What changed in this filing

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Item 7. Management’s Discussion and Analysis

2023-03-31 compared with 2022-03-31 · 369 added, 439 removed, 148 unchanged (85% of the section changed)

7 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Statement Regarding Forward-Looking Statements

SEC encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects

and make informed investment decisions.

FORWARD-LOOKING

statements that may appear in this Annual Report, including without limitation, statements related to the Company’s plans, strategies,

objectives, expectations, intentions, and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities

Litigation Reform Act and contain the words “believes,” “anticipates,” “expects,” “plans,”

“intends” and similar words and phrases.

These forward-looking statements are subject to risks and uncertainties that could

cause actual results to differ materially from the results projected in any forward-looking statement.

The forward-looking statements

are made as of the date of this Annual Report, and we assume no obligation to update the forward-looking statements, or to update the

reasons why actual results could differ from those projected in the forward-looking statements.

Investors should consult all the information

set forth in this Annual Report and the other information set forth from time to time in our reports filed with the Securities and Exchange

Commission pursuant to the Securities Exchange Act of 1934, including our reports on Forms 10-Q and 8-K.

following discussion and analysis provides information that our management believes is relevant to an assessment and understanding of

our results of operations and financial condition.

The discussion should be read in conjunction with the financial statements and footnotes

included in Item 8 of this Annual Report.

(together with its

consolidated subsidiaries, referred to herein as “DSS,” “we,” “us,” “our” or the “Company”)

currently operates nine (9) distinct business lines with operations and locations around the globe.

These business lines are:

Packaging, (2) Biotechnology, (3) Direct, (4) Commercial Lending, (5) Securities and Investment Management, (6) Alternative Trading (7)

Digital Transformation, (8) Secure Living, and (9) Alternative Energy.

Each of these business lines are in different stages of development,

growth, and income generation.

Our divisions, their business

lines, subsidiaries, and operating territories:

(1) Our Product Packaging line is led by Premier Packaging Corporation, Inc.

statements contained herein this report constitute “forward-looking statements” within the meaning of the Private Securities

Litigation Reform Act of 1995 (the “1995 Reform Act”).

Except for the historical information contained herein, this report

contains forward-looking statements (identified by words such as “estimate”, “project”, “anticipate”,

“plan”, “expect”, “intend”, “believe”, “hope”, “strategy” and

similar expressions), which are based on our current expectations and speak only as of the date made.

These forward-looking statements

are subject to various risks, uncertainties, and factors, that could cause actual results to differ materially from the results anticipated

in the forward-looking statements.

Company, incorporated in the state of New York in May 1984 has conducted business in the name of Document Security Systems, Inc.

16, 2021, the board of directors approved an agreement and plan of merger with a wholly owned subsidiary, DSS, Inc.

(a New York corporation,

Premier operates in the paper board and fiber based folding carton, consumer product packaging, and document

security printing markets.

It markets, manufactures, and sells sophisticated custom folding cartons, mailers, photo sleeves and complex

3-dimensional direct mail solutions.

Premier is currently located in its new facility in Rochester, NY, and primarily serves the US market.

(2) The Biotechnology business line was created to invest in or acquire companies in the BioHealth and BioMedical fields, including businesses

focused on the advancement of drug discovery and prevention, inhibition, and treatment of neurological, oncological, and immune related

This division is also targeting unmet, urgent medical needs, and is developing open-air defense initiatives, which curb transmission

of air-borne infectious diseases, such as tuberculosis and influenza.

(3) Direct, led by the holding corporation, Decentralized Sharing

Systems, Inc.

(“Decentralized”) provides services to assist companies in the emerging growth “Gig” business model

of peer-to-peer decentralized sharing marketplaces.

Direct specializes in marketing and distributing its products and services through

its subsidiary and partner network, using the popular gig economic marketing strategy as a form of direct marketing.

Direct’s products

include, among other things, nutritional and personal care products sold throughout North America, Asia Pacific, Middle East, and Eastern

(4) Our Commercial Lending business division, driven by American Pacific Bancorp (“APB”), is organized for the purposes

of being a financial network holding company, focused on acquiring equity positions in (i) undervalued commercial bank(s), bank holding

companies and nonbanking licensed financial companies operating in the United States, South East Asia, Taiwan, Japan and South Korea,

and (ii) companies engaged in—nonbanking activities closely related to banking, including loan syndication services, mortgage banking,

trust and escrow services, banking technology, loan servicing, equipment leasing, problem asset management, SPAC (special purpose acquisition

company) consulting services, and advisory capital raising services.

(5) Securities and Investment Management was established to develop

and/or acquire assets in the securities trading or management arena, and to pursue, among other product and service lines, broker dealers,

and mutual funds management.

Also in this segment is the Company’s real estate investment trust (“REIT”), organized

for the purposes of acquiring hospitals and other acute or post-acute care centers from leading clinical operators with dominant market

share in secondary and tertiary markets, and leasing each property to a single operator under a triple-net lease.

the REIT was formed

to originate, acquire, and lease a credit-centric portfolio of licensed medical real estate.

(6) Alternative Trading was established

to develop and/or acquire assets and investments in the securities trading and/or funds management arena.

Trading, in partnership

with recognized global leaders in alternative trading systems, intends to own and operate in the US a single or multiple vertical digital

asset exchanges for securities, tokenized assets, utility tokens, and cryptocurrency via an alternative trading platform using blockchain

The scope of services within this section is planned to include asset issuance and allocation (securities and cryptocurrency),

FPO, IPO, ITO, PPO, and UTO listings on a primary market(s), asset digitization/tokenization (securities, currency, and cryptocurrency),

and the listing and trading of digital assets (securities and cryptocurrency) on a secondary market(s).

(7) Digital Transformation was

established to be a Preferred Technology Partner and Application Development Solution for mid cap brands in various industries including

the direct selling and affiliate marketing sector.

Digital improves marketing, communications and operations processes with custom software

development and implementation.

(8) The Secure Living division has developed a plan for fully sustainable, secure, connected, and healthy

living communities with homes incorporating advanced technology, energy efficiency, and quality of life living environments both for

new construction and renovations for single and multi-family residential housing.

(9) The Alternative Energy group was established to

help lead the Company’s future in the clean energy business that focuses on environmentally responsible and sustainable measures.

Alset Energy, Inc, the holding company for this group, and its wholly owned subsidiary, Alset Solar, Inc., pursue utility-scale solar

farms to serve US regional power grids and to provide underutilized properties with small microgrids for independent energy.

March 3, 2020, the Company, via its subsidiary DSS Securities, entered into a share subscription agreement and loan arrangement with

LiquidValue Asset Management Pte Ltd., AMRE Asset Management, Inc.

and American Medical REIT Inc.

under which it acquired a 52.5% controlling

ownership interest in AMRE Asset Management Inc.

(“AAMI”) which currently has a 93% equity interest in American Medical REIT

AAMI is a real estate investment trust (“REIT”) management company that sets the strategic vision

and formulate investment strategy for AMRE.

It manages the REIT’s assets and liabilities and provides recommendations to AMRE on

acquisition and divestments in accordance with the investment strategies.

