business.
On April 3, 2023, the Company changed its name to Eightco Holdings Inc. from Cryptyde, Inc. and its stock symbol to “OCTO.” The Company is comprised of two main businesses, Forever 8’s Inventory Cash Flow Solution and the Corrugated Packaging Business of Ferguson Containers.
Placement Agent Palladium Capital Group, LLC (the “Placement Agent”) acted as placement agent for the Private Placement.
Palladium Capital Group, LLC acted as placement agent for the Private Placement.
For the acting as placement agent in the Private Placement, the Placement Agent is to receive (i) upon closing cash compensation of $400,000 (8% of the gross proceeds to the Company) (ii) upon closing a warrant to purchase up to 71,161 shares of Common Stock (8% of the shares of Common Stock underlying the Note).
For the acting as placement agent in the Private Placement, the Placement Agent received (i) cash compensation of $400,000 (8% of the gross proceeds to the Company) and (ii) a warrant to purchase up to 71,161 shares of Common Stock (8% of the shares of Common Stock underlying the Hudson Note).
From October 12, 2023, through February 26, 2024, the Borrower entered into Lender Joinder Agreements (the “Joinder Agreement”) with several individuals and entities (the “Subsequent Lenders”).
From October 12, 2023, through February 26, 2024, the Borrower entered into Lender Joinder Agreements (the “Joinder Agreement”) with several individuals and entities as subsequent lenders.
The Company has incurred a loss since Inception resulting in an accumulated deficit of $113,278,588 as of December 31, 2023 and further losses are anticipated in the development of its business. Further, the Company has current liabilities in excess of current assets and has a stockholders’ deficit at December 31, 2023.
The Company has incurred a loss since inception resulting in an accumulated deficit of $112,570,049 as of December 31, 2024 and further losses are anticipated in the development of its business. Further, the Company has current liabilities in excess of current assets and has a stockholders’ deficit at December 31, 2024.
Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP.
All shares of Series A Preferred Stock issued have been since redeemed. 32 Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP.
The Borrower may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”). The Borrower issued a Promissory Note (the “Note”) to the Lender in the amount of the Lender’s respective Initial Loan Advance.
The Borrower may, at any time, request a Subsequent Draw for all or a portion of the Escrow Funds. The Borrower issued a Promissory Note to the lender in the amount of the lender’s Initial Loan Advance.
Under the terms of the Debt Agreement, the Old Notes shall be exchanged for new Notes (“New Notes”) as per the terms of the Loan and Security Agreement dated May 30, 2023. The principal of the New Notes issued under the Debt Agreement is $1,650,000. March 2023 Offering On March 15, 2023, Eightco Holdings Inc.
Under the terms of the Debt Agreement, the Old Notes were exchanged for new Notes (“New Notes”) as per the terms of the Loan and Security Agreement dated May 30, 2023. The principal of the New Notes issued under the Debt Agreement is $1,650,000.
The Borrower may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”). The Borrower issued a Promissory Note (the “Note”) to the Lender in the amount of the Lender’s respective Initial Loan Advance.
The Borrower may, at any time, request a Subsequent Draw for all or a portion of the Escrow Funds. 27 The Borrower issued a Promissory Note to the lender in the amount of the lender’s Initial Loan Advance.
(the “ Company ”), entered into the Series D Loan and Security Agreement (the “Series D Agreement”), with the lenders party thereto from to time (collectively, the “ Lenders”) for an amount of up to $5,000,000.
Series D Financing On March 15, 2024, the Borrower entered into the Series D Loan and Security Agreement (the “Series D Agreement”), with the lenders party thereto from to time for an amount of up to $5,000,000.
The accounting estimates that require our most significant, difficult and subjective judgments have an impact on revenue recognition, the determination of share-based compensation and financial instruments. We evaluate our estimates and judgments on an ongoing basis.
The accounting estimates that require our most significant, difficult and subjective judgments have an impact on revenue recognition, the determination of share-based compensation and financial instruments. We evaluate our estimates and judgments on an ongoing basis. Actual results may differ materially from these estimates under different assumptions or conditions.
