What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-31 compared with 2024-03-27 · 1330 added, 1433 removed, 628 unchanged (81% of the section changed)

4 unchanged sentences

Consolidated Balance Sheets

Statements of Operations

Consolidated Statements of Operations

Consolidated Statements of Cash Flows

2 unchanged sentences

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of DSS,

Opinion on the Financial Statements

We have audited the accompanying consolidated balance

sheets of DSS, Inc, and its subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements

of operations, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively referred to as

the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial

position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years then ended,

in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required

to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations

of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements

are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform,

an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal

control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal

control over financial reporting.

the Board of Directors and

Stockholders of DSS, Inc.

on the Financial Statements

have audited the accompanying consolidated balance sheets of DSS, Inc, and its subsidiaries (the “Company”) as of December

31, 2024 and 2023, and the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the

two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December

31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles

generally accepted in the United States of America.

financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s

financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities

laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits,

we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion

on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess

the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond

to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating

the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are

matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the

audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially

challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the

financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions

on the critical audit matters or on the accounts or disclosures to which they relate.

Investments in real estate

As described in Note 9 to the consolidated financial

statements, the Company owns real estate properties through their subsidiaries with a net book value of approximately $6,279,000, with

an additional $51,530,000 classified as held for sale.

We identified the value of the real estate to be a critical audit matter.

The principal consideration for our determination

of management’s assessment of impairment of the real estate as a critical audit matter is the high degree of subjective auditor

judgment associated with evaluating management’s determination of impairment of the real estate properties, which is primarily due

to the complexity of the valuation models used and the sensitivity of the underlying significant assumptions.

The key assumptions used

within the valuation models included site valuations and various approaches such as cost, sales comparison, etc.

The calculated fair values

are sensitive to changes in these key assumptions.

How the Critical Audit Matter was addressed in

Our audit procedures related to the determination

of the fair value of the real estate properties included the following, among others:

We obtained management’s rollforward of investments in real estate from December 31, 2022, to December 31, 2023 and tested any material additions by vouching to invoices and contracts.

We obtained third party valuations that assess the fair value of the properties from management.

We assessed the qualifications and competence of management and the qualifications, competence and objectivity of third-party specialist.

We engaged a valuation firm to review the valuation reports provided by management to determine if the reports were reasonable and acceptable based on the methodologies used by management’s third-party valuation firm.

We also assessed the qualifications and competence of the valuation firm.

We compared the net book value of the real estate properties to the fair values of the properties per the third-party valuations to determine that the carrying value is less than fair value and impairment was addressed properly.

During the year ended December 31, 2023, Management reclassified the land and building related to AMRE LifeCare and AMRE Winter Haven to assets held for sale.

We assessed the sufficiency of the Company’s disclosure of its accounting for these real estate properties included in Notes 2 and 9.

Evaluation of Intangible Assets and Goodwill for

As described in Notes 2 and 10 to the consolidated

financial statements, the Company holds Intangible Assets and Goodwill through its subsidiaries with

a net book value of approximately $20,193,000 and $26,862,000, respectively.

audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error

or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant

estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits

provide a reasonable basis for our opinion.

Audit Matters

critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated

or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial

statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters

does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit

matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

in Real Estate

described in Note 3 to the consolidated financial statements, the Company owns real estate properties through their subsidiaries with

a net book value of approximately $45,158,000, which are classified as held for sale.

We identified the valuation of the real estate

to be a critical audit matter.

principal consideration for our determination of management’s assessment of impairment of the real estate as a critical audit matter

is the high degree of subjective auditor judgment associated with evaluating management’s determination of impairment of the real

estate properties, which is primarily due to the complexity of the valuation models used and the sensitivity of the underlying significant

The key assumptions used within the valuation models included site valuations and various approaches such as cost, sales

comparison, etc.

The calculated fair values are sensitive to changes in these key assumptions.

the Critical Audit Matter was addressed in the Audit

audit procedures related to the determination of the fair value of the real estate properties included the following, among others:

obtained management’s rollforward of investments in real estate from December 31, 2023,

to December 31, 2024 and tested any material additions by vouching to invoices and contracts.

obtained third party valuations that assess the fair value of the properties from management.

assessed the qualifications and competence of management and the qualifications, competence

and objectivity of third-party specialist.

engaged a valuation firm to review the valuation reports provided by management to determine

if the reports were reasonable and acceptable based on the methodologies used by management’s

third-party valuation firm.

We also assessed the qualifications and competence of the valuation

compared the net book value of the real estate properties to the fair values of the properties

per the third-party valuations to determine if the carrying value is less than fair value

and impairment was addressed properly.

During the year ended December 31, 2024, Management

reclassified the land and building related to AMRE Shelton to assets held for sale.

assessed the sufficiency of the Company’s disclosure of its accounting for these real

estate properties included in Notes 3 and 8.

of Intangible Assets and Goodwill for Impairment

described in Notes 3 and 11 to the consolidated financial statements, the Company holds Intangible Assets and Goodwill through its subsidiaries

with a net book value of approximately $18,890,000 and $1,769,000, respectively.

We identified the value of Intangible Assets and Goodwill

to be a critical audit matter.

The principal consideration for our determination

of management’s assessment of impairment of the Intangible Assets and Goodwill as a critical audit matter is the high degree of

subjective auditor judgment associated with evaluating management’s determination of impairment of Intangible Assets and Goodwill,

which is primarily due to the complexity of the valuation models used and the sensitivity of the underlying significant assumptions.

key assumptions used within the valuation models included qualitative and quantitative assessments.

The calculated fair values are sensitive

to changes in these key assumptions.

How the Critical Audit Matter was addressed in

Our audit procedures related to the determination

of the fair value of the Intangible Assets and Goodwill included the following, among others:

We obtained management’s rollforward of Intangible Assets and Goodwill in from December 31, 2022, to December 31, 2023 and tested any material additions and disposals by vouching to agreements.

We obtained management’s qualitative and quantitative assessments and third-party valuations that assess the fair value of the Intangible Assets and Goodwill.

We assessed the qualifications and competence of management and the qualifications, competence and objectivity of third-party specialists.

We reviewed the valuation reports provided by management to determine if the reports were reasonable and acceptable based on the methodologies used by management’s third-party valuation firm.

We audited the critical inputs used in the valuation calculations and utilized the services of an independent auditor engaged specialist to ensure the methodologies and assumptions utilized by the Company’s independent specialists were reasonable and in accordance with industry standards.

We assessed the sufficiency of the Company’s disclosure of its accounting for Intangible Assets and Goodwill included in Notes 2 and 10.

principal consideration for our determination of management’s assessment of impairment of the Intangible Assets and Goodwill as

a critical audit matter is the high degree of subjective auditor judgment associated with evaluating management’s determination

of impairment of Intangible Assets and Goodwill, which is primarily due to the complexity of the valuation models used and the sensitivity

of the underlying significant assumptions.

The key assumptions used within the valuation models included qualitative and quantitative

The calculated fair values are sensitive to changes in these key assumptions.

the Critical Audit Matter was addressed in the Audit

audit procedures related to the determination of the fair value of the Intangible Assets and Goodwill included the following, among others:

obtained management’s rollforward of Intangible Assets and Goodwill from December 31,

2023, to December 31, 2024 and tested any material additions and disposals by vouching to

obtained management’s qualitative and quantitative assessments and third-party valuations

that assess the fair value of the Intangible Assets and Goodwill.

assessed the qualifications and competence of management and the qualifications, competence

and objectivity of third-party specialists.

reviewed the valuation reports provided by management to determine if the reports were reasonable

and acceptable based on the methodologies used by management’s third-party valuation

audited the critical inputs used in the valuation calculations and utilized the services

of an independent auditor engaged specialist to ensure the methodologies and assumptions

utilized by the Company’s independent specialists were reasonable and in accordance

with industry standards.

assessed the sufficiency of the Company’s disclosure of its accounting for Intangible

Assets and Goodwill included in Notes 3 and 11.

& CO., CPAs, P.C.

We have served as the Company’s auditor since 2022.

Jericho, New York

March 27, 2024

have served as the Company’s auditor since 2022.

AND SUBSIDIARIES

3 unchanged sentences

Cash and cash equivalents

Accounts receivable, net

Current portion of notes receivable

Accounts receivable, net of allowance for credit reserve of $ 1,613,000

Inventory, net

Assets held for sale

Current portion of notes receivable, net

Current portion of notes receivable - related part, net

Current portion of notes receivable

Prepaid expenses and other current assets

5 unchanged sentences

Marketable securities

Notes receivable, net

Notes receivable - related party, net

Notes receivable

10 unchanged sentences

Current portion of long-term debt, net

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

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

Current portion of long-term debt, net

Total current liabilities

1 unchanged sentence

Long-term lease liability

Other long-term liabilities

Deferred tax liability, net

Commitments and contingencies (Note 18)

10 unchanged sentences

( 256,176,000 )

Total DSS stockholders’ equity

Non-controlling interest in subsidiary

Total stockholders’ equity of the company

Non-controlling interest in subsidiaries

Total stockholders’ equity

2 unchanged sentences

$ 153,192,000

See accompanying notes.

accompanying notes.

AND SUBSIDIARIES

3 unchanged sentences

Rental income

Management fee income

Net investment income

4 unchanged sentences

Cost of revenue

Selling, general and administrative (including stock-based compensation)

Selling, general and administrative (including stock-based

compensation)

Total costs and expenses

4 unchanged sentences

Interest income

Interest income on notes receivable, related party

Dividend income

Interest expense

Litigation loss

Foreign currency translation adjustment

Gain/(loss) on equity method investment

Gain/(loss) on investments

( 4,967,000 )

Gain on extinguishment of debt

Loss on equity method investment

Loss on investments

Impairment of intangible assets

( 7,418,000 )

Impairment of real estate assets

( 7,288,000 )

Impairment of investment

Impairment of investments

Impairment of assets upon deconsolidation of SHRG

( 6,220,000 )

Impairment of fixed assets

Impairment of intangible assets

Provision for loan losses

( 3,691,000 )

Impairment of investment in real estate

Impairment of goodwill

( 3,794,000 )

Provision for loan losses

Gain/(loss) on sale of assets

( 1,300,000 )

Loss on sale of assets

Loss from continuing operations before income taxes

( 53,698,000 )

Loss before income taxes

( 74,039,000 )

Income tax expense

Loss from continuing operations

( 53,706,000 )

Income tax loss

( 74,043,000 )

Loss from discontinued operations, net of tax

( 3,481,000 )

Net loss attributed to noncontrolling interest

( 53,706,000 )

( 77,524,000 )

Loss from continuing operations attributed to noncontrolling interest

Net loss attributable to common stockholders

1 unchanged sentence

$ ( 60,627,000 )

Loss per common share:

Shares used in computing loss (earnings) per common share:

See accompanying notes.

Amounts attributable to DSS stockholders

Loss from continuing operations net of taxes

$ ( 46,896,000 )

$ ( 57,335,000 )

Loss from discontinued operations net of taxes

( 3,292,000 )

Net loss attributable to DSS shareholders

$ ( 46,896,000 )

$ ( 60,627,000 )

Loss per common share attributable to common stock holders - continuing operations

Loss per common share attributable to common stock holders - discontinued operations

Shares used in computing loss per common share:

accompanying notes.

AND SUBSIDIARIES

Statements of Cash Flows

the Years Ended December 31,

For the Years Ended December 31,

Cash flows from operating activities:

Net loss from operations

( 53,706,000 )

( 77,524,000 )

Adjustments to reconcile net loss from operations to net cash used by operating activities:

Loss from discontinued operations

( 3,481,000 )

Loss from continuing operations

( 53,706,000 )

( 74,043,000 )

Adjustments to reconcile net loss to net cash used by operating activities:

Depreciation and amortization

Stock based compensation

Gain/(loss) on equity method investment

Loss on investments

Loss (income) on equity method investment

Loss (gain) on investments

Change in ROU assets

( 7,721,000 )

Gain on extinguishment of debt

Deferred tax loss

Loss on sales of assets

Impairment of fixed assets

Impairment of intangible assets

Impairment of real estate

Impairment of Goodwill

Impairment of investments

(Gain) loss on sale of assets

Impairment of intangible assets

Impairment of accounts receivable

Impairment of notes receivable

Impairment of other investments

Impairment of assets upon deconsolidation

Impairment of goodwill

Decrease (increase) in assets:

Accounts receivable

( 1,891,000 )

Prepaid expenses and other current assets

( 2,210,000 )

Increase (decrease) in liabilities:

1 unchanged sentence

( 2,260,000 )

Accrued expenses

Accrued expenses and deferred revenue

( 15,646,000 )

2 unchanged sentences

Other liabilities

Net cash used by operating activities - continuing operations

( 9,082,000 )

( 15,713,000 )

Net cash used by operating activities - discontinued operations

( 3,481,000 )

Net cash used by operating activities

3 unchanged sentences

Purchase of property, plant and equipment

( 2,294,000 )

Purchase of real estate

Purchases of real estate assets

Purchase of investment

Purchase of marketable securities

( 3,327,000 )

Disposal of property, plant & equipment

Asset acquired with APB acquisition

( 1,879,000 )

Disposal of property, plant and equipment

Asset acquired with Sentinel acquisition

Conversion of SHRG to consolidation

Change in Equity investment

Issuance of new notes receivable, net origination fees

( 1,046,000 )

( 3,621,000 )

Payment received on notes receivable

Sale of marketable securities

Purchase of intangible assets

Net cash provided (used) by investing activities

Issuance of new notes receivable, net origination fees

( 1,046,000 )

Payments received on notes receivable

Payments received

on notes receivable, related party

Net cash provided by investing activities

Cash flows from financing activities:

4 unchanged sentences

Issuances of common stock, net of issuance costs

Net cash (used) provided by financing activities

Net cash provided (used) by financing activities

( 2,417,000 )

Net decrease in cash

Net increase (decrease) in cash - continuing operations

( 9,194,000 )

Net increase (decrease) in cash - discontinued operations

( 3,481,000 )

1 unchanged sentence

Cash and cash equivalents at end of year

See accompanying notes.

accompanying notes.

AND SUBSIDIARIES

1 unchanged sentence

the Years Ended December 31,

Preferred Stock

Balance, December 31, 2022

5 unchanged sentences

Acquisition of Sentinel Brokers Company, Inc.

Acquisition of Sharing Services Global Corporation

Stock based payments

( 59,840,000 )

Fractional shares as a result of reverse stock split

Dividend in kind - Deconsolidation of Sharing Services Global Corporation

( 1,206,000 )

1 unchanged sentence

( 1,206,000 )

Balance, December 31, 2022

Deconsolidation of Sharing Services Global Corporation

Net loss from continuing operations

( 60,627,000 )

5 unchanged sentences

$ ( 256,176,000 )

$ 125,562,000

$ 156,681,000

Balance, December 31, 2023

$ 319,963,000

3 unchanged sentences

Issuance of common stock, net of expenses

Acquisition of Sentinel Brokers Company, Inc.

Fractional shares as a result of reverse stock split

Deconsolidation of Sharing Services Global Corporation

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

Stock based compensation - Impact Biomedical, Inc.

( 46,896,000 )

7 unchanged sentences

$ ( 303,072,000 )

See accompanying notes.

accompanying notes.

AND SUBSIDIARIES

2 unchanged sentences

Description of Business

The Company, incorporated

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

On September 16, 2021, the

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

(a New York corporation, incorporated

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

This change became

effective on September 30, 2021.

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

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

(a New York corporation,

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

change became effective on September 30, 2021.

maintained the same trading symbol “DSS”.

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

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

around the globe.

These business lines are:

(1) Product Packaging, (2) Biotechnology, (3) Direct, (4) Commercial Lending, (5)

Securities and Investment Management, (6) Alternative Trading (7) Digital Transformation (discontinued in 2023), (8) Secure Living

(discontinued in 2023), and (9) Alternative Energy (discontinued in 2023).

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

and income generation.

Our divisions,

their business lines, subsidiaries, and operating territories:

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

Corporation, Inc.

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

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

business lines are:

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

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

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

(“Premier”), a New York corporation.

Premier operates in the paper board and fiber based folding

carton, consumer product packaging, and document security printing markets.

It markets, manufactures, and sells sophisticated custom

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

Premier is currently located in its new

facility in Rochester, NY, and primarily serves the US market.