AMRE is a Maryland corporation, organized for the purposes

of acquiring hospitals and other acute or post-acute care centers from leading clinical operators with dominant market share in secondary

and tertiary markets, and leasing each property to a single operator under a triple-net lease.

AMRE was formed to originate, acquire,

and lease a credit-centric portfolio of licensed medical real estate.

AMRE is planned to qualify as a Real Estate Investment Trust for

federal income tax purposes, which will provide.

AMRE’s investors the opportunity for direct ownership of Class A licensed medical

On June 18, 2021, DSS Securities, entered into a stock purchase agreement with AMRE to acquire 264,525 Class A Common Shares

of AMRE at a per share price of $10, for a total consideration of $2,645,250.

The additional 264,525 Class A Common Shares acquired increases

the Company’s total equity interest in AMRE to approximately 93%.

August 21, 2020, the Company, completed its acquisition of Impact BioMedical, Inc.

(“Impact BioMedical”), pursuant to a Share

Exchange Agreement by and among the Company, DSS BioHealth Security, Inc.

(“DSS BioHealth”), Alset International Limited

(formally Singapore eDevelopment Ltd.), and Global Biomedical Pte Ltd.

(“GBM”), which was previously approved by the Company’s

shareholders (the “Share Exchange”).

Under the terms of the Share Exchange, the Company issued 483,334 shares of the Company’s

common stock, par value $0.02 per share, nominally valued at $6.48 per share, and 46,868 newly issued shares of the Company’s Series

A Convertible Preferred Stock (“Series A Preferred Stock”).

As a result of the Share Exchange, Impact BioMedical is now a

wholly owned subsidiary of DSS BioHealth, the Company’s wholly owned subsidiary.

BioMedical strives to leverage its scientific know-how and intellectual property rights to provide solutions that have been plaguing

the biomedical field for decades.

By tapping into the scientific expertise of its partners, Impact BioMedical has undertook a concerted

effort in the research and development (“R&D”), drug discovery and development for the prevention, inhibition,

incorporated in August 2020), for the sole purpose of effecting a name change from Document Security Systems, Inc.

change became effective on September 30, 2021.

maintained the same trading symbol “DSS” and updated its CUSIP number

to 26253C 102.

(together with its consolidated subsidiaries, referred to herein as “DSS,” “we,” “us,” “our”

or the “Company”) currently operates nine (9) distinct business lines with operations and locations around the globe.

business lines are:

(1) Product Packaging, (2) Biotechnology, (3) Direct Marketing, (4) Commercial Lending, (5) Securities and Investment

Management, (6) Alternative Trading (7) Digital Transformation, (8) Secure Living, and (9) Alternative Energy.

Each of these business

lines are in different stages of development, growth, and income generation.

divisions, their business lines, subsidiaries, and operating territories:

(1) Our Product Packaging line is led by Premier Packaging

Corporation, Inc.

(“Premier”), a New York corporation.

Premier operates in the paper board and fiber based folding carton,

consumer product packaging, and document security printing markets.

It markets, manufactures, and sells sophisticated custom folding

cartons, mailers, photo sleeves and complex 3-dimensional direct mail solutions.

Premier is currently located in its new facility in

Rochester, NY, and primarily serves the US market.

(2) The Biotechnology business line was created to invest in or acquire companies

in the BioHealth and BioMedical fields, including businesses focused on the advancement of drug discovery and prevention, inhibition,

and treatment of neurological, oncological, and immune related diseases.

August 2020, the Company’s wholly owned subsidiary, DSS Securities, Inc.

entered into a corporate venture to form and operate a

real estate title agency, under the name and flagging of Alset Title Company, Inc, a Texas corporation (“ATC”).

DSS Securities,

shall own 70% of this venture with the other two shareholders being attorneys necessary to the state application and permitting

December 9, 2020, Impact BioMedical entered into an exclusive distribution agreement with BioMed Technologies Asia Pacific Holdings Limited

(“BioMed”), which is focused on manufacturing natural probiotics.

Under the terms of this distribution agreement, Impact

BioMedical will directly market, advertise, promote, distribute and sell certain BioMed products to resellers.

The products to be distributed

by Impact BioMedical include BioMed’s PGut Premium ProbioticsTM, PGut Allergy ProbioticsTM, PGut SupremeSlim ProbioticsTM, PGut

Kids ProbioticsTM, and PGut Baby ProbioticsTM.

Under the terms of the ten-year distribution agreement, Impact BioMedical will have exclusive

rights to distribute the products within the United States, Canada, Singapore, Malaysia, and South Korea and non-exclusive distribution

rights in all other countries.

This division is also targeting unmet, urgent medical needs,

and is developing open-air defense initiatives, which curb transmission of air-borne infectious diseases, such as tuberculosis and influenza.

(3) Direct Marketing, led by the holding corporation, Decentralized Sharing Systems, Inc.

(“Decentralized”) provides services

to assist companies in the emerging growth “Gig” business model of peer-to-peer decentralized sharing marketplaces.

specializes in marketing and distributing its products and services through its subsidiary and partner network, using the popular gig

economic marketing strategy as a form of direct marketing.

Direct Marketing’s products include, among other things, nutritional

and personal care products sold throughout North America, Asia Pacific, Middle East, and Eastern Europe.

(4) Our Commercial Lending business

division, driven by American Pacific Bancorp (“APB”), is organized for the purposes of being a financial network holding

company, focused on acquiring equity positions in (i) undervalued commercial bank(s), bank holding companies and nonbanking licensed

financial companies operating in the United States, South East Asia, Taiwan, Japan and South Korea, and (ii) companies engaged in—nonbanking

activities closely related to banking, including loan syndication services, mortgage banking, trust and escrow services, banking technology,

loan servicing, equipment leasing, problem asset management, SPAC (special purpose acquisition company) consulting services, and advisory

capital raising services.

(5) Securities and Investment Management was established to develop and/or acquire assets in the securities

trading or management arena, and to pursue, among other product and service lines, broker dealers, and mutual funds management.

in this segment is the Company’s real estate investment trust (“REIT”), organized for the purposes of acquiring hospitals

and other acute or post-acute care centers from leading clinical operators with dominant market share in secondary and tertiary markets,

and leasing each property to a single operator under a triple-net lease.

the REIT was formed to originate, acquire, and lease a credit-centric

portfolio of licensed medical real estate.

(6) Alternative Trading was established to develop and/or acquire assets and investments in

the securities trading and/or funds management arena.

Trading, in partnership with recognized global leaders in alternative trading

systems, intends to own and operate in the US a single or multiple vertical digital asset exchanges for securities, tokenized assets,

utility tokens, and cryptocurrency via an alternative trading platform using blockchain technology.

The scope of services within this

section is planned to include asset issuance and allocation (securities and cryptocurrency), FPO, IPO, ITO, PPO, and UTO listings on

a primary market(s), asset digitization/tokenization (securities, currency, and cryptocurrency), and the listing and trading of digital

assets (securities and cryptocurrency) on a secondary market(s).

(7) Digital Transformation was established to be a Preferred Technology

Partner and Application Development Solution for mid cap brands in various industries including the direct selling and affiliate marketing

Digital improves marketing, communications and operations processes with custom software development and implementation.