Series A Financing On May 30, 2023, the Company’s wholly owned subsidiary, Forever 8 Fund, LLC (the “Borrower”), entered into a Loan and Security Agreement (the “Agreement”) with several individuals, financial institutions and entities (collectively, the “Lenders”).
Series A Financing On May 30, 2023, Forever 8 (the “Borrower”) entered into a Loan and Security Agreement (the “Agreement”) with several individuals, financial institutions and entities as lenders.
Eightco Holdings Inc. has required funding from the Former Parent to launch operations. Ferguson Containers has historically had positive cash flows from operations. Since inception, Ferguson Containers Inc.’s operations have been funded principally through its operations.
Ferguson Containers has historically had positive cash flows from operations. Since inception, Ferguson Containers Inc.’s operations have been funded principally through its operations.
Forever 8 Acquisition On September 14, 2022, the Company entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) by and among the Company, Forever 8 and the Sellers pursuant to which Eightco was to acquire 100% of the issued and outstanding membership interests of Forever 8 (the “Membership Interests”) from the Sellers (the “Acquisition”).
See “Note 16 – Convertible Note Payable” in the accompanying financial statements for further information. 29 Forever 8 Acquisition On September 14, 2022, the Company entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) by and among the Company, Forever 8 and the former members of Forever 8 (the “Sellers”) pursuant to which Eightco was to acquire 100% of the issued and outstanding membership interests of Forever 8 (the “Membership Interests”) from the Sellers (the “Acquisition”).
Following the Separation, we are an independent, publicly traded company, and Vinco retains no ownership interest in our Company. In connection with the Separation, we entered into a Separation and Distribution Agreement and other agreements with Vinco to effect the Separation and provide a framework for our relationship with Vinco after the Separation.
In connection with the Separation, we entered into a Separation and Distribution Agreement and other agreements with Vinco to effect the Separation and provide a framework for our relationship with Vinco after the Separation.
Pursuant to the Operating Agreement, Eightco unconditionally guaranteed the payment, when due, of obligations pursuant to the put right. Eightco shall satisfy these obligations to the Preferred Members either in cash or, if Shareholder Approval has been obtained, through the issuance and delivery to each Preferred Member of one OCTO Share per Preferred Unit held by each Preferred Member.
Eightco shall satisfy these obligations to the Preferred Members either in cash or, if Shareholder Approval has been obtained, through the issuance and delivery to each Preferred Member of one OCTO Share per Preferred Unit held by each Preferred Member. 31 Upon the Closing, Eightco issued the Promissory Notes.
As of the date of this filing, $3,425,000 has been committed by the Lenders. Series B Financing On October 6, 2023, the Company’s wholly owned subsidiary, Forever 8 Fund, LLC (the “Borrower”), entered into a Series B Loan and Security Agreement (the “Series B Agreement”) with an individual (the “Lender”).
As of the date of this filing, $2,375,000 has been committed by the lenders. Series B Financing On October 6, 2023, the Borrower entered into a Series B Loan and Security Agreement (the “Series B Agreement”) with an individual as lender.
Under the terms of the Joinder Agreement, the Subsequent Lenders agreed to become a Lender and be bound by the terms of the Series B Agreement as a Lender pursuant to Section 2.6 of the Series B Agreement.
Under the terms of the Joinder Agreement, the subsequent lenders agreed to become a lender and be bound by the terms of the Series B Agreement as a lender pursuant to the Series B Agreement. As of the date of this filing, $175,000 has been committed by the lender and subsequent lenders.
In the event any interest is not paid when due hereunder, delinquent interest shall be added to principal and shall bear interest on interest, compounded. 25 As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower grants to Lenders a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing (collectively, the “Collateral”).
As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Secured Obligations, Borrower granted to the lender a security interest in all of Borrower’s right, title, and interest in and to all Inventory or Equipment and machinery, in each case, purchased (or refinanced) with the proceeds of the Initial Loan Advance and any Subsequent Draw, and, to the extent not otherwise included, all Proceeds of each of the foregoing and all products, additions, increases and accessions to, substitutions and replacements for, and rents, profits and products of each of the foregoing. 28 As of the date of this filing, $7,225,000 has been committed by the lender.
