SUBSEQUENT EVENTS	9 Months Ended
Sep. 30, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	20. SUBSEQUENT EVENTS On October 23, 2023 (the “Effective Date”), the Company entered into a Prepayment and Redemption Agreement (the “Prepayment Agreement”), by and between the Company and an accredited investor (the “Investor”), pursuant to which, among things, the Company agreed to prepay the Notes (as defined below) and to redeem the March 2023 Warrant (as defined below), subject to the conditions set forth therein. As previously disclosed, pursuant to the Note Securities Purchase Agreement, the Company sold to the Investor the January 2022 Note, of which an aggregate principal amount of $2,000,000 remains outstanding. In addition, pursuant to the Securities Purchase Agreement (together with the Note Securities Purchase Agreement, the “SPAs”) the Company sold to Hudson Bay the March 2023 Note, of which the entire aggregate principal amount remains outstanding (together with the January 2022 Note, the “Notes”) and the March 2023 Warrant Common Stock which remains outstanding as of the September 30, 2023. Pursuant to the Prepayment Agreement, the Company agreed to make an aggregate payment of $8,215,000 (the “Aggregate Payment Amount”) to Hudson Bay in six installments, of which an initial payment of $3,000,000 will be allocated towards the January 2022 Note, a portion of the March 2023 Note and the redemption in full of the March 2023 Warrant (the “Initial Payment”). The remaining five installments, which range from $150,000 to $2,275,000 and are allocated towards the remaining principal of the March 2023 Note as specified in the Prepayment Agreement, are due on the fifteenth day of each month, beginning on November 15, 2023 and ending on March 15, 2024. At its option, the Company may prepay any monthly installment prior to its respective due date. Any cash payments required to be made pursuant to the terms of the Notes shall be suspended as long as the Company timely makes the payments set forth in the Prepayment Agreement and no Event of Default (as defined in the Notes) (or an event that with the passage of time or the giving of notice would result in an Event of Default) occurs and is continuing. In addition, upon receipt by Hudson Bay of the Initial Payment, all of the aggregate principal amount outstanding of the March 2023 Note will no longer be convertible into shares of Common Stock, provided that any aggregate principal amount outstanding of the March 2023 Note shall again become convertible into shares of Common Stock if an Event of Default (or an event that with the passage of time or the giving of notice would result in an Event of Default) occurs and is continuing or in the event the Company fails to timely make the payments under the Prepayment Agreement. Upon receipt by Hudson Bay of the Aggregate Payment Amount, the SPAs, the Notes, the March 2023 Warrant and any other transaction documents related to the SPAs shall terminate and be of no further force or effect, other than certain indemnification obligations in the SPAs. In the event that the conditions to closing shall not have occurred by on or before the fifth (5th) business day following the Effective Date, subject to certain conditions, Hudson Bay has the option to terminate the Prepayment Agreement at the close of business on such date. The Prepayment Agreement contains customary representations, warranties and obligations of the parties, including, among others, disclosure and most favored nation covenants. On October 25, 2023, the Company completed the payment of the Initial Payment. On October 19, 2023, Forever 8, entered into a Series C Loan and Security Agreement (the “Series C Agreement”) with an individual (the “Series C Lender”). Under the terms of the Series C Agreement, the Series C Lender will make available to Forever 8, in an amount not to exceed its obligations, a loan advance in an amount to be determined by the Series C 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 Forever 8 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 an escrow account (the “Escrow Funds”). Forever 8 may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”). Forever 8 issued a Promissory Note to the Series C Lender in the amount of the Series C Lender’s respective Initial Loan Advance. The principal balance of the Initial Loan Advance and each Subsequent Draw shall bear interest thereon from October 19, 2023 and applicable funding date of any Subsequent Draw, respectively, at 18.00% per annum (the “Interest Rate”). The Borrower shall pay the Series C Lender, according to its percentage of its Aggregate Commitment, an unused commitment fee on the actual daily amount of the amount equal to the Aggregate Commitment less the Initial Loan Advance and less the aggregate amount of all Subsequent Draws during the immediately preceding calendar quarter at the rate of five percent (5.00%) 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 addition, upon the occurrence and during the continuation of an Event of Default (as defined in the Series C Agreement) thereunder, the Initial Loan Advance and all Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the Series C Lender, bear interest at the Interest Rate, plus five (5) percentage points. In the event any interest is not paid when due, delinquent interest shall be added to principal and shall bear interest on interest, compounded. On October 6, 2023, Forever 8, entered into a Series B Loan and Security Agreement (the “Series B Agreement”) with an individual (the “Series B Lender”). Under the terms of the Series B Agreement, the Series B Lender will make available to Forever 8, in an amount not to exceed its obligations, a loan advance in an amount to be determined by the Series B Lender (as such amount may be increased, the “Series B Aggregate Commitment”) in the aggregate, of which (x) a certain amount will be deposited into an account of Forever 8 in accordance with its written instructions (the “Series B Initial Loan Advance”) and (y) the remaining balance of the Series B Aggregate Commitment after deducting the Series B Initial Loan Advance shall be deposited into the escrow account (the “Series B Escrow Funds”). Foreber 8 may, at any time, request an advance for all or a portion of the Series B Escrow Funds (each such advance, a “Series B Subsequent Draw”). Forever 8 issued a Promissory Note to the Series B Lender in the amount of the Series B Lender’s respective Series B Initial Loan Advance. The principal balance of the Series B Initial Loan Advance and each Series B Subsequent Draw shall bear interest thereon from the October 4, 2023 and applicable funding date of any Series B Subsequent Draw, respectively, at 15.00% per annum (the “Interest Rate”). The Borrower shall pay the Series B Lender, according to its percentage of its Series B Aggregate Commitment, an unused commitment fee on the actual daily amount equal to the Series B Aggregate Commitment less the Series B Initial Loan Advance and less the aggregate amount of all Series B Subsequent Draws during the immediately preceding calendar quarter at the rate of five percent (5.00%) 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 addition, upon the occurrence and during the continuation of an Event of Default (as defined in the Series B Agreement) thereunder, the Series B Initial Loan Advance and all Series B Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the Series B Lender, bear interest at the Interest Rate, plus five (5) percentage points. 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. On October 6, 2023, the Lender advanced the Borrower $50,000 and an additional $50,000 on October 12, 2023. As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Series B obligations under the Series B Agreement and Series C obligations under the Series C Agreement, Forever 8 granted to the Series B Lender and Series C Lender, a security interest in all of Forever 8’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. On October 12, 2023, Forever 8 entered into a Lender Joinder Agreement (the “Joinder Agreement”) with an individual (the “Subsequent Lender”). Under the terms of the Joinder Agreement, the Subsequent Lender agreed to become a lender and be bound by the terms of the Series B Agreement as a lender On October 17, 2023, the Subsequent Lender advanced Forever 8 $50,000. On October 13, 2023, Eightco committed to a plan of termination that resulted in a work force reduction of 6 employees in all areas of the organization. The Company is undertaking this workforce reduction to lower operating expenses and preserve capital while continuing to focus on its Forever 8 business expansion. In addition to the workforce reduction, the Company’s CEO, CFO and all directors have agreed to accrue all, or a portion, of their compensation until further notice. As a result of this reduction in force, the Company estimates that it will record a one-time charge of approximately $0.3 million in the fourth quarter of 2023. The charge that the Company expects to incur in connection with the reduction in force is subject to a number of assumptions, and actual results may differ. The Company may also incur other charges not currently contemplated due to events that may occur as a result of, or associated with, the reduction in force. On November 1, 2023, the Company issued 115,000 shares of common stock to a consultant for investor relations.