The Secure Living division has developed a plan for fully sustainable, secure, connected, and healthy living communities with homes incorporating

advanced technology, energy efficiency, and quality of life living environments both for new construction and renovations for single

and multi-family residential housing.

(9) The Alternative Energy group was established to help lead the Company’s future in the

clean energy business that focuses on environmentally responsible and sustainable measures.

Alset Energy, Inc, the holding company for

this group, and its wholly owned subsidiary, Alset Solar, Inc., pursue utility-scale solar farms to serve US regional power grids and

to provide underutilized properties with small microgrids for independent energy.

February 8, 2021, DSS Securities announced that it entered into a joint venture (“JV”) with Coinstreet Partners (“Coinstreet”),

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a global digital exchange ecosystem for the issuance, trading, and settlement of tokenized securities, using its proprietary blockchain

The JV leverages the operational strengths and assets of three key leaders in their field, combining traditional capital market

experience, Fintech innovations, and business networks from three continents, North America, Europe, and Asia, to capitalize on unique

digital asset opportunities.

The JV reported that it intended to first pursue a digital securities exchange license in the US.

forward, this JV will be the key operational company building and operating a digital securities exchange that utilizes the GSX STACS

blockchain technology, serving corporate issuers and investors in the sector.

The JV intends to obtain a broker-dealer license and launch an Alternative Trading

System (“ATS”).

The ATS focusing on financial market inefficiencies, will utilize a blockchain based financial market infrastructure

(‘FMI’) that will trade digital asset securities exempt from registration, or ‘private securities’.

FMI will allow for T+0 settlement, which USX believes can be used to attract liquidity.

Th platform will generate trading liquidity for

the ‘middle’ market – companies that are seeking to raise under $150M USD, can pursue private placements, which have

lower compliance costs that public offerings.

This JV is currently in the planning stages.

February 25, 2021, DSS Securities announced its acquisition of an equity interest in WestPark Capital, Inc.(“WestPark”) and

an investment in BMI Capital International LLC (“BMICI”).

an investment in BMI Capital International LLC (“BMIC”).

DSS Securities executed two separate transactions that were designed

to grow the securities division by signing a binding note and stock exchange letter of intent to own 7.5% of the issued and outstanding

shares of WestPark and acquiring 24.9% of BMICI through a purchase agreement.

shares of WestPark and acquiring 24.9% of BMIC through a purchase agreement.

WestPark is a full-service investment banking and securities

brokerage firm which serves the needs of both private and public companies worldwide, as well as individual and institutional investors.

BMI is a private investment bank specializing in corporate finance advising, raising equity, and venture services, providing a global

BMIC is a private investment bank specializing in corporate finance advising, raising equity, and venture services, providing a global

“one-stop” corporate consultancy to listed companies.

From corporate finance to professional valuation, corporate communications

to event management, BMICI services companies in the US, Hong Kong, Singapore, Taiwan, Japan, Canada, and Australia.

March 1, 2021, Decentralized Sharing Systems, Inc.

(“Decentralized”) announced that it increased its investment in Sharing

Services Global Corporation (“Sharing Services” or “SHRG”), a publicly traded company dedicated to maximizing

shareholder value through the acquisition and development of innovative companies, products, and technologies in the direct selling industry,

through a $30 million convertible promissory note dated April 5, 2021.

Decentralized’s financing was made as an investment that

would help accelerate Sharing Services sales and growth, as well as international expansion, with the expectation that such capital reserves

would help make Sharing Services a dominant player in the global marketplace over the next two years.

It was reported that the new $30

million investment would have the potential to exponentially increase Sharing Services sales channels and substantially expand its product

portfolio, and to position Sharing Services to capitalize on consolidation and roll up opportunities of other direct selling companies.

In the joint announcement, Sharing Services reported that the additional funding would now allow it to accelerate its global expansion

with a direct focus on the Asian markets, and specifically in countries such as South Korea, Japan, Hong Kong, China, Singapore, Taiwan,

Thailand, Malaysia, and the Philippines.

In accordance with the April 5, 2021, convertible promissory note, SHRG issued to the Company

27,000,000 shares of its Class A Common Stock, including 15,000,000 shares in payment of the loan origination fee and 12,000,000 shares

in prepayment of interest for the first year.

On December 23, 2021, a wholly owned subsidiary of DSS entered into a Stock Purchase

and Share Subscription Agreement with SHRG, which provided for an investment of up to $3,000,000 by DSS into SHRG in exchange of an aggregate

of 50,000,000 shares of Class A Common Stock and warrants to purchase up to 50,000,000 shares of Class A Common Stock.

As of December

31, 2021, the Company held 141,450,978 class A common shares equating to a 57.7% ownership interest in SHRG with aggregate

fair value of the Company’s investment in SHRG at December 31, 2021, of approximately $12,731,000.

The Company, via

three (3) of the Company’s existing board members, currently holds four (4) of the five (5) SHRG board of director seats.

“JT” Thatch, DSS’s Lead Independent Director and as well the CEO of SHRG is on the SHRG Board, along with Mr.

Fai Ambrose Chan, DSS’s Executive Chairman of the board of directors (joined the SHRG Board effective May 4, 2020), and Mr.

Heuszel, the CEO of the Company (joined the SHRG Board effective September 29, 2020).

March 15, 2021, the Company, through one of its subsidiaries, DSS BioMedical International, Inc.

entered into a Stock Purchase Agreement

(the “Agreement”) with Vivacitas Oncology Inc.

(“Vivacitas”), to purchase 500,000 shares of its common stock

at the per share price of $1.00, with an option to purchase 1,500,000 additional shares at the per share price of $1.00.

under the terms of the Agreement, the Company will be allocated two seats on the board of Vivacitas.

On March 18, 2021, the Company entered

into an agreement with Alset EHome International, Inc.

(“Seller”) to acquire the Seller’s wholly owned subsidiary Impact

Oncology PTE Ltd for the purchase price of $2,480,000 to effectively purchase ownership of 2,480,000 shares of common stock of Vivacitas.

This agreement includes an option to purchase an additional 250,000 shares of common stock.

As a result of these On April 21, 2021, the

Company announced its wholly owned subsidiary, Premier Packaging Corporation’s intentions to relocate from its current 48,000 square-foot

manufacturing facility from Victor, NY to a new 105,000 square-foot facility in the Town of Henrietta, NY approximately 15 miles from

its Victor location by the end of 2021.

In connection with this relocation, Premier Packaging has entered into an agreement to sell its

current Victor location and closed on this transaction on March 18, 2022.

to event management, BMIC services companies in the US, Hong Kong, Singapore, Taiwan, Japan, Canada, and Australia.

May 13, 2021, Sentinel Brokers, LLC., a subsidiary of the Company entered into a stock purchase agreement (“Sentinel Agreement”)

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of the outstanding Class A Common Shares.

Upon the exercising of this option, but no earlier than one year following the effective

date the Sentinel Agreement, Sentinel has the option to sell the remaining 25% to the Company.

Upon the exercising of this option, but no earlier than one year following the effective date

the Sentinel Agreement, Sentinel has the option to sell the remaining 25% to the Company.