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

acquire companies in the BioHealth and BioMedical fields, including businesses focused on the advancement of drug discovery and

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

This division is also targeting

unmet, urgent medical needs, and is developing open-air defense initiatives, which curb transmission of air-borne infectious

operates in the paper board and fiber based folding carton, consumer product packaging, and document security printing markets.

manufactures, and sells sophisticated custom folding cartons, mailers, photo sleeves and complex 3-dimensional direct mail solutions.

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

(2) The Biotechnology business

line was created to invest in or acquire companies in the BioHealth and BioMedical fields, including businesses focused on the advancement

of drug discovery and prevention, inhibition, and treatment of neurological, oncological, and immune related diseases.

This division is

also targeting unmet, urgent medical needs, and is developing open-air defense initiatives, which curb transmission of air-borne infectious

diseases, such as tuberculosis and influenza.

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

(“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.

(4) Our Commercial Lending

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

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

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

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

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

acquisition company) consulting services, and advisory capital raising services.

(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.

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

trading and/or funds management arena.

Alternative Trading, in partnership with recognized global leaders in alternative trading

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

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

The scope of services

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

listings on a primary market(s), asset digitization/tokenization (securities, currency, and cryptocurrency), and the listing and

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

(7) Digital Transformation was established to be

a Preferred Technology Partner and Application Development Solution for mid cap brands in various industries including the direct

selling and affiliate marketing sector.

Digital improves marketing, communications and operations processes with custom software

development and implementation (discontinued in 2023).

(8) The Secure Living division has developed a plan for fully sustainable,

secure, connected, and healthy living communities with homes incorporating advanced technology, energy efficiency, and quality of

life living environments both for new construction and renovations for single and multi-family residential housing (discontinued in 2023).

Alternative Energy group was established to help lead the Company’s future in the clean energy business that focuses on

environmentally responsible and sustainable measures.

Alset Energy, Inc, the holding company for this group, and its wholly owned

subsidiary, Alset Solar, Inc., pursue utility-scale solar farms to serve US regional power grids and to provide underutilized

properties with small microgrids for independent energy (discontinued in 2023).

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.

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.

May 13, 2021, Sentinel Brokers, LLC.

8 unchanged sentences

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

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

EHome International Inc.

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

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

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

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

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

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

This transaction was completed on March 9, 2022.

In addition, the Company’s Executive

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

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

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

with a principal amount of $ 8,350,000

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

This transaction was finalized in July 2022.

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

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

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

(“Alset EHome”), a related party.

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

owner of the outstanding shares of Alset EHome.

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

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

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

of Previously Issued Financial Statements

Company has restated its financial statements for the year ended December 31, 2023, along with certain notes to such restated financial

The adjustments recorded were related to the correction of an error identified by management.

Impacted amounts and associated disclosures are restated within the accompanying notes to the financial

May 4, 2023, the Company distributed approximately 280 million shares of Sharing Service Global Corporation (“SHRG”), beneficially

held by the Company, in the form of a dividend to the shareholders of the Company’s common stock.

Upon completion of this distribution,

the Company retained an ownership interest in SHRG of approximately 7 %.

Effective May 1, 2023, SHRG was deconsolidated from the consolidated

financial statements (the “Deconsolidation”).

The consolidated statement of operations does not include SHRG activity after

April 30, 2023 and the assets and liabilities of SHRG are no longer included within the Company’s consolidated balance sheet.

the 10-Q for the second quarter of 2023, the Company recorded an approximate $ 29.9 million loss on deconsolidation.

The Company also

recorded a decrease in accumulated deficit of $ 18.7 million to reflect the reversal of balances as of deconsolidation.

In preparation

of the Form S-3 as well as the September 30, 2024 10-Q filing this transaction was revisited and it was determined that loss was unintentionally

overstated by approximately $ 23.5 million driven primarily by the increases in accumulated deficit that should have been recorded as

an offset to the initial income statement loss.

In addition, the Company also determined that Deconsolidation also required the recognition

of discontinued operations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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81 % of the issued and outstanding common shares of SHRG.

A s a result, SHRG, whose operations represented

a significant portion of our Direct Marketing segment, was deconsolidated from our consolidated financial statements effective as of

May 1, 2023 (the “Deconsolidation”).

Subsequent to April 30, 2023, the assets

and liabilities of SHRG are no longer included within our consolidated balance sheets.

Any discussions related to results, operations,

and accounting policies associated with SHRG refer to the periods prior to the Deconsolidation.

Deconsolidation, we recognized a loss before income taxes of approximately $ 29,196,000 which is recorded within gain/loss investments

in our consolidated statements of operations for the three and nine months ended September 30, 2023.

As a result, SHRG, whose operations represented a significant portion of our

Direct Marketing segment, was deconsolidated from our consolidated financial statements effective as of May 1, 2023 (the “Deconsolidation”)

and will be treated as discontinued operations on the face of our financial statements.

Subsequent to April 30, 2023, the assets and

liabilities of SHRG are no longer included within our consolidated balance sheets.

Any discussions related to results, operations, and

accounting policies associated with SHRG refer to the periods prior to the Deconsolidation.

Deconsolidation, we recognized an impairment of assets due to the deconsolidation of SHRG approximately $ 6,071,000 which is recorded

as an impairment of assets due to the deconsolidation in our consolidated statements of operations.

Subsequent to the Deconsolidation,

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Reclassifications –

– Interest expense associated with the debt owed by AMRE has been reclassed from Interest expense to Cost of revenue for the year ended December

31, 2022 to conform to 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.

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

funds whose adjusted costs approximates fair value.

Costs associated with Professional fees for the years ended December 31, 2024, and 2023 have been reclassified to Research and

development to conform with current period presentation.

For the year ended December 31, 2023, Sales and marketing costs have been

reclassified from Other operating costs to Sales and marketing to conform with current period presentation.

Further the Current

portion of long-term debt, net, was reduced approximately $ 47,000,000 , the Current portion of long-term debt on assets held-for-sale was increased approximately $ 44,308,000 , and the current

portion of long-term debt – related party, net was increased approximately $ 2,678,000 on the Consolidated Balance Sheet for the

year ended December 31, 2023 have been reclassed to conform with current period presentation.

Additionally, Impairment of goodwill in

the amount of $ 30,978,000 for the year ended December 31, 2023 was reclassified to Selling, general and administration (inclusive of stock

based compensation) on the accompanying Consolidated statement of operations.

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.

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

The Company performs

ongoing credit evaluations and generally does not require collateral.

Payment terms are generally 30 days but up to net 120 for certain

The Company carries its trade accounts receivable at invoice amounts and its rent receivables at contract amounts, less an

allowance for credit losses.

On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for

credit losses based upon management’s estimates that include a review of the history of past write-offs and collections and

an analysis of current credit conditions.

In estimating expected losses in the accounts receivable portfolio, customer-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 customers’ abilities to pay.

At December 31, 2023,

and December 31, 2022, the Company established a reserve for credit losses of approximately $ 2,494,000 and $ 29,000 , respectively.

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

Accounts receivable, net was $ 5,673,000 , $ 7,564,000 , and $ 3,994,000 for January 1, 2022, December 31, 2022, and December

The Company performs ongoing

credit evaluations and generally does not require collateral.

Payment terms are generally 30 days but up to net 120 for certain customers.

The Company carries its trade accounts receivable at invoice amounts and its rent receivables at contract amounts, less an allowance

for credit losses.

On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for credit losses

based upon management’s estimates that include a review of the history of past write-offs and collections and an analysis of current

credit conditions.

In estimating expected losses in the accounts receivable portfolio, customer-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 customers’

abilities to pay.

December 31, 2024, and December 31, 2023 the Company established a reserve for credit losses of approximately $ 1,613,000

and $ 2,494,000 ,

respectively.

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

Accounts receivable, net was $ 3,068,000 ,

and $ 3,994,000 for December 31, 2024, and December 31, 2023, respectively.

Concentration

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and 30 % of our trade accounts receivable balance.

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

on notes as notes receivable, which are then offset by the amount of any related unearned interest income.

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

notes as notes receivable, which are then offset by the amount of any related unearned interest income.

For financial statement purposes,

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

For Loans And Lease Losses - On January 1, 2022, the Company adopted amended accounting guidance “ ASU No.2016-13 –

Credit Losses” which requires an allowance for credit losses to be deducted from the amortized cost basis of financial assets

to present the net carrying value at the amount that is expected to be collected over the contractual term of the asset considering relevant

information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported

In estimating expected losses in the loan and lease portfolio, borrower-specific financial data and macro-economic assumptions

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

Prior to 2022, the allowance for credit losses represented the amount that in management’s judgment

reflected incurred credit losses inherent in the loan and lease portfolio as of the balance sheet date.

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

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

For equity securities without a readily determinable

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

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

For Loans And Lease 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 and lease 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 obligations.

After the forecast period, the Company utilizes longer-term historical loss experience

to estimate losses over the remaining contractual life of the loans.

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

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

For equity securities without a readily determinable fair

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

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

For equity method investments, the Company regularly

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See Note 9 for further discussion on investments.

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

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

The Fair Value Measurement

Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes

a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value.

The hierarchy gives the highest priority

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

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

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

The Fair Value Measurement Topic

of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a

three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value.

The hierarchy gives the highest priority to

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

inputs (Level 3 measurements).

These tiers include:

● Level 1, defined as observable

inputs such as quoted prices for identical instruments in active markets.

● Level 2, defined as inputs other

than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments

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

● Level 3, defined as unobservable

inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived

from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The carrying amounts

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

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

Marketable securities

classify as a Level 1 fair value financial instrument.

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

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

The fair value of revolving credit lines notes payable and

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

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

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

and health and beauty products which and are stated at the lower of cost or net realizable value on the first-in, first-out

(“FIFO”) method.

Packaging work-in-process and finished goods included the cost of materials, direct labor and overhead.

At the closing of each reporting period, the Company evaluates its inventory in order to adjust

the inventory balance for obsolete and slow-moving items.

An allowance for obsolescence of approximately $ 18,000 and

$ 57,000 associated

with the inventory at our Premier subsidiary for December 31, 2023 and 2022, respectively.

Also, SHRG had an allowance for

obsolescence of approximately $ 685,000 at December 31, 2022.

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

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

securities classify as a Level 1 fair value financial instrument.

The fair value of notes receivable approximates their carrying value

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

The fair value of revolving credit lines notes

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

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

– Inventories consist primarily of paper,

pre-printed security paper, paperboard, fully prepared packaging, air filtration systems, and health and beauty products which and are

stated at the lower of cost or net realizable value on the first-in, first-out (“FIFO”) method.

Packaging work-in-process

and finished goods included the cost of materials, direct labor and overhead.

At the closing of each reporting period, the Company evaluates

its inventory in order to adjust the inventory balance for obsolete and slow-moving items.

An allowance for obsolescence of approximately

associated with the inventory at our Premier

subsidiary for December 31, 2024 and 2023, respectively.

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

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or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

in real estate, net – Acquisition of assets are recorded at their relative fair value based on total accumulated

costs of the acquisition.

in real estate, net – Acquisition of assets are recorded at their relative fair value based on total accumulated costs

of the acquisition.

Direct acquisition-related costs are capitalized as a component of the acquired assets.

This includes all costs

related to finding, analyzing and negotiating a transaction.

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).

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

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

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is computed using the straight-line method over the estimated useful lives of the assets.

During 2023, the land and buildings related to AMRE LifeCare and AMRE Winter Haven were reclassified to Assets held for sale.

- ASC 842 requires recognition of leases on the consolidated balance sheets as right-of-use (“ROU”) assets

and lease liabilities.

ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities

represent the Company’s obligation to make lease payments arising from the leases.

Operating lease ROU assets and operating lease

liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date.

the Company’s leases do not provide an implicit rate, the Company used its estimated incremental borrowing rate based on the information

available at commencement date in determining the present value of lease payments.

A number of the lease agreements contain options to

renew and options to terminate the leases early.

The lease term used to calculate ROU assets and lease liabilities only includes renewal

and termination options that are deemed reasonably certain to be exercised.

The Company recognized

lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing operating leases longer

than twelve months..

Operating lease cost is recognized as a single lease cost on a straight-line

basis over the lease term and is recorded in selling, general and administrative expenses.

During 2023, the land and buildings related

to AMRE Shelton, AMRE LifeCare and AMRE Winter Haven were reclassified to Assets held for sale.

During 2024, the land and buildings related to AMRE Shelton, was reclassified to Assets held for sale.

- ASC 842 requires recognition of leases on the consolidated balance sheets as right-of-use (“ROU”) assets and lease

ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent

the Company’s obligation to make lease payments arising from the leases.

Operating lease ROU assets and operating lease liabilities

are recognized based on the present value and future minimum lease payments over the lease term at commencement date.

As the Company’s

leases do not provide an implicit rate, the Company used its estimated incremental borrowing rate based on the information available

at commencement date in determining the present value of lease payments.

A number of the lease agreements contain options to renew and

options to terminate the leases early.

The lease term used to calculate ROU assets and lease liabilities only includes renewal and termination

options that are deemed reasonably certain to be exercised.

Company recognized lease liabilities, with corresponding ROU assets, based on the present value of unpaid lease payments for existing

operating leases longer than twelve months.

Operating lease cost is recognized as a single lease cost on a straight-line basis over

the lease term and is recorded in selling, general and administrative expenses.

Variable lease payments for common area maintenance,

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and non-lease components for all property leases for the purposes of calculating ROU assets and lease liabilities.

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

and tests the recoverability of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be

If a change in circumstance occurs, the Company performs a test of recoverability by comparing the carrying value of the

asset or asset group to its undiscounted expected future cash flows.

If cash flows cannot be separately and independently identified

for a single asset, the Company will determine whether impairment has occurred for the group of assets for which the Company can identify

the projected cash flows.

If the carrying values are in excess of undiscounted expected future cash flows, the Company measures any impairment

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

for sale – The Company has several buildings and

the associated land they occupy for sale as of December 31, 2023.

These consist of primarily of retail space in Lindon, Utah approximating

$ 5,593,000 and the medical facilities associated with AMRE LifeCare of approximately $ 41,541,000 and AMRE Winter Haven of approximately

$ 4,396,000 , and $ 65,000 of other assets

– 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.

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

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.

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, 2023, and no impairment

was deemed necessary for the goodwill associated with Premier Packaging Company, and Impact BioMedical of $ 1,769,000 and $ 25,093,000 ,

respectively.

The goodwill for APB, and Sentinel Co.

of approximately

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

tests the recoverability of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable.

If a change in circumstance occurs, the Company performs a test of recoverability by comparing the carrying value of the asset or asset

group to its undiscounted expected future cash flows.

If cash flows cannot be separately and independently identified for a single asset,

the Company will determine whether impairment has occurred for the group of assets for which the Company can identify the projected cash

If the carrying values are in excess of undiscounted expected future cash flows, the Company measures any impairment by comparing

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

held for sale – The Company has several buildings and associated land for sale as of December 31, 2023.

These consist of primarily of retail space in Lindon, Utah approximating $ 5,593,000 and the medical facilities associated with AMRE LifeCare

of approximately $ 41,541,000 and AMRE Winter Haven of approximately $ 4,396,000 , and $ 65,000 of other assets.

As of December 31, 2024, the balance associated with AMRE LifeCare

was approximately $ 34,450,000 , AMRE Shelton was approximately $ 6,313,000 and AMRE Winter Haven was approximately $ 4,396,000 .

ASC 360 allows assets

held-for-sale to retain that classification if it does not sell within one year.

Each of the following facilities has been held-for-sale

for greater than one year and meet the requirements of ASC 360.

AMRE LifeCare has facilities in Plano, Tx., Fort Worth, Tx., and Pittsburgh,

The Plano facility was under contract at December 31, 2024 and the sale was finalized in March 2025.

The Forth Worth facility incurred

unforeseen damage to the property during 2024 that requires several repairs to be performed.

The facility is currently marketed to sale

The Pittsburgh facility was at 50% capacity through the majority of 2024 which made selling the facility difficult.

A tenant was found during the second half of 2024 and with the building at full capacity, it is expected to be under contract during

AMRE Winter Haven which has a facility in Winter Haven, Fla.

has generated significant interest and prospective buyers have requested

that tenants’ leases, which are short-term in nature, be extended.

