OCTO Eightco Holdings Inc

Proxy Statement
Special Meeting Of Stockholders
To Be Held on June 30, 2023

Information Concerning Solicitation and Voting

This proxy statement and the accompanying proxy card are being furnished in connection with the solicitation of proxies by the Board of Directors of Eightco Holdings Inc. (the “Board”) for use at the special meeting of stockholders (the “Special Meeting”) to be held on June 30, 2023 at 10:00 a.m. Eastern Time, and at any adjournment thereof. The Special Meeting will be a virtual meeting held via the Internet at www.virtualshareholdermeeting.com/. There will not be a physical meeting location, and stockholders will not be able to attend the Special Meeting in person. As always, we encourage you to vote your shares prior to the Special Meeting regardless of whether you intend to attend.

Except where the context otherwise requires, references to “Eightco Holdings,” “Eightco,” “the Company,” “we,” “us,” “our” and similar terms refer to Eightco Holdings Inc. In addition, unless the context otherwise requires, references to “stockholders” are to the holders of our common stock, par value $0.001 per share (“Common Stock”)

The Company held a special meeting of stockholders on March 15, 2023, at which the Company’s stockholders approved an amendment to the Certificate of Incorporation to effect a reverse stock split of the Company’s 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 (the “Reverse Stock Split”). On April 3, 2023, the Board determined to effect the Reverse Stock Split at a ratio of 1-for-50, and the Board approved the corresponding Certificate of Amendment. Unless stated otherwise, numbers of shares, exercise prices, and conversion prices reported in this proxy statement shall reflect the effect of the Reverse Stock Split.

This proxy statement summarizes information about the proposals to be considered at the Special Meeting and other information you may find useful in determining how to vote. The proxy card is a means by which you actually authorize the proxies to vote your shares in accordance with your instructions. Hard copies of this proxy statement, along with the notice and either a proxy card or a voting instruction card, are being mailed to our stockholders of record as of the close of business on May 9, 2023, beginning on or about May        , 2023.

Important Notice Regarding the Availability of Proxy Materials for the Special Meeting of Stockholders to be Held on June 30, 2023. The Notice of Special Meeting and proxy statement are also available at www.proxyvote.com.

Questions and Answers about the Special Meeting

Other than these proposals, no other proposals will be presented for a vote at the Special Meeting.

Beginning fifteen (15) minutes prior to, and during, the Special Meeting, we will have technicians standing by and ready to assist you with any technical difficulties you may have accessing or hearing the virtual meeting. If you encounter any difficulties accessing the virtual meeting or during the virtual meeting, please call the technical support team at the phone number available on www.virtualshareholdermeeting.com/.

Pursuant to the rights of our stockholders contained in our charter documents, each share of our Common Stock is entitled to one vote on all matters listed in this proxy statement.

If your shares are held in a stock brokerage account or by a bank or other nominee, the nominee is considered the record holder of those shares. You are considered the beneficial owner of these shares, and your shares are held in “street name.” A notice or proxy statement and voting instruction card have been forwarded to you by your nominee. As the beneficial owner, you have the right to direct your nominee concerning how to vote your shares by using the voting instructions they included in the mailing or by following their instructions for voting by telephone or the Internet.

We encourage you to provide instructions to your brokerage firm via the Internet or telephone or by returning your signed voting instruction card. This ensures that your shares will be voted at the Special Meeting with respect to the proposal described in this proxy statement.

If your shares are held in “street name,” meaning they are held for your account by an intermediary, such as a bank, broker or other nominee, then you are deemed to be the beneficial owner of your shares and the broker that actually holds the shares for you is the record holder and is required to vote the shares it holds on your behalf according to your instructions. The proxy materials, as well as voting and revocation instructions, should have been forwarded to you by the bank, broker or other nominee that holds your shares. In order to vote your shares, you will need to follow the instructions that your bank, broker or other nominee provides you. The voting deadlines and availability of telephone and Internet voting for beneficial owners of shares held in “street name” will depend on the voting processes of the bank, broker or other nominee that holds your shares. Therefore, we urge you to carefully review and follow the voting instruction card and any other materials that you receive from that organization.

Even if you plan to attend the Special Meeting online, we urge you to vote your shares by proxy in advance of the Special Meeting so that if you should become unable to attend the Special Meeting your shares will be voted as directed by you.

We do not intend to bring any other matter for a vote at the Special Meeting, and we do not know of anyone else who intends to do so. Your proxies are authorized to vote on your behalf, however, using their best judgment, on any other business that properly comes before the Special Meeting.

If your shares are held in the name of a bank, broker or other nominee, you will receive separate voting instructions from your bank, broker or other nominee describing how to vote your shares. The availability of Internet voting will depend on the voting process of your bank, broker or other nominee. Please check with your bank, broker or other nominee and follow the voting instructions your bank, broker or other nominee provides.

If your shares are held in “street name,” you may submit new voting instructions by contacting your bank, broker or other nominee. You may also vote online during the Special Meeting, which will have the effect of revoking any previously submitted voting instructions if you follow the procedures described under “How do I vote?” above.