In consideration of purchase price investment

in Sentinel, the Company is entitled to an additional 50.1% of the net profits of Sentinel.

May 19, 2021, the Company announced that its wholly owned subsidiary, DSS PureAir, Inc., a Texas corporation (“DSS PureAir”),

closed on a Securities Purchase Agreement with Puradigm LLC, a Nevada limited liability corporation (“Puradigm”).

to the terms of the Securities Purchase Agreement, DSS PureAir agreed to provide Puradigm a secured convertible promissory note in the

maximum principal amount of $5,000,000.00 (the “Puradigm Note”).

The Puradigm Note has a two-year term with interest at 6.65%

payable quarterly.

All, or part of the Puradigm Note principal balance can be converted at the sole discretion of DSS PureAir for up

to an 18% membership interest in Puradigm LLC.

The Puradigm Note is secured by all the assets of Puradigm under a security agreement

with Puradigm.

Sentinel LLC purchased this additional 50.1% in December 2022 and as of December 31, 2022 owns 75% of Sentinel Co.

June 18, 2021, AMRE Shelton, LLC., (“AMRE Shelton”) a subsidiary of AMRE financed the purchase of a 40,000 square foot, 2.0

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was appraised at approximately $7,150,000, of which $4,965,000 and $1,600,000 was allocated to the facility and land respectively.

Also include in the value of the property is $585,000 of intangible assets with an estimated useful life of approximately 4

Contained within the sale-purchase agreement for this facility, is a $1,500,000 earnout due to the seller if certain criteria

As of December 31, 2021, no liability has been recorded for this earnout as management determined it is currently remote.

November 4, 2021, AMRE LifeCare Portfolio, LLC.

(“AMRE LifeCare”), a subsidiary of AMRE, acquired three medical facilities

located in Fort Worth, Texas, Plano, Texas, and Pittsburgh, Pennsylvania for a purchase price of $62,000,000.

These facilities are tenanted

and operated by LifeCare Hospitals, a specialty hospital operator with a focus on long-term acute and critical care.

The medical facilities

acquired by AMRE are currently under an 18-year lease with eleven years remaining and an option to renew for an additional five years.

These facilities have a total capacity of 195 hospital beds spanning a gross floor area of approximately 320,000 square feet.

This property

was appraised at approximately $61,601,000, of which $33,600,000 and $12,100,000 was allocated to the facility and land respectively.

Also include in the value of the property is $15,901,000 of intangible assets with estimated useful lives ranging from 1

On December 21, 2021, AMRE Winter Haven, LLC.

(“AMRE Winter Haven”), a subsidiary of AMRE, acquired a medical

facility located in Winter Haven, Florida for a purchase price of $4,500,000.

The purchase price has been allocated as $3,200,000, $1,000,000,

and $222,000 for the facility, land and site and tenant improvements respectively.

Also include in the value of the property is $29,000

of intangible assets with an estimated useful life of approximating 5 years.

include in the value of the property is $585,000 of intangible assets with an estimated useful life of approximately 4 years.

within the sale-purchase agreement for this facility, is a $1,500,000 earnout due to the seller if certain criteria are met.

As of December

31, 2021, no liability has been recorded for this earnout as management determined it is currently remote.

On November 4, 2021, AMRE

LifeCare Portfolio, LLC.

(“AMRE LifeCare”), a subsidiary of AMRE, acquired three medical facilities located in Fort Worth,

Texas, Plano, Texas, and Pittsburgh, Pennsylvania for a purchase price of $62,000,000.

These facilities are tenanted and operated by

LifeCare Hospitals, a specialty hospital operator with a focus on long-term acute and critical care.

The medical facilities acquired

by AMRE are currently under an 18-year lease with eleven years remaining and an option to renew for an additional five years.

These facilities

have a total capacity of 195 hospital beds spanning a gross floor area of approximately 320,000 square feet.

This property was appraised

at approximately $61,601,000, of which $33,600,000 and $12,100,000 was allocated to the facility and land respectively.

in the value of the property is $15,901,000 of intangible assets with estimated useful lives ranging from 1 to 11 years.

21, 2021, AMRE Winter Haven, LLC.

(“AMRE Winter Haven”), a subsidiary of AMRE, acquired a medical facility located in Winter

Haven, Florida for a purchase price of $4,500,000.

The purchase price has been allocated as $3,200,000, $1,000,000, and $222,000 for

the facility, land and site and tenant improvements respectively.

Also include in the value of the property is $29,000 of intangible

assets with an estimated useful life of approximating 5 years.

All assets were allocated on a relative fair value basis.

September 9, 2021, the Company finalized a stock purchase agreement (the “SPA”) with American Pacific Bancorp (“APB”),

which provided for an investment of $40,000,200 by the Company into APB for an aggregate of 6,666,700 shares of the APB’s

Class A Common Stock, par value $0.01 per share.

which provided for an investment of $40,000,200 by the Company into APB for an aggregate of 6,666,700 shares of the APB’s Class

A Common Stock, par value $0.01 per share.

Subject to the terms and conditions contained in the SPA, the shares issued at a purchase

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financing, inventory financing, third party loan servicing, and services that address the financial needs of the world Gig Economy.

September 13, 2021, the Company finalized a shareholder agreement between its subsidiary, DSS Financial Management,

(“DFMI”) and HR1 Holdings Limited (“HR1”), a company incorporated in the British Virgin Islands, for the

purpose to operate a vehicle for private and institutional investors seeking a highly liquid investment fund with attractive risk adjusted

returns relative to market unpredictability and volatility.

Under the terms of this agreement, 4000 shares or 40% of the Company’s

subsidiary Liquid Asset Limited Management Limited (“LVAM”), a Hong Kong company was transferred to HR1 whereas at the conclusion

of the transaction DFMI would own 60% of LVAM and HR1 would own 40%.

LVAM executes within reliable platforms and broad market access

and uses proprietary systems and algorithms to trade liquid exchange-traded funds (“ETFs”), stocks, futures or crypto.

Aimed at providing consistent returns while offering the unique ability to liquidate the portfolio within 5 to 10 minutes under normal

market conditions, LVAM provides an array of advanced tools and products enabling customers to explore multiple opportunities, strengthen

and diversify their portfolios, and meet their individual investing goals.

April 7th, 2021, the Company entered into a transfer and assignment agreement (“RIA Agreement”) between DSS Securities, Inc.

April 7, 2021, the Company entered into a transfer and assignment agreement (“RIA Agreement”) between DSS Securities, Inc.

(“DSSS”) and AmericaFirst Capital Management, LLC (“Advisor”), a California limited liability company and the

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$600,000 consideration given is recorded as an Other intangible asset, net on the Consolidated Balance Sheet at December 31, 2021.

As the RIA Agreement has no defined period, this asset has been deemed an infinite life asset and no amortization has been taken.

the RIA Agreement has no defined period, this asset has been deemed an infinite life asset and no amortization has been taken.

December 23, 2021, DSS purchased 50,000,000 shares at $0.06 per share of Sharing Services Global Corporation (“SHRG”) via

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OTCQB Market, an over-the-counter trading platforms market operated by OTC Markets Group Inc.

of COVID-19 Outbreak

COVID-19 pandemic has created global economic turmoil and has potentially permanently impacted how many businesses operate and how individuals

will socialize and shop in the future.

