What changed in this filing

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Item 1. Financial Statements

2026-05-15 compared with 2025-11-14 · 1088 added, 1019 removed, 552 unchanged (79% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

September 30, 2025

March 31, 2026

December 31, 2025

and cash equivalents

receivable, net

in trading securities

portion of notes receivable, net

portion of notes receivable - related party

portion of notes receivable

expenses and other current assets

current assets

Cash and cash equivalents

Restricted cash

Accounts receivable, net

Inventory, net

Marketable securities, current

Assets held for sale

Current portion of notes receivable, net

Current portion of notes receivable - related party

Current portion of notes receivable

Prepaid expenses and other current assets

Total current assets

Property, plant and equipment, net

Investment in real estate, net

Other investments

Property, plant and equipment,

Investment in real estate,

Investment, cost method

Investment, equity method

Marketable securities, noncurrent

Notes receivable, net

Notes receivable - related party, net

Notes receivable

Investment in equity securities

bond investment – related party

Right-of-use assets

Other intangible assets, net

$ 106,453,000

LIABILITIES AND STOCKHOLDERS’ EQUITY

intangible assets, net

AND STOCKHOLDERS’ EQUITY

current liabilities

Accounts payable

Accrued expenses and deferred revenue

Other current liabilities

Current portion of lease liability

Current portion of long-term debt, net

Current portion of long-term debt on assets held-for-sale, net

Convertible promissory note - related party

Current portion of long-term debt - related party, net

Current portion of long-term debt

Total current liabilities

interest on long-term debt

portion of lease liability

portion of long-term debt, net

note payable - related party

portion of long-term debt - related party, net

portion of long-term debt

current liabilities

Long-term debt, net

Long term lease liability

Total liabilities

Commitments and contingencies (Note 12)

Stockholders’ equity

Preferred stock, $ .02 par value;

47,000 shares authorized, zero shares issued and outstanding ( zero on December 31, 2024);

Liquidation value $ 1,000 per share, zero aggregate.

zero on December 31, 2024).

Common stock, $ .02 par value;

term lease liability

and contingencies (Note 13)

Stockholders’

equity (deficit)

stock, $ 0.02 par value;

47,000 shares authorized, zero shares issued and outstanding

Common stock, $ 0.02 par

200,000,000 shares authorized, 10,042,518 shares issued and outstanding ( 9,092,518 on December 31, 2025)

Treasury stock

Additional paid-in capital

Accumulated deficit

( 332,820,000 )

( 327,001,000 )

Total stockholders’ equity of the Company

Non-controlling interest in subsidiaries

Total stockholders’ equity

Total liabilities and stockholders’ equity

$ 106,453,000

stockholders’ equity of the Company

Non-controlling

interest in subsidiaries

stockholders’ equity

liabilities and stockholders’ equity

accompanying notes to the condensed consolidated financial statements.

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Consolidated Statements of Operations

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

Printed products revenue

Rental revenue

Net investment revenue

Commission revenue

Biotechnology retail revenue

Total revenue

the Three Months Ended March 31,

Commercial lending

Biotechnology

general and administrative (including stock-based compensation)

costs and expenses

Cost of revenue

Selling, general and administrative (including stock based compensation)

Total costs and expenses

Operating loss

( 5,487,000 )

( 3,726,000 )

income on note receivable, related party

equity method investment

Change in fair value of convertible bond investment – related party

on sale on sale of real estate

operations before income taxes

( 6,354,000 )

( 5,363,000 )

Other income (expense):

Interest income

Dividend income

Other income (expense)

Interest expense

Foreign Currency Translation Adjustment

Gain on extinguishment of debt

(Loss)/gain on equity method investment

Gain (loss) on investments

$ ( 6,354,000 )

Impairment of intangible assets

Provision for loan losses

(Loss)/gain on sale

Loss from operations before income taxes

$ ( 5,296,000 )

Loss from operations attributed to noncontrolling interest

loss attributable to DSS common stockholders

$ ( 5,819,000 )

$ ( 4,777,000 )

common share attributable to common stockholders

used in computing loss per common share:

accompanying notes to the condensed consolidated financial statements.

AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

controlling Interest in

December 31, 2024

$ 323,150,000

Income tax benefit

$ ( 303,072,000 )

payments for professional services

based payments

based payments - Impact BioMedical, Inc.

of common stock, net of expenses - Impact BioMedical, Inc.

of common stock award

( 4,777,000 )

1 unchanged sentence

( 5,296,000 )

Income (loss) from operations attributed to noncontrolling interest

Net loss attributable to DSS common stockholders

March 31, 2025

$ 325,325,000

$ ( 307,849,000 )

December 31, 2025

( 327,001,000 )

Loss per common share attributable to common stockholders

Shares used in computing loss per common share:

of common stock, net of expenses

Issuance of warrants in

connection with convertible promissory note – related party

value adjustment related to convertible bond received from related party

based payments - Impact BioMedical, Inc.

( 5,819,000 )

( 6,354,000 )

March 31, 2026

$ 335,998,000

$ ( 332,820,000 )

$ 335,998,000

$ ( 332,820,000 )

accompanying notes to the condensed consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Cash Flows

the Nine Months Ended September 30,

the Three Months Ended March 31,

Cash flows from operating activities:

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Depreciation and amortization

Issuance of common stock for bonus

Gain on allowance for obsolescence of inventory

Stock based payments for professional services rendered

Stock based payments for employees and directors

(Loss)/gain on equity method investment

Loss (gain) on investments

( 1,255,000 )

Stock-based payments to employees and directors

Loss on equity method investment

Unrealized loss on investments

Change in ROU assets

Change in inventory obsolescence

Accrued interest on notes payable

Loss on sale of assets

Impairment of intangibles

Impairment of accounts receivable

Provision for loan losses

extinguishment of debt

Provision for loan loss recoveries

Change in fair value of convertible bond investment - related party

Loss on sale of real estate

Decrease (increase) in assets:

Accounts receivable

( 1,670,000 )

Assets held for sale

Prepaid expenses and other current assets

( 1,113,000 )

Investment in trading securities

Increase (decrease) in liabilities:

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ROU liabilities

Accrued interest on notes payable

Other liabilities

Net cash used by operating activities

( 7,576,000 )

( 5,889,000 )

Net cash (used) provided by operating activities

Cash flows from investing activities:

Purchase of property, plant and equipment

Sale of real estate

Purchase of marketable securities

( 2,794,000 )

Purchase of investment

Purchase of convertible bond - related party

( 2,450,000 )

Disposal of property, plant and equipment

Sale of real estate

Sale of investment, related party

Sale of marketable securities

Issuance of new notes receivable, net origination fees

Payments received on notes receivable

Net cash provided by investing activities

Net cash (used) provided by investing activities

( 2,639,000 )

Cash flows from financing activities:

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( 8,997,000 )

( 1,492,000 )

Borrowings of long-term debt, net

Debt issuance costs

Payment on margin loans

( 1,548,000 )

( 2,806,000 )

Borrowings of convertible note payable - related party

Payments on margin loan

Issuances of common stock, net of issuance costs

1 unchanged sentence

( 11,694,000 )

Net increase (decrease) in cash

( 4,312,000 )

Cash and cash equivalents at beginning of period

Cash and cash equivalents and restricted cash at end of

Cash and cash equivalents

Restricted cash

Cash and cash equivalents and restricted cash at end of

accompanying notes to the condensed consolidated financial statements.

AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

Preferred Stock

Additional Paid-in

Non- controlling Interest in

Balance, December 31, 2023

$ 319,963,000

$ ( 256,176,000 )

Initial public offering of Impact BioMedical

( 14,034,000 )

( 1,728,000 )

( 15,762,000 )

Balance, September 30, 2024

$ 321,885,000

$ ( 270,210,000 )

Balance, December 31, 2024

$ 323,150,000

$ ( 303,072,000 )

$ 323,150,000

$ ( 303,072,000 )

Issuance of common stock, net of expenses - Impact BioMedical, Inc.

Issuance of common stock for bonus

Stock based payments for professional services rendered for Impact Bio

Stock based payments

( 9,184,000 )

( 10,087,000 )

Balance, September 30, 2025

$ 326,277,000

$ ( 312,256,000 )

$ 326,277,000

Net decrease in cash

( 1,378,000 )

Cash and cash equivalents and restricted

cash at beginning of period

Cash and cash equivalents at end of period

accompanying notes to the condensed consolidated financial statements.

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

or the “Company”) currently operates five (5) distinct business lines with operations and locations around the globe.

or the “Company”) currently operates four (4) distinct business lines with operations and locations around the globe.

business lines are:

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

(1) Product Packaging, (2) Biotechnology, (3) Commercial Lending, (4) Securities and Investment Management.

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

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

(3) Our Commercial Lending business division, driven by American Pacific Financial (“APF”), 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.

(4) 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 trusts (“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.

(5) 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.

Direct Marketing’s products include,

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

On June 21, 2025, Impact BioMedical Inc.

(“Impact”), Dr Ashleys Limited,

a Cayman Islands exempted company limited by shares (“PubCo”), Dr Ashleys Nevada Sub, Inc., a Nevada corporation and wholly-owned

subsidiary of PubCo (“Merger Sub”), Dr Ashleys Bio Labs Limited, a Cayman Islands exempted company limited by shares (“Dr

Ashleys Cayman”), and Kanans Visvanats (a.k.a.

Kannan Vishwanatth), a Latvian national, solely in his capacity as the sole shareholder

of Dr Ashleys (“Dr Ashleys Shareholder”) entered into a Merger and Share Exchange Agreement (the “Merger Agreement”).

Pursuant to the Merger Agreement and subject to the terms and conditions set forth therein, (i) Merger Sub shall be merged with and into

Impact with Impact being the surviving entity (the “Merger”), and (ii) simultaneous with or immediately following the Merger,

PubCo shall acquire all of the issued and outstanding ordinary shares of Dr Ashleys Cayman from the Dr Ashleys Shareholder (the “Share

The closing date of the transaction is uncertain as of November 14, 2025, due to the pending approval from regulatory

Management will continue evaluating the status of this deal at year end.

(3) Our Commercial Lending business division, driven by American Pacific Financial (“APF”), provides financing solutions

including commercial business lines of credit, land development financing, inventory financing, equipment financing, and third-party

loan servicing (4) 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 trusts (“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.

June 21, 2025, Impact BioMedical Inc.

(“Impact”), Dr Ashleys Limited, a Cayman Islands exempted company limited by shares

(“PubCo”), Dr Ashleys Nevada Sub, Inc., a Nevada corporation and wholly-owned subsidiary of PubCo (“Merger Sub”),

Dr Ashleys Bio Labs Limited, a Cayman Islands exempted company limited by shares (“Dr Ashleys Cayman”), and Kanans Visvanats

Kannan Vishwanatth), a Latvian national, solely in his capacity as the sole shareholder of Dr Ashleys (“Dr Ashleys Shareholder”)

entered into a Merger and Share Exchange Agreement (the “Merger Agreement”).

Pursuant to the Merger Agreement and subject

to the terms and conditions set forth therein, (i) Merger Sub shall be merged with and into Impact with Impact being the surviving entity

(the “Merger”), and (ii) simultaneous with or immediately following the Merger, PubCo shall acquire all of the issued and

outstanding ordinary shares of Dr Ashleys Cayman from the Dr Ashleys Shareholder (the “Share Exchange”).

The closing date

of the transaction is uncertain as of May 15, 2026, due to the pending approval from regulatory authorities.

Both parties agreed to

extend the closing date to July 1, 2026.

Management will continue evaluating the status of this deal.

Basis of Presentation and Significant Accounting Policies

of Presentation - The accompanying condensed unaudited consolidated financial statements contain all adjustments

(consisting of normal recurring adjustments, unless otherwise indicated) necessary to present fairly our consolidated financial

position as of September 30, 2025 and December 31, 2024, and the results of our consolidated operations for the interim periods

presented in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) and

pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), the instructions to Form 10-Q

and Article 10 of Regulation S-X.

We follow the same accounting policies when preparing quarterly financial data as we use for

preparing annual data.

These statements should be read in conjunction with the consolidated financial statements and the notes

included in our latest annual report on Form 10-K, for the fiscal year ended December 31, 2024 (“Form 10-K”), and our

other reports on file with the Securities and Exchange Commission (the “SEC”).

of Presentation - The accompanying condensed unaudited consolidated financial statements contain all adjustments (consisting of normal

recurring adjustments, unless otherwise indicated) necessary to present fairly our consolidated financial position as of March 31, 2026

and December 31, 2025, and the results of our consolidated operations for the interim periods presented in conformity with accounting

principles generally accepted in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the

Securities and Exchange Commission (“SEC”), the instructions to Form 10-Q and Article 10 of Regulation S-X.

We follow the

same accounting policies when preparing quarterly financial data as we use for preparing annual data.

These statements should be read

in conjunction with the consolidated financial statements and the notes included in our latest annual report on Form 10-K, for the fiscal

year ended December 31, 2025 (“Form 10-K”), and our other reports on file with the Securities and Exchange Commission (the

of Consolidation - The consolidated financial statements include the accounts of DSS, Inc.

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intercompany balances and transactions have been eliminated in consolidation.

of Estimates - The preparation of consolidated financial statements in conformity with accounting principles generally accepted

in the United States requires the Company to make estimates and assumptions that affect the amounts reported and disclosed in the financial

statements and the accompanying notes.

of Estimates - The

preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires

the Company to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying

Actual results could differ materially from these estimates.

On an ongoing basis, the Company

evaluates its estimates, including those related to the accounts receivable, convertible notes receivable, inventory, fair values of

investments, intangible assets and goodwill, useful lives of intangible assets and property and equipment, fair values of options and

warrants to purchase the Company’s common stock, preferred stock, deferred revenue and income taxes, among others.

bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which

form the basis for making judgments about the carrying values of assets and liabilities.

Reclassifications -

Cost associated with Professional fees approximating $ 82,000 and $ 336,000 for the three and nine months ended September 30, 2024,

respectively have been reclassified to Research and development to conform with current period presentation.

Certain items on the statement of cashflow for nine months ended September 2024, have been reclassified to conform

with the current period presentation.

Equivalents –

All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents.

included in cash equivalents in the accompanying consolidated balance sheets are money market funds whose adjusted costs approximate

On an ongoing basis, the Company evaluates its estimates, including

those related to the accounts receivable, convertible notes receivable, inventory, fair values of investments, intangible assets and

goodwill, useful lives of intangible assets and property and equipment, fair values of options and warrants to purchase the Company’s

common stock, preferred stock, deferred revenue and income taxes, among others.

The Company bases its estimates on historical experience

and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the

carrying values of assets and liabilities.

of prior period financial statements - The Company identified and corrected an immaterial classification error in our previously

reported Condensed Consolidated Balance Sheet and Condensed Consolidated Statement of Changes in Shareholders’ Equity as of March

The correction of this error between Additional paid-in capital and Non-controlling interest in subsidiary for the Issuance

of common stock, net of expenses - Impact BioMedical, Inc.

resulted in a $ 205,000

reduction to Additional paid-in capital from the previously reported

number of $ 1,499,000

and an increase of $ 205,000

to Non-controlling interest in subsidiary previously reported at $ 0 .

Additionally, the Company reduced 36,433 shares

from Stock based payments for professional services rendered and increased Issuance of common stock award by 36,433

resulting in final amounts of 0

and 1,000,000

respectively.

The Company also identified certain immaterial errors in the classification of amounts reported

in the consolidated statement of cash flows for the three months ended March 31, 2025.

Specifically, $ 1,806,000

of cash inflows related to sales of marketable securities, which were previously presented within investing

activities, should have been presented within operating activities.