(the “Company”) entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with Hudson Bay (the “Investor”) for the issuance and sale of a Senior Secured Convertible Note with an initial principal amount of $5,555,000 (the “Note”) at a conversion price of $6.245 per share of the Company’s common stock, par value $0.001 (the “Common Stock”), and a warrant (the “Warrant”) to purchase up to 889,512 shares of Common Stock with an initial exercise price of $6.245 per share of Common Stock (the “Private Placement”).
(“Hudson Bay”) for the issuance and sale of a Senior Secured Convertible Note with an initial principal amount of $5,555,000 (the “Hudson Note”) at a conversion price of $6.245 per share of the Company’s common stock, and a warrant (the “Hudson Warrant”) to purchase up to 889,512 shares of Common Stock with an initial exercise price of $6.245 per share of Common Stock (the “Private Placement”).
Principles of Consolidation The consolidated financial statements include the accounts of Eightco Holdings Inc. and its wholly-owned, majority owned subsidiaries and consolidated variable interest entities. Use of Estimates Preparation of financial statements in conformity with U.S.
Our significant accounting policies are more fully described in Note 2 to our consolidated financial statements included elsewhere in this Annual Report. Principles of Consolidation The consolidated financial statements include the accounts of Eightco Holdings Inc. and its wholly-owned or majority owned subsidiaries and consolidated variable interest entities. Use of Estimates Preparation of financial statements in conformity with U.S.
The increase in interest expense was largely attributable to the amortization of debt issuance costs related to borrowing under the convertible notes payable. Total other (expense) income Total other (expense) income was ($58,343,242) for the year ended December 31, 2023 versus ($32,111,553) for the year ended December 31, 2022.
The decrease in interest expense was largely attributable to the full amortization of debt issuance costs related to borrowings under the convertible notes payable. Total other (expense) income Total other (expense) income was $8,347,033 for the year ended December 31, 2024 versus ($58,377,298) for the year ended December 31, 2023.
(the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain investors (the “Investors”), pursuant to which the Company sold to the Investors an aggregate of 865,856 shares (the “Shares”) of the Company’s common stock at a purchase price of $0.82 per Share (the “Private Placement”).
In addition to the Separation and Distribution Agreement, the other principal agreements entered into with Vinco include a Tax Matters Agreement and certain commercial agreements. 26 Financings and Forever 8 Acquisition Financings February 2024 Private Placement On February 26, 2024, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain investors (the “Investors”), pursuant to which the Company sold to the Investors an aggregate of 865,856 shares (the “Shares”) of the Company’s common stock at a purchase price of $0.82 per Share (the “Private Placement”).
Senior Secured Convertible Note The Company issued the Note upon the closing. The entire outstanding principal balance and any outstanding fees or interest is due and payable in full on January 15, 2024 (“Maturity Date”).
The purchase price of the Hudson Note and the Hudson Warrant is $5 million. The entire outstanding principal balance on the Hudson Note and any outstanding fees or interest was due and payable in full on January 15, 2024 (“Maturity Date”).
Cash Flows for the Years Ended December 31, 2023 and 2022 Since inception, Eightco Holdings Inc. and its subsidiaries have primarily used its available cash to fund its operations.
The sale aligns with the Company’s strategic decision to focus resources on scaling Forever 8, the Company’s inventory funding platform. Cash Flows for the Years Ended December 31, 2024 and 2023 Since inception, Eightco Holdings Inc. and its subsidiaries have primarily used its available cash to fund its operations.
Goodwill is a significant percentage of the Company’s’ long term assets and therefore, estimates regarding the fair value of our goodwill have a material impact on our financial statements. 36 Warrant Accounting The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”.
Warrant Accounting The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”.
This discussion and analysis contain forward-looking statements that are based upon current expectations and involve risks, assumptions and uncertainties. Overview As used herein, “Eightco” and the “Company” refer to Eightco Holdings Inc. and subsidiaries and/or where applicable, its management, a Delaware corporation originally incorporated on September 21, 2021 (date of inception) under the laws of the State of Nevada.
You should not place undue reliance on forward-looking statements. 25 Overview As used herein, “Eightco” and the “Company” refer to Eightco Holdings Inc., a Delaware corporation originally incorporated on September 21, 2021 (date of inception) under the laws of the State of Nevada, and its subsidiaries.