The effect of the economic shutdown has impacted our business lines differently, some more

severely than others.

In most cases, we believe the negative economic trends and reduced sales will recover over time.

Additionally,

it is reasonably possible that estimates made in the financial statements have been, or will be, materially and adversely impacted in

the near term as a result of these conditions, including losses on inventory;

impairment losses related to goodwill and other long-lived

assets and current obligations.

May 13, 2021, Sentinel Brokers, LLC.

(“Sentinel LLC”), subsidiary of the Company entered into a stock purchase agreement

(“Sentinel Agreement”) to acquire a 24.9% equity position of Sentinel Brokers Company, Inc.

(“Sentinel Co.”),

a company registered in the state of New York, and in December 2022, Sentinel LLC exercised this option to increase its equity position

Sentinel is a broker-dealer operating primarily as a fiduciary intermediary, facilitating intuitional trading of municipal and

corporate bonds as well as preferred stock, and is registered with the Securities and Exchange Commission, is a member of the Financial

Industry Regulatory Authority, Inc.

(“FINRA”), and is a member of the Securities Investor Protection Corporation (“SIPC”).

On January 24, 2022, DSS entered into a business consulting agreement with Sharing Services Global Corporation (“SHRG”).

As part of this agreement, 50,000,000 warrants were exercised increasing DSS equity position in SHRG to approximately 65%.

February 28, 2022, DSS entered into an Amendment to Stock Purchase Agreement (the “Amendment”) with its shareholder Alset

EHome International Inc.

(“AEI”), pursuant to which the Company and AEI have agreed to amend certain terms of the Stock Purchase

Agreement dated January 25, 2022 (the “SPA”).

Pursuant to the SPA, AEI had agreed to purchase up to 44,619,423 shares of

the Company’s common stock for a purchase price of $0.3810 per share, for an aggregate purchase price of $17,000,000.

to the Amendment, the number of shares of the common stock of the Company that the AEI will purchase has been reduced to 3,986,877 shares

for an aggregate purchase price of $1,519,000.

This transaction was completed on March 9, 2022.

In addition, the Company’s Executive

Chairman and a significant stockholder, Heng Fai Ambrose Chan, is the Chairman, Chief Executive Officer and largest shareholder of AEI.

May 17, 2022, the shareholders of the Company approved the issuance of up to 21,366,177 Shares of our Common Stock to Alset International,

a related party, to purchase the Convertible Promissory Note issued by American Medical REIT, Inc.

with a principal amount of $8,350,000

and accrued but unpaid interest of $367,000 through May 15, 2022.

This transaction was finalized in July 2022.

May 17, 2022, the shareholders of the Company approved the acquisition of 62,122,908 shares of True Partners Capital Holdings Limited

(“True Partners”), a company publicly traded on the Hong Kong stock exchange in exchange for 17,570,948 shares of DSS stock.

The True Partner shares were acquired from Alset EHome International, Inc.

(“Alset EHome”), a related party.

Ambrose Chan, our director and Executive Chairman, is also Chairman of the Board, Chief Executive Officer, and the largest beneficial

owner of the outstanding shares of Alset EHome.

This transaction was completed with the transfer of DSS share to Alset EHome on July

1, 2022 with the issuance of DSS shares, which were valued at $0.34 per share, to Alset EHome.

OF OPERATIONS FOR THE FISCAL YEARS ENDED DECEMBER 31, 2022 AND 2021

ended December 31, 2021

ended December 31, 2020

December 31, 2022

December 31, 2021

Printed products

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Net investment income

- For the year ended December 31, 2021, revenue increased 32% to approximately $20.3 million as compared to revenues

of approximately $15.4 million for the year ended December 31, 2020.

Printed products sales, which include sales of packaging

and printing products, increased 19% in 2021 as compared to 2020.

The increases in sales were due primarily to the impact of the

COVID-19 pandemic in 2020 as key customers saw a decline in business.

In 2021, those key customers returned to pre-pandemic numbers.

Net investment income, Rental income and Management fee income, $250,000, $1,203,000 and $24,000 respectively, represent

new revenue streams for the Company and are associated with our Securities and Commercial Lending business segments.

The Company’s

Direct Marketing revenues increased 40% in 2021 as compared to 2020 due primarily to increase sales in our Asian market.

ended December 31, 2021

ended December 31, 2020

Costs and expenses

Costs of revenue,

exclusive of depreciation and amortization

Sales, general and administrative

Depreciation and amortization

Commission Revenue

Direct marketing

Total Revenue

Revenue - For the

year ended December 31, 2022, revenue increased 133% to approximately $47.3 million as compared to revenues of approximately $20.3 million

for the year ended December 31, 2021.

Printed products sales, which include sales of packaging and printing products, increased 16% in

2022 as compared to 2021.

The increases in sales were due primarily to the addition of several new customers during 202 1 due to the impact

of the COVID-19 pandemic on our competition as well as key customers returned to pre-pandemic numbers.

Net investment income, Rental income

and Management fee income, $630,000, $6,287,000 and $134,000 respectively, represent new revenue streams for the Company in 2021 and are

associated with our Securities and Commercial Lending business segments.

The Company’s Direct Marketing revenues increased 575%

in 2022 as compared to 2021 due primarily to due to the inclusion of SHRG financial results beginning on January 1, 2022.

Commission revenue,

associated with our Securities and Investment Management business line, and in particular our subsidiary Sentinel Co., is a new addition

to our revenue stream this year with $294,000.

December 31, 2022

December 31, 2021

Cost of revenue - printed products

Cost of revenue - securities

Cost of revenue – commercial lending

Cost of revenue – directing marketing

Cost of revenue – other

Sales, general and administrative compensation

Professional fees

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Rent and utilities

and development

operating expenses

costs and expenses

of revenue, exclusive of depreciation and amortization includes all direct costs of the Company’s printed products, including

its packaging and printing sales and its direct marketing sales, materials, direct labor, transportation, and manufacturing facility

In addition, this category includes all direct costs associated with the Company’s technology sales, services and licensing

including hardware and software that are resold, third-party fees, and fees paid to inventors or others as a result of technology licenses

or settlements, if any.

Costs of revenue increased 11% in 2021 as compared to 2020, primarily due the increase price of labor, paper

and other raw materials associated with our printing and packaging division as well as cost associated with direct marketing product

Research and development

Other operating expenses

Total costs and expenses

of revenue includes all direct costs of the Company’s printed products,

including its packaging and printing sales and its direct marketing sales, materials, direct labor, transportation, and

manufacturing facility costs.

In addition, this category includes all direct costs associated with the Company’s technology

sales, services and licensing including hardware and software that are resold, third-party fees, and fees paid to inventors or

others because of technology licenses or settlements, if any.

Cost of revenue for our REIT line of business includes all direct cost

associated with the maintenance and upkeep of the related facilities, depreciation, amortization and the costs to acquire the facilities.

Our Commercial Lending operating segment has costs of revenue associated with the impairment of notes receivable for those amounts at

risk of collection.