Broker non-votes would be included in the determination of the number of shares present at the Special Meeting for determining a quorum at the meeting. Because your broker will not have discretionary voting authority with respect to Proposals 1 or 2, broker non-votes will not be available at the Special Meeting.

If your shares are held in the name of a bank, broker or other nominee, you should check with your bank, broker or other nominee and follow the voting instructions provided. Attendance at the Special Meeting alone will not revoke your proxy.

Proposal 2 – The Adjournment Proposal: The affirmative vote of a majority of the voting power of the shares of Common Stock present in person or represented by proxy at the Special Meeting and entitled to vote on the Adjournment Proposal is required for approval of the Adjournment Proposal.

The principal terms of the March 2023 SPA Issuance and the Adjournment have been approved by the Board. Marking “ABSTAIN” on your proxy or ballot with respect to the March 2023 SPA Issuance Proposal or the Adjournment Proposal has the same effect as a vote against such proposal. We expect that the directors and executive officers will vote all their shares in favor of the March 2023 SPA Issuance Proposal and the Adjournment Proposal.

The information provided above in this “Question and Answer” format is for your convenience only and is merely a summary of the information contained in this proxy statement. We urge you to carefully read this entire proxy statement, including the documents we refer to in this proxy statement. If you have any questions, or need additional materials, please feel free to contact the firm assisting us in the solicitation of proxies, Kingsdale, if you have any questions or need assistance in voting your shares. Banks, brokers and shareholders may call Kingsdale at 1-855-682-2019 (or call collect outside North America at +1-917-473-0932) or may send an email to contactus@kingsdaleadvisors.com.

Proposal 1: Approval of March 2023 Spa proposal

Background and Description of Proposal

Transaction

On March 15, 2023, the Company entered into the March SPA with an accredited investor (“March Investor”) for the issuance and sale of a Senior Secured Convertible Note with an initial principal amount of $5,555,000 (the “Note”) at an initial conversion price of $6.245 per share of the Common Stock, and a warrant (the “Warrant”) to purchase initially up to 889,512 shares of Common Stock with an initial exercise price of $6.245 per share of Common Stock (the “Private Placement”). The purchase price of the Note and the Warrant was $5,000,000.

In connection with the Private Placement, the Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”), a Security and Pledge Agreement (the “Pledge Agreement”), and various ancillary certificates, disclosure schedules and exhibits in support thereof in connection with the closing of the March SPA.

On March 20, 2023, the March SPA closed.

Reasons for the Private Placement

As of February 7, 2023, our cash and cash equivalents were approximately $2,734,000. In February 2023, our Board determined that it was necessary to raise additional funds for general corporate purposes.

We believe that the offering with the March Investor, which yielded gross proceeds of $5,000,000, was necessary in light of our cash and funding requirements at the time. In addition, at the time of the Private Placement, our Board considered numerous alternatives to the transaction, none of which proved to be feasible or, in the opinion of our Board, would have resulted in aggregate terms equivalent to, or more favorable than, the terms obtained in the Private Placement.

Senior Secured Convertible Note

The Company issued the Note upon the closing of the March SPA. The entire outstanding principal balance and any outstanding fees or interest shall be due and payable in full on January 15, 2024 (“Maturity Date”). The Note shall 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 Maturity Date may be extended at the sole option of the March Investor for so long as certain events of default are continuing or for so long as an event is continuing that if not cured and with the passage of time would result in an event of default.

The Note is convertible at the option of the March Investor into shares of Common Stock and had an initial conversion price of $6.245 per share, subject to adjustment for stock splits, combinations or similar events (each a “Note Stock Combination Event”). If on the on the fifth trading day immediately following a Note Stock Combination Event, the conversion price then in effect on such fifth trading day (after giving effect to a proportional adjustment of the conversion price), is greater than the lowest weighted average price of the Common Stock during the twenty consecutive trading day period ending and including the trading day immediately preceding the fifth trading day after such Stock Combination Event (the “Note Event Market Price”), then the conversion price shall be adjusted to the Note Event Market Price.

The Company effected the Reverse Stock Split on April 3, 2023, which constituted a Note Stock Combination Event. Accordingly, on April 11, 2023, the conversion price of the Note was adjusted to $2.0101 per share.

The Note contains certain limitations on conversion. It provides that no conversion may be made if, after giving effect to the conversion, the March Investor would own in excess of 9.99% of the Company’s outstanding shares of Common Stock. This percentage may be increased or decreased to a percentage not to exceed 9.99%, at the option of the March Investor, except any increase will not be effective until 61 days prior notice to the Company.

The conversion price of the Note is subject to anti-dilution adjustment which, subject to specified exceptions, in the event that the Company issues or is deemed to have issued certain securities at a price lower than the then applicable conversion price, immediately reduces the conversion price of the Note to equal the price at which the Company issues or is deemed to have issued its Common Stock.

If there is an event of default, then the March Investor has the right to request redemption of all or any portion of the Note, at 130% of the sum of the outstanding principal, interest and late fees to be redeemed, provided that if certain conditions specified in the Note are not satisfied, then the March Investor has the right to request redemption of all or any portion of the Note, at 130% of the greater of (i) the sum of the outstanding principal, interest and late fees to be redeemed and (ii) the product of (a) the number of shares into which the Note (including all principal, interest and late fees) subject to redemption may be converted and (b) the greatest closing sale price for the Common Stock beginning on the date immediately preceding the event of default and ending on the date the Company makes the entire payment required to be made upon the redemption provided, however, that if no Cash Release Event (as defined in the Note) has occurred on or prior to the applicable of default redemption date, the principal amount used in calculating the applicable event of default redemption price on such event of default redemption date shall be decreased by the holder’s pro rata portion of $222,000.

Warrant

The Warrant was issued upon closing and is immediately exercisable and, in the aggregate, initially entitled the March Investor to timely purchase up to 889,512 shares of Common Stock. The Warrant had an initial exercise price of $6.245 per share payable in cash, or while each share of Common Stock issuable upon exercise of the Warrant is not registered for resale with the SEC or such prospectus is not available for resale, by way of a “cashless exercise” or an “alternative cashless exercise,” at the option of the March Investor. An “alternative cashless exercise” will provide the March Investor with 0.7 shares of Common Stock for each share that would have been issuable to the March Investor upon such exercise had the Holder elected to pay the exercise price in cash. The Warrant will expire on the fifth anniversary of its date of issuance.

The exercise price of the Warrant is subject to adjustment for stock splits, combinations or similar events (each a “Warrant Stock Combination Event”). If on the on the fifth trading day immediately following a Warrant Stock Combination Event, the exercise price is greater than the lowest weighted average price of the Common Stock during the twenty consecutive trading day period ending on, and including, the trading day immediately preceding the fifth trading day after such Warrant Stock Combination Event (the “Warrant Event Market Price”) then the exercise price shall be adjusted to the Warrant Event Market Price. Upon each such adjustment of the exercise price hereunder, the number of underlying shares of Common Stock shall, subject to specified exceptions, be increased (but in no event decreased) to the number of shares of Common Stock determined by multiplying the exercise price in effect immediately prior to such adjustment by the number of underlying shares of Common Stock acquirable upon exercise of the Warrant immediately prior to such adjustment and dividing the product thereof by the exercise price resulting from such adjustment.

The Company effected the Reverse Stock Split on April 3, 2023, which constituted a Warrant Stock Combination Event. Accordingly, on April 11, 2023, the exercise price of the Warrant was adjusted to $2.0101 per share, and the number of shares underlying the Warrant was increased to 2,763,545.

The Warrant will require payments to be made by the Company for failure to deliver the shares of Common Stock issuable upon exercise. The Warrant also contains limitations on exercise, including the limitation that the March Investor may not exercise its Warrant to the extent that upon exercise the March Investor, together with its affiliates, would own in excess of 9.99% of the Company’s outstanding shares of Common Stock (subject to an increase or decrease, upon at least 61-days’ notice by the March Investor to the Company, of up to 9.99%).

The exercise price of the Warrant will also subject to anti-dilution adjustment which, subject to specified exceptions, in the event that the Company issues or is deemed to have issued certain securities at a price lower than the then applicable exercise price, immediately reduces the exercise price of the Warrant to equal the price at which the Company issues or is deemed to have issued its Common Stock.

The Company may not enter into a fundamental transaction unless the successor entity assumes the obligations of the Company under the Warrant. Upon the occurrence of a fundamental transaction involving a change of control, the holder of the Warrant will have the right to have the Warrant repurchased for a purchase price in cash equal to the Black-Scholes value (as calculated pursuant to the Warrant) of the then unexercised portion of the Warrant.

If the Company issues options, convertible securities, warrants, stock, or similar securities to holders of its Common Stock, the holder of the Warrant shall have the right to acquire the same as if it had exercised its Warrant.

The March Investor is entitled to receive any dividends paid or distributions made to the holders of the Common Stock on an “as if exercised” to Common Stock basis.

Effect of Issuance of Securities

The potential issuance of 2,763,545 shares of Common Stock underlying the Note and 2,763,545 shares of Common Stock underlying the Warrant, plus any additional shares of Common Stock issued pursuant to the anti-dilution provisions contained in the Warrant or Note, would result in an increase in the number of shares of Common Stock outstanding, and our stockholders would incur dilution of their percentage ownership to the extent that the investors convert the Note or exercise the Warrant, or to the extent that additional shares of Common Stock are issued pursuant to the anti-dilution terms of the Warrant. Because of potential adjustments to the number of shares of Common Stock issuable upon conversion of the Note and exercise of the Warrant, the exact magnitude of the dilutive effect of the Note and Warrant cannot be conclusively determined. However, the dilutive effect may be material to our current stockholders.