In addition, we will generate revenues from the sale of corrugated custom packaging to a wide array of customers and the sales of Bitcoin mining equipment offered through CW Machines, LLC. Cost of Revenues Our cost of revenues includes inventory costs, materials and supplies costs, internal labor costs and related benefits, subcontractor costs, depreciation, overhead and shipping and handling costs.
The Company no longer expects to generate revenue from this business line. Cost of Revenues Our cost of revenues includes inventory costs, materials and supplies costs, internal labor costs and related benefits, subcontractor costs, depreciation, overhead and shipping and handling costs. In 2022, we incurred costs related to the purchase and resale of Bitcoin mining equipment through CW Machines, LLC.
Interest income includes the interest earned under our notes receivable. Other Income Other income includes the gain on disposal of the building located in Washington, New Jersey.
These expenses may fluctuate based on the scope and timing of restructuring initiatives . Interest Expense and Income, Net Interest expense includes the cost of our borrowings under our debt arrangements. Interest income includes the interest earned under our notes receivable. Other Income Other income includes the gain on disposal of the building located in Washington, New Jersey.
Operating Expenses Selling, general and administrative expenses were $16,335,561 and $16,401,414 for the years ended December 31, 2023 and 2022, respectively, representing a decrease of $65,763, or 0.40%. The decrease was largely attributable to the decrease in salaries.
The decrease was largely attributable to the decrease in revenues. 37 Operating Expenses Selling, general and administrative expenses were $1,439,964 and $1,530,024 for the years ended December 31, 2024 and 2023, respectively, representing a decrease of $90,060, or 5.89%. The decrease was largely attributable to a decrease in salaries.
Upon exercise of the put right, each Initial Base Preferred Unit (as defined in the Purchase Agreement) shall be exchanged for one Eightco share.
The Preferred Members (who are the Sellers) have a put right to cause Eightco to redeem certain Preferred Units, from time to time on or after the six-month anniversary following the Closing. Upon exercise of the put right, each Initial Base Preferred Unit (as defined in the Purchase Agreement) shall be exchanged for one Eightco share.
Restructuring and severance expenses were $2,133,982 and $1,300,000 for the years ended December 31, 2023 and 2022, respectively, representing an increase of $833,982, or 64.15%. The increase was largely attributable to the headcount reductions. Interest Expense Interest expense was $11,553,589 for the year ended December 31, 2023, versus $6,966,606 for the year ended December 31, 2022.
Restructuring and severance expenses were $1,414,838 and $2,133,982 for the years ended December 31, 2024 and 2023, respectively, representing a decrease of $719,144, or 33.70%. The decrease was largely attributable to the completion of the restructuring plan. Interest Expense Interest expense was $5,287,920 for the year ended December 31, 2024, versus $11,553,477 for the year ended December 31, 2023.
Our Inventory Cash Flow Solution Business, Forever 8 Fund, LLC, a Delaware limited liability company is focused on purchasing inventory and becoming the supplier for e-commerce retailers, which we acquired on October 1, 2022 (“Forever 8”). We no longer intend to generate revenue from our Web 3 Business.
We acquired Forever 8 in October 2022 and it is focused on purchasing inventory and becoming the supplier for e-commerce retailers. We no longer intend to generate revenue from our Web 3 Business. Our Corrugated Packaging Business manufactures and sells custom packaging for a wide variety of products and through packaging helps customers generate brand awareness and promote brand image.
The increase in total other income (expense) was largely attributable to the loss on issuance of warrants and amortized interest expense. Income tax expense Income tax expense (benefit) was $- for the year ended December 31, 2023, versus an income tax benefit of ($172,997) for the year ended December 31, 2022, respectively.
The increase in total other income (expense) was largely attributable to no further charges for the loss on issuance of warrants and amortized interest expense under the convertible notes payable.
Investing Activities Net cash provided by (used in) investing activities was ($295,150) during the year ended December 31, 2023 compared to $468,419 for the year ended December 31, 2022. The decrease is largely attributable to cash received from the acquisition of the Forever 8 Fund, LLC recognized in the year ended December 31, 2022.