The Company is currently negotiating long-term leases with the

existing tenants and the property is expected to be under contract in 2025.

– 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.

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

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, 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 .

goodwill for APF, and Sentinel Co.

of approximately $ 29,744,000 ,

and $ 1,234,000

respectively, were deemed impaired and written

off at December 31, 2023.

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

benefits such as earnings and cash flows.

Acquired identifiable intangible assets are recorded at fair value and are amortized over

their estimated useful lives.

Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment

at least annually or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets

are below their estimated fair values.

respectively,

were deemed impaired and written off at December 31, 2023.

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

as earnings and cash flows.

Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated

useful lives.

Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually

or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets are below their estimated

Impairment is tested under ASC 350.

At December 31, 2023, The Company impaired approximately

$ 7,418,000 associated with intangible assets for AMRE Lifecare and AMRE Winter Haven.

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

accepted by the customer.

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

or service provided.

At December 31, 2023, The Company impaired approximately $ 7,418,000 associated with

intangible assets for AMRE Lifecare and AMRE Winter Haven.

There was no impairment of intangible assets deemed necessary for 2024.

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

by the customer.

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

service provided.

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

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marketing line of business primarily through internet sales and recognizes revenue as items are shipped.

As of December 31,

2023, 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 - Costs of revenue includes all direct cost of the Company’s packaging, commercial and security

printing sales, primarily, paper, inks, dies, and other consumables, and direct labor, transportation, amortization, deprecation, and

manufacturing facility costs.

In addition, 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 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.

of December 31, 2024 and 2023, 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

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 - Costs of revenue includes all direct cost of the Company’s packaging, commercial and security printing

sales, primarily, paper, inks, dies, and other consumables, and direct labor, transportation, amortization, deprecation, and manufacturing

facility costs.

In addition, 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 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,

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charged to customers pertaining to these costs are reflected as revenue.

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.

The Company uses the Black-Scholes-Merton option pricing model for determining

the estimated fair value for stock-based awards.

The Black-Scholes-Merton model requires the use of subjective assumptions which determine

the fair value of stock-based awards, including the option’s expected term and the price volatility of the underlying stock.

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 complete.

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.

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.

The Company uses the Black-Scholes-Merton option pricing

model for determining the estimated fair value for stock-based awards.

The Black-Scholes-Merton model requires the use of subjective

assumptions which determine the fair value of stock-based awards, including the option’s expected term and the price

volatility of the underlying stock.

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 complete.

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.

The Company record stock based compensation expense of approximately $ 19,000 for the year ended December 31, 2024 and is included in Sales, general and administrative compensation (inclusive of stock based compensation) on the accompanying Statement of Operations.

There were no stock-based payments made during the twelve months ended December 31, 2023.

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

A significant portion of the Company’s sales commissions expense is generated from its direct marketing line of business.

commissions are based on current month shipments and are paid one month in arrears.

There were no sales commissions capitalized as of

December 31, 2023.

Legal Expenses - Contingent legal fees are expensed in the consolidated statements of operations in the period

that the related revenues are recognized.

In instances where there are no recoveries from potential infringers, no contingent legal fees

however, the Company may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services

agreement that will be paid out from the proceeds from settlements or licenses that arise pursuant to an enforcement action, which will

be expensed as legal fees in the period in which the payment of such fees is probable.

Any unamortized patent acquisition costs will

be expensed in the period a conclusion is reached in an enforcement action that does not yield future royalties potential.

These commissions are based on current month shipments and are paid one month in arrears.

There were no

sales commissions capitalized as of December 31, 2024 or 2023.

Legal Expenses - Contingent legal fees are expensed in the consolidated statements of operations in the period that the

related revenues are recognized.

In instances where there are no recoveries from potential infringers, no contingent legal fees are paid;

however, the Company may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services agreement

that will be paid out from the proceeds from settlements or licenses that arise pursuant to an enforcement action, which will be expensed

as legal fees in the period in which the payment of such fees is probable.

Any unamortized patent acquisition costs will be expensed

in the period a conclusion is reached in an enforcement action that does not yield future royalties potential.

and Development - Research and development costs are expensed as incurred.

Research and development costs consist primarily

of third-party research costs and consulting costs.

Research and development costs consist primarily of

third-party research costs and consulting costs.

The Company recognized costs of approximately $ 278,000 and $ 1,685,000 in 2024 and

2023, respectively.

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

and for the estimated future tax effect attributable to temporary differences and carry-forwards.

Measurement of deferred income items

is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits

not expected to be realized.

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

the estimated future tax effect attributable to temporary differences and carry-forwards.

Measurement of deferred income items is based

on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not

expected to be realized.

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

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

Basic (loss) earnings per share

reflect the actual weighted average of shares issued and outstanding during the period.

Diluted (loss) earnings per share are

computed including the number of additional shares from outstanding warrants, stock options and preferred stock that would have been

outstanding if dilutive potential shares had been issued and is calculated utilizing the treasury stock method.

In a loss period,

the calculation for basic and diluted (loss) earnings per share is the same, as the impact of potential common shares is

anti-dilutive.

For the year ended December 31, 2022 potential dilutive instruments include both warrants and options of 5,000 shares.

the year-ended December 31, 2023, potential dilutive instruments was 0 .

Per Common Share - The Company presents basic

and diluted (loss) earnings per share.

Basic (loss) earnings per share reflect the actual weighted average of shares issued and outstanding

during the period.

Diluted (loss) earnings per share are computed including the number of additional shares from outstanding warrants,

stock options and preferred stock that would have been outstanding if dilutive potential shares had been issued and is calculated utilizing

the treasury stock method.

In a loss period, the calculation for basic and diluted (loss) earnings per share is the same, as the impact

of potential common shares is anti-dilutive.

For the year ended December 31, 2024 and 2023, there were no potential dilutive instruments

issued and outstanding.

Operations - On May 4, 2023, the Company distributed approximately 280 million shares of Sharing Service Global Corporation (“SHRG”),

beneficially held by the Company, in the form of a dividend to the shareholders of the Company’s common stock.

Upon completion

of this distribution, the Company retained an ownership interest in SHRG of approximately 7 %.

Effective May 1, 2023, SHRG was deconsolidated

from the consolidated financial statements (the “Deconsolidation”).

The consolidated statement of operations does not include

SHRG activity after April 30, 2023 and the assets and liabilities of SHRG are no longer included within the Company’s consolidated

balance sheet.

The deconsolidation of SHRG is a strategic shift, as a significant portion of the Direct Marketing line of business was

While the Decentralized Sharing Systems part of the business will continue to provide these services, SHRG was a significant

portion of this segment as it made up approximately 47 % and 20 %, respectively, of the total DSS revenue in 2022 and 2023.

the Company has applied discontinued operations treatment for this deconsolidation as required by Accounting Standards Codification 205—Discontinued

The major classes of assets and liabilities of SHRG are classified as Discontinued Operations on the Consolidated Balance

Sheets and the operating results of the discontinued operations is reflected on the Consolidated Statements of Operations as Loss from

Discontinued Operations.

- 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 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.

1 unchanged sentence

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

Acquisition of assets

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

Direct acquisition-related costs are expensed

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.

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

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

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.

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.

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

7 unchanged sentences

While the Company has approximately $ 11.4 million in cash, the Company has incurred

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

from its $ 6.6 million

in cash as of December 31, 2023, the Company believes it can continue as a going concern, due to its ability to generate operating

cash through the sale of its $ 10.0 million

of Marketable Securities, and the anticipated receipts of principal and interest on its Notes receivable of approximately $ 8.8 million

through December 31, 2024.

The Company has also taken steps to sell its real estate holdings in Utah, Texas, Pennsylvania, and

These properties approximate $ 51.6

million in assets and are identified on the accompanying balance sheet as Held for sale.

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.

Although there are no assurances, we believe the above would allow us to fund our nine business lines current and planned operations

for the twelve months from the filing date of this Annual Report.

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

its ability to continue as a going concern has been alleviated.

Inventory consisted

of the following as of December 31:

Schedule of Inventory

operating losses as well as negative cash flows from operating activities over the past two years.

Aside from its $ 11.4

million in cash as of December 31, 2024, the Company believes it can continue as a going concern, due to its ability to generate operating

cash through the sale of its $ 9.2 million of Marketable Securities.

Between March 24, 2025 and March 27, 2025, the Company sold a shares

of Impact BioMedical, a subsidiary, for approximately $ 1,969,000 .

Further, the Company has approximately 1,052,000 shares of Impact BioMedical

shares available to sell.

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.

Although there are no assurances, we believe the above would allow us to fund

our nine business lines current and planned operations for the twelve months from the filing date of this Annual Report.

Based on this,

the Company has concluded that substantial doubt of its ability to continue as a going concern has been alleviated.

Accounting Standards - The Financial Accounting Standards Board (FASB) issues various Accounting Standards Updates relating to

the treatment and recording of certain accounting transactions.

There are several new accounting pronouncements issued by FASB which

are not yet effective.

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

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.

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 for which financial statements have not yet been issued.

The Company is currently evaluating this ASU, but does not expect it to have material impact to its financial statements.

November 2024, the FASB issued ASU No.

2024-03 (“ASU 2024-03”), Disaggregation of Income Statement Expenses (“DISE”) .

2024-03 requires disaggregated disclosure of income statement expenses for public business entities.

ASU 2024-03 does

not change the expense captions an entity presents on the face of the income statement;

rather, it requires disaggregation of certain

expense captions into specified categories in disclosures within the footnotes to the financial statements.

As revised by ASU No.

Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, the provisions of ASU 2024-03 are

effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027,

with early adoption permitted.

With the exception of expanding disclosures to include more granular income statement expense categories,

we do not expect the adoption of ASU 2024-03 to have a material effect on our consolidated financial statements taken as a

consisted of the following as of December 31:

Finished Goods

5 unchanged sentences

Notes Receivable

On May 14, 2021,

DSS Pure Air, Inc.

a subsidiary of the Company entered a convertible promissory note (“Note 1”) with Borrower 1, a company

registered in the state of Texas.

Note 1 has an aggregate principal balance up to $ 5,000,000 , to be funded at the request of Borrower

Note 1, which incurs interest at a rate of 6.65 % due quarterly, has a maturity date of May 1, 2023 .

Note 1 contains an optional conversion

clause that allows the Company to convert all, or a portion of all, into newly issued member units of Borrower 1 with the maximum principal

amount equal to 18% of the total equity position of Borrower 1 at conversion .

The outstanding principal and interest as of December 31,

2023, and December 31, 2022, approximated $ 5,544,000 and $ 5,420,000 , respectively, which is included in current notes receivable on the

accompanying consolidated balance sheet.

As of December 31, 2023, the Company has a reserve of $ 2,772,000 against the principal and interest

This note is currently in default and its terms are currently being re-negotiated.

On September 23,

2021, APB entered into refunding bond anticipatory note (“Note 2”) with Borrower 2, which operates as a conservation and

reclamation district pursuant to Chapter 3891, Texas Special District Local Laws Code ;

Chapter 375, Texas Local Government Code;

Chapter 49, Texas Water Code.

The District Note was in the sum of $ 3,500,000 and incurs interest at a rate of 5.59 % per annum.

and interest are due in full on September 22, 2022 , and later amended to extend the maturity date to September 19, 2024 .

This note may

be redeemed prior to maturity with 10 days written notice to APB at a price equal to principal plus interest accrued on the redemption

The outstanding principal and interest of $ 3,910,000 and $ 3,701,000 is included in the current portion of notes receivable on the

consolidated balance sheet at December 31, 2023 and December 31, 2022, respectively.

On October 25, 2021,

APB entered into a loan agreement (“Note 3”) with Borrower 3, 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 Borrower 3, with an option to increase the maximum principal

borrowing to $ 3,000,000 .

Note 3, which incurs interest at a rate of 8.0 % with principal and interest due at the maturity date of October

This note contains an optional conversion feature allowing APB to convert the outstanding principal to a 10% membership interest.

APB, as holder of Note 3, 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 was reserved for fully as of December 31, 2022.

On May 14, 2021,

APB extended the credit (“Note 4”) to an individual (“Borrower 4”) in the form of two promissory notes for $ 250,000

and $ 10,000 respectively, bearing interest at 12.5 %, with a maturity date of May 15, 2023 .

This promissory note was secured by a deed

of trust on a tract of land, which is approximately 315 acres, and located in Coke County, Texas.

The outstanding principal and interest

for both notes were paid in full during the third quarter of 2023.

$ 252,000 and $ 9,000 are included in Note receivable at December 31,

On October 27, 2021,

HWH World, Inc., a subsidiary of the Company entered a revolving loan commitment (“Note 5”) with Borrower 5, a company registered

The outstanding principal and interest at December 31, 2023 and December 31, 2022 is $ 0 and $ 63,000 , respectively, and was

included in Notes receivable current portion.

This note has been written-off during the third quarter 2023.

On December 28, 2021,

APB entered into a promissory note (“Note 6”) with Borrower 6, a company registered in the state of California.

a principal balance of $ 700,000 .

Note 6, which incurs interest at a rate of 12.0 % with principal and interest due at the maturity date

of December 28, 2022 .

May 14, 2021, DSS Pure Air, Inc.

a subsidiary of the Company entered a convertible promissory note (“Note 1”) with

Puradigm, Inc.

(“Puradigm”), a company registered in the state of Texas.

Note 1 has an aggregate principal balance up to

$ 5,000,000 ,

to be funded at the request of Puradigm.

Note 1, which incurs interest at a rate of 6.65 %

due quarterly, has a maturity date of May 1, 2023.

1 contains an optional conversion clause that allows the Company to convert all, or a portion of all, into newly issued member units

of Puradigm with the maximum principal amount equal to 18% of the total equity position of Puradigm at conversion.

outstanding principal and interest as of December 31, 2024 and December 31, 2023, approximated $ 5,544,000 As

of December 31, 2024 and December 31, 2023, the Company has a reserve of $ 5,544,000 and

$ 2,772,000 ,

respectively, against the principal and interest outstanding.

September 23, 2021, APB entered into refunding bond anticipatory note (“Note 2”) with Southeast Regional Management

District (“SERMD”), which operates as a conservation and reclamation district pursuant to Chapter 3891, Texas Special

District Local Laws Code, Chapter 375, Texas Local Government Code;

and Chapter 49, Texas Water Code.

The District Note was in the

sum of $ 3,500,000

and incurs interest at a rate of 5.59 %

Principal and interest are due in full on September 22, 2022, and later amended to extend the maturity date to September

The outstanding principal and interest of $ 3,910,000

was included in the current portion of notes receivable on the consolidated balance sheet at December 31, 2023.

Note 2 was repaid in

full during March 2024.

October 25, 2021, APF entered into a loan agreement (“Note 3”) 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 3, 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 3, 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 was reserved for fully as of December 31, 2022.

On December 28, 2021, APF entered

into a promissory note (“Note 4”) with WestPark Capital Group, LLC.

(“WestPark”), a company registered in the

state of California.

Note 4 has a principal balance of $ 700,000 .

Note 4, which incurs interest at a rate of 12.0 % with principal and interest

due at the maturity date of December 28, 2022 .

On December 29, 2022, the maturity date of this note was extended to May 31, 2023 .

On November 27, 2023, the parties to Note 6 agreed to modify the payment terms of the note to be monthly payments

of $ 50,000 until the outstanding principal and interest are paid in full.

The outstanding principal and

interest of $ 253,000 and $ 701,000 is included in the Current portion of notes receivable on the consolidated balance sheet at December

31, 2023 and December 31, 2022, respectively.

On January 24, 2022,

APB and Borrower 7 entered into a promissory note (“Note 7”) 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, 2023 and December 31, 2022 approximates $ 103,000

and $ 106,000 , respectively, and is included in Notes receivable on the accompanying consolidate balance sheet.

On March 2, 2022,

APB and Borrower 8, a corporation organized under the laws of the Republic of Korea entered into a promissory note (“Note 8”).

Under the terms of Note 8, APB at its discretion, may lend up to the principal sum of $ 893,000 with an interest rate of 8 %, and matures

in March 2024 , with interest payable quarterly.

The outstanding principal and interest at December 31, 2023 is $ 446,000 , net of $ 3,500

of unamortized origination fees.

The outstanding principal and interest at December 31, 2022 is $ 874,000 net of $ 25,000 of unamortized

origination fees.