Total costs of revenue increased 123% in 2022 as compared to 2021, primarily

due to the inclusion of SHRG financial results beginning on January 1, 2022, as well as the increase price of labor, paper and other

raw materials associated with our printing and packaging division as well as cost associated with direct marketing product

manufacturing and procurement.

general and administrative compensation costs, increased 81% in 2021 as compared to 2020, primarily due a bonus of approximately

$7.9 million accrued for Mr.

Heng Fai Ambrose Chan, in accordance with the terms of his employment contract as an executive

of the Company’s DSS Cyber Security Pte.

Ltd subsidiary as compared to $4.3 million accrued in 2020.

Chan is also the Company’s

largest shareholder and Chairman of the Board of Directors.

and amortization include the depreciation of machinery and equipment used for production, depreciation of office equipment and building

and leasehold improvements, amortization of software, and amortization of acquired intangible assets such as customer lists, trademarks,

non-competition agreements and patents, and internally developed patent assets.

Also included is the depreciation of the buildings acquired

and amortization of intangible assets included in real estate acquisitions made by our REIT business line.

Depreciation and amortization

expense increased by 305% during 2021, as compared to 2020, primarily due to beginning the amortization of the intangible assets

obtained as part of the Impact BioMedical acquisition in January 2021 (approximately $93,000 per month) and other acquisitions made

during 2021 as well as the 2020 expiration of the non-compete agreement with a former executive, and a large 10-year asset

becoming fully depreciated.

fees increased 73% in 2021 as compared to 2020, primarily due to an increase in legal fees associated with the direct marketing division,

due diligence fees, as well as costs associated with acquisitions.

Also, the Company recorded $1,041,000 of loan loss reserves associated with its notes receivable.

general and administrative compensation costs, increased 110% in 2022 as compared to 2021, primarily due to the inclusion of SHRG financial results beginning on January 1, 2022.

fees increased 59% in 2022 as compared to 2021, primarily due to an increase in legal fees associated with the direct marketing

division, due diligence fees, as well as costs associated with acquisitions.

based compensation includes expense charges for all stock-based awards to employees, directors, and consultants.

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due to the expiration of several warrants and options during 2022.

Also, one-time stock grants that took place in 2020 to directors,

certain officers, and consultants with no similar offerings or grants in 2021.

and marketing costs, which includes internet and trade publication advertising, travel and entertainment costs, sales-broker commissions,

and trade show participation expenses, increased 33% during 2021 as compared to 2020, primarily due to increased direct marketing

distributor commissions as well as increased commissions incurred at our printing and packing division

and utilities increased 15% during 2021 as compared to 2020 due to a new lease in Houston, Texas.

and trade show participation expenses, increased 215% during 2022 as compared to 2021, primarily due to increased direct marketing distributor

commissions due to the inclusion of SHRG financial results beginning on January 1,

2022, as well as increased commissions incurred at our printing and packing division.

and utilities increased 306% during 2022 as compared to 2021 due to a new lease in West Henrietta, NY.

and development costs consist primarily of third-party research costs and consulting costs.

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Research and development costs increased 16% as compared to the same period in 2021 primarily

due to the acquisition of Impact Biomedical, Inc.

in August of 2020 and the related costs for continued research and development of the

acquired product formulations as well as development of new technologies.

due to increases in such activities at our Impact Biomedical, Inc.

operating expenses consist primarily of equipment maintenance and repairs, office supplies, IT support, bad debt expense, insurance

costs, and corporate travel.

Other operating expenses increased 55% in 2021 as compared to 2020 primarily due to increased

software costs associated with enhancements to the Company’s ERP system as well as new software implement as part of the Company’s

Direct Marketing segment and increased D&O insurance.

Other operating expenses increased 16% in 2022 as compared to 2021 primarily due to increased software costs

associated with enhancements to the Company’s ERP system as well as new software implement as part of the Company’s Direct

Marketing segment and increased D&O insurance costs.

Income and Expense

ended December 31, 2021

ended December 31, 2020

December 31, 2022

December 31, 2021

Other Income (Expense)

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Interest expense

(Loss) gain on investments

Dividend Income

Loss on investments

(10,697,000 )

from equity method investment

Gain on extinguishment

of deferred financing costs and debt discount

(12,035,000 )

income increased 6,503%, during the year ended December 31, 2021, as compared to the same period in 2020, due to interest

recognized on the Company’s money markets, notes receivable, and the accretion of the discount on convertible notes receivable.

expense increased 7% during the year ended December 31, 2021, as compared to the same period in 2020, due to increases in

debt balances.

income represents recognition of amortization of note origination fees.

gain on investments is recognized on the change in fair market value of warrants in SHRG ($8.9) million, Alset International

Limited ($1.9) million and other marketable securities ($1.2) million for the year 2021, as compared to SHRG $7.1 million on

related warrants, Alset International Limited $3.4 million and other marketable securities $0.1 million for the year 2020.

(Loss) gain from equity

method investment represents the Company’s prorated portion of earnings for its investments accounted for under the

equity method for the year ended December 31, 2021 and 2020.

on extinguishment of debt is associated funds received by AAMI in April 2020 from the SBA Paycheck Protection

Program of $116,000.

As of January 8, 2021, this note was forgiven in full.

debt discount decreased 100% during the year ended December 31, 2021, as compared to the same period in 2020, due to the balance

of debt issue costs being fully expensed in 2020.

Gain (loss) from equity method investment

Impairment of fixed asset

Impairment of investment

Litigation loss

Gain on extinguishment of debt

Gain On disposal of operations, net of taxes

Total other income

$ (25,803,000 )

$ (16,673,000 )

income is recognized on the Company’s money markets, and a portion of notes receivable, identified in Note 4.

expense increased 1385% during the year ended December 31, 2022, as compared to the same period in 2021, due to increases in debt

balances, in particular within our REIT business line.

income (expense) is driven by origination fees , and tax benefits at SHRG.

on investments consists of net realized losses on marketable securities which are recognized as the difference between the purchase

price and sale price of the common stock investment.

Also included are net unrealized losses on marketable securities which are recognized

on the change in fair market value on our common stock investment.

of investments is driven by the Company impairment of its investment in Vivacitas

approximately $4,100,000 as of December 31, 2022.

Gain (loss) from equity method investment represents the Company’s prorated portion of earnings for its investments accounted for

under the equity method for the year ended December 31, 2022, and 2021.

Impairment of fixed

asset is associated with the write down of fair value of SHRG’s Lindon, Utah property.

Litigation loss represents

the Company’s cost to settle its litigation with Maiden Biosciences litigation, which was settled and the Court’s December

20, 2022 judgment was vacated, and the case was dismissed with prejudice (see Note 16).

on extinguishment of debt is associated funds received by AAMI in 2020 and 2021 from the SBA Paycheck Protection Program of $110,000

and $116,000, respectively.

These notes were forgiven in full during 2022 and 2021 repetitively.

Gain on sale of assets is

driven by the Company’s gain on the sale of Premier’s manufacturing facility in Victor, NY, as well as other capital assets.

and Capital Resources

1 unchanged sentence

As of December 31, 2022, the Company had cash of approximately $19.3 million.