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2023

20. SUBSEQUENT EVENTS

On October 23, 2023 (the “Effective Date”), the Company entered into a Prepayment and Redemption Agreement (the “Prepayment Agreement”), by and between the Company and an accredited investor (the “Investor”), pursuant to which, among things, the Company agreed to prepay the Notes (as defined below) and to redeem the March 2023 Warrant (as defined below), subject to the conditions set forth therein.

As previously disclosed, pursuant to the Note Securities Purchase Agreement, the Company sold to the Investor the January 2022 Note, of which an aggregate principal amount of $2,000,000 remains outstanding. In addition, pursuant to the Securities Purchase Agreement (together with the Note Securities Purchase Agreement, the “SPAs”) the Company sold to Hudson Bay the March 2023 Note, of which the entire aggregate principal amount remains outstanding (together with the January 2022 Note, the “Notes”) and the March 2023 Warrant Common Stock which remains outstanding as of the September 30, 2023.

Pursuant to the Prepayment Agreement, the Company agreed to make an aggregate payment of $8,215,000 (the “Aggregate Payment Amount”) to Hudson Bay in six installments, of which an initial payment of $3,000,000 will be allocated towards the January 2022 Note, a portion of the March 2023 Note and the redemption in full of the March 2023 Warrant (the “Initial Payment”). The remaining five installments, which range from $150,000 to $2,275,000 and are allocated towards the remaining principal of the March 2023 Note as specified in the Prepayment Agreement, are due on the fifteenth day of each month, beginning on November 15, 2023 and ending on March 15, 2024. At its option, the Company may prepay any monthly installment prior to its respective due date.

Any cash payments required to be made pursuant to the terms of the Notes shall be suspended as long as the Company timely makes the payments set forth in the Prepayment Agreement and no Event of Default (as defined in the Notes) (or an event that with the passage of time or the giving of notice would result in an Event of Default) occurs and is continuing. In addition, upon receipt by Hudson Bay of the Initial Payment, all of the aggregate principal amount outstanding of the March 2023 Note will no longer be convertible into shares of Common Stock, provided that any aggregate principal amount outstanding of the March 2023 Note shall again become convertible into shares of Common Stock if an Event of Default (or an event that with the passage of time or the giving of notice would result in an Event of Default) occurs and is continuing or in the event the Company fails to timely make the payments under the Prepayment Agreement.

Upon receipt by Hudson Bay of the Aggregate Payment Amount, the SPAs, the Notes, the March 2023 Warrant and any other transaction documents related to the SPAs shall terminate and be of no further force or effect, other than certain indemnification obligations in the SPAs. In the event that the conditions to closing shall not have occurred by on or before the fifth (5th) business day following the Effective Date, subject to certain conditions, Hudson Bay has the option to terminate the Prepayment Agreement at the close of business on such date.

The Prepayment Agreement contains customary representations, warranties and obligations of the parties, including, among others, disclosure and most favored nation covenants.

On October 25, 2023, the Company completed the payment of the Initial Payment.

On October 19, 2023, Forever 8, entered into a Series C Loan and Security Agreement (the “Series C Agreement”) with an individual (the “Series C Lender”). Under the terms of the Series C Agreement, the Series C Lender will make available to Forever 8, in an amount not to exceed its obligations, a loan advance in an amount to be determined by the Series C 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 Forever 8 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 an escrow account (the “Escrow Funds”). Forever 8 may, at any time, request an advance for all or a portion of the Escrow Funds (each such advance, a “Subsequent Draw”).

Forever 8 issued a Promissory Note to the Series C Lender in the amount of the Series C Lender’s respective Initial Loan Advance. The principal balance of the Initial Loan Advance and each Subsequent Draw shall bear interest thereon from October 19, 2023 and applicable funding date of any Subsequent Draw, respectively, at 18.00% per annum (the “Interest Rate”). The Borrower shall pay the Series C Lender, according to its percentage of its Aggregate Commitment, an unused commitment fee on the actual daily amount of the amount equal to the Aggregate Commitment less the Initial Loan Advance and less the aggregate amount of all Subsequent Draws during the immediately preceding calendar quarter at the rate of five percent (5.00%) 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 addition, upon the occurrence and during the continuation of an Event of Default (as defined in the Series C Agreement) thereunder, the Initial Loan Advance and all Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the Series C Lender, bear interest at the Interest Rate, plus five (5) percentage points. In the event any interest is not paid when due, delinquent interest shall be added to principal and shall bear interest on interest, compounded.