APB and Borrower 8 are currently negotiating an extension of the maturity date of this note.

On May 9, 2022,

DSS PureAir and Borrower 9 entered into a promissory note (“Note 9”) in the principal sum of $ 210,000

27, 2023, the parties to Note 4 agreed to modify the payment terms of the note to be monthly payments of $ 50,000 until the outstanding

principal and interest are paid in full.

The outstanding principal and interest was paid in full as of September 30, 2024.

31, 2023 outstanding principal and interest of $ 253,000 is included in the Current portion of notes receivable on the consolidated balance

On January 24, 2022, APF and

an individual entered into a promissory note (“Note 5”) in the principal sum of $ 100,000

with interest of 6 %,

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

unpaid principal and interest are due on February

due annually, and maturing in January

The outstanding principal and interest at December 31, 2023 approximates $ 103,000 and

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

Note 5 was paid in full during

October 2024.

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

On 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

Under the terms of Note 6, 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 , with interest payable quarterly.

The outstanding principal and interest at December 31, 2024 and

December 31, 2023 is $ 468,000 and $ 446,000 , respectively.

The Company placed a reserve in the amount of $ 234,000 against this note.

note has been extended to March 2025.

On May 9, 2022, DSS PureAir and

Puradigm entered into a promissory note (“Note 7”) 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.

All unpaid principal and interest

are due on February 9, 2023 .

This loan is currently in default and terms are currently being re-negotiated.

The outstanding principal and

interest at December 31, 2023 approximates $ 224,000

of which $ 112,000 has been reserved for and is included in current portions of notes receivable on the accompanying consolidate

The outstanding principal

and interest at December 31, 2024 and December 31, 2023 approximates $ 224,000 of which $ 145,000 and $ 112,000 has been reserved for as of

December 31, 2024 and December 31, 2023, respectively, and is included in Current portions of notes receivable on the accompanying consolidate

balance sheet.

The outstanding principal and interest at December 31, 2022 approximates $ 213,000

and is included in current portions of notes receivable on the accompanying consolidate balance sheet.

8, related party

On August 29,

2022, DSS Financial Management Inc and Borrower 10, a related party, entered into a promissory note (“Note 10”) in the principal sum of

with interest of 8 %,

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

All unpaid principal and interest is due on August

The outstanding principal and interest at December 31, 2023 and December 31, 2022 approximates $ 100,000 ,

and $ 100,000 ,

respectively, and is included in Notes receivable on the accompanying consolidate balance sheet, of which $ 76,000

is included in the Current portion of notes receivable and $ 24,000

is included in the long-term portion of notes receivable at December 31, 2023.

DSS owns 24.9 % of the outstanding common shares of Borrower 10.

On 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 installments beginning on September 14, 2022.

All unpaid principal

and interest is due on August 29, 2025 .

The outstanding principal and interest at December 31, 2024 approximated $ 86,000 , and was fully

reserved for as of December 31, 2024.

At December 31, 2023, the balance approximated $ 100,000 of which $ 76,000 is included in the Current

portion of notes receivable and $ 24,000 is included in the long-term portion of notes receivable.

DSS owns 24.9 % of the outstanding common

shares of BMIC.

9, related party

On July 26, 2022,

APB and Borrower 11 entered into a promissory note (“Note 11”) in the principal sum of $ 1,000,000 with interest of 8 %.

unpaid principal and interest due on July 26, 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.

outstanding principal and interest at December 31, 2022 approximates $ 924,000 , net of $ 66,000 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 Borrower 11.

On 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 .

The outstanding principal and interest

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

At December 31, 2023 approximates $ 107,000

with approximately $ 53,000 of principal and accrued interest classified as Current portion notes receivable, and the remaining balance

of approximately $ 54,000 is recorded as notes receivable, on the accompanying consolidated balance sheet.

DSS owns 24.9 % of the outstanding

common shares of BMIC.

10, related party

2022, DSS and Borrower 12, entered into a convertible promissory note (“Note 12”) in the principal sum of $ 27,000,000

On July 26, 2022, APF and

(“VEII”) entered into a promissory note (“Note 10”) in the principal sum of $ 1,000,000

with interest of 8 %

with an optional conversion into shares of Borrower 12 at a conversion price of $ 0.03 ,

maturing on June

14, 2024 , with interest due quarterly.

In December 2022, this note was fully reserved for.

On August 31, 2023, the full value

of the outstanding principal and interest of this note was exchanged for 26,000

shares of Series D Preferred Stock with a par value of $ 0.0001

Beginning on September 1, 2028, these Series D Preferred Shares may be redeemed in the amount of $ 1,000

Due to the lack of liquidity of these shares, the Company has placed no value on these shares.

Heng Fai Ambrose Chan, the Chairman of DSS, Inc is also the Chairman of

with all unpaid principal and interest due on July

This note was amended so that all unpaid principal and interest is due July 26, 2025.

The outstanding principal and

interest on September 30, 2024 approximates $ 959,000 ,

and is included in notes receivable on the accompanying consolidate balance sheet.

Approximately $ 959,000

of this note was reserved for as of December 31, 2024.

The outstanding principal and interest on December 31, 2023, approximates

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.

On February 19, 2021, Impact BioMedical,

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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, 2024.

This note is secured by certain real property situated in Collier

County, Florida.

The outstanding principal and interest as of December 31, 2023, approximately $ 203,000 and is classified in current

notes receivable on the accompanying consolidated balance sheets.

The outstanding principal and interest as of December 31, 2022 is approximately

$ 206,000 with $ 16,000 classified in Current portion of notes receivable and $ 190,000 classified as Notes receivable on the accompanying

consolidated balance sheets.

The due date of this loan is currently being re-negotiated.

On May 8, 2023, DSS

Financial Management Inc and Borrower 14 entered into a promissory note (“Note 14”) in the principal sum of $ 102,000 with

interest at the prime rate plus 2 % ( 10.5 % at December 31, 2023) with a maturity date of May 7, 2026 .

The outstanding principal and interest

at December 31, 2023 approximates $ 107,000 with approximately $ 53,000 of principal and accrued interest classified as Current portion

notes receivable, and the remaining balance of approximately $ 54,000 is recorded as notes receivable, on the accompanying consolidated

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,

The outstanding principal and

interest as of December 31, 2024 and December 31, 2023, was approximately $ 201,000 and $ 203,000 , respectively.

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.

On June 27, 2023,

DSS and Borrower 15 entered into a convertible promissory note (“Note 15”) in the principal sum of $ 1,400,000 with

a discount of $ 300,000 and interest rate of 10 % and maturity date of September 1, 2024 .

The outstanding principal, interest, and associated

discount was fully reserved for as of December 31, 2023.

On March 31,2023,

DSS Biohealth Security, Inc and Borrower 16 entered into a promissory note (“Note 16”) in the principal sum of $ 140,000 and

interest rate floating daily to Wall Street Journal Prime rate per annum ( 8.5 % at September 31, 2023) with the total outstanding principal

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

The outstanding principal and interest as of December 31, 2023 of approximately $ 203,000 is classified in Current notes

receivable on the accompanying consolidated balance sheets.

On June 27, 2023, Decentralized

Sharing Systems, Inc.

and Stemtech Corporation (“Stemtech”) entered into a convertible promissory note (“Note 12”)

in the principal sum of $ 1,400,000 with a discount of $ 300,000 and interest rate of 10 % and maturity date of September 1, 2024 .

The outstanding

principal, interest, and associated discount was fully reserved for as of December 31, 2024 and 2023.

On March 31,2023, DSS Biohealth

Security, Inc and an individual entered into a promissory note (“Note 13”) in the principal sum of $ 140,000 and interest rate

floating daily to Wall Street Journal Prime rate per annum ( 8.5 % at December 31, 2023) with the total outstanding principal and interest

due at the maturity date of March 31, 2025 .

The outstanding principal and interest at December 31, 2023 approximates $ 133,000 .

Of the total financed, approximately $ 99,000 of principal and accrued interest is classified as Current portion of notes receivable and

the remaining balance of approximately $ 34,000 is recorded as Notes receivable on the accompanying consolidated balance sheet.

On September 28,

2023, APB and Borrower 17 entered into a promissory note (“Note 17”) in the principal sum of $ 400,000 with interest of 5 %.

All unpaid principal and interest due on November 12, 2023 .

As of December 31, 2023, this loan has been paid off in full.

On August 11, 2022,

APB and Borrower 18 entered into a promissory note (“Note 18”) in the principal sum of $ 1,430,000 with interest of 8 %.

unpaid principal and interest due on August 12, 2024 .

The outstanding principal and interest on December 31, 2023, approximates $ 1,102,000 ,

net of $ 375,000 of unamortized origination fees and is included in Notes receivable on the accompanying consolidate balance sheet.

outstanding principal, interest, and associated fees were fully reserved for as of December 31, 2023.

total financed, approximately $ 99,000 of principal and accrued interest is classified as Current portion of notes receivable and the remaining

balance of approximately $ 34,000 is recorded as Notes receivable on the accompanying consolidated balance sheet at December 31, 2023.

As of December 31, 2024, the outstanding balance sheet approximating $ 135,000 was fully reserved for.

On August 29, 2024, APF entered into a promissory note (“Note 14”)

with WestPark.

Note 14 has a principal balance of $ 459,000 .

Note 14, which incurs interest at a rate of 10.0 % with principal and interest

due at the maturity date of April 27, 2026 .

On November 1, 2024, monthly payments of approximately $ 28,000 are due with any unpaid interest

and principal due at maturity.

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 Notes receivable on the accompanying consolidated

balance sheet.

Provision for Credit Losses

January 1, 2022, the Company adopted amended accounting guidance “ ASU

No.2016-13 – Credit Losses” for the measurement of credit losses on financial instruments and other financial

That guidance requires an allowance for credit losses to be deducted from the amortized cost basis of financial assets to

present the net carrying value that is expected to be collected over the contractual term of the assets considering relevant

information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the

reported amount.

The guidance replaced the previous incurred loss model for determining the allowance for credit losses.

Accounts receivable are stated

at the amount owed by the customer.

The Company maintains an allowance for credit losses for accounts receivable and unbilled receivables,

based on expected credit losses resulting from the inability of our customers to make required payments.

The allowance for credit losses

is estimated based on historical experience, current economic conditions and the creditworthiness of customers.

Receivables are charged

to the allowance when determined to be no longer collectible.

The Company regularly monitors and assesses its risk of not collecting amounts

owed by customers and records its allowance for credit losses based on the results of this analysis.

As of December 31,

2023, 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

We analyzed the loan

loss reserve from three basis:

ASC Topic 326 for the measurement of credit losses on financial instruments and other

financial assets.

That guidance requires an allowance for credit losses to be deducted from the amortized cost basis of financial

assets to present the net carrying value that is expected to be collected over the contractual term of the assets considering

relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability

of the reported amount.

The guidance replaced the previous incurred loss model for determining the allowance for credit

receivable are stated at the amount owed by the customer.

The Company maintains an allowance for credit losses for accounts receivable

and unbilled receivables, based on expected credit losses resulting from the inability of our customers to make required payments.

allowance for credit losses is estimated based on historical experience, current economic conditions and the creditworthiness of customers.

Receivables are charged to the allowance when determined to be no longer collectible.

The Company regularly monitors and assesses its

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

of 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.

analyzed the loan loss reserve from three basis:

general loan portfolio reserves;

industry portfolio reserves, and specific loan loss reserves.

year-ended December 31, 2023 and December 2022, the Company recorded a Loan loss reserve of approximately $ 4,933,000 and $ 1,041,000 ,

respectively.

Loan Portfolio Reserve - Based upon a relatively young loan portfolio that are relatively new loans to generally credit

worthy borrowers, we do not believe that a substantial general loan portfolio reserve is due at this time.

However, we do recognize

that some inherent risks are in all loan portfolios, thus we recorded a general contingent portfolio reserve of $ 194,000

for December 31, 2023 and $ 145,000 for December 31, 2022 or approximately ¼ of 1% of the loan portfolio loan balance.

industry portfolio reserves, and specific loan loss

As of year-ended December 31, 2024 and December 2023, the Company recorded a Loan loss reserve of approximately $ 9,406,000

and $ 4,933,000 , respectively.

Loan Portfolio Reserve - Based upon a relatively young loan portfolio that are relatively new loans to generally credit worthy borrowers,

we do not believe that a substantial general loan portfolio reserve is due at this time.

However, we do recognize that some inherent

risks are in all loan portfolios, thus we recorded a general contingent portfolio reserve of $ 196,000 for December 31, 2024 and $ 194,000

for December 31, 2023 or approximately ¼ of 1% of the loan portfolio loan balance.

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

1 unchanged sentence

Accordingly, we have not recorded a discretionary reserve as of December 31, 2024 and December 31,

Loan Reserves - Previously, we had identified credit weaknesses and borrower repayment weakness in the Borrower 4 loan, which

has a current principal and interest balance of $ 884,000 .

As of December 31, 2023 and December 31, 2022 we have recorded a specific loan

loss reserve for the full balance due the Company.

As of December 31, 2023, the Company identified credit weakness in borrower 2 and

has placed a reserve approximating $ 2,884,000 against the outstanding principal and interest.

As of December 31, 2023, the Company identified

credit weakness in borrower 16 and placed a reserve of $ 1,046,000 against the outstanding principal and interest.

The Company identified

credit weakness in Borrower 19 and has placed a reserve of $ 1,102,000 against the outstanding principal and interest.

The following table identifies the loan

loss reserve for the period ending December 31, :

Schedule of Loan Loss Reserve

Loan Reserves - P reviously, 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 and December 31, 2023.

The Company had also previously identified credit weakness in Puradigm and has placed a reserve approximating

$ 5,544,000 and $ 2,884,000 against the outstanding principal and interest as of December 31, 2024 and 2023, respectively.

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 and 2023.

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.

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.

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.

No additional reserves were deemed necessary as of December

following table identifies the loan loss reserve for the period ending December 31:

of Loan Loss Reserve

General Loan Portfolio Reserve

Specific Loan Reserves

in the allowance for doubtful accounts and loan loss reserve were as follows:

in the allowance for credit losses and loan loss reserve were as follows:

of Allowance for Doubtful Accounts and Loan Loss Reserve

Allowance for credit losses

Loan loss reserve

Balance at January 1, 2022

Adoption of CECL

Bad debt expense

Allowance for

credit losses

Balance at December 31, 2022

Bad debt expense

Credit loss expense

( 1,037,000 )

1 unchanged sentence

Balance at December 31, 2023

Credit loss expense

Balance at December 31, 2024

FINANCIAL INSTRUMENTS

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Cash Equivalents and Marketable Securities

The following tables show the Company’s

cash and marketable securities by significant investment category as of December 31:

Schedule of Cash and Marketable Securities by Significant Investment Category

Unrealized Gain/Loss

Cash And Cash Equivalents

Marketable Securities

following tables show the Company’s cash and marketable securities by significant investment category as of December 31:

of Cash and Marketable Securities by Significant Investment Category

Money Market Funds

2 unchanged sentences

$ ( 16,722,000 )

Cash And Cash Equivalents

Marketable Securities

Money Market Funds

1 unchanged sentence

( 17,325,000 )

Convertible securities

$ ( 17,325,000 )

The following tables shows the

Company’s net unrealized (loss) gain recognized during the year on marketable securities still held as of December 31:

following tables shows the Company’s net unrealized (loss) gain recognized during the year on marketable securities as of December 31:

of Net Unrealized (Loss) Gain Recognized on Marketable Securities

4 unchanged sentences

( 1,973,000 )

Net unrealized gain (loss) recognized during the reporting year on marketable

securities still held at the reporting date

Net unrealized gain (loss) recognized during the reporting year on marketable securities still held at the reporting date

$ ( 743,000 )

$ ( 3,548,000 )

The Company typically

invests with the primary objective of minimizing the potential risk of principal loss.

The Company’s investment policy generally

requires securities to be investment grade and limits the amount of credit exposure to any one issuer.

Fair values were determined for

each individual security in the investment portfolio.

On July 1 st ,

2023, The Company intended to sell its subsidiary, HWH World, Inc.

The proposed transaction had the Company sell 1,000 shares

of common stock, representing all the issued and outstanding common stock shares of HWH World for the sum $ 706,000 representing

the gross proceeds of the sale of HWH inventory less cost of goods sold.