As of December 31, 2021, the Company

believes that it has sufficient cash to meet its cash requirements for at least the next 12 months from the filing date of this Annual

In addition, the Company believes that it will have access to sources of capital from the sale of its equity securities and debt

Cash Flow - During 2021, the Company expended approximately $9.0 million for operations, which generally reflected

by fluctuations in accounts receivable, inventory, and prepaid and other current assets, accrued expenses and other liabilities.

Cash Flow - During 2021, the Company expended approximately $122.0 million in investing activities.

This includes $56.8 million in

investments in real estate associated with its REIT business line.

In addition, the Company expended approximately $21.5

million on purchases of investments and marketable securities, $18.1 million on the purchase of intangible assets and $11.6 million on investments in

notes receivable.

Cash Flows - During 2021, the Company generated $179.2 million from financing activities, which includes $121.7

million from new issuances of common stock and $60.8 million from the borrowings of long-term debt.

This is offset by principal

payments on debt of approximately $1.9 million.

As of December 31, 2022, the Company believes that it has

sufficient cash to meet its cash requirements for at least the next 12 months from the filing date of this Annual Report.

the Company believes that it will have access to sources of capital from the sale of its equity securities and debt financings.

Flow from Operating Activities

Net cash used by operating

activities was approximately $27.0 million for the year ended December 31, 2022 as compared to approximately $9.0 million for the year

ended December 31, 2021.

This increase is driven by an increase in net loss of continuing operations of approximately $69.7 million,

as well as an increase in accounts receivable of $1.9 million offset by an increase in accounts payable of $4.0 million year over year.

Flow from Investing Activities

cash used in investing activities was approximated $18.0 million for year ended December 31, 2022 as compared to approximately

$122.0 million for the year ended December 31, 2021.

During the year ended December 31, 2022, we purchased $2.3 million in property,

plant, and equipment, $14.9 million of marketable securities, and issued $3.6 million in new notes receivable.

In comparison, the Company purchased $71.1 million in property, plant,

equipment and real estate for the twelve months ended December 31, 2021.

Flow from Financing Activities

Net cash provided from financing

activities was approximated $7.6 million for the year ended December 31, 2022 as compared to $179.2 million for the year ended December

During the year ended December 31, 2022, we borrowed $9.6 million of long-term debt as compared to $60.9 million during the

year ended December 31, 2021.

Also, the Company raised $122 million through new issuance of common stock during the year ended December

Operations and Going Concern

accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

of accounting contemplates the recovery of our assets and the satisfaction of liabilities in the normal course of business.

These consolidated

financial statements do not include any adjustments to the specific amounts and classifications of assets and liabilities, which might

be necessary should we be unable to continue as a going concern.

While the Company has approximately $19.3 million in cash, the Company

has incurred operating losses as well as negative cash flows from operating and investing activities over the past two years.

from its $19.3 million in cash as of December 31, 2022, the Company believes it can continue as a going concern, during the twelve

months ended December 31, 2021, due to its ability to generate operating cash through the sale of its $27.3 million of Marketable

Securities, and the anticipated receipts of principal and interest on its Notes receivable of approximately $11.2 million through

March 31, 2024.

Also, our subsidiary Impact BioMedical is in the process of and IPO in which DSS will maintain a minimum of 55%

Initial conversations with underwriters are providing an estimate of $30 - $50 million potential capital raise.

expected to close early 3rd quarter 2023.

Our subsidiary SHRG is in the process of up listing to NASDQ and conversations with the

underwriter involved illustrate an approximate raise of $15 million dollars.

Additionally, we are in negotiations with Pinnacle Bank

to extend our note payable, approximating $40.2 million through November 2024.

Company’s management intends to take actions necessary to continue as a going concern.

Management’s plans concerning these

matters includes, among other things, continued growth among our operating segments, and tightly controlling operating costs and reducing

spending growth rates wherever possible to return to profitability.

In addition, the Company has taken steps, and will continue to take

measures, to materially reduce the expenses and cash burn at all corporate and business line levels.

the Company’s current operating levels and capital usage, we believe that without any further acquisition or investments, our $19.3

million in aggregate cash, as of December 31, 2022, along with the $27.3 million of Marketable Securities, and the anticipated receipts

of principal and interest on its Notes receivable of approximately $11.2 million through March 2024, would allow us to fund our nine

business lines current and planned operations through March 2024.

Based on this, the Company has concluded that substantial doubt of

its ability to continue as a going concern has been alleviated

Sheet Arrangements

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Accounting Policies

preparation of financial statements and related disclosures in conformity with generally accepted accounting principles in the U.S.

GAAP”) requires management to make judgments, assumptions and estimates that affect the amounts reported in our consolidated financial

statements and accompanying notes.

The Company’s consolidated financial statements for the fiscal year ended December 31, 2021

describe the significant accounting policies and methods used in the preparation of the consolidated financial statements.

Value of Financial Instruments - Fair value is defined as the price that would be received to sell an asset or paid to

transfer a liability in an orderly transaction between market participants at the measurement date.

The Fair Value Measurement Topic

of the FASB ASC establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value.

The hierarchy

gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and

the lowest priority to unobservable inputs (Level 3 measurements).

preparation of financial statements and related disclosures in conformity with U.S.

GAAP requires management to make judgments, assumptions

and estimates that affect the amounts reported in our financial statements and accompanying notes.

The financial statements as of December

31, 2021, describe the significant accounting policies and methods used in the preparation of the financial statements.

There have been

no material changes to such critical accounting policies as of the Annual Report on Form 10-K for the year ended December 31, 2022.

For Loans and Lease Losses

On January 1, 2022, the Company

adopted amended accounting guidance “ ASU No.2016-13 – Credit Losses” which requires an allowance for credit losses

to be deducted from the amortized cost basis of financial assets to present the net carrying value at the amount that is expected to be

collected over the contractual term of the asset considering relevant information about past events, current conditions, and reasonable

and supportable forecasts that affect the collectability of the reported amount.

In estimating expected losses in the loan and lease portfolio,

borrower-specific financial data and macro-economic assumptions are utilized to project losses over a reasonable and supportable forecast

Assumptions and judgment are applied to measure amounts and timing of expected future cash flows, collateral values and other

factors used to determine the borrowers’ abilities to repay obligations.

After the forecast period, the Company utilizes longer-term

historical loss experience to estimate losses over the remaining contractual life of the loans.

Prior to 2022, the allowance for credit

losses represented the amount that in management’s judgment reflected incurred credit losses inherent in the loan and lease portfolio

as of the balance sheet date.

Value of Financial Instruments

value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between

market participants at the measurement date.

The Fair Value Measurement Topic of the Financial Accounting Standards Board (“FASB”)

Accounting Standards Codification (“ASC”) establishes a three-tier fair value hierarchy which prioritizes the inputs used

in measuring fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets

or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

These tiers include:

● Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets.

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted

prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active;

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions,

such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

carrying amounts reported in the balance sheet of cash and cash equivalents, accounts receivable, prepaids, accounts payable and accrued

expenses approximate fair value because of the immediate or short-term maturity of these financial instruments.