As a result of the revision, net cash used in operating activities

for the three months ended March 31, 2025 decreased from $ 1,638,000

to a cash provided by operating activities of $ 168,000 .

The Company assessed the materiality of this change in presentation on prior period financial statements in accordance with SEC Staff

Accounting Bulletin No.

99, “Materiality,” (ASC Topic 250, Accounting Changes and Error Corrections).

Based on this assessment,

the Company concluded that this classification error correction in its Balance Sheet is not material to any previously presented financial

statements based upon overall considerations of both quantitative and qualitative factors.

The correction had no effect on any previously

reported amounts in our consolidated financial statements as of and for three months ended March 31, 2025 other than those previously

Equivalents – All highly liquid investments with maturities of three months or less at the date of purchase are classified

as cash equivalents.

Amounts included in cash equivalents in the accompanying consolidated balance sheets are money market funds whose

adjusted costs approximate fair value.

cash - Restricted cash consists of deposits and other cash balances that are restricted as to withdrawal or use under the terms

of certain contractual arrangements.

These amounts are generally maintained as collateral for letters of credit, lease-related security

deposits, or other business requirements.

The Company classifies restricted cash as a current assets on noncurrent asset on the Consolidated

balance sheets based on when the applicable restrictions are expected to lapse.

For purposes of the consolidated statements of cash flows,

cash, cash equivalents, and restricted cash are presented in total

Receivable - The Company extends credit to its customers in the normal course of business.

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abilities to pay.

September 30, 2025, December 31, 2024, the Company established a reserve for credit losses of approximately $ 1,014,000 ,

and $ 1,613,000 ,

respectively.

Accounts receivable, net at September 30, 2025, and December 31, 2024, was $ 4,139,000 ,

and $ 3,068,000 ,

respectively.

The Company does not accrue interest on past due accounts receivable.

March 31, 2026, December 31, 2025, the Company established a reserve for credit losses of approximately $ 974,000 , and $ 1,014,000 , respectively.

Accounts receivable, net at March 31, 2026, and December 31, 2025, was $ 2,042,000 , and $ 2,254,000 , respectively.

The Company does not

accrue interest on past due accounts receivable.

Concentration

of Credit Risk - The Company maintains its cash in bank deposit accounts, which at times may exceed federally insured

The Company believes it is not exposed to any significant credit risk because of any non-performance by the financial

institutions.

As of September 30, 2025, one customer accounted for approximately 25 %

of Credit Risk - The Company maintains its cash

in bank deposit accounts, which at times may exceed federally insured limits.

The Company believes it is not exposed to any significant

credit risk because of any non-performance by the financial institutions.

As of March 31, 2026, one customer accounted for approximately

of our consolidated revenue and two customers accounted for approximately 25 %,

of our trade accounts receivable balance.

As of September 30, 2024, two customers accounted for approximately 20 %

As of March 31, 2025, one customer accounted for approximately 30 %

of our consolidated revenue and two customers accounted for approximately 35 %

of our trade accounts receivable balance.

of December 31, 2024, two customers accounted for approximately 22 % and 13 % of our consolidated revenue and 29 % and 20 % of our trade

accounts receivable balance.

As of March 31, 2026 and 2025 one vendor accounted for approximately 13 % and 11 %, respectively, of our cost of revenue.

of December 31, 2025, one customers accounted for approximately 29 % of our consolidated revenue.

As of December 31, 2025, five customers

accounted for 19 %, 18 %, 13 %, 12 % and 11 % of our trade accounts receivable balance.

receivable, unearned interest, and related recognition - The Company records all future payments of principal and interest on

9 unchanged sentences

with warrants acquired at origination, are accreted as an adjustment to yield over the term of the loan.

For Loans Losses - ASC Topic 326 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 portfolio, borrower-specific financial

data and macro-economic assumptions are utilized to project losses over a reasonable and supportable forecast period.

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.

At September 30, 2025, December 31,

2024, the Company established a reserve for credit losses of approximately $ 7,478,000 , $ 9,406,000 , respectively.

For Loans Losses - ASC Topic 326 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 portfolio, borrower-specific financial data and macro-economic assumptions

are utilized to project losses over a reasonable and supportable forecast period.

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

After the forecast period, the Company utilizes longer-term historical loss experience to estimate losses over the remaining

contractual life of the loans.

At March 31, 2026, and December 31, 2025, the Company established a reserve for credit losses of approximately

$ 7,478,000 .

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

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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.

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 consolidated balance sheet of cash and cash equivalents, accounts receivable, prepaids, accounts payable

6 unchanged sentences

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

The fair value of the convertible bond investment is classified as a Level 3 asset within the fair value hierarchy

because there is no quoted price in an active market for the identical bond and the valuation requires significant unobservable inputs,

including issuer credit risk, expected term, volatility, liquidity, conversion probability, and the value of the embedded conversion feature.

– Inventories consist primarily of paper, pre-printed security paper, paperboard, fully prepared packaging, air filtration

4 unchanged sentences

slow-moving items.

An allowance for obsolescence of approximately $ 131,000 and $ 180,000 associated with the inventory at our Premier

subsidiary for September 30, 2025, and December 31, 2024, respectively.

An allowance for obsolescence of approximately $ 57,000 and $ 53,000 associated with the inventory at our Premier subsidiary

for March 31, 2026 and December 31, 2025, respectively.

Write- downs and write-offs are charged to Cost of revenue.

15 unchanged sentences

accompanying Condensed consolidated statement of operations.

During 2023, the land and buildings related to AMRE LifeCare and AMRE Winter

Haven were reclassified to Assets held for sale.

During 2024, the land and buildings related to AMRE Shelton were reclassified to Assets

held for sale.

As of September 30, 2025, circumstances around the sale of these properties have changed and the Company does not believe the

sale of these properties will be finalized within the 12 months from the filing of these quarterly financial statements and have reclassified

these assets to Investment in real estate, net and will begin to depreciate these assets prospectively.

The Company’s

policy is to obtain an independent third-party valuation for each major project in the United States as part of our assessment of identifying

potential triggering events for impairment.

Management may use the market comparison method to value the investments.

In addition to

the annual assessment of potential triggering events in accordance with ASC 360 – Property Plant and Equipment (“ASC 360”),

the Company applies a fair value-based impairment test to the net book value assets on an annual basis and on an interim basis if certain

events or circumstances indicate that an impairment loss may have occurred.

bond investment - The Company accounts for its convertible bond investment as a financial asset measured at fair value.

has elected the fair value option under ASC 825, Financial Instruments , and, accordingly, changes

in the fair value of the investment are recognized in earnings in the period of change.

Interest income is recognized when earned in

accordance with the contractual terms of the bond.

Fair value is determined in accordance with ASC 820, Fair

Value Measurement , using valuation techniques appropriate for the instrument and available market information.

The valuation considers,

among other factors, the stated interest rate, maturity date, conversion price, market price of the underlying equity securities, foreign

currency exchange rates, issuer credit risk, expected term, volatility, liquidity, and conversion economics.

The convertible bond investment is classified as a Level 3 financial asset

because there is no quoted price in an active market for the identical bond and the valuation requires significant unobservable inputs,

including issuer credit risk, expected term, volatility, liquidity, conversion probability, and conversion economics.

Assets - The estimated fair values of acquired intangibles are generally determined based upon future economic benefits such

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No circumstances or events have occurred since the most recent analysis that would indicate

the need for an impairment is needed for the nine months ended September 30, 2025.

the need for an impairment is needed for the three months ended March 31, 2026.

Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities

assumed in a business combination.

Goodwill is subject to impairment testing at least annually and will be tested for impairment between

annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired.

FASB ASC Topic 350 provides

an entity with the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to

a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

If, after completing

the assessment, it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value,

the Company will proceed to a quantitative test.

The Company may also elect to perform a quantitative test instead of a qualitative test

for any or all of our reporting units.

The test compares the fair value of an entity’s reporting units to the carrying value of

those reporting units.

This quantitative test requires various judgments and estimates.

The Company estimates the fair value of the reporting

unit using a market approach in combination with a discounted operating cash flow approach.

Impairment of goodwill is measured as the

excess of the carrying amount of goodwill over the fair values of recognized and unrecognized assets and liabilities of the reporting

The Company performed its annual goodwill impairment test as of December 31, 2024, and no impairment was deemed necessary for the

goodwill associated with Premier Packaging Company of approximately $ 1,769,000 , however an impairment of Impact BioMedical goodwill was

deemed necessary of approximately $ 25,093,000 .

No circumstances or events have occurred since the most recent analysis that would indicate

the need for an impairment is needed for the nine months ended September 30, 2025.

Goodwill is subject to impairment testing at least annually and will be tested for impairment

between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired.

Topic 350 provides an entity with the option to first assess qualitative factors to determine whether the existence of events or

circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its

carrying amount.

If, after completing the assessment, it is determined that it is more likely than not that the fair value of a

reporting unit is less than its carrying value, the Company will proceed to a quantitative test.

The Company may also elect to

perform a quantitative test instead of a qualitative test for any or all of our reporting units.

The test compares the fair value of

an entity’s reporting units to the carrying value of those reporting units.

This quantitative test requires various judgments

and estimates.

The Company estimates the fair value of the reporting unit using a market approach in combination with a discounted

operating cash flow approach.

Impairment of goodwill is measured as the excess of the carrying amount of goodwill over the fair

values of recognized and unrecognized assets and liabilities of the reporting unit.

The Company performed its annual goodwill

impairment test as of December 31, 2025, and no impairment was deemed necessary for the goodwill associated with Premier Packaging

Company of approximately $ 1,769,000 .

No circumstances or events have occurred since the most recent analysis that would indicate the need for an impairment is needed for

the three months ended March 31, 2026.

of Long-Lived Assets and Goodwill - The Company monitors the carrying value of long-lived assets for potential impairment and

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the fair value of the asset or asset group to its carrying value.

At June 30, 2025, the Company determined to resign its position as

the registered investment advisor (“RIA”) of the American First Mutual Funds and impaired the related asset acquired at the

time the Company became the RIA in September 2021 in the amount of $ 600,000 .

No circumstances or events have occurred since the most recent analysis

that would indicate the need for an impairment is needed for the three months ended March 31, 2026.

Promissory Note - The Company accounts for convertible promissory notes in accordance with

ASU 2020-06, and evaluates embedded features under ASC 815, Derivatives and Hedging .

Upon issuance, convertible notes are recorded

at their principal amount, net of any original issue discount (“OID”) and debt issuance costs.

OID and issuance costs are

presented as a direct deduction from the carrying amount of the debt and are amortized to interest expense using the effective interest

method over the contractual term (ASC 835-30).

The Company assesses all terms and features of its convertible notes, including conversion

options, redemption provisions, make-whole or down-round adjustments, and default put/call rights, to determine whether any embedded features

shall be bifurcated and accounted for as derivatives at fair value with changes in fair value recognized in earnings (ASC 815 and ASC

820), or whether the convertible note instrument could be qualified for simplified accounting per ASU 2020-06 and recorded at amortized

cost as liability.

Convertible notes are classified as current or noncurrent liabilities based on contractual maturity and the Company’s

intent and ability to settle the obligation within twelve months of the balance sheet date.

Accrued interest and amortization of discounts

and issuance costs are included in interest and amortization expense, respectively.

For diluted earnings per share, the Company applies

the if-converted method to its convertible instruments in accordance with ASU 2020-06 (ASC 260).

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

Under the guidance, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition

and all acquisition costs are expensed as incurred.

The excess of the purchase price over the estimated fair values is recorded as goodwill.

If the fair value of the assets acquired exceeds the purchase price and the liabilities assumed, then a gain on acquisition is recorded.

ASU 2020-06 and evaluates embedded and freestanding features under ASC 815.

Convertible notes are initially recorded at principal amount,

net of any original issue discount, debt issuance costs, and discounts arising from the allocation of proceeds to detachable warrants

or other freestanding instruments.

When a financing transaction includes multiple instruments, the Company allocates proceeds based on

the relative fair values of the instruments, or, when required, first records liability-classified instruments at fair value with residual

proceeds allocated to the remaining instruments.

The Company evaluates conversion options, redemption provisions, down-round

or anti-dilution features, most-favored-nation provisions, default rights, warrants, and other terms to determine whether separate accounting

Embedded derivatives or liability-classified instruments are measured at fair value, with changes in fair value recognized

Debt discounts, original issue discount, and issuance costs are amortized to interest expense using the effective interest

method over the contractual term.

Convertible notes are classified as current or noncurrent based on contractual maturity and settlement

For diluted earnings per share, the Company applies the if-converted method in accordance with ASC 260.

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

805 Business Combinations.

Under the guidance, the assets and liabilities of the acquired business are recorded at their fair values

at the date of acquisition and all acquisition costs are expensed as incurred.

The excess of the purchase price over the estimated fair

values is recorded as goodwill.

If the fair value of the assets acquired exceeds the purchase price and the liabilities assumed, then

a gain on acquisition is recorded.

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

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

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.

Per Common Share - The Company presents basic and diluted (loss) earnings per share.

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diluted (loss) earnings per share is the same, as the impact of potential common shares is anti-dilutive.

For the nine months ended September

30, 2025 and 2024, there were no potential dilutive instruments issued and outstanding.

For the three months ended

March 31, 2026 and 2025, there were no potential dilutive instruments issued and outstanding.

Payments - Compensation cost for stock awards are measured at fair value and the Company recognizes compensation

expense over the service period for which awards are expected to vest.

For stock options and similar awards, fair value is estimated

on the grant date using an appropriate valuation model, such as the Black-Scholes option-pricing model, which requires management to

make assumptions regarding expected volatility, expected term, risk-free interest rate, expected dividends, and forfeitures.

restricted stock, restricted stock units, and common stock awards, fair value is generally based on the market price of the

Company’s common stock on the grant date.

For equity instruments issued to consultants and vendors in exchange for goods and services the Company determines

the measurement date for the fair value of the equity instruments issued at the earlier of (i) the date at which a commitment for

performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor’s performance is

In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the

term of the consulting agreement.

Taxes - The Company recognizes estimated income taxes payable or refundable on income tax returns for the current year and for

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We recognize penalties and accrued interest related to unrecognized tax benefits in income tax expense.

Company adopted Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740):

Improvements to Accounting for Income Taxes, effective

for the fiscal year beginning January 1, 2025.

The Company applied the updated guidance during the interim period for the quarter ended

March 31, 2025, in accordance with the modified retrospective approach.

ASU 2023-09 enhances guidance on income tax accounting, with

a focus on tax law changes, the allocation of tax credits, and the treatment of uncertain tax positions.

Due to the Company’s ongoing

operating losses and significant net operating loss (NOL) carry forwards, the Company does not perform quarterly tax provisions.

result, the adoption of ASU 2023-09 did not result in any immediate material impact on the Company’s consolidated financial statements.

The Company has continued to evaluate its deferred tax asset position, with the full utilization of its NOL carryforwards remaining dependent

on the availability of future taxable income.

Since no taxable income has been generated, and in light of the continued operating losses,

there was no adjustment recorded to retained earnings upon the adoption of ASU 2023-09.

The Company will continue to monitor its tax

positions and NOL utilization, making adjustments to its deferred tax asset valuation allowance as needed in future periods.

Concern – The accompanying consolidated financial statements have been prepared assuming that the Company will continue

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one year of the date that the financial statements are issued.

from its $ 7.0 million

in cash as of September 30, 2025, to continue as a going concern, the Company can generate operating cash through the sale of its $ 1.6

million of Marketable Securities.

To continue as a going concern,

Also, historically, the Company has been able to obtain equity and/or debt-based financing to meet its working capital needs.

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.

from its $ 4.8 million in cash as of March 31,

2026, to continue as a going concern, the Company can generate operating cash through the sale of its $ 983,000

of Marketable Securities.

To continue as a going concern, historically, the Company has been able to obtain equity and/or debt-based

financing to meet its working capital needs.

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.

Party Transactions - Transactions with affiliates and other parties that meet the definition of a related party under ASC 850,

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Each of these pronouncements, as applicable, has been or will be adopted by the Company.

Company adopted ASC Topic 280, Segment Reporting , as part of the updates to the segment reporting requirements under GAAP.

new guidance requires the identification of operating segments and their aggregation based on similar economic characteristics, and for

those segments to be reported consistent with the internal management reporting structure used by the chief operating decision maker

As a result of this adoption, the Company has assessed its operating segments and has realigned its segment reporting to more

accurately reflect how its management team evaluates performance and makes strategic decisions.

The adoption of Topic 280 did not result

in a change to the Company’s segment structure or to the method used to allocate resources among segments.

In December 2023, the FASB issued

2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures (“ASU 2023-09”).

requires that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation

and income taxes paid.

The amendment in the ASU 2023-09 is intended to enhance the transparency and decision usefulness of income tax

The ASU 2023-09’s amendments are effective for annual periods beginning after December 15, 2024.

The Company is currently

evaluating the impact that adoption of ASU 2023-09 will have on its financial statements.

November 2023, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”)

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which improves reportable segment disclosure

through enhanced disclosures about significant segment expenses.

The amendment is effective for fiscal years beginning after December

15, 2023 and for interim periods within fiscal years beginning after December 15, 2024 and early adoption is permitted.

The amendments

should be applied retrospectively to all prior periods presented in the financial statements.

The Company has adopted the enhanced segment

disclosures for the year ended December 31, 2024.

The Company reports its segment information to reflect the manner in which the Company’s

chief operating decision maker (“CODM”) reviews and assesses performance.

The Company’s Interim Chief Executive Officer

has responsibilities as the CODM and review and assess the performance of the Company as a whole.

primary financial measures used by the CODM to evaluate performance and allocate resources are net income (loss) and operating income

The CODM uses net income (loss) and operating income (loss) to evaluate the performance of the Company’s ongoing operations

and as part of the Company’s internal planning and forecasting processes.

Information on Net loss and Operating loss is disclosed

in the Condensed Consolidated Statements of Operations.

Segment expenses and other segment items are provided to the CODM on the same

basis as disclosed in the Condensed Consolidated Statements of Operations.

CODM does not evaluate performance or allocate resources based on segment assets, and therefore such information is not presented in

the notes to the financial statements

December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures” which is intended to simplify various

aspects related to accounting for income taxes.

ASU 2023-09 removes certain exceptions to the general principles in Topic 740 and also

clarifies and amends existing guidance to improve consistent application.

The amendments in ASU 2023-09 are effective for public business

entities for fiscal years beginning after December 15, 2024, including interim periods therein.

Early adoption of the standard is permitted,

including adoption in interim or annual periods.

The adoption of this ASU did not have a material impact on the Condensed Consolidated

Financial Statements.

November 2024, the FASB issued ASU No.

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ASU 2024-03 to have a material effect on our consolidated financial statements taken as a whole.

November 2024, the FASB issued ASU 2024-04 (“ASU 2024-04”), Debt—Debt with Conversion and Other Options (Subtopic

Induced Conversions of Convertible Debt Instruments , which clarifies the requirements for determining whether certain settlements

of convertible debt instruments should be accounted for as induced conversions or as extinguishments.

The amendments in ASU 2024-04 are

effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting

Early adoption is permitted for entities that have adopted ASU 2020-06.

The Company is currently evaluating the effect of adopting

ASU 2024-04 on its consolidated financial statements and related disclosures.

The Company does not currently expect the adoption of this

standard to have a material impact on its consolidated financial statements.

In December 2025, the Financial Accounting Standards Board issued Accounting

Standards Update No.

2025-11, Interim Reporting (Topic 270) .

The amendments are intended to improve interim financial reporting

disclosures and clarify the application of Topic 270.

The Company is currently evaluating the provisions of ASU 2025-11, including the

timing of adoption and the potential impact on its interim financial statement presentation and related disclosures.

The Company does

not currently expect the adoption of ASU 2025-11 to have a material impact on its consolidated financial position, results of operations,

or cash flows.

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

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of the related lease.

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

fees related to loans managed for third parties 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 September 30, 2025, the Company had no unsatisfied performance obligations for contracts with an original expected duration of

greater than one year.

Pursuant to Topic 606, the Company has applied the practical expedient with respect to disclosure of the

deferral and future expected timing of revenue recognition for transaction price allocated to remaining performance obligations.

Company elected the practical expedient allowing it to not recognize as a contract asset the commission paid to its salesforce on

the sale of its products as an incremental cost of obtaining a contract with a customer but rather recognize such commission as

expense when incurred as the amortization period of the asset that the Company would have otherwise recognized is one year or

Commission revenues are generated when the Company buys and sells bond and equity securities on behalf of its customers.

Each time a customer enters into a buy or sell transaction, the Company recognizes a commission.

Commissions and related clearing expenses

are recorded on the trade date.

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

and management fees related to loans managed for third parties owed to the Company occurs.

of March 31, 2026, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater

than one year.

Pursuant to Topic 606, the Company has applied the practical expedient with respect to disclosure of the deferral and

future expected timing of revenue recognition for transaction price allocated to remaining performance obligations.

The Company elected

the practical expedient allowing it to not recognize as a contract asset the commission paid to its salesforce on the sale of its products

as an incremental cost of obtaining a contract with a customer but rather recognize such commission as expense when incurred as the amortization

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

of revenue includes all direct cost of the Company’s packaging, commercial and security printing sales, primarily, paper, inks,

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this category includes all direct costs associated with the manufacturing and procurement of the products sold in the Company’s

Direct Marketing line of business as well as with the Company’s technology sales, services and licensing including hardware and

software that is resold, third-party fees, and fees paid to inventors or others as a result of technology licenses or settlements, if

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.

Costs of revenue do not include expenses

related to product development, integration, and support.

These costs are included in research and development, which is a component

of selling, general and administrative expenses on the consolidated statement of operations.

Legal costs are included in selling, general

and administrative.

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

or others as a result 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.

Costs of revenue do not include expenses related to product development, integration, and support.

These costs are

included in research and development, which is a component of selling, general and administrative expenses on the consolidated statement

of operations.

Legal costs are included in selling, general and administrative.

commissions are expensed as incurred for contracts with an expected duration of one year or less.

There were no sales commissions capitalized

as of September 30, 2025 or September 30, 2024.

as of March 31, 2026 or March 31, 2025.

and Handling Costs

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Schedule of Inventory

September 30, 2025

December 31, 2024

Finished Goods

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Inventory gross

Less allowance for obsolescence

$ ( 180,000 )

allowance for obsolescence

Inventory net

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The outstanding

principal and interest as of September 30, 2025 and December 31, 2024, approximated $ 5,544,000 .

As of September 30, 2025 and December

principal and interest as of March 31, 2026 and December 31, 2025, approximated $ 5,544,000 .

As of March 31, 2026 and December 31, 2025

this note is in default and the Company has a reserve of $ 5,544,000 against the principal and interest outstanding.

October 25, 2021, APF entered into a loan agreement (“Note 2”) with Asili, LLC.

(“Asili”), a company registered

in the state of Utah.

Note 3 has an initial aggregate principal balance up to $ 1,000,000 , to be funded at the request of Asili, with

an option to increase the maximum principal borrowing to $ 3,000,000 .

Note 2, which incurs interest at a rate of 8.0 % with principal and

interest due at the maturity date of October 25, 2022 .

This note contains an optional conversion feature allowing APF to convert the

outstanding principal to a 10 % membership interest.

APF, as holder of Note 2, has the right to elect one member to the Board of Managers.

This note is in default and the outstanding principal and interest of approximately $ 884,000 is fully reserved for as of September 30,

2025 and December 31, 2024.

January 24, 2022, APF and an individual entered into a promissory note (“Note 3”) in the principal sum of $ 100,000 with interest

of 6 %, due annually, and maturing in January 2024 .

The outstanding principal and interest at December 31, 2024 approximated $ 17,000 and

was included in Current portion of notes receivable on the accompanying consolidate balance sheet.

As of September 30, 2025, the outstanding

principal and interest approximating $ 18,000 were written-off.

March 2, 2022, APF and WUURII Commerce, Inc.

(“WUURII”), a corporation organized under the laws of the Republic of Korea

entered into a promissory note (“Note 4”).

Under the terms of Note 4, APF at its discretion, may lend up to the principal

sum of $ 893,000 with an interest rate of 8 %, and matured in March 2024 and was extended to April 2025, with interest payable quarterly.

The outstanding principal and interest at September 30, 2025, and December 31, 2024 is $ 465,000 and $ 468,000 , respectively.

is currently in default and as of September 30, 2025 the Company has a reserve of $ 465,000 against the principal and interest outstanding.

May 9, 2022, DSS PureAir and Puradigm entered into a promissory note (“Note 5”) in the principal sum of $ 210,000 with interest

entered into a promissory note (“WUURII Note”).

Under the terms of WUURRI Note, APF at its discretion, may lend up to

the principal sum of $ 893,000

with an interest rate of 8 %,

and matured in March

2024 and was extended to April 2025 , with interest payable quarterly.

The outstanding principal and interest at March 31,

2026, and December 31, 2025 is $ 465,000

and $ 465,000 ,

respectively.

This loan is currently in default and as of March 31, 2026 the Company has a reserve of $ 465,000

against the principal and interest outstanding.

May 9, 2022, DSS PureAir and Puradigm entered into a promissory note (“Puradigm Note 1”) in the principal sum of $ 210,000 with interest

of 10 %, is due in three quarterly installments beginning on August 9, 2022, with the first two payment consisting of interest only.

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The outstanding principal and interest

at September 30, 2025 and December 31, 2024 approximates $ 224,000 .

This note was fully reserved for as of September 30, 2025 and December

at March 31, 2026 and December 31, 2025 approximates $ 224,000 .

This note was fully reserved for as of March 31, 2026 and December 31,

4, related party

August 29, 2022, DSS Financial Management Inc and BMI Capital, Inc.

(“BMIC”), a related party, entered into a promissory

note (“Note 6”) in the principal sum of $ 100,000 with interest of 8 %, is due in three quarterly installments beginning on

September 14, 2022.

All unpaid principal and interest is due on August 29, 2025 .

The outstanding principal and interest at September

30, 2025, and December 31, 2024 approximated $ 83,000 , and was fully reserved for as of September 30, 2025 and December 31, 2024.

owns 24.9 % of the outstanding common shares of BMIC.

Capital International LLC.

(“BMIC LLC”), a related party, entered into a promissory note (“BMIC Note 1”) in

the principal sum of $ 100,000

with interest of 8 %,

is due in three quarterly installments beginning on September 14, 2022.

All unpaid principal and interest was due on August

The outstanding principal and interest at March 30,2026 and December 31, 2025 approximated $ 86,000 ,

and was fully reserved for as of March 31, 2026 and December 31, 2025.

DSS owns 24.9 %

of the outstanding common shares of BMIC LLC.

5, related party

May 8, 2023, DSS Financial Management Inc and BMIC entered into a promissory note (“Note 7”) in the principal sum of $ 102,000

May 8, 2023, DSS Financial Management Inc and BMIC LLC entered into a promissory note (“BMIC Note 2”) in the principal sum of

$ 102,000 with interest at the prime rate plus 2 % with a maturity date of May 7, 2026 .

The outstanding principal and interest at September 30,

2025, and December 31, 2024 approximated $ 110,000 , and was fully reserved for as of September 30, 2025 and December 31, 2024.

24.9 % of the outstanding common shares of BMIC.

The outstanding principal and interest at March

31, 2026, and December 31, 2025 approximated $ 110,000 , and was fully reserved for as of March 31, 2026 and December 31, 2025.

24.9 % of the outstanding common shares of BMIC LLC.

6, related party

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principal and interest is due July 26, 2025.

The outstanding principal and interest as of September 30, 2025 and December 31, 2024 approximates

This note was fully reserved for as of September 30, 2025 and December 31, 2024.

Heng Fai Ambrose Chan, the Chairman of DSS,

Inc is also the on the board of directors of VEII.

February 19, 2021, Impact BioMedical, Inc, entered into a promissory note with an individual.

The Company loaned the principal sum of

$ 206,000 , with interest at a rate of 6.5 %, and maturity date of August 19, 2022 later amended to February 19, 2026.

Monthly payments

are due on the twenty-first day of each month and continuing each month thereafter until February 19, 2026.

This note is secured by certain

real property situated in Collier County, Florida.

The outstanding principal and interest as of September 30, 2025, and December 31,

2024 was approximately $ 199,000 and $ 201,000 , respectively.

As of September 30, 2025, approximately $ 199,000 is classified in Current

notes receivable.

As of December 31, 2024, $ 184,000 is classified in Current notes receivable and the remaining $ 17,000 is classified

as Notes receivable on the accompanying consolidated balance sheet.

September 27, 2023, Decentralized Sharing Systems, Inc.

and Stemtech Corporation (“Stemtech”) entered into a convertible

promissory note (“Note 10”) in the principal sum of $ 1,400,000

with a discount of $ 300,000

and interest rate of 10 %

and maturity date of September

The outstanding principal, interest, and associated discount was fully reserved for as of December 31, 2024 and

written off as of September 30, 2025

March 31, 2023, DSS Biohealth Security, Inc and an individual entered into a promissory note (“Note 11”) in the

principal sum of $ 140,000

and interest rate floating daily to Wall Street Journal Prime rate per annum with the total outstanding principal and interest due

at the maturity date of March

As of September 30, 2025 and December 31, 2024, the outstanding principal and interest approximated $ 135,000 .

This balance was fully reserved for as of September 30, 2025 and December 31, 2024.

The outstanding principal and interest as of March 31, 2026 and December 31, 2025 approximates

This note was fully reserved for as of March 31, 2026 and December 31, 2025.

Heng Fai Ambrose Chan, the Chairman of DSS, Inc

is also the on the board of directors of VEII.

February 19, 2021, Impact BioMedical, Inc, entered into a promissory note (“Note 7”) with an individual.

The Company loaned

the principal sum of $ 206,000 , with interest at a rate of 6.5 %, and maturity date of August 19, 2022 later amended to February 19, 2026.

Monthly payments are due on the twenty-first day of each month and continuing each month thereafter until February 19, 2026.

is secured by certain real property situated in Collier County, Florida.

The outstanding principal and interest as of March 31, 2026,

approximately $ 199,000 with $ 199,000 classified in Current portion of notes receivable on the accompanying consolidated balance sheet.

The outstanding principal and interest as of December 31, 2025 is approximately $ 198,000 and is classified in Current portion of notes

receivable on the accompanying consolidated balance sheet.

The maturity date of this note is currently being renegotiated.

March 31, 2023, DSS Biohealth Security, Inc and an individual entered into a promissory note (“Note 8”) in the principal

sum of $ 140,000 and interest rate floating daily to Wall Street Journal Prime rate per annum with the total outstanding principal and

interest due at the maturity date of March 31, 2025 .

As of March 31, 2026 and December 31, 2025, the outstanding principal and interest

approximated $ 135,000 .

This balance was fully reserved for as of March 31, 2026 and December 31, 2025.

August 29, 2024, APF entered into a promissory note (“Note 9”) with WestPark.

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with principal and interest due at the maturity date of April

On November 1, 2024, monthly payments of approximately $ 28,000

are due with any unpaid interest and principal due at maturity.

As of September 30, 2025, the outstanding principal and interest

approximates $ 257,000 ,

As of March 31, 2026, the outstanding

principal and interest approximates $ 229,000 ,

which is classified as Current notes receivable on the accompanying consolidated balance sheet.

As of December 31, 2024, the

outstanding principal and interest approximates $ 450,000 ,

of which $ 337,000

is classified as Current notes receivable and the remaining $ 113,000

is classified as Non-current notes receivable on the accompanying consolidated balance sheet.

As of December 31, 2025, the outstanding

principal and interest approximates $ 237,000 ,

which is classified as Current notes receivable on the accompanying consolidated balance sheet.

Convertible Bond Investment – related party

March 27, 2026, the Company received a convertible bond investment from True Partners Capital Holding Limited (“True

Partners”), a publicly listed company on the Hong Kong Stock Exchange and a related party of the Company.

The bond has a face

value of $ 2,450,000 , bears interest at 3.0 %

per annum, was registered on March 27, 2026, and matures on March 26, 2028, unless earlier converted, redeemed, or otherwise settled

in accordance with its terms.

Interest accrues daily on a 365-day basis and is payable annually in cash.

At maturity, the outstanding principal

balance is mandatorily and automatically convertible into ordinary shares of True Partners.

True Partners is considered a related party because the Company holds a

significant equity investment in True Partners and has determined that it has the ability to exercise significant influence over True

This determination is based on the Company’s equity ownership, its additional investment through the convertible bond,

and the election of the Company’s Executive Chairman and significant stockholder, Heng Fai Ambrose Chan, to True Partners’

board of directors.

Accordingly, the Company’s receipt of the convertible bond is considered a related party transaction.

is convertible into ordinary shares of True Partners at a conversion price of HKD $ 0.10 per share, which was approximately USD $ 0.01 per

share as of both March 27, 2026 and March 31, 2026, based on the applicable exchange rate or rounded U.S.

dollar equivalent used by the

Based on the bond’s fixed currency conversion rate, the bond is convertible into approximately 190,684,000 ordinary shares

of True Partners.

accounts for the convertible bond investment at fair value and has elected the fair value option under ASC 825, Financial Instruments.

Based on a valuation performed as of March 27, 2026, the estimated fair value of the convertible bond was approximately $ 8,648,000 , consisting

of a $ 127,000 debt-like component related to the present value of contractual cash interest payments and an $ 8,521,000 equity-like conversion

feature related to the value of the shares issuable upon conversion of principal.

Based on a valuation performed as of March 31, 2026,

the estimated fair value of the convertible bond was approximately $ 8,520,000 , consisting of a $ 129,000 debt-like component and an $ 8,391,000

equity-like conversion feature.

The Company recorded the convertible bond investment at March 31, 2026 estimated fair value of approximately

$ 8,520,000 .

value of the convertible bond investment was determined in accordance with ASC 820, Fair Value Measurement.

The valuation considered,

among other factors, the contractual interest rate, maturity date, mandatory conversion terms, conversion price, market price of the underlying

True Partners ordinary shares, foreign currency exchange rates, issuer credit risk, expected term, liquidity, discount rates, and conversion

The investment is classified as a Level 3 asset within the fair value hierarchy because there is no quoted price in an active

market for the identical convertible bond and the valuation requires significant unobservable inputs, including issuer credit risk, expected

term, liquidity assumptions, discount rates, and conversion economics.

Because the convertible bond was received from a related party, the Company

evaluated the substance of the transaction, including the relationship between the parties, the nature of the consideration exchanged,

and whether the fair value of the bond exceeded the stated face amount or consideration transferred.

The Company determined that the excess

of the estimated fair value of the convertible bond over the stated face amount or consideration transferred was attributable to the related

party nature of the transaction and, accordingly, was deemed to be a contribution to capital.

As a result, the Company recorded the initial

excess fair value of approximately $ 6,198,000 as a fair value adjustment related to convertible bond received from related party within

additional paid-in capital, rather than recognizing the amount as a gain in earnings.

Subsequent changes in fair value are recognized

in earnings in accordance with the Company’s election of the fair value option under ASC 825.

As of March 31, 2026 the Company recognized

a loss of approximately $ 128,000 on the condensed consolidated statement of operations.

Financial Instruments

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Schedule of Cash and Marketable Securities by Significant Investment Category

September 30, 2025

Restricted Cash

March 31, 2026

Convertible bond investment – related party

Money Market Funds

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( 17,697,000 )

Convertible bond investment – related party

$ ( 11,627,000 )

December 31, 2025

Restricted Cash

Money Market Funds

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risk of not collecting amounts owed by customers and records its allowance for credit losses based on the results of this analysis.

of September 30, 2025 and December 31, 2024, we have reviewed the entire loan portfolio as well as all financial assets of the Company

for the purpose of evaluating the loan portfolio and the loan balances, including a review of individual and collective portfolio loan

quality, loan(s) performance, including past due status and covenant defaults, assessment of the ability of the borrower to repay the

loan on the loan terms, whether any loans should be placed on nonaccrual or returned to accrual, any concentrations in any single borrower

and/or industry that we might need to further manage, and if any specific or general loan loss reserve should be established for the

entire loan portfolio or for any specific loan.

of March 31, 2026 and December 31, 2025, we have reviewed the entire loan portfolio as well as all financial assets of the Company for

the purpose of evaluating the loan portfolio and the loan balances, including a review of individual and collective portfolio loan quality,

loan(s) performance, including past due status and covenant defaults, assessment of the ability of the borrower to repay the loan on

the loan terms, whether any loans should be placed on nonaccrual or returned to accrual, any concentrations in any single borrower and/or

industry that we might need to further manage, and if any specific or general loan loss reserve should be established for the entire

loan portfolio or for any specific loan.

analyzed the loan loss reserve from three basis:

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industry portfolio reserves, and specific loan loss

For the nine months ended September 30, 2025, September 30, 2024 and year ended December 31, 2024, the Company recorded a Loan

loss reserve of approximately $ 0 $ 908,000 and $ 9,406,000 , respectively.

For the three months ended March 31, 2026 and year ended December 31, 2025, the Company recorded a Loan loss reserve of approximately$ 7,478,000 and

$ 7,478,000 , respectively.

Loan Portfolio Reserve - Based upon the review of our loan portfolio, we do not believe that a substantial general loan portfolio

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However, we do recognize that some inherent risks are in all loan portfolios, thus we recorded a general

contingent portfolio reserve of $ 0 and $ 196,000 of the loan portfolio loan balance as of September 30, 2025 and December 31, 2024, respectively.

contingent portfolio reserve of $ 0 and $ 196,000 of the loan portfolio loan balance as of March 31, 2026 and December 31, 2025, respectively.

Portfolio Reserves - Given the relatively young loan portfolio and a diversification of the portfolio over several different loan

products, the risk is reduced.

Accordingly, we have not recorded a discretionary reserve as of September 30, 2025 and December 31, 2024.

Loan Reserves - Previously, we had identified credit weaknesses and borrower repayment weakness with Asili, which has a current principal

and interest balance of $ 884,000 and have recorded a loan loss reserve for the full balance due the Company as of December 31, 2024.

The Company had also previously identified credit weakness in Puradigm and has placed a reserve approximating $ 5,768,000 against the

outstanding principal and interest as of December 31, 2024 of their two loans.

Previously, the Company identified credit weakness in

Stemtech and has placed a reserve approximating $ 1,045,000 against the outstanding principal and interest as of December 31, 2024.

the first quarter of 2024, the Company identified credit weakness in VEII and an individual and has placed a reserve approximating $ 959,000

against the outstanding principal and interest as of March 31, 2024.

Accordingly, we have not recorded a discretionary reserve as of March 31, 2026 and December 31, 2025.

Loan Reserves - The Company had previously identified credit weakness in Puradigm and has placed a reserve approximating $ 5,768,000

against the outstanding principal and interest as of December 31, 2024 of their two loans.

During the first quarter of 2024, the Company

identified credit weakness in VEII and an individual and has placed a reserve approximating $ 959,000 against the outstanding principal

and interest as of March 31, 2024.

There has been no change to this amount.

Also, during the first

quarter of 2024, the Company identified credit weakness in BMIC, a related party, and has placed a reserve approximating $ 211,000 against

the outstanding principal and interest as of March 31, 2024, later adjusted to $ 196,000 as of September 30, 2024.

The Company identified

credit weakness with WUURII and has placed a $ 234,000 reserve against the outstanding principal and interest as of December 31, 2024

and reserved for the remaining outstanding balance of approximately $ 233,000 as of September 30, 2025.

The Company has also identified

credit weakness with an individual and has placed a $ 135,000 reserve against the outstanding principal and interest as of December 31,

2024, and reserved for an approximate $ 17,000 against the outstanding principal and interest for another individual as of September 30,

No additional reserves were deemed necessary as of September 30, 2025.

Also, during the first quarter of 2024, the Company identified

credit weakness in BMIC LLC., a related party, and has placed a reserve approximating $ 211,000 against the outstanding principal and

interest as of March 31, 2024, later adjusted to $ 196,000 as of December 31, 2024.

The Company identified credit weakness with WUURII

and has placed a $ 234,000 reserve against the outstanding principal and interest as of December 31, 2024 and reserved for the remaining

outstanding balance of approximately $ 233,000 as of December 31, 2025.

The Company has also identified credit weakness with an individual

and has placed a $ 135,000 reserve against the outstanding principal and interest as of December 31, 2024, and reserved for an approximate

$ 17,000 against the outstanding principal and interest for another individual as of December 31, 2025.

No additional reserves were deemed

necessary as of December 31, 2025.

additional reserves were deemed necessary as of March 31, 2026.

Disposal of assets

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Chan is also the majority shareholder of Alset Intl as well as the largest shareholder of

The fair value of the marketable security as of September 30, 2025 and December 31, 2024, was approximately $ 2,467,000 and

The fair value of the marketable security as of March 31, 2026 and December 31, 2025, was approximately $ 2,277,000 and $ 2,277,000 ,

respectively.

During the nine months ended September 30, 2025 and 2024, the Company recorded unrealized loss of approximately

$ 51,000 and $ 407,000 , respectively.

Partners Capital Holding Limited

Company owns 81,836,908 shares of True Partners Capital Holding Limited (“True Partners”), a publicly listed company on the

During the three months ended March 31, 2026 and 2025, the Company recorded unrealized loss of approximately $ 0 and $ 241,000 ,

respectively.

Partners Capital Holding Limited, related party

Company owns 81,836,908 shares

or approximately 19.55 % of True Partners Capital Holding Limited (“True Partners”), a publicly listed company on the

Hong Kong Stock Exchange.

On February 28, 2022, the Company entered into a Stock Purchase Agreement with Alset EHome International Inc.

(“AEI”), pursuant to which AEI has agreed to sell a subsidiary holding 62,336,908 shares of stock of True Partner Capital

Holding Limited exchange for 17,570,948 shares of common stock of the Company (the “DSS Shares”).

The Company’s Executive

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

Further, on February 20, 2025, the Company acquired an additional 19,500,000 shares of True Partners.

The fair value of the marketable

security as of September 30, 2025 and December 31, 2024, was approximately $ 5,679,000 and $ 3,815,000 , respectively.

During the nine months

ended September 30, 2025 and 2024, the Company recorded unrealized gain of approximately $ 864,000 and a loss of approximately $ 936,000 ,

On February 28, 2022, the Company entered into a Stock Purchase Agreement with Alset EHome International

(“AEI”), pursuant to which AEI has agreed to sell a subsidiary holding 62,336,908 shares

of stock of True Partner Capital Holding Limited exchange for 17,570,948 shares

of common stock of the Company (the “DSS Shares”).

The Company’s Executive Chairman and a significant stockholder,

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

Further, on February 20, 2025, the

Company acquired an additional 19,500,000 shares

of True Partners.

The fair value of the marketable security as of March 31, 2026 and December 31, 2025, was approximately $ 3,600,000 and

$ 4,206,000 ,

respectively.

On March 27, 2026, the

Company acquired or received a convertible bond investment issued by True Partners with an initial fair value of approximately

$ 8,648,000 , which was adjusted to $ 8,520,000 (see Note 6) as of March 31, 2026.

During the three months ended March 31, 2026, in

connection with the Company’s additional investment in True Partners through the convertible bond and the election of Mr.

to the board of directors of True Partners, the Company determined that it has the ability to exercise significant influence over

True Partners.

Accordingly, beginning on March 27, 2026, the Company began accounting for its investment in True Partners under the

equity method of accounting.

a result of the change to equity method accounting, the Company reclassified its investment in True Partners from Investment in equity

securities to Investment, equity method on the consolidated balance sheet.

As of March 31, 2026, the carrying value of the Company’s

investment in True Partners, was approximately $ 3,600,000 .

Prior to the ability to exercise significant influence, the Company recognized an unrealized

loss of approximately $ 606,000 during the three months ended March 31, 2026 related to the change in fair value of the True Partners

marketable equity securities.

During the three months ended March 31, 2025, the Company recognized an unrealized loss of approximately

$ 902,000 related to the investment.

Capital Group, LLC.

December 30, 2020, the Company signed a binding letter of intent with WestPark Capital Group, LLC.

(“WestPark”) and

Century TBD, Inc.

(“TBD”) where the parties agreed to prepare a note and stock exchange agreement whereby DSS will

assign the TBD Note to WestPark and WestPark shall issue to DSS a stock certificate reflecting 7.5 %

of the issued and outstanding shares of West Park.

This note and stock exchange agreement was finalized during the first quarter

2022 and valued utilizing the cost method at approximately $ 500,000

and is included in Investments on the consolidated balance sheet on September 30, 2025 December 31, 2024.

As of September 30, 2025, and December 31, 2024 the Company has recorded no impairment losses on this investment.

(“WestPark”) and Century

(“TBD”) where the parties agreed to prepare a note and stock exchange agreement whereby DSS will assign the TBD

Note to WestPark and WestPark shall issue to DSS a stock certificate reflecting 7.5 % of the issued and outstanding shares of West Park.

This note and stock exchange agreement was finalized during the first quarter 2022 and valued utilizing the cost method at approximately

$ 500,000 and is included in Investments on the consolidated balance sheet on March 31, 2026 December 31, 2025.

As of March 31, 2026,

and December 31, 2025 the Company has recorded no impairment losses on this investment.

Capital International LLC, related party

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a Delaware corporation (“BMIF”) and BMI Capital International LLC, a Texas limited liability

company (“BMIC”) whereas DSS Securities, Inc.

purchased 14.9 % membership interests in BMIC for $ 100,000 .

DSS Securities also

had the option to purchase an additional 10 % of the outstanding membership interest which it exercised for $ 100,000 in January of 2021

company (“BMIC LLC”) whereas DSS Securities, Inc.

purchased 14.9 % membership interests in BMIC LLC for $ 100,000 .

DSS Securities

also had the option to purchase an additional 10 % of the outstanding membership interest which it exercised for $ 100,000 in January of

2021 and increased its ownership to 24.9 %.

The Company is currently accounting for this investment under the equity method of accounting per

The Company’s portion of net gain in BMIC during the nine months ended September 30, 2025 was approximately $ 4,000 and

a net loss for the nine months ended September 30, 2024, of approximately $ 3,000 .

Upon achieving greater than 20 % ownership in BMIC LLC during the quarter ended September 30,

2021, the Company is currently accounting for this investment under the equity method of accounting per ASC 323 The Company’s portion

of net gain in BMIC during the three months ended March 31, 2026 was approximately $ 4,000 and a net loss for the three months ended March

31, 2025, of approximately $ 3,000 .

is a broker-dealer registered with the Securities and Exchange Commission, is a member of the Financial Industry Regulatory Authority,

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Short-Term and Long-Term Debt

Notes - On May 20, 2021, Premier Packaging entered into master loan and security agreement (“BOA Note”) with

Bank of America, N.A.

(“BOA”) to secure financing approximating $ 3,710,000 to purchase and use as collateral, a new

Heidelberg XL 106-7+L printing press.

The aggregate principal balance outstanding under the BOA Note shall bear interest at a

variable rate on or before the loan closing.

As of September 30, 2025, and December 31, 2024, the outstanding principal on the BOA

Note was $ 2,049,000 and $ 1,647,000 , respectively and had an interest rate of 4.63 %.

As of September 30, 2025, $ 538,000 was included

in the Current portion of long-term debt, net, and the remaining balance of approximately $ 1,510,572,000 is recorded as Long-term

As of December 31, 2024, $ 520,000 was included in the current portion of long-term debt, net, and the remaining balance of

approximately $ 1,916,000 recorded as long-term debt.

This note matures in April of 2029 .

Interest expense for the nine months ended

September 30, 2025 and 2024 approximated $ 79,000 and $ 147,000 , respectively.

The BOA Note contains certain covenants that are

analyzed annually.

As of September 30, 2025, Premier is in compliance with these covenants.

Notes - On May 20, 2021, Premier Packaging entered into master loan and security agreement (“BOA Note”) with Bank

of America, N.A.

(“BOA”) to secure financing approximating $ 3,710,000 to purchase and use as collateral, a new Heidelberg

XL 106-7+L printing press.

The aggregate principal balance outstanding under the BOA Note shall bear interest at a variable rate on or

before the loan closing.

As of March 31, 2026, and December 31, 2025, the outstanding principal on the BOA Note was $ 1,783,000 and $ 1,916,000 ,

respectively and had an interest rate of 4.63 %.

As of March 31, 2026, $ 544,000 was included in the Current portion of long-term debt,

net, and the remaining balance of approximately $ 1,238,000 is recorded as Long-term debt.

As of December 31, 2025, $ 544,000 was included

in the current portion of long-term debt, net, and the remaining balance of approximately $ 1,372,000 recorded as long-term debt.

note matures in April of 2029.

Interest expense for the three months ended March 31, 2026 and 2025 approximated $ 22,000 and $ 27,000 ,

respectively.

The BOA Note contains certain covenants that are analyzed annually.

As of March 31, 2026, Premier is in compliance with

these covenants.

August 1, 2021, AMRE Shelton, LLC., (“AMRE Shelton”) a subsidiary of AMRE, entered into a loan agreement (“Shelton

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intangible assets with an estimated useful life of approximating 3 years.

The net book value of these assets as of September 30, 2025,

and December 31, 2024, approximated $ 6,277,000 and $ 6,332,000 , respectively.

As of September 30, 2025, the outstanding principal and

interest of approximately $ 4,280,000 , net of $ 10,000 in deferred financing costs.

As of September 30, 2025, approximately $ 204,000 is

classified as Current portion of long-term debt, net with the remaining $ 4,076,000 classified as Current portion of long-term debt, net

on the consolidated balance sheet.

Interest expense for the nine months ended September 30, 2025 and 2024 approximated $ 140,000 and $ 147,000 ,

respectively.

As of December 31, 2024, the outstanding principal and interest of approximately $ 4,424,000 , net of $ 27,000 in deferred

financing costs, is classified as Current portion of long-term debt on assets held-for-sale, net on the consolidated balance sheet.

agreement matures in July of 2031.

October 13, 2021, Liquid Value Asset Management Limited (“LVAM”), a majority owned subsidiary of the Company, entered

into loan agreement with BMIC (“BMIC Loan”), a related party, whereas LVAM borrowed the principal amount of $ 3,000,000 ,

with interest to be charged at a variable rate to be adjusted at the maturity date.

The BMIC loan contains an auto renewal period of

three months, with a maturity date of October 2025 as of September 30, 2025.

The net book value of these assets as of March 31, 2026, and

December 31, 2025, approximated $ 6,223,000 and $ 6,231,000 , respectively.

As of March 31, 2026, the outstanding principal and interest

of approximately $ 4,280,000 , net of $ 2,000 in deferred financing costs.

As of March 31, 2026, approximately $ 225,000 is classified as

Current portion of long-term debt, net with the remaining $ 3,940,000 classified as Current portion of long-term debt, net on the consolidated

balance sheet.

Interest expense for the three months ended March 31, 2026 and 2025 approximated $ 15,000 and $ 47,000 , respectively.

of December 31, 2025 approximately $ 226,000 of principal and accrued interest is classified as current portion of long-term debt, net,

and the remaining balance of approximately $ 4,001,000 recorded as long-term debt, net of $ 4,000 in deferred financing costs.

This agreement

matures in July of 2031.

October 13, 2021, Liquid Value Asset Management Limited (“LVAM”), a majority owned subsidiary of the Company, entered into

loan agreement with BMIC (“BMIC Loan”), a related party, whereas LVAM borrowed the principal amount of $ 3,000,000 , with interest

to be charged at a variable rate to be adjusted at the maturity date.

The BMIC loan contains an auto renewal period of three months,

with a maturity date of April 2026 as of March 31, 2026.

The BMIC Loan was automatically extended to January 2026.

As of September 30, 2025, and December 31, 2024, the outstanding principal and interest of approximately $ 464,000

and $ 463,000 ,

respectively, are included in Current portion of long-term debt – related party, net on the consolidated balance

As of March 31, 2026,

and December 31, 2025, the outstanding principal and interest of approximately $ 33,000 and $ 33,000 , respectively, are included in Current

portion of long-term debt – related party, net on the consolidated balance sheet.

October 13, 2021, LVAM entered into a loan agreement with Lee Wilson Tsz Kin (“Wilson Loan”), a related party, whereas LVAM

borrowed the principal amount of $ 3,000,000 ,

with interest to be charged at a variable rate to be calculated at the maturity date.

The Wilson Loan contains an auto renewal period

of three months, with a maturity date of October 2025 as of September 30, 2025.

The Wilson Loan was automatically extended to January

As of September 30, 2025, and December 31, 2024, the outstanding principal and interest of approximately $ 145,000

and $ 145,000 ,

respectively, are included in Current portion of long-term debt – related party, net on the consolidated balance sheet.

November 2, 2021, AMRE LifeCare entered into a loan agreement (“LifeCare Agreement”) with Pinnacle Bank,

(“Pinnacle Bank”) in the amount of $ 40,300,000 .

The LifeCare Agreement supported the acquisition of three medical

facilities located in Fort Worth, Texas, Plano, Texas (sold in March 2025), and Pittsburgh, Pennsylvania for a purchase price of

$ 62,000,000 .

These assets are classified as investments, real estate on the consolidated balance sheet, and serves as collateral for

the LifeCare Agreement.

The purchase price has been allocated as $ 32,100,000 , $ 12,100,000 , and $ 1,500,000 for the facility, land and

site improvements, respectively.

Also included in the value of the property is $ 15,901,000 of intangible assets with estimated

useful lives ranging from 1 to 11 years.

The net book value of the assets acquired as of September 30, 2025 is approximately

$ 24,722,000 .

The net book value of these assets as of September 30, 2025, and December 31, 2024, approximated $ 24,233,000 and

$ 34,450,000 , respectively.

The LifeCare Agreement calls for the principal amount of the in equal, consecutive monthly instalments

based upon a twenty-five (25) year amortization of the original principal amount of the LifeCare Agreement at an initial rate of

interest equal to the interest rate determined in accordance as of July 29, 2022 provided, however, such rate of interest shall not

be less than 4.28 %, with the first such instalment being payable on August 29, 2022 and subsequent instalments being payable on the

first day of each succeeding month thereafter until the maturity date, at which time any outstanding principal and interest is due

The affective interest rate at September 30, 2025 was 8.5 %.

As of September 30, 2025, the outstanding principal and

interest of the LifeCare agreement approximates $ 39,144,000 and is included Current portion of long-term debt, net on the

accompanying balance sheet.

As of December 31, 2024 the outstanding principal and interest balance approximated and is included in

Current portion of long-term debt, net on the consolidated balance sheet.

Interest expense for the nine

months ended September 30, 2025 and 2024 approximated $ 2,278,000 and $ 2,939,000 , respectively.

This note is in default and demand

was made for final payment to be made by December 22, 2023.

As of September 30, 2025, this amount is past due.

March 17, 2022, AMRE Winter Haven, LLC (“AMRE Winter Haven”) and Pinnacle Bank (“Pinnacle”) entered into a term

loan (“Pinnacle Loan”) whereas Pinnacle lent to AMRE Winter Haven the principal sum of $ 2,990,000 , maturing on March 7, 2024

(later extended to July 7, 2024) to acquire a medical facility located in Winter Haven, Florida for a purchase price of $ 4,500,000 .

assets acquired are classified as investments, real estate on the consolidated balance sheet, and serves as collateral for the Pinnacle

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 included in the value of the property is $ 29,000 of intangible assets with an estimated useful life of approximately

The net book value of the assets acquired as of September 30, 2025, and December 31, 2024 is approximately $ 4,370,000 and $ 4,396,000 ,

respectively.

Payments are to be made in equal, consecutive installments based on a 25 -year amortization period with interest at 4.28 %.

The first installment is due January 1, 2023.

This AMRE Winter Haven note is currently due and has an effective interest rate of 9.6 %.

This note was assumed by SMS Financial on August 15, 2024, and refinanced with American Savings Life Insurance Company (“American

Savings Note”) on August 29, 2025 in the amount of $ 3,250,000 .

This note has an annual interest rate of 7.99 % and requires monthly

installments of principal and interest of approximately $ 22,000 beginning on October 1, 2025 with a ballon payment at maturity on September

The outstanding principal and interest, approximates $ 3,130,000 and is included in Current portion of long-term debt, net on

the accompanying consolidated balance sheet at September 30, 2025.

The outstanding principal and interest, approximates $ 3,040,000 and

is included in Current portion of long-term debt, net on the accompanying consolidated balance

sheet at December 31, 2024.

Interest expense approximates $ 346,000 and $ 179,000 for the nine months ended September 30, 2025 and 2024,

respectively.

March 30, 2023, Premier Packaging, a subsidiary of the Company entered into a loan and security agreement with Union Bank &

Trust Company for the principal amount of $ 790,000 and shall accrued interest at the rate of 7.44 %.

Principal and interest shall be

repaid in the approximate amount of $ 14,000 through March 2029.

This loan is collateralized by a Bobst Model Novacut and is

guaranteed by DSS, Inc.

As of September 30, 2025, the outstanding principal and interest approximates $ 514,000 of which $ 130,000 was

included in the current portion of long-term debt, net, and the remaining balance of approximately $ 484,000 recorded as long-term

As of December 31, 2024, the outstanding principal and interest approximates $ 605,000 of which $ 123,000 was included in the

current portion of long-term debt, net, and the remaining balance of approximately $ 482,000 recorded as long-term debt.

expense for the nine months ended September 30, 2025 and 2024 approximated $ 32,000 and $ 38,000 , respectively.

borrowed the principal amount of $ 3,000,000 , with interest to be charged at a variable rate to be calculated at the maturity date.

Wilson Loan contains an auto renewal period of three months, with a maturity date of April 2026 as of March 31, 2026 .

The Wilson Loan

was automatically extended to January 2026.

As of March 31, 2026, and December 31, 2025, the outstanding principal and interest of approximately

$ 145,000 and $ 145,000 , respectively, are included in Current portion of long-term debt – related party, net on the consolidated

balance sheet.

November 2, 2021, AMRE LifeCare entered into a loan agreement (“LifeCare Agreement”) with Pinnacle Bank, (“Pinnacle

Bank”) in the amount of $ 40,300,000 .

The LifeCare Agreement supported the acquisition of three medical facilities located in Fort

Worth, Texas, Plano, Texas (sold in March 2025), and Pittsburgh, Pennsylvania for a purchase price of $ 62,000,000 .

These assets are classified

as investments, real estate on the consolidated balance sheet, and serves as collateral for the LifeCare Agreement.

The purchase price

has been allocated as $ 32,100,000 , $ 12,100,000 , and $ 1,500,000 for the facility, land and site improvements, respectively.

Also included

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

value of the assets acquired as of March 31, 2026 and December 31, 2025 is approximately $ 10,274,000 and $ 10,381,000 , respectively.

LifeCare Agreement calls for the principal amount of the in equal, consecutive monthly instalments based upon a twenty-five (25) year

amortization of the original principal amount of the LifeCare Agreement at an initial rate of interest equal to the interest rate determined

in accordance as of July 29, 2022 provided, however, such rate of interest shall not be less than 4.28 % , with the first such instalment

being payable on August 29, 2022 and subsequent instalments being payable on the first day of each succeeding month thereafter until

the maturity date, at which time any outstanding principal and interest is due in full.

The affective interest rate at March 31, 2026

As of March 31, 2026, the outstanding principal and interest of the LifeCare agreement approximates $ 30,287,000 and is included

Current portion of long-term debt, net on the accompanying balance sheet.

As of December 31, 2025, the outstanding principal and interest

of the LifeCare agreement approximates $ 37,401,000 and is included Current portion of long-term debt, net on the accompanying balance

Interest expense for the three months ended March 31, 2026 and 2024 approximated $ 582,000 and $ 867,000 , respectively.

is in default and demand was made for final payment to be made by December 22, 2023.

As of March 31, 2026, this amount is past due.

March 30, 2023, Premier Packaging, a subsidiary of the Company entered into a loan and security agreement with Union Bank & Trust

Company for the principal amount of $ 790,000 and shall accrued interest at the rate of 7.44 %.

Principal and interest shall be repaid

in the approximate amount of $ 14,000 through March 2029.

This loan is collateralized by a Bobst Model Novacut and is guaranteed by DSS,

As of March 31, 2026, the outstanding principal and interest approximates $ 450,000 of which $ 132,000 was included in the current

portion of long-term debt, net, and the remaining balance of approximately $ 318,000 recorded as long-term debt.

As of December 31, 2025,

the outstanding principal and interest approximates $ 482,000 of which $ 132,000 was included in the current portion of long-term debt,

net, and the remaining balance of approximately $ 350,000 recorded as long-term debt.

Interest expense for the three months ended March

31, 2026 and 2025 approximated $ 9,000 and $ 11,000 , respectively.

August of 2025, DSS issued a $ 500,000 convertible promissory note to Alset, Inc.

(“holder”), the Company’s largest

shareholder and a related party, bearing interest at Prime ( 7.25 % at September 30, 2025).

The first 12 months’ interest is to be

paid in shares of the Company;

shareholder and a related party, bearing interest at Prime ( 7.25 % at March 31, 2026).

The first 12 months’ interest is to be paid

in shares of the Company;

thereafter, interest is prepaid annually in cash or shares at the holder’s election.

convertible at the holder’s option at a fixed $ 0.86 per share, is payable on demand (or July 31, 2028 if not demanded), and may

be redeemed by the Company on or after the first anniversary.

The Company is required to reserve sufficient authorized shares and maintain

the listing/quotation of its common stock.

Under ASU 2020-06 and ASC 815-40, the debt host’s embedded conversion feature is indexed

to the Company’s own stock and is equity-classified;

accordingly, no embedded derivative is bifurcated and the instrument is accounted

for as single-unit debt using the effective interest method.

The note is convertible

at the holder’s option at a fixed $ 0.86 per share, is payable on demand (or July 31, 2028 if not demanded), and may be redeemed

by the Company on or after the first anniversary.

The Company is required to reserve sufficient authorized shares and maintain the listing/quotation

of its common stock.

Under ASU 2020-06 and ASC 815-40, the debt host’s embedded conversion feature is indexed to the Company’s

own stock and is equity-classified;

accordingly, no embedded derivative is bifurcated and the instrument is accounted for as single-unit

debt using the effective interest method.

Interest is recognized in interest expense;

when settled in shares, a credit

to APIC is recorded at the fair value of shares on settlement, and any prepaid interest is recorded as a discount/prepaid and amortized

to expense over the related period.

The outstanding principal and interest, approximates $ 503,000

and is included in Current portion of long-term debt, net on the accompanying consolidated balance sheet at September 30, 2025.

summary of scheduled principal payments of long-term debt, not including revolving lines of credit, subsequent to September 30,

2025, are as follows:

when settled in shares, a credit to APIC is recorded

at the fair value of shares on settlement, and any prepaid interest is recorded as a discount/prepaid and amortized to expense over the

related period.

The outstanding principal and interest, approximates $ 520,000 and is included in Current portion of long-term debt, net

on the accompanying consolidated balance sheet at March 31, 2026.

The outstanding principal and interest, approximates $ 512,000 and is

included in Convertible note payable, related party on the accompanying consolidated balance sheet at December 31, 2025.

Interest expense

for the three months ended March 31, 2026 and 2025 approximated $ 8,000 and $ 0 , respectively.

March 26, 2026, the Company issued a $ 2,450,000 convertible promissory note to Alset International Limited (“AIL”), a related

The note bears interest at 3.0 % per annum, matures five years from issuance, and is convertible at any time into shares of the

Company’s common stock at a conversion price of $ 0.74 per share.

Interest is payable at maturity either in cash or shares of common

stock, at the holder’s election.

The note also contains a most favored nation provision allowing AIL to exchange the note for a

subsequent convertible instrument issued by the Company if AIL determines that such instrument contains more favorable terms.

a related party because the Company owns approximately 4% of AIL’s outstanding shares, and the Company’s Chairman is the

Executive Director, Chief Executive Officer, majority shareholder of AIL, and the largest shareholder of the Company.

In connection with

the note, the Company issued AIL a warrant to purchase up to 16,554,055 shares of the Company’s common stock at an exercise price

of $ 0.93 per share.

The warrant expires five years from the issuance date.

The Company evaluated the conversion feature, most favored

nation provision, and warrant under ASC 815, ASC 815-40, and ASC 480 and concluded that no derivative liability was required.

The conversion

feature qualified for the scope exception for instruments indexed to and classified in the Company’s own equity, and the warrant

was classified as equity because it is share-settled, contains a fixed share limit, does not require net cash settlement, and the Company

has sufficient authorized and unissued shares to settle the warrant.

The Company allocated the $2,450,000 proceeds between the convertible

note and warrant based on their relative fair values.

The warrant valuation was determined using a Black-Scholes option-pricing model.

Significant valuation inputs included the Company’s common stock price of $0.91 per share, exercise price of $0.93 per share, expected

term of 5.0 years, risk-free rate of 4.0%, selected volatility of 85.0%, expected dividend rate of 0.0%, and 16,554,055 warrants outstanding.

Based on these inputs, the calculated warrant value was $0.63 per warrant, resulting in an indicated fair value of $10,368,000.

value of the convertible note was determined using valuation techniques that considered the contractual note terms, conversion feature,

most favored nation provision, Company-specific credit risk, market interest rates, expected volatility, and probability-weighted conversion

The valuation considered two scenarios:

a no subsequent convertible instrument issuance before expiration scenario, with an

indicated value of $3,418,000.

For purposes of allocating the $2,450,000 proceeds at issuance, the Company used the relative fair values

of the warrant and convertible note.

Accordingly, $1,843,000 was allocated to the warrant and recorded in additional paid-in capital,

and $607,000 was allocated to the note.

The allocation resulted in a debt discount of $1,843,000, which will be amortized to interest

expense over the five-year term of the note using the effective interest method.

As of March 31, 2026, the note had a principal amount

of $2,450,000, unamortized debt discount of approximately $1,843,000 and a net carrying amount of approximately $607,000.

The debt discount

is being amortized to interest expense over the five-year contractual term of the note using the effective interest method.

summary of scheduled principal payments of long-term debt, not including revolving lines of credit, subsequent to March 31, 2026, are

Schedule of Notes Payable and Long-term Debt

payable - related party

Convertible promissory note - related party

Notes payable

Convertible note payable

- related party

Notes payable

- related party

Lease Liability

Company has operating leases predominantly for operating facilities.

As of September 30, 2025, the remaining lease terms on our

operating leases range from less than one 1 to nine years .

Renewal options to extend our leases have not been exercised due to

Termination options are not reasonably certain of exercise by the Company.

There is no transfer of title or option to

purchase the leased assets upon expiration.

As of March 31, 2026, the remaining lease terms on our operating

leases range from less than one to three years.

Renewal options to extend our leases have not been exercised due to uncertainty.

options are not reasonably certain of exercise by the Company.

There is no transfer of title or option to purchase the leased assets

upon expiration.

There are no residual value guarantees or material restrictive covenants.

significant finance leases as of September 30, 2025.

minimum lease payments as of September 30, 2025 are as follows:

of Lease Liability:

of Future Minimum Lease Payments

lease payments

Imputed Interest

value of remaining lease payments

Weighted-average

remaining lease term (years)

Weighted-average

discount rate

cash paid for leases during the nine months ended September 30, 2025 and 2024 approximated $ 651,000 and $ 786,000 ,

respectively.

There are no significant finance leases as

of March 31, 2026.

minimum lease payments as of March 31, 2026 are as follows:

Minimum Lease Payments

Total lease payments

Less imputed interest

( 1,235,000 )

Present value of remaining lease payments

Weighted average remaining lease term (years)

Weighted average discount

cash paid for leases during the three months ended March 31, 2026 and 2025 approximated $ 212,000 and $ 220,000 , respectively.

Commitments and Contingencies

3 unchanged sentences

In exchange, the Licensee shall pay the Company a royalty of 5.5 % of net sales.

If not terminated under terms of the agreement, the Equivir License

expires the later of a) expiration date of the last to expire valid claim comprising the licensed patents, or (b) twelve (12) years from

the date of first commercial sale.

terms of the Equivir Agreement, the Company shall reimburse the Licensee for 50 % of the development costs provided that the development

costs shall not exceed $ 1,250,000 .

As of September 30, 2025 and December 31, 2024, a liability of $ 0 has been recorded in relation to

the Equivir License.

If not terminated

under terms of the agreement, the Equivir License expires the later of a) expiration date of the last to expire valid claim comprising

the licensed patents, or (b) twelve (12) years from the date of first commercial sale.

Under the terms of the Equivir Agreement, the

Company shall reimburse the Licensee for 50 % of the development costs provided that the development costs shall not exceed $ 1,250,000 .

As of March 31, 2026 and December 31, 2025, a liability of $ 0 has been recorded in relation to the Equivir License.

Agreement - On August 15, 2018, the Impact BioMedical entered into Royalty Agreement with Chemia Corporation (“Chemia”)

16 unchanged sentences

by the Company towards patent application and licensing should be reimbursed to the Company before any royalty payments are made.

the nine months ended September 30, 2025 and 2024, there were no reimbursements or royalties paid to the Company and the Company cannot

the three months ended March 31, 2026 and 2025, there were no reimbursements or royalties paid to the Company and the Company cannot

be assured that Chemia’s efforts will end up in any future sales of the technology.

Agreements – Impact BioMedical has an employment agreement with it CEO Frank Heuszel in which Mr.

agreement contains a mandatory bonus clause of $ 150,000

for the first year of the employment term, beginning September 2024, $ 100,000

for the second year of the employment term, beginning September 2025, and $ 100,000

for the third year of the employment term, beginning September 2026.

As of March 31, 2026, approximately $ 96,000

is accrued for year one and year two of Mr.

Heuszel’s bonus, respectively.

As of December 31, 2025, approximately $ 96,000

is accrued for year one of Mr.

Heuszel’s bonus and $ 25,000

for the second year of Mr.

Heuszel’s bonus.

Litigation Payments – The Company retains the services of professional service providers, including law firms that specialize

in intellectual property licensing, enforcement and patent law.

These service providers are often retained on an hourly, monthly, project,

contingent or a blended fee basis.

In contingency fee arrangements, a portion of the legal fee is based on predetermined milestones or

the Company’s actual collection of funds.

The Company accrues contingent fees when it is probable that the milestones will be achieved,

and the fees can be reasonably estimated.

As of March 31, 2026 and December 31, 2025, the Company had not accrued any contingent legal

fees pursuant to these arrangements.

Stockholders’ Equity

transactions - On January 4, 2024 the Company effected a reverse stock split of 1 for 20 .

As of December 31, 2023 there were

140,264,240 shares of our Common Stock issued and outstanding, which was converted to 7,066,772 .

December 10, 2024, DSS entered into a securities purchase agreement with Alset Inc., a related party, pursuant to which the Company agreed

to sell and issue in a private placement an aggregate of 820,597 shares of the Company’s common stock for approximately $ 803,000 .

December 10, 2024, DSS entered into a securities purchase agreement with Heng Fai Ambrose Chan, the Chaiman of the Board of Directors

and a related party, pursuant to which the Company agreed to sell and issue in a private placement an aggregate of 205,149 shares of

the Company’s common stock for approximately $ 197,000 .

February 6, 2025, as a bonus for compensation awarded to Heng Fai Holdings Limited (“HFHL”), a Hong Kong Company, which

is beneficially owned by Mr.

transactions - On February 6, 2025, as a bonus for compensation awarded to Heng Fai Holdings Limited (“HFHL”), a

Hong Kong Company, which is beneficially owned by Mr.

Heng Fai Ambrose Chan, Director of DSS, Inc., and pursuant to DSS, Inc’s.

2020 Employee, Director

and Consultant Equity Incentive Plan (the “Plan”), HFHL was awarded 1,000,000

shares of the Company’s common stock, approximating $ 870,000 ,

under the Plan, for strategic planning and merger and acquisition services rendered at the beginning of 2025.

The issuance was approved by the board of

directors on January 31, 2025.

2020 Employee, Director and Consultant Equity Incentive Plan (the “Plan”), HFHL was awarded 1,000,000 shares of the Company’s

common stock, approximating $ 870,000 , under the Plan, for strategic planning and merger and acquisition services rendered at the beginning

The issuance was approved by the board of directors on January 31, 2025.

March 21, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 499,800 shares of Impact Biomedical common stock.

These shares were acquired by DSS during Impact’s initial public offering on September 16, 2024.

The sale of these shares, which

were previously held by DSS as part of its ownership interest in Impact, was completed for a total value of $ 1,500,000 , which represents

the consideration received from the transaction.

With this sale, the shares are now publicly held and are no longer held by DSS.

April 4, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 890,800 shares of Impact Biomedical common stock.

The sale of these shares, which

were previously held by DSS as part of its ownership interest in Impact, was completed for a total approximate value of $ 845,000 , which

represents the consideration received from the transaction.

With this sale, the shares are now publicly held and are no longer held by

May 22, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 499,800

shares of Impact Biomedical common stock.

The sale of these shares, which were previously held by DSS as part of its ownership

interest in Impact, was completed for a total approximate value of $ 63,000 ,

which represents the consideration received from the transaction.

With this sale, the shares are now publicly held and are no longer

On May 23, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 45,400 shares of Impact

Biomedical common stock.

These shares were acquired by DSS during Impact’s initial public offering on

September 16, 2024.

The sale of these shares, which were previously held by DSS as part of its ownership interest in Impact, was

completed for a total approximate value of $ 24,000 , which represents the consideration received from the transaction.

With this sale,

the shares are now publicly held and are no longer held by DSS.

completed for a total value of $ 1,500,000 ,

of which $ 205,000 has been classified as non-controlling interest in subsidiary, which represents the consideration received from

the transaction.

With this sale, the shares are now publicly held and are no longer held by DSS.

February 4, 2026, DSS entered into an underwriting agreement (the “Underwriting Agreement”) with Aegis Capital Corp.

which provided for the issuance and sale by the Company and the purchase by the underwriter, in a firm commitment underwritten public

offering of 900,000 shares of the Company’s common stock.

Subject to the terms and conditions contained in the Underwriting Agreement,

the shares were sold at a public offering price of $ 1.00 per share, less certain underwriting discounts and commissions.

closed on February 5, 2026 and the Company received approximately $ 700,000 , net of expenses.

Additionally, on March 19, 2026, an additional 50,000 shares were issued under the Underwriting Agreement and the Company received approximately

$ 46,000 , net of expenses.

Compensation - The Company records stock-based payment expense related to options and warrants based on the grant date fair value

2 unchanged sentences

and consultants.

Such awards include option grants, warrant grants, and restricted stock awards.

During the nine months ended September

30, 2025 and 2024, there were none .

Such awards include option grants, warrant grants, and restricted stock awards On February 6, 2025, as a bonus for compensation awarded to Heng Fai Holdings Limited (“HFHL”), a Hong

Kong Company, which is beneficially owned by Mr.

Heng Fai Ambrose Chan, Director of DSS, Inc., and pursuant to DSS, Inc’s.

Employee, Director and Consultant Equity Incentive Plan (the “Plan”), HFHL was awarded 1,000,000 shares of the Company’s

common stock, approximating $ 870,000 , under the Plan, for strategic planning and merger and acquisition services rendered at the beginning

The issuance was approved by the board of directors on January 31, 2025.

During the three months ended March 31, 2026 there were

no such awards.

BioMedical, Inc.

Transactions - On May 10, 2023, the IBO’s Board of Directors approved an amendment to the Articles of Incorporation

for IBO to increase the total number of shares of Common Stock to 4,000,000,000

shares with a par value of $ 0.001 .

Each share of Common Stock when issued, shall have one (1) vote on all matters presented to the stockholders.

Its Amended and

Restated Articles of Incorporation also authorized 100,000,000

shares of preferred stock, par value $ 0.001

On May 11, 2023, IBO effected a forward split.

As a result, there were 3,877,282,251

shares of its Common Stock and no

shares of preferred stock issued and outstanding.

Prior to the split, there were 125,073,621

shares of its Common Stock and no

shares of preferred stock issued and outstanding.

On October 31, 2023, IBO effected a reverse

stock split of 1 for 55 .

Also on October 31, 2023, DSS BioHealth Securities, Inc., IBO’s largest shareholder converted 60,496,041

shares of Common Stock into 60,496,041

shares of Series A Convertible Preferred Shares, reducing its ownership of the IBO’s Common Stock from approximately 88 %

to approximately 12 %.

As of September 30, 2024 and December 31, 2023, there were 11,503,955

and 10,000,000 ,

respectively, shares of its Common Stock and 60,496,041

shares of preferred stock issued and outstanding.

October 31, 2023, IBO effected a reverse stock split of 1 for 55 .

As of December 31, 2023, and December 31, 2022, there were

3,877,282,251 shares of its Common Stock issued and outstanding which was converted to 70,496,041 shares.

Also on October 31, 2023, DSS

BioHealth Securities, Inc., IBO’s largest shareholder converted 60,496,041 shares of Common Stock into 60,496,041 shares

of Series A Convertible Preferred Shares, reducing its ownership of the Company’s Common Stock from approximately 88 % to approximately

September 16, 2024, Impact Biomedical Inc., entered into an underwriting agreement (the “Underwriting Agreement”) with Revere

Securities, LLC., as representative (the “Representative”) of the underwriters named therein (the “Underwriters”),

pursuant to which IBO agreed to sell to the Underwriters in a firm commitment initial public offering (the “Offering”)

an aggregate of 1,500,000 of IBO’s shares of common stock, par value $ 0.001 per share at a public offering price of $ 3.00

On September 17, 2024, IBO closed the Offering, and as of September 30, 2024 there were 11,497,703 shares of common

stock issued and outstanding.

The total net proceeds to IBO from the Offering, after deducting discounts, expenses allowance

and expenses, was approximately $ 3,726,000 (inclusive of approximately $ 1.5 million contributed by DSS).

A final prospectus relating

to this Offering was filed with the Commission on September 16, 2024.

The shares of Common Stock were approved to list on the NYSE American

under the symbol “IBO” and began trading there on September 16, 2024.

IBO also issued warrants to the Representative

and its affiliates (the “Representative’s Warrants”) warrants to purchase the number of shares of Common Stock in the

aggregate equal to 5% of the Common Stock to be issued and sold in this offering (including any Shares of Common Stock sold upon exercise

of the over-allotment option, if applicable).

The Representative’s Warrants are exercisable for a price per share equal to 125%

of the public offering price.

The warrants are exercisable at any time, in whole or in part, commencing nine (9) months from the date

of commencement of sales of the offering and ending on the third anniversary thereof.

As of September 30, 2024, only the 1,500,000 shares

included in the Offering are freely tradable on the NYSE.

The remaining outstanding common shares of Impact Biomedical of 9,997,703 are

restricted from trading for 180 days from the Offering date.

February 26, 2025, IBO issued 36,433

shares of the Company’s common stock as payment of legal fees incurred associated with IBO’s IPO, registration

of shares associated with its equity incentive plan as well as other related services.

The legal fees received were valued at approximately $ 29,000 .

June 23, 2025, IBO issued 100,000 shares of IBO’s common stock as payment of legal fees incurred

associated with IBO’s merger and share exchange agreement with Dr.

Ashleys Limited.

Transaction - On February 26, 2025, Impact BioMedical issued 36,433

shares of the its common stock as payment of legal

fees incurred associated with Impact’s IPO, registration of shares associated with its equity incentive plan as well as other related

The legal fees received were valued at approximately $ 29,000 .

Compensation – IBO records stock-based payment expense related to options and warrants based on the grant date

fair value in accordance with FASB ASC 718.

Stock-based compensation includes expense charges for all stock-based awards to

employees, directors and consultants.

Compensation – IBO records stock-based payment expense related to options and warrants based on the grant date fair

value in accordance with FASB ASC 718.

Stock-based compensation includes expense charges for all stock-based awards to employees,

directors and consultants.

Such awards include option grants, warrant grants, and restricted stock awards.

On October 1, 2024, 880,000

2024, 880,000 option grants with a purchase price of $ 3.00 per share were awarded to certain officers, directors and consultants of

These options have various vesting periods, and all expire on October 31, 2031.

option grants with a purchase price of $ 3.00

per share were awarded to certain officers, directors and consultants of Impact BioMedical.

These options have various vesting

periods, and all expire on October 31, 2031.

Potential proceeds of these grants is $ 2,640,000

and are fair valued using a Black-Scholes model at approximately $ 50,000 .

IBO record stock based compensation

expense of approximately $ 5,000 and $ 19,000 for the nine month and year ended September 30, 2025 and the year ended December 31,

2024, respectively, and is included in Sales, general and administrative compensation (inclusive of stock based compensation) on the

accompanying Statement of Operations.

Impact recorded stock-based compensation expense of approximately $ 2,000

for the three month and year ended March 31, 2025 and is included in Sales, general and administrative compensation (inclusive of

stock-based compensation) on the accompanying Statement of Operations.

These options were forfeited during the fourth quarter of

January 2026, the Impact BioMedical granted and issued 3,200,000

shares of common stock to various individuals including executives, board members, audit committee members, etc.

Agreement included

the individuals rescinding and cancelling any and all unexercised stock options previously granted.

Impact Biomedical recorded

stock-based compensation expense of approximately $ 1,440,000 , of which $ 158,000 has been classified as non-controlling interest in subsidiary,

for the three months ended March 31, 2026, and is included in Sales, general and administrative compensation (inclusive of

stock-based compensation) on the accompanying Condensed Consolidated Statement of Operations.

Supplemental Cash Flow Information

following table summarizes supplemental cash flows for the nine months ended September 30, 2025 and 2024:

following table summarizes supplemental cash flows for the three months ended March 31, 2026 and 2025:

Schedule of Supplemental Cash Flow Information

Cash paid for interest

Non-cash investing and financing activities:

Shares issued in lieu of bonus cash

Shares issued in lieu of cash as payment for legal services

Extinguishment of debt

paid for interest

investing and financing activities:

issued in lieu of cash as payment for legal services

Stock-based compensation

Segment Information

Company’s businesses lines are organized, managed, and internally reported as five operating segments.

One of these operating segments,

Product Packaging, is the Company’s packaging and printing group.

Product Packaging operates in the paper board folding carton,

smart packaging, and document security printing markets.

It markets, manufactures, and sells mailers, photo sleeves, sophisticated custom

folding cartons, and complex 3-dimensional direct mail solutions.

These products are designed to provide functionality and marketability

while also providing counterfeit protection.

A second, Biotechnology, invests in, or acquires 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.

This division is also developing open-air defense initiatives, which curb transmission of air-borne

infectious diseases, such as tuberculosis and influenza.

Biotechnology is also targeting unmet, urgent medical needs.

A third operating

segment, Securities and Investment Management (“Securities”) was established to develop and/or acquire assets and investments

in the securities trading and/or funds management arena.

Further, Securities, 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, stable coins and cryptocurrency via a digital asset trading platform using blockchain technology.

services within this section is planned to include asset issuance and allocation (securities and cryptocurrency), FPO, IPO, ITO, PPO,

STO 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).

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.

The fourth segment, Direct, provides services to assist companies in the emerging growth gig business model of peer-to-peer decentralized

sharing marketplaces.

It 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 products include, among other things,

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

The fifth business line, Commercial

Banking, is organized for the purposes of being a financial network holding company, focused providing commercial loans and 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, and advisory capital raising services.

From this financial platform, the Company shall provide an integrated suite of financial services for businesses that shall include commercial

business lines of credit, land development financing, inventory financing, third party loan servicing, and services that address the

financial needs of the world Gig Economy.

information concerning the Company’s operations by reportable segment for the three and nine months ended September 30, 2025 and

Company reports its segment information to reflect the manner in which the Company’s chief operating decision maker

(“CODM”) reviews and assesses performance.

The Company’s Interim Chief Executive Officer has responsibilities as

the CODM and reviews and assess the performance of the Company as a whole.

The primary financial measures used by the CODM to

evaluate performance and allocate resources are net income (loss) and operating income (loss).

The CODM uses net income (loss) and

operating income (loss) to evaluate the performance of the Company’s ongoing operations and as part of the Company’s

internal planning and forecasting processes.

Information on Net income (loss) and Operating income (loss) is disclosed in the

Consolidated Statements of Operations.

Segment expenses and other segment items are provided to the CODM on the same basis as

disclosed in the Consolidated Statements of Operations.

The CODM does not evaluate performance or allocate resources based on

segment assets, and therefore such information is not presented in the notes to the financial statements.

During the fourth quarter

of 2025, we realigned our internal reporting to better reflect how management reviews operating results and allocates resources.

a result of this CODM realignment, Direct Marketing is no longer a reportable segment and is now reported within Corporate and Other

or the year ended December 31, 2025 and the three months ended March 31, 2026.

This change did not impact consolidated revenue, consolidated net income (loss), total assets,

or cash flows for any period presented;

it only impacted the presentation of segment information.

Segment information for prior

periods presented has been recast to conform to the current-period segment presentation.

Our four reporting segments are:

(“Premier”) Premier Packaging Corporation provides custom packaging services and serves clients in the

pharmaceutical, nutraceutical, consumer goods, beverage, specialty foods, confections, photo packaging and direct marketing industries,

among others.

The group also provides active and intelligent packaging and document security printing services for end-user customers.

In addition, the division produces a wide array of printed materials, such as folding cartons and paperboard packaging, security paper,

vital records, prescription paper, birth certificates, receipts, identification materials, entertainment tickets, secure coupons and

parts tracking forms.

The division also provides resources and production equipment for our ongoing research and development of security

printing, brand protection, consumer engagement and related technologies.

(“Commercial Lending”) through its operating company, American Pacific Financial, Inc.

represents our financing business line.

is organized for the purposes of being a financial network holding company, focused providing

commercial loans and 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, and advisory capital

raising services.

From this financial platform, the Company shall provide an integrated suite of financial services for businesses that

shall include commercial business lines of credit, land development financing, inventory financing, third party loan servicing, and services

that address the financial needs of the world Gig Economy.

Biotechnology:

(“Biotech”) targets unmet, urgent medical needs and expands the borders of medical and pharmaceutical science.

drives mission-oriented research, development, and commercialization of solutions for medical advances in human wellness and healthcare.

By leveraging technology and new science with strategic partnerships, Biotech provides advances in drug discovery for the prevention,

inhibition, and treatment of neurological, oncology and immuno-related diseases.

Other exciting technologies include a breakthrough alternative

sugar aimed to combat diabetes and functional fragrance formulations aimed at the industrial and medical industry.

and Investment Management:

(“Securities”) Securities was established to develop and/or acquire assets in the securities

trading or management arena, and to pursue, among other product and service lines, real estate investment funds, broker dealers, and

mutual funds management.

information concerning the Company’s operations by reportable segment for the three months ended March 31, 2026 and 2025

is as follows.

The Company relies on intersegment cooperation and management does not represent that these segments, if operated

independently, would report the results contained herein:

The Company relies on intersegment cooperation and management does no t represent that these segments, if operated independently,

would report the results contained herein:

Schedule of Operations by Reportable Segment

Three Months Ended September 30, 2025

Product Packaging

Commercial Lending

Direct Marketing

Biotechnology

Cost of revenue

Gross profit (loss)

Operating expense

( 7,587,000 )

( 1,754,000 )

Operating income (loss)

( 11,065,000 )

( 3,234,000 )

Other income (expense)

Net income (loss) from operations before taxes

( 10,986,000 )

( 2,229,000 )

Three Months Ended September 30, 2024

Product Packaging

Commercial Lending

Direct Marketing

Three Months Ended March 31, 2026

Biotechnology

2 unchanged sentences

( 1,202,000 )

( 1,004,000 )

Operating expense

3 unchanged sentences

( 1,257,000 )

( 5,487,000 )

Other income (expense)

Net income (loss) from

operations before taxes

$ ( 1,205,000 )

Net income (loss) from operations before taxes

$ ( 2,293,000 )

2 unchanged sentences

$ ( 6,354,000 )

Nine Months Ended September 30, 2025

Product Packaging

Commercial Lending

Direct Marketing

Three Months Ended March 31, 2025

Biotechnology

1 unchanged sentence

Gross profit (loss)

( 1,090,000 )

Operating expense

( 7,519,000 )

Operating income (loss)

2 unchanged sentences

( 3,726,000 )

( 10,384,000 )

Other income (expense)

Net income (loss) from operations

( 1,077,000 )

( 1,637,000 )

( 12,280,000 )

( 10,154,000 )

Nine Months Ended September 30,2024

Product Packaging

Commercial Lending

Direct Marketing

Biotechnology

Cost of revenue

Gross profit (loss)

( 3,786,000 )

( 3,585,000 )

Operating expense

Operating income (loss)

( 1,562,000 )

( 2,665,000 )

( 6,809,000 )

( 2,164,000 )

( 14,287,000 )

Other income (expense)

Net income (loss) from

operations before taxes

$ ( 551,000 )

Net loss from operations

$ ( 270,000 )

5 unchanged sentences

Schedule of Disaggregation of Revenue

Printed Products Revenue Information:

months ended September 30, 2025

Packaging Printing

and Fabrication

Commercial and Security Printing

Property Rental Income

Printed Products Revenue

Three months ended September 30, 2024

Products Revenue Information:

ended March 31, 2026

Packaging Printing and Fabrication

1 unchanged sentence

Real Property Rental Income

Total Printed Products Revenue

months ended September 30, 2025

Packaging Printing

and Fabrication

Commercial and Security Printing

Property Rental Income

Printed Products Revenue

Nine months ended September 30, 2024

ended March 31, 2025

Packaging Printing and Fabrication

1 unchanged sentence

Real Property Rental Income

Total Printed Products Revenue

Printed Products Revenue

Lending Revenue Information:

Three months ended September 30, 2025

Net Investment Income

Total Commercial Lending Revenue

Three months ended September 30, 2024

Net Investment Income

Total Commercial Lending Revenue

Nine months ended September 30, 2025

Net investment income

Total Commercial Lending Revenue

Nine months ended September 30, 2024

Net Investment Income

Total Commercial Lending Revenue

Nine months ended September 30, 2024

Total Direct Marketing Revenue

Biotechnology Revenue Information:

Three months ended September 30, 2025

Retail internet sales

Total Biotechnology Revenue

Three months ended September 30, 2024

Retail internet sales

Total Biotechnology Revenue

Nine months ended September 30, 2025

Retail internet sales

Total Biotechnology Revenue

Nine months ended September 30, 2024

Retail internet sales

Total Biotechnology Revenue

ended March 31, 2026

Net investment

Commercial Lending Revenue

ended March 31, 2025

Net Investment

Commercial Lending Revenue

Biotechnology

Revenue Information:

Three months ended September 30, 2025

Rental income

Commission income

Total Securities Revenue

Three months ended September 30, 2024

Rental income

Commission income

Total Securities Revenue

Nine months ended September 30, 2025

ended March 31, 2026

Retail internet

Biotechnology Revenue

ended March 31, 2025

Retail internet

Biotechnology Revenue

Securities Revenue Information:

ended March 31, 2026

Rental income

Commission income

Total Securities Revenue

Nine months ended September 30, 2024

Securities Revenue

ended March 31, 2025

Rental income

Commission income

Total Securities Revenue

Securities Revenue

Related Party Transactions

8 unchanged sentences

Chan is also the majority shareholder of Alset Intl as well as the largest shareholder of

The fair value of the marketable security as of September 30, 2025 and December 31, 2024, was approximately $ 2,467,000 and

The fair value of the marketable security as of March 31, 2026 and December 31, 2025, was approximately $ 2,277,000 and $ 2,467,000 ,

respectively.

During the nine months ended September 30, 2025 and 2024, the Company recorded unrealized loss of approximately

$ 51,000 and $ 407,000 , respectively.

During the three months ended March 31, 2026 and 2025, the Company recorded unrealized loss of approximately $ 0 and $ 241,000 ,

respectively.

September 10, 2020, the Company’s wholly owned subsidiary DSS Securities, Inc.

entered into membership interest purchase

agreement with BMI Financial Group, Inc.

a Delaware corporation (“BMIF”) and BMI Capital International LLC, a Texas

limited liability company (“BMIC”) whereas DSS Securities, Inc.

purchased 14.9 % membership interests in BMIC for

DSS Securities also had the option to purchase an additional 10 % of the outstanding membership interest which it exercised

for $ 100,000 in January of 2021 and increased its ownership to 24.9 %.

The Company is currently accounting for this investment under

the equity method of accounting per ASC 323.

The Company’s portion of net gain in BMIC during the nine months ended September

30, 2025 was approximately $ 4,000 and a net loss for the nine months ended September 30, 2024, of approximately $ 3,000 .

broker-dealer registered with the Securities and Exchange Commission, is a member of the Financial Industry Regulatory Authority,

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

Company’s chairman of the board and another independent board member of the Company also have ownership interest in

February 28, 2022, the Company entered into a Stock Purchase Agreement with Alset EHome International Inc.

(“AEI”), pursuant

to which AEI has agreed to sell a subsidiary holding 62,336,908 shares of stock of True Partner Capital Holding Limited exchange for

17,570,948 shares of common stock of the Company (the “DSS Shares”).

The Company’s Executive Chairman and a significant

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

Further, on February 20,

2025, the Company acquired an additional 19,500,000 shares of True Partners.

The fair value of the marketable security as of September

30, 2025 and December 31, 2024, was approximately $ 5,679,000 and $ 3,815,000 , respectively.

During the nine months ended September 30,

2025 and 2024, the Company recorded unrealized gain of approximately $ 1,864,000 and a loss of approximately $ 936,000 , respectively.

August 29, 2022, DSS Financial Management Inc and BMI Capital, Inc.

(“BMIC”), a related party, entered into a promissory

note (“Note 8”) in the principal sum of $ 100,000 with interest of 8 %, is due in three quarterly instalments beginning on

September 14, 2022.

All unpaid principal and interest is due on August 29, 2025 .

The outstanding principal and interest at September

30, 2025, and December 31, 2024 approximated $ 83,000 , and was fully reserved for as of September 30, 2025 and December 31, 2024.

owns 24.9 % of the outstanding common shares of BMIC.

May 8, 2023, DSS Financial Management Inc and BMIC entered into a promissory note (“Note 9”) in the principal sum of $ 102,000

with interest at the prime rate plus 2 % ( 10.5 % at September 30, 2024 and December 31, 2023) with a maturity date of May 7, 2026 .

outstanding principal and interest at September 30, 2025, and December 31, 2024 approximated $ 110,000 , and was fully reserved for as

of September 30, 2025 and December 31, 2024.

DSS owns 24.9 % of the outstanding common shares of BMIC.

entered into membership interest purchase agreement

with BMI Financial Group, Inc.

a Delaware corporation (“BMIF”) and BMI Capital International LLC, a Texas limited liability

company (“BMIC LLC”) whereas DSS Securities, Inc.

purchased 14.9 % membership interests in BMIC LLC for $ 100,000 .

DSS Securities

also had the option to purchase an additional 10 % of the outstanding membership interest which it exercised for $ 100,000 in January of

2021 and increased its ownership to 24.9 %.

Upon achieving greater than 20 % ownership in BMIC LLC during the quarter ended September 30,

2021, the Company is currently accounting for this investment under the equity method of accounting per ASC 323 The Company’s portion

of net gain in BMIC during the three months ended March 31, 2026 was approximately $ 4,000 and a net loss for the three months ended March

31, 2025, of approximately $ 3,000 .

Company owns 81,836,908 shares or approximately 19.55 % of True Partners

Capital Holding Limited (“True Partners”), a publicly listed company on the Hong Kong Stock Exchange.

On February 28, 2022,

the Company entered into a Stock Purchase Agreement with Alset EHome International Inc.

(“AEI”), pursuant to which AEI has

agreed to sell a subsidiary holding 62,336,908 shares of stock of True Partner Capital Holding Limited exchange for 17,570,948 shares

of common stock of the Company (the “DSS Shares”).

The Company’s Executive Chairman and a significant stockholder, Heng

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

Further, on February 20, 2025, the Company acquired

an additional 19,500,000 shares of True Partners.

The fair value of the marketable security as of March 31, 2026 and December 31, 2025,

was approximately $ 3,600,000 and $ 4,206,000 , respectively.

On March 27, 2026, the Company acquired or received a convertible bond investment

issued by True Partners with an initial recorded value of approximately $ 2,450,000 (see Note 6).

During the three months ended March 31,

2026, in connection with the Company’s additional investment in True Partners through the convertible bond and the election of Mr.

Chan to the board of directors of True Partners, the Company determined that it has the ability to exercise significant influence over

True Partners.

Accordingly, beginning on March 27, 2026, the Company began accounting for its investment in True Partners under the equity

method of accounting.

As a result of the change to equity method accounting, the Company reclassified its investment in True Partners

from Investment in equity securities to Investment, equity method on the consolidated balance sheet.

As of March 31, 2026, the carrying

value of the Company’s investment in True Partners, was approximately $ 3,600,000 .

Prior to the ability to exercise significant influence,

the Company recognized an unrealized loss of approximately $ 606,000 during the three months ended March 31, 2026 related to the change

in fair value of the True Partners marketable equity securities.

During the three months ended March 31, 2025, the Company recognized

an unrealized loss of approximately $ 902,000 related to the investment.

Capital International LLC.

(“BMIC LLC”), a related party, entered into a promissory note (“Note 4”) in the principal

sum of $ 100,000 with interest of 8 %, is due in three quarterly installments beginning on September 14, 2022.

All unpaid principal and

interest was due on August 29, 2025 .

The outstanding principal and interest at March 30,2026 and December 31, 2025 approximated $ 86,000 ,

and was fully reserved for as of March 31, 2026 and December 31, 2025.

DSS owns 24.9 % of the outstanding common shares of BMIC LLC.

May 8, 2023, DSS Financial Management Inc and BMIC LLC entered into a promissory note (“Note 5”) in the principal sum of

$ 102,000 with interest at the prime rate plus 2 % with a maturity date of May 7, 2026 .

The outstanding principal and interest at March

31, 2026, and December 31, 2025 approximated $ 110,000 , and was fully reserved for as of March 31, 2026 and December 31, 2025.

24.9 % of the outstanding common shares of BMIC LLC.

July 26, 2022, APF and VEII, Inc.

3 unchanged sentences

principal and interest is due July 26, 2025.

The outstanding principal and interest as of September 30, 2025 and December 31, 2024 approximates

Approximately $ 959,000 of this note was reserved for as of December 31, 2024.

The outstanding principal and interest on December

31, 2023, approximates $ 939,000 , net of $ 20,000 of unamortized origination fees and is included in notes receivable on the accompanying

consolidate balance sheet.

Heng Fai Ambrose Chan, the Chairman of DSS, Inc is also the on the board of directors of VEII.

October 13, 2021, LVAM entered into loan agreement with BMIC (“BMIC Loan”), a related party, whereas LVAM borrowed the principal

amount of $ 3,000,000 , with interest to be charged at a variable rate to be adjusted at the maturity date.

The BMIC loan contains an auto

renewal period of three months, with a current maturity date of October 2025.

As of September 30, 2025, and December 31, 2024, the outstanding

principal and interest of approximately $ 464,000 and $ 463,000 , respectively, are included in Current portion of long-term debt –

related party, net on the consolidated balance sheet.

The outstanding principal and interest as of March 31, 2026 and December 31, 2025 approximates

This note was fully reserved for as of March 31, 2026 and December 31, 2025.

Heng Fai Ambrose Chan, the Chairman of DSS, Inc

is also the on the board of directors of VEII.

October 13, 2021, Liquid Value Asset Management Limited (“LVAM”), a majority owned subsidiary of the Company, entered into

loan agreement with BMIC (“BMIC Loan”), a related party, whereas LVAM borrowed the principal amount of $ 3,000,000 , with interest

to be charged at a variable rate to be adjusted at the maturity date.

The BMIC loan contains an auto renewal period of three months,

with a maturity date of April 2026 as of March 31, 2026 .

The BMIC Loan was automatically extended to January 2026.

As of March 31, 2026,

and December 31, 2025, the outstanding principal and interest of approximately $ 33,000 and $ 33,000 , respectively, are included in Current

portion of long-term debt – related party, net on the consolidated balance sheet.

October 13, 2021, LVAM entered into a loan agreement with Lee Wilson Tsz Kin (“Wilson Loan”), a related party, whereas LVAM

borrowed the principal amount of $ 3,000,000 , with interest to be charged at a variable rate to be calculated at the maturity date.

Wilson Loan matures on October 12, 2022 , and contains an auto renewal period of three months with a current maturity date of October

As of September 30, 2025, and December 31, 2024, the outstanding principal and interest of approximately $ 145,000 and $ 145,000 ,

respectively, are included in Current portion of long-term debt – related party, net on the consolidated balance sheet.

Wilson Loan contains an auto renewal period of three months, with a maturity date of April 2026 as of March 31, 2026 .

The Wilson Loan

was automatically extended to January 2026.

As of March 31, 2026, and December 31, 2025, the outstanding principal and interest of approximately

$ 145,000 and $ 145,000 , respectively, are included in Current portion of long-term debt – related party, net on the consolidated

balance sheet.

February 6, 2025, as a bonus for compensation awarded to Heng Fai Holdings Limited (“HFHL”), a Hong Kong Company, which is

5 unchanged sentences

The issuance was approved by the board of directors on January 31, 2025.

In August of 2025, DSS

issued a $ 500,000 convertible promissory note to Alset, Inc.

(“holder”), bearing interest at Prime ( 7.25 % at September

The first 12 months’ interest is to be paid in shares of the Company;

thereafter, interest is prepaid annually in

cash or shares at the holder’s election.

The note is convertible at the holder’s option at a fixed $ 0.86 per share, is

payable on demand (or July 31, 2028 if not demanded), and may be redeemed by the Company on or after the first anniversary.

Company is required to reserve sufficient authorized shares and maintain the listing/quotation of its common stock.

2020-06 and ASC 815-40, the debt host’s embedded conversion feature is indexed to the Company’s own stock and is

equity-classified;

accordingly, no embedded derivative is bifurcated and the instrument is accounted for as single-unit debt using

the effective interest method.

August of 2025, DSS issued a $ 500,000 convertible promissory note to Alset, Inc.

(“holder”), the Company’s largest

shareholder and a related party, bearing interest at Prime ( 7.25 % at March 31, 2026).

The first 12 months’ interest is to be paid

in shares of the Company;

thereafter, interest is prepaid annually in cash or shares at the holder’s election.

The note is convertible

at the holder’s option at a fixed $ 0.86 per share, is payable on demand (or July 31, 2028 if not demanded), and may be redeemed

by the Company on or after the first anniversary.

The Company is required to reserve sufficient authorized shares and maintain the listing/quotation

of its common stock.

Under ASU 2020-06 and ASC 815-40, the debt host’s embedded conversion feature is indexed to the Company’s

own stock and is equity-classified;

accordingly, no embedded derivative is bifurcated and the instrument is accounted for as single-unit

debt using the effective interest method.

Interest is recognized in interest expense;

when settled in shares, a credit to APIC is recorded at

the fair value of shares on settlement, and any prepaid interest is recorded as a discount/prepaid and amortized to expense over the

when settled in shares, a credit to APIC is recorded

at the fair value of shares on settlement, and any prepaid interest is recorded as a discount/prepaid and amortized to expense over the

related period.

The outstanding principal and interest, approximates $ 503,000

and is included in Current portion of long-term debt, net on the accompanying consolidated balance sheet at September 30, 2025.

is a related party and the Company’s largest shareholder.

The outstanding principal and interest, approximates $ 520,000 and is included in Current portion of long-term debt, net

on the accompanying consolidated balance sheet at March 31, 2026.

The outstanding principal and interest, approximates $ 512,000 and is

included in Convertible note payable, related party on the accompanying consolidated balance sheet at December 31, 2025.

Interest expense

for the three months ended March 31, 2026 and 2025 approximated $ 8,000 and $ 0 , respectively.

February 6, 2025, as a bonus for compensation awarded to Heng Fai Holdings Limited (“HFHL”), a Hong Kong Company, which is

beneficially owned by Mr.

Heng Fai Ambrose Chan, Director of DSS, Inc., HFHL was awarded 1,000,000 shares of the Company’s common

stock, approximating $ 870,000 .

The issuance was approved by the board of directors on January 31, 2025.

March 21, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 499,800 shares of Impact Biomedical common stock.

These shares were acquired by DSS during Impact’s initial public offering on September 16, 2024.

The sale of these shares, which

were previously held by DSS as part of its ownership interest in Impact, was completed for a total value of $ 1,500,000 , which represents

the consideration received from the transaction.

With this sale, the shares are now publicly held and are no longer held by DSS.

April 4, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 890,800 shares of Impact Biomedical common stock.

The sale of these shares, which were previously held by DSS as part of its ownership interest in Impact, was completed for a total approximate

value of $ 845,000 , which represents the consideration received from the transaction.

With this sale, the shares are now publicly held

and are no longer held by DSS.

May 22, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 115,600 shares of Impact Biomedical common stock.

The sale of these shares, which were previously held by DSS as part of its ownership interest in Impact, was completed for a total approximate

value of $ 63,000 , which represents the consideration received from the transaction.

With this sale, the shares are now publicly held

and are no longer held by DSS.

May 23, 2025, DSS, the parent company of Impact Biomedical, completed the sale of 45,400 shares of Impact Biomedical common stock.

sale of these shares, which were previously held by DSS as part of its ownership interest in Impact, was completed for a total approximate

value of $ 24,000 , which represents the consideration received from the transaction.

With this sale, the shares are now publicly held

and are no longer held by DSS.

March 26, 2026, Alset International Limited (“AIL”), a majority-owned subsidiary of Alset Inc.

(the “Company”)

entered into a securities purchase agreement (the “SPA”) with DSS pursuant to which AIL will loan DSS $ 2,450,000 , in exchange

for a convertible promissory note (the “Note”) and warrants to purchase 16,554,055 shares of DSS common stock (the “Warrants”).

The Note, SPA, and Warrants are collectively referred to herein as the “Transaction Documents.” The Note will bear a simple

interest rate of 3 % per annum.

Under the terms of the Note, AIL may convert any outstanding principal and interest into shares of DSS

common stock at $ 0.74 per share upon notice prior to maturity of the Note five ( 5 ) years from the date of thereof.

The Warrants to be

issued to AIL are to purchase up to 16,554,055 shares of DSS common stock at an exercise price of $ 0.93 per share.

The Warrants expire

on their fifth anniversary.

2026, the Company received a convertible bond from True Partners Capital Holding Limited (“True Partners”), a related

The bond has a face value of $ 2,450,000 ,

bears interest at 3.0 %

per annum, matures on March 27, 2028, and is mandatorily convertible at maturity into ordinary shares of True Partners at HKD $ 0.10

True Partners is a related party because the Company holds a significant equity investment in True Partners and has the

ability to exercise significant influence through its ownership interest, the convertible bond investment, and the election of the

Company’s Executive Chairman and significant stockholder, Heng Fai Ambrose Chan, to True Partners’ board of directors.

The Company recorded the bond at its estimated fair value of approximately

$ 8,520,000 based on a valuation performed as of March 31, 2026.

is classified as a Level 3 fair value measurement because there is no quoted market price for the identical instrument and the valuation

uses significant unobservable inputs, including issuer credit risk, expected term, liquidity assumptions, credit spread, and conversion

The excess of the bond’s estimated fair value over its stated face amount or consideration transferred was deemed a contribution

to capital and recorded as a Fair value adjustment related to convertible bond received from related party within additional paid-in capital,

rather than as a gain in earnings.

Subsequent Events

Company has evaluated all subsequent events and transactions through November 14, 2025 the date that the condensed consolidated financial

Company has evaluated all subsequent events and transactions through May 15, 2026 the date that the condensed consolidated financial

statements were available to be issued and noted no subsequent events requiring financial statement recognition or disclosure other than

In October of 2025, AMRE

received notice from one if its tenants that it will not be continuing its lease at our Pittsburgh facility due to the

tenant’s inability to obtain certain medical practice licenses in the state of Pennsylvania.

As of September 30, 2025, the Company has recorded within other assets, a rent receivable of approximately $ 90,000

that has been past due for the tenant, while recorded the lease receivable of approximately $ 1,184,000 for the remaining term.

would continue to evaluate this circumstance, and determine whether a loss would be recognized at year end.

On April 29, 2026,

True Partner International Limited, a subsidiary of DSS, delivered a conversion notice to True Partner Capital Holding Limited to convert the full outstanding

principal amount of its $ 2,450,000 , 3 % convertible bonds.

Pursuant to the notice, the bonds were converted at a conversion price of

HK$ 0.10 per share, resulting in the issuance of 190,683,500 ordinary shares.

Accrued interest of approximately $ 6,000 remained payable in cash and was not converted

At conversion, the Company owns approximately 45% of the issued and outstanding shares of True Partner Capital.

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-Q

Item 1. Financial Statements