The parties involved amended the terms of this agreement during

the third quarter of 2023 from that of equity transaction to the purchase of inventory and assumption of certain liabilities by SHRG.

The amended agreement identified the purchase price approximating $ 758,000 to be paid from amongst other things, the gross proceeds generated

by the sale of the inventory acquired.

The value of the inventory sold approximates $ 698,000 and the value of the liabilities assumed

by SHRG as part of this transaction is approximately $ 59,000 .

Further, the agreement includes payment of 1% royalty, starting November

1, 2023, being defined as 1% of the gross sale price of all Seller’s new products made and sold outside of existing inventory on

the schedule, for a period ending October 31, 2033.

There is substantial doubt regarding SHRG’s ability to sell and pay for the

inventory acquired, and therefore, the Company has determined not to record a receivable for the purchase price.

Company typically invests with the primary objective of minimizing the potential risk of principal loss.

The Company’s investment

policy generally requires securities to be investment grade and limits the amount of credit exposure to any one issuer.

Fair values were

determined for each individual security in the investment portfolio.

Disposal of assets

July 1 st , 2023, The Company intended to sell its subsidiary, HWH World, Inc.

The proposed transaction had the Company

sell 1,000 shares of common stock, representing all the issued and outstanding common stock shares of HWH World for the sum $ 706,000

representing the gross proceeds of the sale of HWH inventory less cost of goods sold.

The parties involved amended the terms of this

agreement during the third quarter of 2023 from that of equity transaction to the purchase of inventory and assumption of certain liabilities

The amended agreement identified the purchase price approximating $ 758,000 to be paid from amongst other things, the gross proceeds

generated by the sale of the inventory acquired.

The value of the inventory sold approximates $ 698,000 and the value of the liabilities

assumed by SHRG as part of this transaction is approximately $ 59,000 .

Further, the agreement includes payment of 1% royalty, starting

November 1, 2023, being defined as 1% of the gross sale price of all Seller’s new products made and sold outside of existing inventory

on the schedule, for a period ending October 31, 2033.

There is substantial doubt regarding SHRG’s ability to sell and pay for

the inventory acquired, and therefore, the Company has determined not to record a receivable for the purchase price.

A net loss approximating

1 unchanged sentence

assets on the consolidated statement of operations.

On July 1 st ,

2023, The Company sold 100 % of the equity in its subsidiary HWH Holdings, Inc, a Texas corporation (“HWHH”) to SHRG for a purchase price

approximating $ 259,000 .

This amount is to be paid from gross proceeds generated by the sale of the inventory acquired as part of the

This transaction was later amended during the third quarter of 2023 to assign the purchase of HWHH from SHRG to Ascend Management

July 1 st , 2023, The Company sold 100 % of the equity in its subsidiary HWH Holdings, Inc, a Texas corporation (“HWHH”)

to SHRG for a purchase price approximating $ 259,000 .

This amount is to be paid from gross proceeds generated by the sale of the inventory

acquired as part of the transaction.

This transaction was later amended during the third quarter of 2023 to assign the purchase of HWHH

from SHRG to Ascend Management Pte., Ltd.

(“Ascend”), a Singaporean limited company.

There is substantial doubt regarding Ascend’s ability to sell

and pay for the inventory acquired, and therefore, the Company has determined not to record a receivable for the purchase price.

loss approximating $ 617,000 associated with this transaction has been recorded during the third quarter of 2023 and is included in Loss/Gain

on sale of assets on the consolidated statement of operations.

There is substantial doubt regarding

Ascend’s ability to sell and pay for the inventory acquired, and therefore, the Company has determined not to record a receivable

for the purchase price.

A net loss approximating $ 617,000 associated with this transaction has been recorded during the third quarter

of 2023 and is included in Loss/Gain on sale of assets on the consolidated statement of operations.

On June 13, 2024, the Company

sold its retail space in Lindon, Utah for the sales price, net of expenses, of approximately $ 5,758,000 .

The associated asset was previously

classified as Held for sale in the amount of $ 5,593,000 , resulting in a gain on the sale of approximately $ 165,000 .

International Limited , related party

The Company owns

127,179,291 shares or approximately 4 % of the outstanding shares of Alset International Limited (“Alset Intl”), a company

incorporated in Singapore and publicly listed on the Singapore Exchange Limited.

This investment is classified as a marketable security

and is classified as long-term assets on the consolidated balance sheets as the Company has the intent and ability to hold the investments

for a period of at least one year.

Company owns 127,179,291 shares or approximately 4 % of the outstanding shares of Alset International Limited (“Alset Intl”),

a company incorporated in Singapore and publicly listed on the Singapore Exchange Limited.

This investment is classified as a marketable

security and is classified as long-term assets on the consolidated balance sheets as the Company has the intent and ability to hold the

investments for a period of at least one year.

The Chairman of the Company, Mr.

Heng Fai Ambrose Chan, is the Executive Director and Chief Executive

Officer of Alset Intl.

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

fair value of the marketable security as of December 31, 2023, and December 31, 2022, was approximately $ 3,269,000 and $ 3,319,000 respectively.

During the year ended December 31, 2023 and December 31, 2022, the Company recorded unrealized loss on this investment of approximately

$ 50,000 and unrealized loss of $ 1,590,000 , respectively.

Heng Fai Ambrose Chan, is the Executive Director and

Chief Executive Officer of Alset Intl.

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

The fair value of the marketable security as of December 31, 2024, and December 31, 2023, was approximately $ 2,518,000 and

$ 3,269,000 respectively.

During the year ended December 31, 2024 and December 31, 2023, the Company recorded unrealized loss on this

investment of approximately $ 750,000 and unrealized loss of $ 50,000 , respectively.

Park Capital, Inc.

On December 30,

2020, the Company signed a binding letter of intent with West Park Capital, Inc (“West Park”) and Century TBD Holdings,

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

to West Park and West Park 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 at approximately $ 500,000

and is included in Investments on the consolidated balance sheet on December 31, 2022 and as of December 31, 2023.

December 30, 2020, the Company signed a binding letter of intent with West Park Capital, Inc (“West Park”) and Century TBD

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

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

This note and stock exchange agreement was finalized during the first quarter 2022 and valued at approximately $ 500,000 and is

included in Investments on the consolidated balance sheet on December 31, 2024 and as of December 31, 2023.

Capital International LLC

On September 10,

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

entered into membership interest purchase agreement with BMI Financial

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

whereas DSS Securities, Inc.

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 $ 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

Upon achieving greater than 20 % ownership in BMIC 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 loss in BMIC during the year

ended December 31, 2023, approximated $ 34,000 and $ 20,000 for year ended December 31, 2022.

BMIC is a broker-dealer

registered with the Securities and Exchange Commission, is a member of the Financial Industry Regulatory Authority, Inc.

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

The Company’s chairman of the board and

another independent board member of the Company also have ownership interest in BMIC.

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 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 loss in BMIC during the year ended December 31, 2024, approximated $ 1,000 and $ 34,000 for year ended December 31, 2023.

is a 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”).

The Company’s

chairman of the board and another independent board member of the Company also have ownership interest in BMIC.

Technologies Asia Pacific Holdings Limited

On December 19,

2020, Impact BioMedical, a wholly owned subsidiary of the Company, entered into a subscription agreement (the “Subscription Agreement”)

with BioMed Technologies Asia Pacific Holdings Limited (“BioMed”), a limited liability company incorporated in the British

Virgin Islands, pursuant to which the Company agreed to purchase 525 ordinary shares or 4.99 % of BioMed at a purchase price of approximately

The Subscription Agreement provides, among other things, the Company has the right to appoint a new director to the board of

With respect to an issuance of shares to a third party by BioMed, the Company will have the right of first refusal to purchase

such shares, as well as customary tag-along rights.

In connection with the Subscription Agreement, Impact Biomedical entered into an

exclusive distribution agreement (the “Distribution Agreement”) with BioMed, to directly market, advertise, promote, distribute,

and sell certain BioMed products, which focus on manufacturing natural probiotics, to resellers.

This investment is valued at cost as

it does not have a readily determined fair value.

Under the terms

of the Distribution Agreement, the Company will have exclusive rights to distribute the products within the United States, Canada, Singapore,

Malaysia, and South Korea and non-exclusive distribution rights in all other countries.

In exchange, the Company agreed to certain obligations,

including mutual marketing obligations to promote sales of the products.

This agreement is for ten years with a one year auto-renewal

Oncology, Inc.

On March 15, 2021,

the Company, through one of its subsidiaries, entered into a Stock Purchase Agreement (the “Vivacitas Agreement #1”) with

Vivacitas Oncology Inc.

(“Vivacitas”), to purchase 500,000 shares of its common stock at the per share price of $ 1.00 , with

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

This option will terminate upon one of the following

(i) Vivacitas’ board of directors cancels this option because it is no longer in the best interest of the Company;

December 31, 2022;

or (iii) the date on which Vivacitas receives more than $ 1.00 per share of the Company’s common stock in a private

placement with gross proceeds of $ 500,000 .

Under the terms of the Vivacitas Agreement #1, the Company will be allocated two seats on

the board of Vivacitas.

On March 18, 2021, the Company entered into an agreement with Alset EHome International, Inc.

to purchase from the Seller’s its wholly owned subsidiary Impact Oncology PTE Ltd.

(“IOPL”) for a purchase price $ 2,480,000 .

The acquisition of IOPL has been treated as an asset acquisition as IOPL does not meet the definition of a business as defined in Topic

IOPL owns 2,480,000 shares of common stock of Vivacitas along with the option to purchase an additional 250,000 shares of common

The Sellers largest shareholder is Mr.

Chan Heng Fai Ambrose, the Chairman of the Company’s board of directors and its largest

On April 1, 2021,

the Company entered into an additional stock purchase agreement with Vivacitas (“Vivacitas Agreement #2”), whereas Vivacities

wished to employ the service of the Chief Business Officer of Impact Biomedical, and in return for the services of this individual, Vivacitas

shall issue to the Company, the aggregate purchase price for the Class A Common Shares of Vivacitas at the value of $ 1.00 per share shall

be $ 120,000 to be paid in twelve (12) equal monthly installments for the period between April 1, 2021 and March 31, 2022 .

On July 22, 2021,

the Company exercised 1,000,000 of the available options under the Vivacitas Agreement #1 for $ 1,000,000 .

This, along with the shares

received as part Vivacitas Agreement #2 increased the Company’s equity position in Vivacitas to approximately 16 % as of December

As of December 31, 2021, the fair value of the Company’s investment in Vivacitas is not readily available, and therefore

is recorded at cost in the amount of $ 4,035,000 , As of December 31, 2022, the Company determined to impair 100 % of its investment in

Vivacitas, in the amount of $ 4,100,000 .

In September 2021,

the Company’s former subsidiary SHRG, Stemtech Corporation (“Stemtech”) and Globe Net Wireless Corp.

entered into a Securities Purchase Agreement (the “SPA”) pursuant to which SHRG invested $ 1.4 million in Stemtech in exchange

(a) a Convertible Promissory Note in the amount of $ 1.4 million in favor of the Company (the “Convertible Note”) and

(b) a detachable Warrant to purchase shares GNTW common stock (the “GNTW Warrant”).

Stemtech is a subsidiary of GNTW.

an inducement to enter into the SPA, GNTW agreed to pay to the SHRG an origination fee of $ 500,000 , payable in shares of GNTW’s

common stock.

The Convertible Note matures on September 9, 2024 , bears interest at the annual rate of 10 %, and is convertible, at the

option of the holder, into shares of GNTW’s common stock at a conversion rate calculated based on the closing price per share of

GNTW’s common stock during the 30-dayperiod ended September 19, 2021.

The GNTW Warrant expires on September 13, 2024 and conveys

the right to purchase up to 1.4 million shares of GNTW’s common stock at a purchase price calculated based on the closing price

per share of GTNW’s common stock during the 10-day period ended September 13, 2021.

In September 2021, GNTW issued to the Company

154,173 shares of its common stock, or less than 1% of the shares of GNTW then issued and outstanding, in payment of the origination

In November 2021, Globe Net Wireless Corp.

changed its corporate name to Stemtech Corporation.

In connection therewith, the investee’s

common stock is now traded under the symbol “STEK”.

The SHRG carries its investment in the Convertible Note, the GNTW Warrant

and the shares of GNTW common stock at fair value in accordance with GAAP.

As of December 31, 2023 and December 31, 2022 the investment

in the GNTW Warrant and Convertible Note, were valued at $ 0 , and $ 44,000 and $ 0 and $ 39,000 , respectively.

In September 2021,

SHRG entered into a Membership Unit Purchase Agreement pursuant to which the SHRG acquired a 30.75 %

equity interest in MojiLife, LLC, a limited liability company organized in the State of Utah, in exchange for $ 1,537,000 .

MojiLife is an emerging growth distributor of technology-based consumer products for the home and car.

MojiLife’s products include

esthetically attractive, cordless scent diffusers for the home or for the car, as well as proprietary home cleaning products and accessories.

On a quarterly basis, SHRG evaluates the recoverability of its investments and reviews current economic trends to determine the adequacy

of its allowance for impairment losses based on each investee financial performance data and other relevant information.

for impairment losses is recognized when recovery in full of SHRG’s investment is no longer probable.

Investment balances are written

off against the allowance after the potential for recovery is considered remote.

In March of 2022, SHRG impaired the MojiLife investment

as the evaluation at such time determined the investment was not fully recoverable and 100 %

valuation was reserved.

December 19, 2020, Impact BioMedical, a wholly owned subsidiary of the Company, entered into a subscription agreement (the “Subscription

Agreement”) with BioMed Technologies Asia Pacific Holdings Limited (“BioMed”), a limited liability company incorporated

in the British Virgin Islands, pursuant to which the Company agreed to purchase 525 ordinary shares or 4.99 % of BioMed at a purchase

price of approximately $ 632,000 .

The Subscription Agreement provides, among other things, the Company has the right to appoint a new

director to the board of BioMed.

With respect to an issuance of shares to a third party by BioMed, the Company will have the right of

first refusal to purchase such shares, as well as customary tag-along rights.

In connection with the Subscription Agreement, Impact Biomedical

entered into an exclusive distribution agreement (the “Distribution Agreement”) with BioMed, to directly market, advertise,

promote, distribute, and sell certain BioMed products, which focus on manufacturing natural probiotics, to resellers.

This investment

is impaired in full at December 31, 2024 as it does not have a readily determined fair value.

the terms of the Distribution Agreement, the Company will have exclusive rights to distribute the products within the United States,

Canada, Singapore, Malaysia, and South Korea and non-exclusive distribution rights in all other countries.

In exchange, the Company agreed

to certain obligations, including mutual marketing obligations to promote sales of the products.

This agreement is for ten years with

a one year auto-renewal feature.

PROPERTY PLANT AND EQUIPMENT AND INVESTMENT IN REAL ESTATE, NET

Property Plant and Equipment and Investment in Real Estate, Net

Property, plant and

equipment consisted of the following as of December 31, 2023:

Schedule of Property, Plant and Equipment

plant and equipment consisted of the following as of December 31:

of Property, Plant and Equipment

Machinery and equipment

3 unchanged sentences

Construction in progress

Less accumulated depreciation

accumulated depreciation

Property, plant and equipment, net

Depreciation expense

for the years ended December 31, 2023 and 2022 was $ 802,000 and $ 1,569,000 respectively.

Real Estate consisted

of the following at December 31:

Schedule of Investment in Real Estate

expense for the years ended December 31, 2024 and 2023 was $ 878,000 and $ 802,000 respectively.

Estate consisted of the following at December 31:

of Investment in Real Estate

Building and improvements

1 unchanged sentence

Investment in real estate

Depreciation expense

for the years ended December 31, 2023 and 2022 was $ 2,085,000 and $ 2,077,000 respectively.

expense for the years ended December 31, 2024 and 2023 was $ 98,000 and $ 2,085,000 respectively.

INTANGIBLE ASSETS

Intangible Assets

August 25, 2022, DSS PureAir, a subsidiary of the Company finalized an asset purchase agreement with Celios Corporation (“Celios”)

to acquire inventory, patents, and other intangible assets associated with that inventory, and other intangible assets from Celios for

The related intangible assets were valued at $ 409,000 with an estimated remaining useful life between 3 and 20 years.