On October 6, 2023, Forever 8, entered into a Series B Loan and Security Agreement (the “Series B Agreement”) with an individual (the “Series B Lender”). Under the terms of the Series B Agreement, the Series B Lender will make available to Forever 8, in an amount not to exceed its obligations, a loan advance in an amount to be determined by the Series B Lender (as such amount may be increased, the “Series B Aggregate Commitment”) in the aggregate, of which (x) a certain amount will be deposited into an account of Forever 8 in accordance with its written instructions (the “Series B Initial Loan Advance”) and (y) the remaining balance of the Series B Aggregate Commitment after deducting the Series B Initial Loan Advance shall be deposited into the escrow account (the “Series B Escrow Funds”). Foreber 8 may, at any time, request an advance for all or a portion of the Series B Escrow Funds (each such advance, a “Series B Subsequent Draw”).

Forever 8 issued a Promissory Note to the Series B Lender in the amount of the Series B Lender’s respective Series B Initial Loan Advance. The principal balance of the Series B Initial Loan Advance and each Series B Subsequent Draw shall bear interest thereon from the October 4, 2023 and applicable funding date of any Series B Subsequent Draw, respectively, at 15.00% per annum (the “Interest Rate”). The Borrower shall pay the Series B Lender, according to its percentage of its Series B Aggregate Commitment, an unused commitment fee on the actual daily amount equal to the Series B Aggregate Commitment less the Series B Initial Loan Advance and less the aggregate amount of all Series B Subsequent Draws during the immediately preceding calendar quarter at the rate of five percent (5.00%) 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 addition, upon the occurrence and during the continuation of an Event of Default (as defined in the Series B Agreement) thereunder, the Series B Initial Loan Advance and all Series B Subsequent Draws, including principal, interest, compounded interest, and professional fees thereupon, shall upon the election of the Series B Lender, bear interest at the Interest Rate, plus five (5) percentage points. 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. On October 6, 2023, the Lender advanced the Borrower $50,000 and an additional $50,000 on October 12, 2023.

As security for the prompt and complete payment when due (whether on the payment dates or otherwise) of all the Series B obligations under the Series B Agreement and Series C obligations under the Series C Agreement, Forever 8 granted to the Series B Lender and Series C Lender, a security interest in all of Forever 8’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.

On October 12, 2023, Forever 8 entered into a Lender Joinder Agreement (the “Joinder Agreement”) with an individual (the “Subsequent Lender”). Under the terms of the Joinder Agreement, the Subsequent Lender agreed to become a lender and be bound by the terms of the Series B Agreement as a lender On October 17, 2023, the Subsequent Lender advanced Forever 8 $50,000.

On October 13, 2023, Eightco committed to a plan of termination that resulted in a work force reduction of 6 employees in all areas of the organization. The Company is undertaking this workforce reduction to lower operating expenses and preserve capital while continuing to focus on its Forever 8 business expansion. In addition to the workforce reduction, the Company’s CEO, CFO and all directors have agreed to accrue all, or a portion, of their compensation until further notice.

As a result of this reduction in force, the Company estimates that it will record a one-time charge of approximately $0.3 million in the fourth quarter of 2023. The charge that the Company expects to incur in connection with the reduction in force is subject to a number of assumptions, and actual results may differ. The Company may also incur other charges not currently contemplated due to events that may occur as a result of, or associated with, the reduction in force.

On November 1, 2023, the Company issued 115,000 shares of common stock to a consultant for investor relations.