Investing Activities Net cash provided by (used in) investing activities was ($70,098) during the year ended December 31, 2024 compared to ($295,150) for the year ended December 31, 2023. The decrease was primarily due to lower purchases of property and equipment.
A significant percentage of the Company’s’ long term liabilities are warrant liability and therefore, estimates regarding the fair value of our goodwill have a material impact on our financial statements. Key Components of our Results of Operations Revenues We generate the majority of our revenues from inventory financing through our wholly owned subsidiary, Forever 8 Fund, LLC.
Goodwill is a significant percentage of the Company’s’ long term assets and therefore, estimates regarding the fair value of our goodwill have a material impact on our financial statements.
As of the date of this filing, $275,000 has been committed by the Lenders. 26 Series C Financing On October 19, 2023, the Company’s wholly owned subsidiary, Forever 8 Fund, LLC (the “Borrower”), entered into a Series C Loan and Security Agreement (the “Series C Agreement”) with an individual (the “Lender”).
Series C Financing On October 19, 2023, the Borrower entered into a Series C Loan and Security Agreement (the “Series C Agreement”) with an individual as lender.
Gross Profit For the year ended December 31, 2023, gross profit increased by $6,298,551, or 287.09%, as compared to the year ended December 31, 2022. The increase was largely attributable to the increase in sales through the Forever 8 Fund.
Gross Profit For the year ended December 31, 2024, gross profit decreased by $277,794, or 4.44%, as compared to the year ended December 31, 2023. The decrease was largely attributable to the decrease in revenues.
On March 27, 2024, the Company issued 120,974 shares of common stock which retired a portion of the Promissory Notes.
On March 27, 2024, the Company issued 120,974 shares of common stock which retired a portion of the Promissory Notes. On June 14, 2024, the Company executed further amendments to accomplish the following: ● The Company recorded a gain of $6.1 million related to the full release of contingent consideration, originally recognized at the time of acquisition.
The decrease in income tax benefit for the year ended December 31, 2023 was a result of state taxes related to Ferguson Containers, Inc. for the year ended December 31, 2021. Net (loss) income Net loss was ($68,320,414) for the year ended December 31, 2023, versus a net loss of ($47,446,060) for the year ended December 31, 2022.
The increase in income tax benefit for the year ended December 31, 2024 was a result of recovery for foreign taxes related to Forever 8 EU for the year ended December 31, 2024. 36 Net income (loss) from continuing operations Net income (loss) from continuing operations was $289,811 for the year ended December 31, 2024, versus a net loss of ($69,057,115) for the year ended December 31, 2023.
The amended and restated operating agreement (the “Operating Agreement”) provides for, among other things, a put right for designated members (the “Preferred Members”). The Preferred Members (who are the Sellers) have a put right to cause Eightco to redeem certain Preferred Units, from time to time on or after the six-month anniversary following the Closing.
In accordance with the Purchase Agreement, the Company’s existing operating agreement was amended and restated. The amended and restated operating agreement (the “Operating Agreement”) provides for, among other things, a put right for designated members (the “Preferred Members”).
Financing Activities Net cash provided by financing activities was $6,361,634 during the year ended December 31, 2023 compared to $20,920,207 for the year ended December 31, 2022. This decrease was largely attributable to a decrease in proceeds from the issuance of common stock and borrowings under convertible notes as compared to the year ended December 31, 2022.
This decrease was largely attributable to repayments of $4,915,000 under convertible notes payable, offset by proceeds from the issuance of common stock of $3,064,067 and borrowings under lines of credit of $3,750,000 as compared to the year ended December 31, 2023. Eightco Holdings Inc. has required funding from the Former Parent to launch operations.
The Note does not bear interest, provided, however, that the Note will bear interest at 18% per annum upon the occurrence of an event of default (as described below).
The Hudson Note did not bear interest, provided, however, that the Hudson Note would bear interest at 18% per annum upon the occurrence of an event of default. The Hudson Note was paid in full on February 26, 2024. Additionally, the Company redeemed all of the Hudson Warrants for $660,000 on October 23, 2023.
The Company classifies a warrant to purchase shares of its common stock as a liability on its consolidated balance sheets as this warrant is a free-standing financial instrument that may require the Company to transfer consideration upon exercise Each warrant is initially recorded at fair value on date of grant using the Monte-Carlo simulation pricing model and net of issuance costs, and it is subsequently re-measured to fair value at each subsequent balance sheet date.
The Company classifies a warrant to purchase shares of its common stock as equity on its consolidated balance sheets as this warrant is a free-standing financial instrument that is indexed to the Company’s own stock and meets the criteria for equity classification.
The Company has continued to raise capital in 2024 and will continue to look to reduce costs in 2024.
The Company raised capital in 2024 and intends to continue reducing costs in 2025 while raising additional capital as needed.
Cost of Revenues For the year ended December 31, 2023, cost of revenues increased by $37,178,154 or 125.49%, as compared to the year ended December 31, 2022.
The Company no longer generates revenues related to CW Machines. Cost of Revenues For the year ended December 31, 2024, cost of revenues decreased by $27,669,287 or 45.13%, as compared to the year ended December 31, 2023. The decrease was largely attributable to the decrease in revenues.
Removed
Our Packaging Business manufactures and sells custom packaging for a wide variety of products and through packaging helps customers generate brand awareness and promote brand image. On June 29, 2022, the Company separated from its former parent company, Vinco Ventures Inc. (“Vinco”).
Added
This discussion and analysis contain forward-looking statements that are based upon current expectations and involve risks, assumptions and uncertainties. These statements relate to future events including, without limitation, our ability to raise capital, our operational and strategic initiatives or our future financial performance.
Removed
As previously announced, we concluded a spin-off from Vinco (the “Separation”) and continue operating our BTC Mining Hardware Business and our Packaging Business.
Added
We have attempted to identify forward-looking statements by using terminology such as “anticipates,” “believes,” “expects,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predict,” “should” or “will” or the negative of these terms or other comparable terminology.
Removed
The Separation occurred concurrently with the distribution (the “Distribution”) of our common stock to stockholders of Vinco as of May 18, 2022 (the “Record Date”) at a ratio of one share of our common stock for every ten shares of Vinco common stock held by the Vinco stockholders.
Added
These statements are only predictions; uncertainties and other factors may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements.
Removed
In addition to the Separation and Distribution Agreement, the other principal agreements entered into with Vinco include a Tax Matters Agreement and certain commercial agreements.
Added
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.
Removed
Name Change, Symbol Change and Recapitalization On March 15, 2023, a Special Meeting of Security Holders was held to vote upon the proposal to approve an amendment to the Certificate of Incorporation to effect, at the discretion of the Board but prior to the one-year anniversary of the date on which the reverse stock split is approved by the Company’s stockholders, a reverse stock split of all of the outstanding shares of Common Stock at a ratio in the range of 1-for-2 to 1-for-50, with such ratio to be determined by the Board in its discretion and included in a public announcement (the “Reverse Stock Split Proposal”).
Added
On June 29, 2022, the Company separated from the Former Parent, Vinco Ventures Inc. (“Vinco”). As previously announced, we concluded a spin-off from Vinco in May 2022 (the “Separation”). Following the Separation, we are an independent, publicly traded company, and Vinco retains no ownership interest in our Company.
Removed
On April 3, 2023, the Company filed a Certificate of Amendment (the “Certificate of Amendment”) to the Company’s Certificate of Incorporation (the “Certificate of Incorporation”) with the Secretary of State of Delaware (1) to effect a 1-for-50 reverse stock split of the shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), either issued and outstanding or held by the Company as treasury stock (the “Reverse Stock Split”) and (2) to change the name of the Company from “Cryptyde, Inc.” to “Eightco Holdings Inc.” (the “Name Change”).
Added
In the event any interest is not paid when due hereunder, delinquent interest shall be added to principal and shall bear interest on interest, compounded.
Removed
Both the Reverse Stock Split and the Name Change were effective as of 4:05 p.m., New York time, on April 3, 2023. The Common Stock began trading on a reverse stock split-adjusted basis on the Nasdaq Capital Market on April 4, 2023.
Added
March 2023 Offering On March 15, 2023, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with Hudson Bay Master Fund Ltd.

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