Intangible assets are comprised of the

following as of December 31:

Schedule of Intangible Assets

assets are comprised of the following as of December 31:

of Intangible Assets

Gross Carrying Amount

Accumulated Amortization

Carrying Amount

Net Carrying Amount

Gross Carrying Amount

Accumulated Amortization

1 unchanged sentence

Developed technology assets

Acquired intangibles customer lists, licenses, non-compete agreements, branding, product formulas,

tenant improvements, in-place, favorable and unfavorable leases

Acquired intangibles customer lists, licenses, non-compete agreements, branding, product formulas, tenant improvements, in-place, favorable and unfavorable leases

Acquired intangibles patents and patent rights

Patent application costs

Patent application costs are amortized over their expected useful life which is generally the remaining legal life of the patent.

of December 31, 2023, the weighted average remaining useful life of these assets in service was approximately 1.7 years.

amortized for the year ended December 31, 2023 and 2022 was approximately $ 2,319,000 and $ 9,279,000 ,

respectively.

Expected amortization for each of the

five succeeding fiscal years is as follows:

Schedule of Estimated Future Amortization of Intangible Assets

ACCRUED EXPENSES AND DEFERRED REVENUE

application costs are amortized over their expected useful life which is generally the remaining legal life of the patent.

December 31, 2024, the weighted average remaining useful life of these assets in service was approximately 1.7 years.

amortized for the year ended December 31, 2024 and 2023 was approximately $ 1,361,000 and $ 2,319,000 , respectively.

amortization for each of the five succeeding fiscal years is as follows:

of Estimated Future Amortization of Intangible Assets

ACCRUED EXPENSES AND DEFERRED REVENUE

Accrued Expenses and Deferred Revenue

consist of the following for the year ended December 31:

Summary of Accrued Expenses and Deferred Revenue

expenses and deferred revenue consist of the following for the year ended December 31:

of Accrued Expenses and Deferred Revenue

Customer deposits

1 unchanged sentence

Accrued wages

Settlement liability

Uncertain tax positions

Accrued expenses

Income tax payable

Sales tax payable

3 unchanged sentences

Short Term and Long-Term Debt

Notes - On March 2, 2020, AMRE entered into a $ 200,000

unsecured promissory note with LVAMPTE, a related party.

The Note calls for interest to be paid annually on March 2 with interest

fixed at 8.0 %.

As further incentive to enter into this Note, AMRE granted LVAMPTE warrants to purchase shares of common stock of AMRE (the “Warrants”).

The amount of the warrants granted is the equivalent of the Note Principal divided by the Exercise Price.

The Warrants are exercisable

for four years and are exercisable at $ 5.00

per share (the “Exercise” Price).

In March 2022, this debt was converted into equity in AMRE, and LVAMPTE exercised

the warrants for $ 200,000

(see the consolidated statement of changes in stockholders’ equity) The holder is a related party owned by the Chairman

of the Company’s board of directors.

On May 20, 2021,

Premier Packaging entered into master loan and security agreement (“BOA Note”) with Bank of America, N.A.

to secure financing approximating $ 3,710,000 to purchase 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 December 31, 2023, and December

31, 2022, the outstanding principal on the BOA Note was $ 2,932,000 and $ 3,406,000 , respectively and had an interest rate of 4.63 %.

of December 31, 2023, $ 491,000 was included in the current portion of long-term debt, net, and the remaining balance of approximately

$ 2,442,000 recorded as long-term debt, The BOA Note contains certain covenants that are analyzed annually.

As of December 31, 2023, Premier

is in compliance with these covenants.

On August 1, 2021,

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

with Patriot Bank, N.A.

(“Patriot Bank”) in an amount up to $ 6,155,000 , with the amount financed approximating $ 5,105,000 .

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 a new Heidelberg XL 106-7+L printing

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

As of December 31, 2023, and December 31, 2024, the outstanding principal on the BOA Note was $ 2,932,000

and $ 2,436,000 ,

respectively and had an interest rate of 4.63 %.

As of December 31, 2023, $ 491,000

was included in the current portion of long-term

debt, net, and the remaining balance of approximately $ 2,442,000

recorded as long-term debt, The BOA Note contains

certain covenants that are analyzed annually.

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, The BOA Note contains certain covenants

that are analyzed annually.

As of December 31, 2024, 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

Agreement”) with Patriot Bank, N.A.

(“Patriot Bank”) in an amount up to $ 6,155,000 ,

with the amount financed approximating $ 5,105,000 .

The Shelton Agreement contains monthly payments of principal and an initial interest of 4.25 %.

The interest will be adjusted commencing

on July 1, 2026 and continuing for the next succeeding 5-year period shall be determined one month prior to the change date and shall

be an interest rate equal to two hundred fifty (250) basis points above the Federal Home Loan Bank Boston 5-Year/25-Year amortizing advance

rate, but in no event less than 4.25% for the term of 120 months with a balloon payment approximating $ 2,829,000 due at term end.

affective interest rate at December 31, 2022 was 4.25 %.

The funds borrowed were used to purchase a 40,000 square foot, 2.0 story, Class

A+ multi-tenant medical office building located on a 13.62-acre site.

interest will be adjusted commencing on July 1, 2026 and continuing for the next succeeding 5-year period shall be determined one month

prior to the change date and shall be an interest rate equal to two hundred fifty (250) basis points above the Federal Home Loan Bank

Boston 5-Year/25-Year amortizing advance rate, but in no event less than 4.25% for the term of 120 months with

a balloon payment approximating $ 2,829,000

due at term end.

The affective interest rate

at December 31, 2022 was 4.25 %.

The funds borrowed were used to purchase a 40,000

square foot, 2.0 story, Class A+ multi-tenant

medical office building located on a 13.62-acre site.

The purchase price has been allocated as $ 4,640,000 ,

and $ 325,000 for the facility, land, and tenant improvements, respectively.

Also included in the value of the property is $ 585,000 of

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

The net book value of these assets as of December 31, 2023

approximated $ 6,729,000 .

Of the total financed, approximately $ 206,000 of principal and accrued interest is classified as current portion

of long-term debt, net, and the remaining balance of approximately $ 4,402,000 recorded as long-term debt, net of $ 50,000 in deferred

financing costs.

On 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.

$ 1,600,000 ,

and $ 325,000

for the facility, land, and tenant improvements,

respectively.

Also included in the value of the property is $ 585,000

of intangible assets with an estimated useful

life of approximating 3

The net book value of these assets as

of December 31, 2023 approximated $ 6,729,00 .

Of the total financed, approximately $ 201,000

of principal and accrued interest is classified

as current portion of long-term debt, net, and the remaining balance of approximately $ 4,402,000

recorded as long-term debt, net of $ 50,000

in deferred financing costs, The net book value

of these assets as of December 31, 2024 approximated $ 6,313,000 .

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=fir-sale, net on the consolidated balance sheet.

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 matures on October

12, 2022 , and contains an auto renewal period of three months.

As of December 31, 2023 and December 31, 2022, $ 547,000 and $ 3,000,000 , respectively,

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

On 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 matures on

October 12, 2022 , and contains an auto renewal period of nine months.

As of December 31, 2024 and December 31, 2023, $ 463,000 and $ 547,000 ,

respectively, are included in Current portion of long-term debt, 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 nine months.

This loan was funded during March 2022.

As of December 31, 2023

$ 2,131,000 is included in the Current portion of long-term debt, net on the consolidated balance sheet.

As of December 31, 2022 $ 3,008,000

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

On November 2,

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

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

As of December 31, 2024 $ 145,000 is included in the Current portion of long-term debt, net on the consolidated balance sheet.

December 31, 2023 $ 2,131,000 is included in the Current portion of long-term debt, 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, and

4 unchanged sentences

$ 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

The net book value of the assets acquired as of December 31, 2022 is approximately $ 52,407,000 .

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.

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

3 unchanged sentences

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

affective interest rate at December 31, 2022 was 8.46 %.

The maturity date of November

2, 2023 , may be extended to November

As of December 31, 2022, the outstanding principal and interest of the LifeCare agreement approximates $ 40,193,000 ,

net of deferred financing costs of $ 270,000 .

As of December 31, 2023, the outstanding principal and interested approximates $ 41,331,000 .

Interest expense for the year-ended December 31, 2023 and 2022 approximated $ 3,773,000

and $ 2,418,000 ,

December 31, 2024, the outstanding principal and interest of the LifeCare agreement approximates $ 46,069,000

and is included in Current portion of long-term debt on assets held-for-sale, net on the consolidated balance sheet.

of December 31, 2023, the outstanding principal and interested approximates $ 41,331,000

and is included in Current portion of long-term debt on assets held-for-sale, net on the Consolidated Balance Sheet.

Interest expense for the year-ended

December 31, 2024 and 2023 approximated $ 3,861,000 and

$ 3,773,000 ,

respectively.

This note is in default and demand was made for final payment to be made

by December 22, 2023.

This amount is past due.

In November 2021, AMRE entered into

a convertible promissory note (“Alset Note”) with Alset International Limited (“Alset International”), a

related party, for the principal amount of $ 8,350,000 .

The Alset Note accrues interest at 8 %

per annum and matures

in December 2023 , with interest due quarterly and the principal due at maturity.

Principal and interest of approximately

is included in long-term debt, net on the accompanying consolidated balance sheet on December 31, 2022.

On May 17, 2022, the

shareholders of the Company approved the issuance of up to 21,366,177

Shares our Common Stock to Alset International to purchase the Convertible Promissory Note issued by American Medical REIT, Inc.

with a principal amount of $ 8,350,000

and accrued unpaid interest of $ 119,000

through December 31, 2022.

This transaction was finalized in July 2022 and is eliminated upon consolidation into DSS.

expense for this note totaled $ 677,000

for year ended December 31, 2023 and $ 346,000

for year ended December 31, 2022.

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

This amount is past

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

1 unchanged sentence

maturing on March

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

7, 2024 to acquire a medical facility

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

The assets acquired are classified as investments, real estate on the consolidated balance sheet.

2 unchanged sentences

$ 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 5

The net book value of the assets acquired as of December 31, 2022 is approximately $ 4,450,000 .

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 5 years.

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.

The first installment was due January 1, 2023.

The Pinnacle Loan contains certain covenants that are to be tested annually.

note is currently due.

AMRE note is currently due.

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

and is included in Current portion of long-term debt on assets held-for-sale, net long-term debt, net on the accompanying consolidated balance sheet at

December 31, 2024.

The outstanding principal and interest, net of debt issuance costs of $ 17,000 ,

approximates $ 2,977,000

and is included in long-term debt, net on the accompanying consolidated balance sheet at December 31, 2023.

The outstanding

principal and interest, net of debt issuance costs of $ 60,000 ,

approximates $ 2,952,000

and is included in long-term debt, net on the accompanying consolidated balance sheet at December 31, 2022.

approximates $ 2,977,000 and

is included in in Current portion of long-term debt on assets held-for-sale, net on the accompanying consolidated balance sheet at December 31, 2023.

Interest expense equaled

for year ended December 31, 2023 and $ 153,000

for year ended December 31, 2022.

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 December 31, 2023, the outstanding principal and interest approximates $ 719,000 of which $ 112,000 was included in the current

portion of long-term debt, net, and the remaining balance of approximately $ 607,000 recorded as long-term debt.

$ 251,000 for

year ended December 31, 2024 and $ 281,000 for

year ended December 31, 2023.

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 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.

As of December 31, 2023, the outstanding

principal and interest approximates $ 719,000

of which $ 112,000

was included in the current portion of long-term debt, net, and the remaining balance of approximately $ 607,000

recorded as long-term debt.

summary of scheduled principal payments of long-term debt, not including revolving lines of credit, subsequent to December 31, 2024 are

Schedule of Notes Payable and Long-term Debt

Lease Liability

of Notes Payable and Long-term Debt

Notes payable

Notes payable - related party

Notes payable - assets held-for-sale

Company has operating leases predominantly for operating facilities.

17 unchanged sentences

Weighted-average discount rate

March of 2022, Premier Packaging began leasing its relocated manufacturing facilities to West Henrietta, New York.

contains an escalating payment clause, ranging from $ 61,000

per month to $ 78,000

per month, over the twelve-year term of the lease.

Total lease expense during the years ended December 31, 2023 and 2022

approximated $ 790,000

cash paid during the years ended December 31, 2024 and 2023 approximated $ 956,000

and $ 917,000 ,

2 unchanged sentences

Stockholders’ Equity

Equity transactions –

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

EHome International Inc.

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

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

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

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

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

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

This transaction was completed on March 9, 2022.

In addition, the Company’s Executive

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

March 10, 2022, the Company issued 894,084 shares of common stock to Mr.

Heng Fai Ambrose Chan pursuant to his employment agreement.

These shares were issued in consideration of $ 340,000 due under this employment agreement.

May 5, 2022, the Company issued 63,205 shares of common stock to Mr.

Frank Heuszel, CEO of DSS, pursuant to his employment agreement.

These shares were issued in consideration of $ 29,000 due under this employment agreement.

May 25, 2022, the Company issued 15,389,995 shares of common stock to Mr.

Heng Fai Ambrose Chan pursuant to his employment agreement.

These shares were issued in consideration of $ 5,848,000 due under this employment agreement.

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

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

with a principal amount of $ 8,350,000

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

This transaction was finalized in July 2022.

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

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

value on the agreed upon date of February 18, 2022 which was approximately $ 0.41 per share.

The True Partner shares were acquired from

Alset EHome International, Inc.

(“Alset EHome”), a related party.

Heng Fai Ambrose Chan, our director and Executive Chairman,

is also Chairman of the Board, Chief Executive Officer, and the largest beneficial owner of the outstanding shares of Alset EHome.

transaction was completed with the transfer of DSS share to Alset EHome on July 1, 2022.

On April 10, 2023, the Company

issued 62,354 shares of common stock to Mr.

transactions –

April 10, 2023, the Company issued 62,354 shares of common stock to Mr.

Frank Heuszel, CEO of DSS, pursuant to his employment agreement.

These shares were issued

to settle a previously recorded liability of approximately $ 268,000 .

January 4, 2024 the Company effected a reverse stock split of 1

These shares were issued to settle a previously recorded liability of approximately $ 268,000 .

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

As of December 31, 2023 and December 31, 2022, there were 140,264,240

and 139,017,000

shares of our Common Stock issued and outstanding, respectively, which was converted to 7,066,772

and 6,950,858

shares, respectively.

and 139,017,000 shares of our Common Stock issued and outstanding, respectively, which was converted to 7,066,772 and 6,950,858 shares,

respectively.

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 .

Incentive Plan – On June 20, 2013, the Company’s shareholders adopted the 2013 Employee, Director and Consultant

Equity Incentive Plan (the “2013 Plan”).

The 2013 Plan provides for the issuance of up to a total of 50,000 shares

of common stock authorized to be issued for grants of options, restricted stock and other forms of equity to employees, directors

and consultants.

Under the terms of the 2013 Plan, options granted thereunder may be designated as options which qualify for

incentive stock option treatment (“ISOs”) under Section 422A of the Internal Revenue Code, or options which do not

qualify (“NQSOs”).

During the year ended December 31, 2023, 5,333 options

were forfeited.

As of December 31, 2023, no shares

remained available under this plan.

On December 9, 2019, the Company’s shareholders adopted the 2020 Employee, Director and Consultant

Equity Incentive Plan (the “2020 Plan”).

The 2020 Plan provides for the issuance of an initial 241,204

shares of common stock authorized to be issued

for grants of options, restricted stock and other forms of equity to employees, directors and consultants.

addition, on the first day of each calendar year, for a period of not more than ten (10) years, commencing January 1, 2021, or the first

business day of the calendar year if the first day of the calendar year falls on a Saturday or Sunday, the shares available under this

plan will automatically increase in an amount equal to the lesser of (i) five percent (5%) of the total number of shares of Common Stock

outstanding as of December 31 of the preceding fiscal year or (ii) such number of shares of Common Stock as determined by the Board of

Under the terms of the 2020 Plan, options

granted thereunder may be designated as options which qualify for incentive stock option treatment (“ISOs”) under Section

422A of the Internal Revenue Code, or options which do not qualify (“NQSOs”).

As of December 31, 2024, there are 814,184

shares available under this plan.

Compensation – The Company records stock-based payment expense related to options and warrants based on the grant date

3 unchanged sentences

Such awards include option grants, warrant grants, and restricted stock awards.

During the year ended

December 31, 2022, the Company’s stock compensation approximated $ 4,000 .

During the year ended December 31, 2023 there were none .

Warrants – The Company did not issue any warrants in 2023 or 2022, nor did it have any outstanding warrants as of December 31,

2023 and 2022.

Incentive Plan – On December 9, 2019, the Company’s shareholders adopted the 2020 Employee, Director and Consultant

Equity Incentive Plan (the “2020 Plan”).

During the year ended December

31, 2024, and 2023 the Company’s stock compensation approximated $ 0 .

The Company did not issue any warrants in 2024 or 2023, nor did it have any outstanding warrants as of December 31, 2024 and 2023.

BioMedical, Inc.

Equity Transactions –

August 8, 2023 DSS BioHealth Securities, Inc.

(“DSS BioHealth”), a wholly-owned subsidiary of the Company, and the sole shareholder

of Impact BioMedical Inc., distributed to the shareholders of DSS on record as of July 10, 2023 4 shares of Impact Bio’s stock

for 1 share they owned of DSS stock.

Each share of Impact BioMedical distributed as part of the distribution will not be eligible for

resale until 180 days from the date Impact BioMedical’s initial public offering becomes effective under the Securities Act, subject

to the discretion of the Company to lift the restriction sooner.

October 31, 2023, Impact BioMedical 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 our Common Stock issued and outstanding which was converted to 70,496,041 shares.

Also on October 31, 2023,

DSS BioHealth Securities, Inc., the Company’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

The Preferred Shares are voting shares and convertible.

On 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 the Company agreed

to sell to the Underwriters in a firm commitment initial public offering (the “Offering”) an aggregate of 1,500,000 of the

Company’s shares of common stock, par value $ 0.001 per share at a public offering price of $ 3.00 per share.

On September 17, 2024,

the Company closed the Offering.

The total net proceeds to the Company from the Offering, after deducting discounts, expenses allowance

and expenses, was approximately $ 3,726,000 .

A final prospectus relating to this Offering was filed with the Commission on September 16,

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.

The Company 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

As of September 30, 2024, the Representative had not exercised any of these warrants.

As of September 30, 2024, only the 1,500,000

shares included in the Offering are freely tradable on the NYSE.

The remaining 9,997,703 are restricted from trading for 180 days from

the Offering date.

Incentive Plan – During 2023, the Company’s shareholders adopted the 2023 Employee, Director and Consultant Equity

Incentive Plan (the “2023 Plan”).

The 2023 Plan provides for the issuance of an initial 18,762,000 shares of common stock

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business day of the calendar year if the first day of the calendar year falls on a Saturday or Sunday, the shares available under this

plan will automatically increase in an amount equal to the lesser of (i) five percent (5%) of the total number of shares of Common Stock

plan will automatically increase in an amount equal to the lesser of (i) two percent (2%) of the total number of shares of Common Stock

outstanding as of December 31 of the preceding fiscal year or (ii) such number of shares of Common Stock as determined by the Board of

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As of December 31, 2024, there are 18,037,079 shares available under this plan.

Options – On June 20, 2013, the Company’s shareholders adopted the 2013 Employee, Director and Consultant Equity

Incentive Plan (the “2013 Plan”).

The 2013 Plan provides for the issuance of up to a total of 50,000

shares of common stock authorized to be issued for grants of options, restricted stock and other forms of equity to employees,

directors and consultants.

Under the terms of the 2013 Plan, options granted thereunder may be designated as options which qualify

for incentive stock option treatment (“ISOs”) under Section 422A of the Internal Revenue Code, or options which do not

qualify (“NQSOs”).

During the year ended December 31, 2023, 5,333 options were forfeited.

As of December 31, 2023, no

shares remained available under this plan.

Impact BioMedical, Inc.

Equity Transactions

On August 8, 2023 DSS BioHealth

Securities, Inc.

(“DSS BioHealth”), a wholly-owned subsidiary of the Company, and the sole shareholder of Impact BioMedical

Inc., distributed to the shareholders of DSS on record as of July 10, 2023 4 shares of Impact Bio’s stock for 1 share they owned

of DSS stock.

Each share of Impact BioMedical distributed as part of the distribution will not be eligible for resale until 180 days from

the date Impact BioMedical’s initial public offering becomes effective under the Securities Act, subject to the discretion of the

Company to lift the restriction sooner.

On October 31,

2023, Impact BioMedical 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 our Common Stock

issued and outstanding which was converted to 70,496,041 shares.

Also on October 31, 2023, DSS BioHealth Securities, Inc., the

Company’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 12 %.

Preferred Shares are voting shares and convertible.

Compensation – The Company 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 option grants

with a purchase price of $ 3.00 per share were awarded to certain officers, directors and consultants of the Company.

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 .

The Company record stock based compensation expense of approximately $ 19,000 for the year

ended December 31, 2024 and is included in Sales, general and administrative compensation (inclusive of stock based compensation) on the

accompanying Statement of Operations.

There were no stock-based payments made during the twelve months ended December 31, 2023.

Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the

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( 5,519,000 )

increase in allowance

Total income tax loss (benefit)

increase/(decrease) in allowance

Total income tax provision

components of deferred tax assets and liabilities are as follows:

Schedule of Deferred Tax Assets and Liabilities

of Deferred Tax assets and Liabilities

Deferred tax assets:

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Depreciation and amortization

Right -of-use asset

Right to Use Asset

Investment in pass-through entity

Gross deferred tax liabilities

2 unchanged sentences

( 34,838,000 )

Net deferred tax liabilities

December 31, 2023 and 2022, the Company has approximately $ 138.9 million and $ 108.4 million in federal net operating loss carryforwards

(“NOLs”), respectively, available to reduce future taxable income.

Under the provisions of the Internal Revenue Code, the

net operating losses are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

tax attributes are subject to an annual limitation as a result of certain cumulative changes in ownership interest of significant shareholders

which could constitute a change of ownership as defined under Internal Revenue Code Section 382.

Net deferred tax assets (liabilities)

December 31, 2024 and 2023, the Company has approximately $ 126.2

million and $ 138.9

million in federal net operating loss carry forwards (“NOLs”), respectively, available to reduce future taxable income.

Under the provisions of the Internal Revenue Code, the net operating losses are subject to review and possible adjustment by the

Internal Revenue Service and state tax authorities.

Certain tax attributes are subject to an annual limitation as a result of

certain cumulative changes in ownership interest of significant shareholders which could constitute a change of ownership as defined

under Internal Revenue Code Section 382.

For the year ended December 31, 2021, the Company has completed a full analysis of

historical ownership changes and determined that a portion of the net operating losses have a limitation on future deductibility.

Approximately $ 43.8 million of net

operating losses incurred prior to 2020 will be unable to offset future taxable income and have been reserved via a valuation

allowance to reduce the deferred tax asset to the expected realizable amount, leaving $ 2.9 million

available for use which expire at various dates through 2038 and the residual which never expire.

Additionally, at December 31, 2024

and 2023, the Company had approximately $ 20.7

million and $ 20.7

of California and Illinois NOL carry-forwards, respectively, which expire

through 2043 .

The NOL carry forwards may be limited in certain circumstances, including ownership change and have been fully

reserved via a valuation allowance.

valuation allowance for deferred tax assets decreased approximately $ 2.2 million for the year ended December 31, 2024 and increased

approximately $ 5.5 for

the year ended December 31, 2023, The valuation allowance for deferred tax liability decreased approximately $ 2.3 million

in the year ended December 31, 2024 and increased approximately $ 1.1 million

for the year ended December 31, 2023.

the Company has completed a full analysis of historical ownership changes and determined that a portion of the net operating losses have

a limitation on future deductibility.

Approximately $ 43.8 million of net operating losses incurred prior to 2020 will be unable to offset

future taxable income and have been reserved via a valuation allowance to reduce the deferred tax asset to the expected realizable amount,

leaving $ 2.9 million available for use which expire at various dates through 2038 and the residual which never expire.

This analysis

is currently being performed for tax year ending December 31, 2023.

Additionally, at December 31, 2023 and 2022, the Company had approximately

$ 20.7 million and $ 43.6 of California and Illinois NOL carry-forwards, respectively, which expire through 2043 .

The NOL carry-forwards

may be limited in certain circumstances, including ownership change and have been fully reserved via a valuation allowance.

valuation allowance for deferred tax assets increased approximately $ 5.5 million and $ 15.4 million for the years ended December 31, 2023

and December 31, 2022, respectively.

The valuation allowance for deferred tax liability increased approximately $ 1.1 million in the year

ended December 31,2023 and decreased approximately $ 9.9 million for the year ended December 31, 2022.

differences between the United States statutory federal income tax rate and the effective income tax rate in the accompanying consolidated

statements of operations are as follows:

Schedule of Effective Income Tax Rate Reconciliation

of Effective Income Tax Rate Reconciliation

Statutory United States federal rate

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sell the Company’s Equivir technology.

exchange, the Licensee shall pay the Company a royalty of 5.5 %

of net sales.

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 December 31, 2023 and December 31, 2022, $200,000 and $0, respectively, has been accrued for in relation to the Equivir License

as development of the Equivir technology.

Agreements – As of December 31, 2023, the Company has no employment or severance agreements with members of its management

Proceedings – Maiden Biosciences Litigation

February 15, 2021, Maiden Biosciences, Inc.

(“Maiden”) commenced an action against DSS, Inc.

(“DSS”), Decentralized

Sharing Systems, Inc.

(“Decentralized”), HWH World, Inc.

(“HWH”), RBC Life International, Inc.

(RBC International)

(together, the “DSS Defendants”), Frank D.

Heuszel (“Heuszel”), RBC Life Sciences, Inc (“RBC”), Steven

Brown, Clinton Howard, and Andrew Howard (collectively, “Defendants”).

The lawsuit is currently pending in the United

States District Court Northern District of Texas, Dallas Division, and is styled and numbered Maiden Biosciences, Inc.

Document Security

Stems, Inc., et al., Case No.

3:21-cv-00327.

lawsuit relates to two promissory notes executed by RBC in the 4 th quarter of 2019 in favor of Decentralized and HWH, totaling

approximately $1,000,000.

Maiden, a 2020 default judgment creditor of RBC, in the principal amount of $4,329,000, now complains about

those notes, the funding of those notes, the subsequent default of those notes by RBC, and HWH and Decentralized’s subsequent Article

9 foreclosure or deed-in-lieu debt conveyances.

In the instant lawsuit, Maiden first asserted claims against Defendants for unjust enrichment,

fraudulent transfer under the Texas Uniform Fraudulent Transfer Act (“TUFTA”), and violation of the Racketeer Influenced

and Corrupt Organizations Act (“RICO”).

Maiden also sought a judgment from the court declaring:

“(1) Defendants lacked

a valid security interest in RBC and RBC Subsidiaries’ assets and therefore lacked the authority to sell the assets during the

public foreclosure sale;

(2) Defendant Heuszel’s low bid at the public foreclosure sale was invalid and void;

(3) the public foreclosure

sale was conducted in a commercially unreasonable manner;

and (4) Defendants do not have the legal authority to transfer RBC and RBC’s

Subsidiaries assets to Heuszel and HWH.” Maiden sought to recover from Defendants:

(1) treble damages or, alternatively, damages

in the amount of their underlying judgment plus the other creditors’ claims or the value of the assets transferred, whichever is

less, plus punitive or exemplary damages;

(2) pre- and post-judgment interest;

and (3) attorneys’ fees and cost .

March 30, 2021, Defendants DSS, Decentralized, HWH, RBC International, and Heuszel filed a motion to dismiss seeking to dismiss Maiden’s

unjust enrichment, exemplary damages, and RICO claims against DSS, Decentralized, HWH, RBC Life International, Inc., and Heuszel, as

well as Maiden’s fraudulent transfer claims against DSS and RBC International.

On August 9, 2021, the Court then entered an order

granting in part the motion to dismiss filed on behalf of DSS, Decentralized, HWH, RBC International, and Heuszel.

Among other things,

the Court held that Maiden failed to plausibly plead certain causes of action, including (1) the civil RICO claim against DSS, Decentralized,

HWH, RBC International, and Heuszel, (2) the TUFTA claim against DSS, and (3) the unjust enrichment claim against DSS and RBC International.

Notably, the Court declined the request to dismiss the TUFTA claim against RBC International.

On September 3, 2021, Maiden filed its

first amended complaint, asserting a single cause of action against the DSS Defendants, Heuszel, and RBC for an alleged TUFTA violation.

Maiden sought the same relief requested in its original complaint.

Maiden, however, abandoned its request for treble damages.

17, 2021, the DSS Defendants filed a motion to dismiss the amended complaint seeking to dismiss Maiden’s TUFTA claim to the extent

it seeks to avoid a transfer of assets owned by any of RBC’s subsidiaries, including but not limited to RBC Life Sciences USA,

Further, the motion to dismiss sought the dismissal of Maiden’s TUFTA claim against Heuszel.

19, 2021, the Court granted the motion to dismiss in part, dismissing Maiden’s claim against Heuszel and determined Maiden failed

to plead that it was a creditor of RBC USA or RBC’s other subsidiaries.

However, the Court permitted Maiden to replead once again.

December 17, 2021, Maiden filed its second amended complaint which asserted a single TUFTA claim against only the DSS Defendants, RBC,

During the discovery period, the Parties conducted written discovery, production of documents, and depositions of fact witnesses

and expert witnesses.

The discovery period closed on August 9, 2022.

The DSS Defendants have engaged Stout Risius Ross, LLC (“Stout”)

to provide expert opinions regarding the value of the assets at issue.

trial in this matter began on December 12, 2022.

The Company vigorously defended its position that Maiden should recover nothing on its

The DSS Defendants’ experts at Stout provided expert opinions regarding the value of the assets at issue and the deficiencies

with Maiden’s designated expert’s opinions.

The jury returned a verdict in favor of Maiden, and the Court entered a judgment

on December 20, 2022.

The DSS Defendants filed post-judgment motions seeking reversal of the judgment for several reasons, including

(1) the evidence does not support Maiden’s claim against the Company;

(2) recovery of exemplary damages under TUFTA is unsupported;

and (3) the evidence established that the DSS Defendants are entitled to judgment in their favor on their affirmative defenses.

the DSS Defendants filed their post-judgment motions, the case was settled for $8.75 million, the Court’s December 20, 2022 judgment

was vacated, and the case was dismissed with prejudice .

addition to the foregoing, we may become subject to other legal proceedings that arise in the ordinary course of business and have not

been finally adjudicated.

Adverse decisions in any of the foregoing may have a material adverse effect on our results of operations,

cash flows or our financial condition.

The Company accrues for potential litigation losses when a loss is probable and estimable.

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 December 31, 2023 and 2022 the Company had not

accrued any contingent legal fees pursuant to these arrangements.

Payments – The Company is party to certain agreements with funding partners who have rights to portions of

intellectual property monetization proceeds that the Company receives.

As of December 31, 2023 and 2022, there are no contingent payments

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

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 December 31, 2024 and December 31, 2023, $ 200,000 , and $ 200,000 , respectively, have been recorded

in relation to the Equivir License as development of the Equivir technology.

Agreements – As of December 31, 2024, DSS has no employment or severance agreements with members of its management

Its subsidiary 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, $ 100,000 for the second year of the

employment term, and $ 100,000 for the third year of the employment term.

As of December 31, 2024, approximately $ 38,000 is accrued for

year one 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 December 31, 2024 and 2023 the Company had not accrued any contingent legal fees pursuant

to these arrangements.

Payments – The Company is party to certain agreements with funding partners who have rights to portions of intellectual

property monetization proceeds that the Company receives.

As of December 31, 2024 and 2023, there are no contingent payments due.

DISCONTINUED OPERATIONS

Discontinued Operations

May 4, 2023, the Company distributed approximately 280 million shares of SHRG beneficially held by DSS and Decentralized Sharing Systems

in the form of a dividend to the shareholders of DSS common stock.

Upon completion of this distribution, DSS will retain an ownership

interest in SHRG of approximately 7 %.

Immediately prior to this distribution, DSS owned approximately 81 % of the issued and outstanding

common shares of SHRG.

As a result, SHRG, whose operations represented a significant portion of our Direct Marketing segment, was deconsolidated

from our consolidated financial statements effective as of May 1, 2023 (the “Deconsolidation”) and will be treated as discontinued

operations on the face of our financial statements.

Subsequent to April 30, 2023, the assets and liabilities of SHRG are no longer included

within our consolidated balance sheets.

Any discussions related to results, operations, and accounting policies associated with SHRG

refer to the periods prior to the Deconsolidation.

Deconsolidation, we recognized an impairment of assets due to the deconsolidation of SHRG approximately $ 6,220,000 which is recorded

as an impairment of assets due to the deconsolidation in our consolidated statements of operations.

Subsequent to the Deconsolidation,

we accounted for our equity ownership interest in SHRG as a marketable security and at the quoted price stock price of SHRG, valued at

approximately $ 74,000 at December 31, 2023.

following tables show the major classes of assets and liabilities held for sale and results of operations of the discontinued operation:

of Major Classes of Assets and Liabilities Held for Sale and Results of Operations

Services Global Corporation

of Operations Loss - Discontinued Operations

the Years Ended December 31,

For the Year Ended

Direct marketing

Total revenue

Costs and expenses:

Cost of revenue

Selling, general and administrative

Total costs and expenses

Operating loss

Other income (expense):

Other income (expense)

Interest income

Gain (loss) on investments

Impairment of assets

Loss from discontinued operations before income taxes

( 3,481,000 )

Income tax benefit/(loss)

Loss from discontinued operations

( 3,481,000 )

SUPPLEMENTAL CASH FLOW INFORMATION

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cash flow information for the years ended December 31:

Schedule of Supplemental Cash Flow Information

of Supplemental Cash Flow Information

Cash paid for interest

Cash paid for income taxes

Non-cash investing and financing activities:

Right of use asset

Shares issued in lieu of bonus cash

Purchase of notes receivable with company stock

Purchase of marketable security with Company stock

Third party Note receivable received in lieu of cash

1 unchanged sentence

Segment Information

Company’s nine businesses lines are organized, managed, and internally reported as five operating segments.

Company’s businesses lines are organized, managed, and internally reported as five operating segments.

One of these operating

41 unchanged sentences

financial needs of the world Gig Economy.

segment structure presented below represents a change from the prior year for the inclusion of our Biotechnology, Securities, and Commercial

Lending segments and the removal of our Plastics segment, Digital Group and IP Technology Management segment as the Plastics segment

was discontinued in 2020, DSS Digital was sold and discontinued in May 2021 and activities surrounding our IP Technology Management segment

have significantly decreased.

The amounts for these segments have been included in the Corporate reporting segment for the year ended

December 31, 2023 and 2022, as necessary, below for reconciliation purposes.

information concerning the Company’s operations by reportable segment for the twelve months ended December 31, 2024 and 2023 is

1 unchanged sentence

would report the results contained herein:

Schedule of Operations by Reportable Segment

of Operations by Reportable Segment

Year Ended December 31, 2024

1 unchanged sentence

Commercial Lending

Direct Marketing

Biotechnology

Assets held for sale

Depreciation and amortization

Cost of revenue

Interest expense

Interest Income

Stock based compensation

Net income (loss) from continuing operations

Gross profit (loss)

( 4,786,000 )

( 4,442,000 )

Operating expense

Operating income (loss)

( 2,152,000 )

2 unchanged sentences

( 2,781,000 )

Capital expenditures

Identifiable assets

( 42,596,000 )

Other income (expense)

( 1,186,000 )

( 3,784,000 )

( 6,822,000 )

( 11,102,000 )

Net income (loss) from continuing operations before taxes

( 2,311,000 )

( 2,074,000 )

( 32,755,000 )

( 14,367,000 )

( 2,013,000 )

( 53,698,000 )

Year Ended December 31,2023

Product Packaging

Commercial Lending

Direct Marketing

Biotechnology

Depreciation and amortization

Cost of revenue

Interest expense

Stock based compensation

Net income (loss) from continuing operations

Gross profit (loss)

( 2,786,000 )

Operating expense

Operating income (loss)

( 30,876,000 )

3 unchanged sentences

( 3,251,000 )

Capital expenditures

Identifiable assets

( 50,778,000 )

Other income (expense)

( 7,268,000 )

( 2,677,000 )

( 9,242,000 )

( 3,264,000 )

( 23,261,000 )

Net income (loss) from continuing operations before taxes

$ ( 31,501,000 )

$ ( 9,567,000 )

$ ( 7,185,000 )

$ ( 19,694,000 )

$ ( 6,515,000 )

$ ( 74,039,000 )

International

revenue, which consists of sales to customers with operations in Canada, Western Europe, Latin America, Africa, the Middle East and Asia

comprised 7.0 % of total revenue for 2023 ( 11.0 % - 2022).

Revenue is allocated to individual countries by customer based on where the

product is shipped.

The Company had no long-lived assets in any country other than the United States for any period presented.

revenue, which consists of sales to customers with operations in Canada, Latin comprised less

than 1.0 % of total revenue for 2024 ( 7.0 %

Revenue is allocated to individual countries by customer based on where the product is shipped.

The Company had no

long-lived assets in any country other than the United States for any period presented.

following tables disaggregate our business segment revenues by major source:

of Disaggregation of Revenue

Products Revenue Information:

Schedule of Disaggregation of Revenue

Twelve months ended December 31, 2024

1 unchanged sentence

Commercial and Security Printing

Total Printed Products

Total Printed Products Revenue

Twelve months ended December 31, 2023

1 unchanged sentence

Commercial and Security Printing

Total Printed Products

Twelve months ended December 31, 2023

Direct Marketing Internet Sales

Total Direct Marketing

Twelve months ended December 31, 2022

Direct Marketing Internet Sales

Total Direct Marketing

Twelve months ended December 31, 2023

Rental income

Total Rental Income

Total Printed Products Revenue

Commercial Lending Revenue Information:

Twelve months ended December 31, 2024

Rental income

Total Rental Income

Net investment Revenue

Total Commercial Lending Revenue

Twelve months ended December 31, 2023

Commission income

Total commission income

Net Investment Revenue

Total Commercial Lending Revenue

Direct Marketing Revenue Information:

Twelve months ended December 31, 2024

Commission income

Total commission income

months ended December 31, 2023

Management fee income

Direct Marketing Internet Sales

Total Direct Marketing Revenue

Twelve months ended December 31, 2023

Management fee income

Total Management fee income

Investment Income

Direct Marketing Internet Sales

Total Direct Marketing Revenue

Securities Revenue Information:

Twelve months ended December 31, 2024

Net investment income

Total Net Investment Income

Rental Revenue

Commisions Revenue

Total Securities revenue

Twelve months ended December 31, 2023

Net investment income

Total Net Investment Income

Rental Revenue

Commission Revenue

Total Securities revenue

Related Party Transactions

12 unchanged sentences

investment of approximately $ 750,000 and unrealized loss of $ 50,000 , respectively.

March 2, 2020, AMRE entered into a $ 200,000 unsecured promissory note with LVAMPTE, a related party.

The Note calls for interest to be

paid annually on March 2 with interest fixed at 8.0 %.

As further incentive to enter into this Note, AMRE granted LVAMPTE warrants to

purchase shares of common stock of AMRE (the “Warrants”).

The amount of the warrants granted is the equivalent of the Note

Principal divided by the Exercise Price.

The Warrants are exercisable for four years and are exercisable at $ 5.00 per share (the “Exercise”

In March 2022, this debt was converted into equity in AMRE, and LVAMPTE exercised the warrants for $ 200,000 (see the consolidated

statement of changes in stockholders’ equity) The holder is a related party owned by the Chairman of the Company’s board

of directors.

March 18, 2021, the Company entered into an agreement with Alset EHome International, Inc.

(“Seller”), a related party, to

purchase from the Seller’s its wholly owned subsidiary Impact Oncology PTE Ltd.

(“IOPL”) for a purchase price $ 2,480,000 .

The acquisition of IOPL has been treated as an asset acquisition as IOPL does not meet the definition of a business as defined in Topic

IOPL owns 2,480,000 shares of common stock of Vivacitas along with the option to purchase an additional 250,000 shares of common

The Sellers largest shareholder is Mr.

Heng Fai Ambrose Chan, the Chairman of the Company’s board of directors and its largest

At December 31, 2022 the full value of this investment was impaired.

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 matures on October

12, 2022 , and contains an auto renewal period of three months.

As of December 31, 2023 and December 31, 2022, $ 547,000 and $ 3,000,000 ,

respectively, are included in Current portion of long-term debt, 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 nine months.

This loan was funded during March 2022.

As of December 31, 2023 $ 2,131,000 is included in the Current portion of long-term debt, net on the consolidated balance sheet.

December 31, 2022 $ 3,008,000 is included in the Current portion of long-term debt, net on the consolidated balance sheet.

November 2021, AMRE entered into a convertible promissory note (“Alset Note”) with Alset International Limited (“Alset

International”), a related party, for the principal amount of $ 8,350,000 .

The Alset Note accrues interest at 8 % per annum and matures

in December 2023 , with interest due quarterly and the principal due at maturity.

Principal and interest of approximately $ 8,805,000 is

included in long-term debt, net on the accompanying consolidated balance sheet on December 31, 2022.

On May 17, 2022, the shareholders

of the Company approved the issuance of up to 21,366,177 Shares our Common Stock to Alset International to purchase the Convertible Promissory

Note issued by American Medical REIT, Inc.

with a principal amount of $ 8,350,000 and accrued unpaid interest of $ 119,000 through December

This transaction was finalized in July 2022 and is eliminated upon consolidation into DSS.

Interest expense for this note totaled

$ 677,000 for year ended December 31, 2023 and $ 346,000 for year ended December 31, 2022.

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

EHome International Inc.

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

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

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

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

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

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

This transaction was completed on March 9, 2022.

In addition, the Company’s Executive

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

On July 26, 2022, APB and Borrower 11 entered into a promissory note (“Note

11”) in the principal sum of $ 1,000,000 with interest of 8 %.

All unpaid principal and interest due on July 26, 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.

The outstanding principal and interest at December 31, 2022 approximates

$ 924,000 , net of $ 66,000 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 Borrower 11.

October 2017, Sharing Services issued a Convertible Promissory Note in the principal amount of $ 50,000 (the “Note”) to HWH

International, Inc.

(“HWH” or the “Holder”), a related party.

HWH is affiliated with Heng Fai Ambrose Chan, who

became a Director of the Company in April 2020.

The Note is convertible into 333,333 shares of the Company’s Common Stock.

with issuance of the Note, the Company issued to HWH a detachable stock warrant to purchase up to an additional 333,333 shares of the

Company’s Common Stock, at an exercise price of $ 0.15 per share.

Under the terms of the Note and the detachable stock warrant,

the Holder is entitled to certain financing rights.

If the Company enters into more favorable transactions with a third-party investor,

it must notify the Holder and may have to amend and restate the Note and the detachable stock warrant to be identical.

On August 9, 2022,

HWH and the Company executed an agreement to settle the Note and cancel the related stock warrant for $ 78,635.62 , which amount represents

the principal plus accrued interest.

The Company made the payment to HWH on August 9, 2022.

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

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

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

(“Alset EHome”), a related party.

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

owner of the outstanding shares of Alset EHome.

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

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

On August 29, 2022, DSS Financial

Management Inc and Borrower 10, a related party, entered into a promissory note (“Note 10”) 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 December 31, 2023 and December 31, 2022 approximates $ 100,000 , and $ 100,000 ,

respectively, and is included in Notes receivable on the accompanying consolidate balance sheet, of which $ 76,000 is included in the Current

portion of notes receivable and $ 24,000 is included in the long-term portion of notes receivable at December 31, 2023.

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 installments beginning on September 14, 2022.

All unpaid principal

and interest is due on August 29, 2025 .

The outstanding principal and interest at December 31, 2024 approximated $ 86,000 , and was fully

reserved for as of December 31, 2024.

At December 31, 2023, the balance approximated $ 100,000 of which $ 76,000 is included in the Current

portion of notes receivable and $ 24,000 is included in the long-term portion of notes receivable.

DSS owns 24.9 % of the outstanding common

shares of BMIC.

On 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 .

The outstanding principal and interest

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

At December 31, 2023 approximates $ 107,000

with approximately $ 53,000 of principal and accrued interest classified as Current portion notes receivable, and the remaining balance

of approximately $ 54,000 is recorded as notes receivable, on the accompanying consolidated balance sheet.

DSS owns 24.9 % of the outstanding

common shares of BMIC.

On July 26, 2022, APF and VEII,

(“VEII”) entered into a promissory note (“Note 10”) in the principal sum of $ 1,000,000 with interest of 8 %

with all unpaid principal and interest due on July 26, 2024 .

This note was amended so that all unpaid principal and interest is due July

The outstanding principal and interest on September 30, 2024 approximates $ 959,000 , and is included in notes receivable on the

accompanying consolidate balance sheet.

Approximately $ 480,000 of Note 10 was reserved for as of March 31, 2024.

No additional reserve

was deemed necessary 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.

Ambrose Chan, the Chairman of DSS, Inc is also the on the board of directors of VEII.

On 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 matures on October 12, 2022 , and contains

an auto renewal period of three months.

As of December 31, 2024 and December 31, 2023, $ 463,000 and $ 547,000 , respectively, are included

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

On 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 matures on October

12, 2022 , and contains an auto renewal period of nine months.

This loan was funded during March 2022.

As of December 31, 2024 $ 145,000

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

As of December 31, 2023 $ 2,131,000 is included

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

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 .

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 .

SUBSEQUENT EVENTS

Subsequent Events

The Company has evaluated all

subsequent events and transactions through March 26, 2024, the date that the consolidated financial statements were available

to be issued and other then the reverse stock split identified in Note 14 and noted no subsequent events requiring financial statement recognition or disclosure.

Company has evaluated all subsequent events and transactions through March 31, 2025, the date that the consolidated financial statements

were available to be issued and have identified the below transactions:

December 27, 2024, True Partner International Limited, a wholly owned subsidiary of DSS Financial Management, Inc.

entered into a share

subscription agreement, in which they invested approximately $ 1,000,000 in True Partner Capital Holding Limited in exchange for 19,500,000

This transaction was concluded in February 2025.

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 under

the Plan, for services rendered.

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

March 21, 2025, the Company via its subsidiaries DSS Blockchain Security, DSS BioHealth Security and DSS Securities, each sold 499,800

shares of Impact BioMedical for net proceeds of approximately $ 1,616,428 .

Further, on March 26, 2025, the Company sold an additional 122,285 shares

of Impact BioMedical.

The total grossed for these transactions was approximately $ 1,969,000 .

Company and its subsidiary Impact BioMedical have agreed to settle a portion of the outstanding indebtedness that Impact BioMedical owes

to the Company under the Promissory Note in the amount of $ 8,697,142.80 through the issuance of 2,415,873 shares of the Company’s

common stock, at a conversion ratio of $ 3.60 per share, which was equal to the closing market price of the Company’s common stock

on March 24, 2025.

March 27, 2025, the Company finalized the sale of its Plano, Tx.

Facility for a gross sales price of $ 9,500,000 .

9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

June 29, 2022, the Company’s Board of Directors (the “Board”) approved replacing Turner, Stone & Company, LLP (the

“Former Accountant”) as our independent registered public accounting firm, with Grassi & Co.

Accountant”) as our independent registered public accounting firm, effective July 1, 2022.

The engagement of the New Accountant

was recommended and approved by the Board.

Former Accountant’s audit report on our financial statements for the year ended December 31, 2021 contained no adverse opinion

or disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope or accounting principles.

The audit report

of Turner, Stone & Company, LLP on our financial statements for the year ended December 31, 2021 contained no adverse opinion or

disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope or accounting principles.

the year ended December 31, 2021 and the interim period ending June 30, 2022, there were no “disagreements” (as

such term is defined in Item 304 of Regulation S-K) with the Former Accountant or the Previous Accountant on any matter of accounting

principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the

satisfaction of the Former Accountant or Previous Accountant, would have caused them to make reference thereto in their reports on the

financial statements for such periods.

to retaining the New Accountant, the Company did not consult with the New Accountant regarding either:

(i) the application of accounting

principles to a specified transaction, either contemplated or proposed, or the type of audit opinion that might be rendered on the Company’s

financial statements;

or (ii) any matter that was the subject of a “disagreement” or a “reportable event” (as

those terms are defined in Item 304 of Regulation S-K).

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data