Marketable securities

classify as a Level 1 fair value financial instrument.

The fair value of notes receivable approximates their carrying value as the stated

or discounted rates of the notes do reflect recent market conditions.

The fair value of revolving credit lines notes payable and long-term

debt approximates their carrying value as the stated or discounted rates of the debt reflect recent market conditions.

The fair value

of investments where the fair value is not considered readily determinable, are carried at cost.

– Investments in equity securities with a readily determinable fair value, not accounted for under the equity method, are

recorded at that value with unrealized gains and losses included in earnings.

For equity securities without a readily determinable fair

value, the investment is recorded at cost, less any impairment, plus or minus adjustments related to observable transactions for the

same or similar securities, with unrealized gains and losses included in earnings.

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as

quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own

assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value

drivers are unobservable.

carrying amounts reported in the consolidated balance sheet of cash and cash equivalents, accounts receivable, prepaids, accounts payable

and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments.

securities classify as a Level 1 fair value financial instrument.

The fair value of notes receivable approximates their carrying value

as the stated or discounted rates of the notes do not reflect recent market conditions.

The fair value of revolving credit lines notes

payable and long-term debt approximates their carrying value as the stated or discounted rates of the debt reflect recent market conditions.

The fair value of investments where the fair value is not considered readily determinable, are carried at cost.

Investments in equity securities with a readily determinable fair value, not accounted for under the equity method, are recorded

at that value with unrealized gains and losses included in earnings.

For equity securities without a readily determinable fair value,

the investment is recorded at cost, less any impairment, plus or minus adjustments related to observable transactions for the same or

similar securities, with unrealized gains and losses included in earnings.

equity method investments, the Company regularly reviews its investments to determine whether there is a decline in fair value below

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discussion on investments.

Party Liabilities - On April 1, 2020 the Company’s HWH World, Inc subsidiary has a service agreement with HWH Korea, a

subsidiary of Alset International Limited (“Alset Intl.”) (formally Singapore eDevelopment Limited).

The Chairman of the

Heng Fai Ambrose Chan, is the Executive Director and Chief Executive Officer of Alset Intl.

Chan is also the majority

shareholder of Alset Intl as well as the largest shareholder of the Company, beneficially owning approximately 31.3% of DSS.

Company also owns approximately 127,179,000 shares of Alset Intl, a company publicly listed on the Singapore Exchange Limited.

agreement will allow HWH Korea to utilize the Company’s merchant account in connection with their direct marketing network with

periodic remittance of the cash collected to them for a fee of 2.5% of amounts collected.

As of December 31, 2021, the Company had collected

approximately $0 as compared to $1,100,000 as of December 31, 2020, on behalf of HWH Korea, which is included in Accrued expenses and

deferred revenue on the consolidated balance sheet.

There were no amounts outstanding to this related party at December 31, 2021.

- The Company recognizes its products and services revenue based on when the title passes to the customer or when the service

is completed and accepted by the customer.

Revenue is measured as the amount of consideration the Company expects to receive in exchange

for shipped product or service provided.

Company recognizes its revenue based on when the title passes to the customer or when the service is completed

and accepted by the customer.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for shipped

product or service provided.

Sales and other taxes billed and collected from customers are excluded from revenue.

recognizes rental income associated with its REIT, net of amortization of favorable/unfavorable lease terms relative to market, and includes

rental abatements and contractual fixed increases attributable to operating leases, where collection has been considered probable, on

a straight-line basis over the term of the related lease.

The Company recognizes management fee income from its investment banking line

of business as interest owed to the Company occurs.

The Company generates revenue from its direct marketing line of business primarily

through internet sales and recognizes revenue as items are shipped.

The Company recognizes

rental income associated with its REIT, net of amortization of favorable/unfavorable lease terms relative to market and includes rental

abatements and contractual fixed increases attributable to operating leases, where collection has been considered probable, on a straight-line

basis over the term of the related lease.

The Company recognizes net investment income from its investment banking line of business as

interest owed to the Company occurs.

The Company generates revenue from its direct marketing line of business primarily through internet

sales and recognizes revenue as items are shipped.

of December 31, 2022, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater

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period of the asset that the Company would have otherwise recognized is one year or less.

- In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”)

2017-01, Business Combinations (“Topic 805”):

Clarifying the Definition of a Business (“ASU 2017-01”).

is intended to assist entities with evaluating whether a set of transferred assets and activities is a business.

Under this guidance,

an entity first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable

asset or a group of similar identifiable assets.

If this threshold is met, the set is not a business.

If the threshold is not met, the

entity then evaluates whether the set meets the requirement that a business include, at a minimum, an input and a substantive process

that together significantly contribute to the ability to create outputs.

See Note 7 regarding the acquisitions.

combinations and non-controlling interests are recorded in accordance with FASB ASC 805 Business Combinations.

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of business combination accounting requires the use of significant estimates and assumptions.

See Note 5 regarding the acquisitions.

of assets are recorded at their relative fair value based on total accumulated costs of the acquisition.

Direct acquisition-related costs

are capitalized as a component of the acquired assets.

This includes all costs related to finding, analyzing and negotiating a transaction.

Direct acquisition-related

costs are expensed as incurred.

This includes all costs related to finding, analyzing and

negotiating a transaction.

The allocation of the purchase price is an area that requires judgment and significant estimates.

Tangible and intangible assets include

land, building and improvements, furniture, fixtures and equipment, acquired above market and below market leases, in-place lease value

(if applicable).

Acquisition-date fair values of assets and assumed liabilities are determined based on replacement costs, appraised

values, and estimated fair values using methods similar to those used by independent appraisers and that use appropriate discount and/or

capitalization rates and available market information.

Operations – On April 20, 2020, the Company executed a nonbinding letter of intent with a perspective buyer for the sale

of certain assets of its plastic printing business line, which it operated under Plastic Printing Professionals, Inc.

(“DSS Plastics”),

a wholly owned subsidiary of the Company.

That sale was consummated and closed on August 14, 2020.

The remaining assets of DSS Plastics

were either sold, separately disposed, or retained by other existing DSS businesses lines.

Accordingly, the operations of DSS Plastics

have been discontinued.

Based on the magnitude of DSS Plastics’ historical revenue to the Company and because the Company has exited

the production of laminated and surface printed cards, this sale represented a significant strategic shift that has a material effect

on the Company’s operations and financial results.

Accordingly, the Company has applied discontinued operations treatment for this

sale as required by Accounting Standards Codification 210-05—Discontinued Operations.

The major classes of assets and liabilities

of DSS Plastics are classified as Held For Sale – Discontinued Operations on the Consolidated Balance Sheets and the operating

results of the discontinued operations is reflected on the Consolidated Statements of Operations as Loss from Discontinued Operations.

Tangible and intangible assets include land, building and improvements, furniture, fixtures and equipment, acquired above market and

below market leases, in-place lease value (if applicable).

Acquisition-date fair values of assets and assumed liabilities are

determined based on replacement costs, appraised values, and estimated fair values using methods like those used by independent

appraisers and that use appropriate discount and/or capitalization rates and available market information.

May 7, 2021, the Company completed the sale of 100% of the capital stock of DSS Digital Inc.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis