What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-15 compared with 2024-11-13 · 642 added, 965 removed, 641 unchanged (71% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

September 30, 2024

March 31, 2025

December 31, 2024

1 unchanged sentence

Cash and cash equivalents

Restricted cash

Accounts receivable, net

Inventory, net

Assets held for sale

Current portion of notes receivable

Current portion of notes receivable - related party

Current portion of notes receivable

Prepaid expenses and other current assets

1 unchanged sentence

Property, plant and equipment, net

Investment in real estate, net

Other investments

1 unchanged sentence

Marketable securities

Notes receivable, net

Notes receivable - related party, net

Notes receivable

2 unchanged sentences

$ 106,453,000

$ 153,192,000

LIABILITIES AND STOCKHOLDERS’ EQUITY

5 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

Total current liabilities

14 unchanged sentences

( 303,072,000 )

Total DSS stockholders’ equity

Total stockholders’ equity of the Company

Non-controlling interest in subsidiaries

2 unchanged sentences

$ 106,453,000

$ 153,192,000

accompanying notes to the condensed consolidated financial statements.

2 unchanged sentences

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

Printed products

1 unchanged sentence

Net investment income

Direct marketing

Commission revenue

7 unchanged sentences

( 4,680,000 )

( 14,287,000 )

( 15,567,000 )

Other income (expense):

Interest income

Dividend income

Other income (expense)

Interest expense

Foreign Currency Translation Adjustment

(Loss) gain on equity method investment

(Loss) gain on investments

( 1,021,000 )

( 2,471,000 )

Impairment of assets upon deconsolidation

( 6,220,000 )

Loss on equity method investment

Loss on investments

Provision for loan losses

( 1,179,000 )

( 4,936,000 )

(Loss) gain on sale of asset

( 1,281,000 )

Loss from continuing operations before income taxes

( 5,701,000 )

( 6,681,000 )

Loss on sale of real estate

Loss from operations before income taxes

( 5,363,000 )

1 unchanged sentence

Income tax benefit (expense)

Loss from continuing operations

$ ( 5,296,000 )

$ ( 5,109,000 )

( 15,762,000 )

( 29,580,000 )

Loss from discontinued operations, net of tax

( 3,481,000 )

$ ( 5,701,000 )

$ ( 6,681,000 )

$ ( 15,762,000 )

$ ( 33,061,000 )

Loss attributed to noncontrolling interest

Net loss attributable to common stockholders

$ ( 5,283,000 )

$ ( 4,342,000 )

$ ( 14,034,000 )

$ ( 30,325,000 )

Amounts attributable to DSS stockholders

Loss from continuing operations net of taxes

( 5,283,000 )

( 4,342,000 )

( 14,034,000 )

( 27,033,000 )

Loss from discontinued operations net of taxes

( 3,292,000 )

Net loss attributable to DSS shareholders

$ ( 5,283,000 )

$ ( 4,342,000

Loss from operations attributed to noncontrolling interest

Net loss attributable to DSS common stockholders

$ ( 4,777,000 )

$ ( 4,072,000 )

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

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

Loss per common share attributable to common stockholders

Shares used in computing loss per common share:

2 unchanged sentences

Consolidated Statements of Cash Flows

the Nine Months Ended September 30,

2023 (restated)

the Three Months Ended March 31,

Cash flows from operating activities:

1 unchanged sentence

$ ( 5,109,000 )

Loss from discontinued operations

Loss from continuing operations

$ ( 15,762,000 )

$ ( 29,580,000 )

Adjustments to reconcile net loss to net cash used by

operating activities:

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

Depreciation and amortization

Loss (income) on equity method investment

Stock based compensation

Issuance of common stock for bonus

Stock based payments for professional services

Loss on equity method investment

Loss on investments

Loss on sale of real estate

Change in ROU assets

(Loss) gain on sale of assets

Impairment of assets upon deconsolidation

Provision for loan losses

Change in inventory obsolescence

Accrued interest on notes payable

Provision for loan loss recoveries

Impairment of notes receivable

Decrease (increase) in assets:

Accounts receivable

Assets held for sale

Prepaid expenses and other current assets

1 unchanged sentence

Accounts payable

( 2,896,000 )

Accrued expenses

( 15,549,000 )

Change in ROU liabilities

Other liabilities

Net cash used by operating activities - continuing operations

( 9,181,000 )

( 17,554,000 )

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

Sale of real estate

Purchase of investment

( 1,000,000 )

Disposal of property, plant and equipment

Sale of investment, related party

Sale of marketable securities

Issuance of new notes receivable, net origination fees

Payments received on notes receivable

4 unchanged sentences

( 1,062,000 )

Borrowings of long-term debt

Issuances of common stock, net of issuance costs

Net cash provided (used) by financing activities

( 3,243,000 )

Net increase (decrease) in cash - continuing operations

Payments on margin loans

( 2,806,000 )

Net increase (decrease) in cash - discontinued operations

Borrowings of long-term debt

Net cash used by financing activities

( 11,694,000 )

Net increase (decrease) in cash

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

Cash and cash equivalents and restricted cash at end of

accompanying notes to the condensed consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Changes in Stockholders’ Equity

Non-controlling

Preferred Stock

Additional Paid-in

Non- controlling Interest in

Balance, December 31, 2023

3 unchanged sentences

( 4,072,000 )

Stock based payments

Dividend in kind - Deconsolidation

of Sharing Services Global Corporation

( 1,037,000 )

( 5,109,000 )

( 1,206,000 )

Deconsolidation of Sharing

( 30,325,000 )

Balance, March 30, 2024

$ 319,963,000

$ ( 260,248,000 )

September 30, 2023

Balance, December 31, 2024

$ 323,150,000

1 unchanged sentence

$ 323,150,000

Balance, December 31, 2023

$ ( 303,072,000 )

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

Issuance of common stock for bonus

Stock based payments for professional services rendered

Stock based payments

( 4,777,000 )

Initial public offering of

Impact BioMedical

( 4,777,000 )

( 5,296,000 )

Balance, March 31, 2025

$ 325,530,000

$ ( 307,849,000 )

September 30, 2024

$ 325,530,000

13 unchanged sentences

(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.

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

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.

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

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

13 unchanged sentences

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

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

(“Decentralized”) provides services

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

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 Financial, Inc.

(“APF”, formally American

Pacific Bancorp, Inc.

“APB”), focused on acquiring equity positions in (i) undervalued

commercial bank(s), bank holding companies and nonbanking licensed financial companies operating in the United States, South East Asia,

Taiwan, Japan and South Korea, and (ii) companies engaged in—nonbanking activities closely related to banking, including loan syndication

services, mortgage banking, trust and escrow services, banking technology, loan servicing, equipment leasing, problem asset management,

SPAC (special purpose acquisition company) consulting services, and advisory capital raising services.

(5) Securities and Investment

Management was established to develop and/or acquire assets in the securities trading or management arena, and to pursue, among other

product and service lines, broker dealers, and mutual funds management.

Also in this segment is the Company’s real estate investment

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

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

(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).

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

energy business that focuses on environmentally responsible and sustainable measures.

Alset Energy, Inc, the holding company for this

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

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

(3) Our Commercial Lending business division, driven by American Pacific Financial (“APF”), is organized for the purposes

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

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

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

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

company) consulting services, and advisory capital raising services.

(4) Securities and Investment Management was established to develop

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

and mutual funds management.

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

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

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

the REIT was formed

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

(5) Direct Marketing, led by the holding

corporation, Decentralized Sharing Systems, Inc.

(“Decentralized”) provides services to assist companies in the emerging

growth “Gig” business model of peer-to-peer decentralized sharing marketplaces.

Direct Marketing’s products include,

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

accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments, unless

otherwise indicated) necessary to present fairly our consolidated financial position as of September 30, 2024 and December 31, 2023,

and the results of our consolidated operations for the interim periods presented.

We follow the same accounting policies when preparing

quarterly financial data as we use for preparing annual data.

These statements should be read in conjunction with the consolidated financial

statements and the notes included in our latest annual report on Form 10-K/A, for the fiscal year ended December 31, 2023 (“Form

10-K/A”), and our other reports on file with the Securities and Exchange Commission (the “SEC”).

otherwise indicated) necessary to present fairly our consolidated financial position as of March 31, 2025 and December 31, 2024, and

the results of our consolidated operations for the interim periods presented.

We follow the same accounting policies when preparing quarterly

financial data as we use for preparing annual data.

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

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

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

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

2 unchanged sentences

intercompany balances and transactions have been eliminated in consolidation.

Deconsolidation

of Sharing Services Global Corporation(“SHRG”) - On 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

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”).

The consolidated statement of operations for the fiscal quarter ended September

30, 2023, therefore includes one month of activity related to SHRG prior to 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 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.

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

9 unchanged sentences

Reclassifications -

- Cost associated with Professional fees for the three

and nine months ended September 30, 2023 and the nine months September 30, 2024 have been reclassified to Research and development to

conform with current period presentation.

Cost associated with Professional fees approximating $ 133,000 for the three months ended March 31, 2024 have been reclassified to

Research and development to conform with current period presentation.

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

17 unchanged sentences

abilities to pay.

September 30, 2024, and December 31, 2023, the Company established a reserve for credit losses of approximately $ 2,497,000 and $ 2,494,000 ,

March 31, 2025, December 31, 2024, and January 1, 2024 the Company established a reserve for credit losses of approximately $ 1,013,000 ,

$ 1,613,000 ,

and $ 2,494,000 , respectively.

Accounts receivable, net at March 31, 2025, December 31, 2024, and January 1, 2024 was $ 2,627,000 , $ 3,068,000 , and

$ 3,994,000 , respectively.

1 unchanged sentence

Concentration

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

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

of September 30, 2024, two customers accounted for approximately 20 % and 10 % of our consolidated revenue and two customers accounted for

approximately 26 % and 23 % of our trade accounts receivable balance.

of September 30, 2023, one customer accounted for approximately 21 % of our consolidated revenue and two customers accounted for approximately

32 % and 15 % of our consolidated trade accounts receivable balance.

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

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

institutions.

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

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

and 11 % of our trade accounts receivable balance.

As of March 31, 2025 one vendor accounted for approximately 13 %

of our cost of revenue.

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

11 unchanged sentences

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.

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.

At March 31, 2025, December 31, 2024, and January 1, 2024 the Company established a reserve for credit losses of

approximately $ 1,013,000 , $ 1,613,000 , and $ 2,494,000 , respectively.

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

36 unchanged sentences

slow-moving items.

An allowance for obsolescence of approximately $ 45,000 and $ 18,000 associated with the inventory at our Premier subsidiary

for September 30, 2024, and December 31, 2023, respectively.

An allowance for obsolescence of approximately $ 159,000 and $ 180,000 associated with the inventory at our Premier

subsidiary for March 31, 2025, and December 31, 2024, respectively.

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

12 unchanged sentences

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

Depreciation, amortization, cost to maintain and secure the buildings as

well as interest incurred on the loans to procure the real estate are included in Cost of revenue on the accompanying Condensed consolidated

statement of operations.

During 2023, the land and buildings related

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

held for sale – The Company has several buildings and the associated land they occupy for sale as of September 30, 2024

and December 31, 2023.

These consist of primarily of retail space in Lindon, Utah approximating $ 5,593,000 (sale of this building was

finalized during Q2 2024) and the medical facilities associated with AMRE LifeCare of approximately $ 41,610,000 and AMRE Winter Haven

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

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.

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

would indicate the need for an impairment is needed for the nine months ended September 30, 2024.

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

held for sale – The Company has several buildings and associated land for sale as of March 31, 2025.

The balance associated

with AMRE LifeCare was approximately $ 24,722,000 , AMRE Shelton was approximately $ 6,322,000 and AMRE Winter Haven was approximately $ 4,396,000 .

Assets - The estimated fair values of

acquired intangibles are generally determined based upon future economic benefits such as earnings and cash flows.

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.

Impairment is tested under ASC 350 No circumstances or events have occurred since the most recent analysis that would indicate the

need for an impairment is needed for the three months ended March 31, 2025.

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

18 unchanged sentences

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, and Impact BioMedical of $ 1,769,000 and $ 25,093,000 , respectively.

The goodwill for

APB, and Sentinel Co.

of approximately $ 29,744,000 , and $ 1,234,000 respectively, were deemed impaired and written off at December 31,

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

for the nine months ended September 30, 2024.

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

deemed necessary of approximately $ 25,093,000 .

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

the need for an impairment is needed for the three months ended March 31, 2025.

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

13 unchanged sentences

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 three and nine months ended September 30, 2023, potential dilutive instruments was 0 .

For the three and nine months ended September 30, 2024, potential dilutive instruments was 0 .

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 three months ended

March 31, 2025 and 2024, there were no potential dilutive instruments issued and outstanding.

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

4 unchanged sentences

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

Concern - The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a

going concern.

This basis of accounting contemplates the recovery of our assets and the satisfaction of liabilities in the normal course

These consolidated financial statements do not include any adjustments to the specific amounts and classifications of assets

and liabilities, which might be necessary should we be unable to continue as a going concern.

While the Company has approximately $ 11.6

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 $ 11.6 million in cash as of September 30, 2024, the Company believes it can continue as a going concern, due to its ability

to generate operating cash through the sale of its $ 4.1 million of Marketable Securities.

The Company has also taken steps to sell its

real estate holdings assets of AMRE LifeCare and Winter Haven located in Texas, Pennsylvania, and Florida.

The Company adopted Accounting Standards Update (ASU) 2023-09, Income Taxes

Improvements to Accounting for Income Taxes, effective for the fiscal year beginning January 1, 2025.

The Company applied

the updated guidance during the interim period for the quarter ended March 31, 2025, in accordance with the modified retrospective approach.

ASU 2023-09 enhances guidance on income tax accounting, with a focus on tax law changes, the allocation of tax credits, and the treatment

of uncertain tax positions.

Due to the Company’s ongoing operating losses and significant net operating loss (NOL) carry forwards,

the Company does not perform quarterly tax provisions.

As a result, the adoption of ASU 2023-09 did not result in any immediate material

impact on the Company’s consolidated financial statements.

The Company has continued to evaluate its deferred tax asset position,

with the full utilization of its NOL carryforwards remaining dependent on the availability of future taxable income.

Since no taxable

income has been generated, and in light of the continued operating losses, there was no adjustment recorded to retained earnings upon

the adoption of ASU 2023-09.

The Company will continue to monitor its tax positions and NOL utilization, making adjustments to its deferred

tax asset valuation allowance as needed in future periods.

Concern – The accompanying consolidated financial statements have been prepared assuming

that the Company will continue as a going concern.

This basis of accounting contemplates the recovery of our assets and the satisfaction

of liabilities in the normal course of business.

These consolidated financial statements do not include any adjustments to the specific

amounts and classifications of assets and liabilities, which might be necessary should we be unable to continue as a going concern.

the Company has approximately $ 10.8

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.

These factors raise substantial doubt about the Company’s

ability to continue as a going concern within one year of the date that the financial statements are issued.

from its $ 10.8 million in cash as of March 31, 2025, to continue as a going concern, the Company can generate operating cash through the sale of its $ 6.5 million of Marketable Securities.

To continue as a going concern, The Company has also taken steps to sell its real estate holdings assets

of AMRE LifeCare, Winter Haven, and Shelton located in Texas, Pennsylvania, Florida, and Connecticut.

These properties approximate

$ 35.4 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.

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 Quarterly Report.

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

continue as a going concern has been alleviated.

Issued Accounting Pronouncements — In 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 of the quarter ending September 30, 2024.

Restatement of previously issued financial statements

Company has restated the 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.

The nature and impact of this

adjustment on the Company’s previously issued financial statements is summarized as follows and the effects by impacted line items

are detailed in the tables below.

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 an 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 has determined that Deconsolidation also requires the recognition

of discontinued operations.

Management and the Audit Committee of the Company has concluded that restatement of its December 31, 2023

financial statements, filed on March 27, 2024, was required.

following tables summarize the effect of the restatement on each financial statement line items as of the September 30, 2023:

of Restatement

of Previously Issued Financial Statements

As Previously Reported

Consolidated Statements of Operations Income (Loss) for the nine months ended September 30, 2023

Direct marketing revenue

( 4,325,000 )

Total revenue

( 4,325,000 )

Cost of revenue

( 1,258,000 )

Selling, general and administrative (including stock based compensation)

( 4,728,000 )

Total costs and expenses

( 5,986,000 )

Operating loss

$ ( 17,228,000 )

( 1,661,000 )

$ ( 15,567,000 )

Other income (expense)

Loss on investment

$ ( 30,490,000 )

( 28,019,000 )

$ ( 2,471,000 )

Impairment of assets due to deconsolidation

$ ( 6,220,000 )

Loss from continuing operations before income taxes

$ ( 53,030,000 )

( 23,459,000 )

$ ( 29,571,000 )

Loss from continuing operations

$ ( 53,030,000

$ ( 29,580,000

(Loss) from discontinued operations, net of tax

$ ( 3,481,000 )

$ ( 53,039,000

( 19,978,000 )

$ ( 33,061,000 )

Net loss attributable to common stockholders

$ ( 50,303,000 )

( 19,978,000 )

$ ( 30,325,000 )

Loss per common share - basic earnings per share

Loss per common share - diluted earnings per share

Loss per common share - discontinued operations basic

Loss per common share - discontinued operations diluted

Consolidated Statements of Cash Flows for the nine months ended September 30, 2023

$ ( 53,039,000 )

( 19,978,000 )

$ ( 33,061,000 )

Loss from discontinued operations

( 3,481,000 )

$ ( 3,481,000 )

Loss from continuing operations

( 29,580,000 )

$ ( 29,580,000 )

Loss (gain) on investments

( 26,198,000 )

Impairment of assets

Net cash used by operating activities - continuing operations

( 17,554,000 )

$ ( 17,554,000 )

Net cash used by operating activities - discontinued operations

( 3,481,000 )

$ ( 3,481,000 )

Net increase (decrease) in cash - continuing operations

( 8,912,000 )

$ ( 8,912,000 )

Net increase (decrease) in cash - discontinued operations

( 3,481,000 )

$ ( 3,481,000 )

Consolidated Statements of Changes in Stockholders’ Equity for the nine months ended September 30, 2023

Dividend in kind - Deconsolidation of Sharing Services Global Corporation

( 1,206,000 )

$ ( 1,206,000 )

Deconsolidation of Sharing

Services Global Corp

$ ( 50,303,000 )

( 19,978,000 )

$ ( 30,325,000 )

Accumulated deficit

$ ( 225,873,000 )

$ ( 225,874,000 )

Total stockholders’ equity

$ 127,747,000

$ 127,746,000

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.

Issued Accounting Pronouncements — 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.

The Company adopted ASC Topic 280, Segment Reporting , as part of

the updates to the segment reporting requirements under GAAP.

The new guidance requires the identification of operating segments and their

aggregation based on similar economic characteristics, and for those segments to be reported consistent with the internal management reporting

structure used by the chief operating decision maker (CODM).

As a result of this adoption, the Company has assessed its operating segments

and has realigned its segment reporting to more accurately reflect how its management team evaluates performance and makes strategic decisions.

The adoption of Topic 280 did not result in a change to the Company’s segment structure or to the method used to allocate resources

among segments.

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

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

9 unchanged sentences

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

of September 30, 2024, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater

of March 31, 2025, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater

than one year.

5 unchanged sentences

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

Sales Commissions

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

There were no sales commissions capitalized

as of September 30, 2024 or September 30, 2023.

as of March 31, 2025 or March 31, 2024.

and Handling Costs

22 unchanged sentences

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 September 30, 2024 and December 31, 2023, approximated $ 5,544,000

which is included in current notes receivable on the accompanying consolidated balance sheet.

As of September 30, 2024 and December

31, 2023, the Company has a reserve of $ 3,326,000

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;

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

As of March 31, 2025 and December 31, 2024 and the Company has a reserve of $ 5,544,000

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 % per annum.

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

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

The District Note was in the sum of $ 3,500,000

and incurs interest at a rate of 5.59 % per annum.

Principal and interest are due in full on September 22, 2022, and later amended to

extend the maturity date to September 19, 2024 .

Note 2 was repaid in full during March 2024.

6 unchanged sentences

with principal and interest due at the maturity date of October

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

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.

This note is in default

and the outstanding principal and interest of approximately $ 884,000

is fully reserved for as of March 31, 2025 and December 31, 2024.

December 28, 2021, APF entered into a promissory note (“Note 4”) with WestPark Capital Group, LLC.

4 unchanged sentences

with principal and interest due at the maturity date of December

On December 29, 2022, the maturity date of this note was extended

On December 29, 2022, the maturity

date of this note was extended to May

On November 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.

At December 31, 2023 outstanding

principal and interest of $ 253,000

is included in the Current portion of notes receivable on the consolidated balance

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 %,

due annually, and maturing in January

The outstanding principal and interest

at September 30, 2024 and December 31, 2023 approximates $ 116,000 and

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

was paid in full during October 2024.

until the outstanding principal and interest are paid in full.

The outstanding principal and interest was paid in full during 2024.

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 %, due annually, and maturing in January 2024 .

The outstanding principal and interest at March 31, 2025, and December 31, 2024 approximated

$ 18,000 and $ 17,000 , respectively and is and is included in Current portion of notes receivable on the accompanying consolidate balance

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

(“WUURII”), a corporation organized under the laws of the Republic of Korea entered into a promissory note (“Note

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 September 30, 2024 and December 31,

2023 is $ 484,000 and $ 446,000 , respectively.

This note has been extended to March 2025.

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

entered into a promissory note (“Note 6”).

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

The outstanding principal and interest at

March 31, 2025, and December 31, 2024 is $ 465,000

and $ 468,000 ,

respectively.

As of March 31, 2025 the Company has a reserve of $ 234,000 against the principal and interest outstanding.

This loan is currently

in default and terms are currently being re-negotiated.

May 9, 2022, DSS PureAir and Puradigm entered into a promissory note (“Note 7”) in the principal sum of $ 210,000

1 unchanged sentence

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

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

The outstanding principal and

interest at September 30, 2024 and December 31, 2023 approximates $ 224,000

of which $ 134,00 and $ 112,000

has been reserved for as of September 30, 2024 and December 31, 2023, respectively, and is included in Current portions of notes

receivable on the accompanying consolidate balance sheet.

principal and interest are due on February

This loan is currently in default and

terms are currently being re-negotiated.

The outstanding principal and interest at March 31, 2025 and December 31, 2024 approximates

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

8, related party

5 unchanged sentences

All unpaid principal and interest is due on August

The outstanding principal and interest at September 30, 2024 approximated $ 86,000 ,

and was fully reserved for as of September 30, 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.

The outstanding principal and interest at March 31, 2025, and December 31, 2024 approximated $ 83,000 ,

and was fully reserved for as of March 31, 2025 and December 31, 2024.

DSS owns 24.9 %

2 unchanged sentences

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

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.

owns 24.9 % of the outstanding common shares of BMIC.

$ 102,000 with

interest at the prime rate plus 2 %

with a maturity date of May

The outstanding principal and

interest at March 31, 2025, and December 31, 2024 approximated $ 110,000 ,

and was fully reserved for as of March 31, 2025 and December 31, 2024.

DSS owns 24.9 %

of the outstanding common shares of BMIC.

10, related party

1 unchanged sentence

(“VEII”) entered into a promissory note (“Note 10”) in the principal sum

of $ 1,000,000

with interest of 8 %

of $ 1,000,000 with

interest of 8 %

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 $ 480,000

of Note 10 was reserved for as of March 31, 2024.

No additional reserve was deemed necessary as of September 30, 2024.

outstanding principal and interest on December 31, 2023, approximates $ 939,000 ,

net of $ 20,000

of unamortized origination fees and is included in notes receivable on the accompanying consolidate balance sheet.

Heng Fai Ambrose

Chan, the Chairman of DSS, Inc is also the on the board of directors of VEII.

This note was amended so that all

unpaid principal and interest is due July 26, 2025.

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

2024 approximates $ 930,000 .

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

Heng Fai Ambrose Chan, the Chairman of DSS, Inc

is also the on the board of directors of VEII.

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

5 unchanged sentences

real property situated in Collier County, Florida.

outstanding principal and interest as of September 30, 2024 and December 31, 2023, was approximately $ 202,000 and $ 203,000 , respectively,

of which $ 143,000 is classified in Current notes receivable and the remaining $ 59,000 is classified as Notes receivable on the accompanying

consolidated balance sheet as of September 30, 2024.

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.

outstanding principal and interest as of March 31, 2025, and December 31, 2024 was approximately $ 200,000 and $ 201,000 , respectively.

As of March 31, 2025, approximately $ 200,000 is classified in Current notes receivable.

As of December 31, 2024, $ 184,000 is classified

in Current notes receivable and the remaining $ 17,000 is classified as Notes receivable on the accompanying consolidated balance sheet.

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 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

The outstanding principal,

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

The outstanding principal, interest, and associated discount was fully reserved for as of March 31, 2025 and

December 31, 2024.

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 ( 8.0 %

at September 30, 2024 and 8.5 % at December 31, 2023) with the total outstanding principal and interest due at the maturity date of March

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

recorded as Notes receivable on the accompanying consolidated balance sheet at December 31, 2023.

As of September 30, 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.

sum of $ 140,000

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

at the maturity date of March

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

This balance was fully reserved for at March 31, 2025 and December 31, 2024.

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 September 30,2024, the outstanding principal and interest

approximates $ 464,000 , of which $ 305,000 is classified as Current notes receivable and the remaining $ 159,000 is classified as Notes receivable

on the accompanying consolidated balance sheet.

Note 14, which incurs interest at a rate of 10.0 % with principal and interest due at the maturity date of April 27, 2026 .

1, 2024, monthly payments of approximately $ 28,000 are due with any unpaid interest and principal due at maturity.

As of March 31, 2025,

the outstanding principal and interest approximates $ 350,000 , of which $ 284,000 is classified as Current notes receivable and the remaining

$ 66,000 is classified as Notes receivable on the accompanying consolidated balance sheet.

As of December 31, 2024, the outstanding principal

and interest approximates $ 450,000 , of which $ 337,000 is classified as Current notes receivable and the remaining $ 113,000 is classified

as Notes receivable on the accompanying consolidated balance sheet.

Financial Instruments

3 unchanged sentences

of Cash and Marketable Securities by Significant Investment Category

September 30, 2024

March 31, 2025

Restricted Cash

Money Market Funds

13 unchanged sentences

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 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 losses.

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 losses.

receivable are stated at the amount owed by the customer.

5 unchanged sentences

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

of September 30, 2024 and December 31, 2023, we have reviewed the entire loan portfolio as well as all financial assets of the Company for

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

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

5 unchanged sentences

general loan portfolio reserves;

industry portfolio reserves, and specific loan loss

For the nine months ended September 30, 2024, and 2023, the Company recorded a Loan loss reserve of approximately $ 1,627,000 and $ 1,179 ,000,

respectively.

Loan Portfolio Reserve - Based upon the review of our loan portfolio, 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 $ 192,000

industry portfolio reserves, and specific loan

loss reserves.

For the three months ended March 31, 2025, March 31, 2024 and year ended December 31, 2024, the Company recorded a

Loan loss reserve of approximately $ 0 , $ 249,000

and $ 9,406,000 ,

of the loan portfolio loan balance as of September 30, 2024 and December 31, 2023, respectively.

respectively.

Loan Portfolio Reserve - Based upon the review of our loan portfolio, 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 and $ 196,000 of the loan portfolio loan balance as of March 31, 2025 and December 31, 2024,

respectively.

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

products, the risk is reduced.

Accordingly, we have not recorded a discretionary reserve as of September 30, 2024 and December 31, 2023.

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

principal and interest balance of $ 884,000

and have recorded a loan loss reserve for the full balance due the Company as of December 31, 2023 and September 30, 2024.

Company had also previously identified credit weakness in Puradigm and has placed a reserve approximating $ 2,884,000

and $ 3,461,000 against the outstanding principal and interest as of December 31, 2023 and September 30, 2024, respectively.

Previously, the Company identified credit weakness in Stemtech and has placed a reserve approximating $ 1,045,000

against the outstanding principal and interest as of December 31, 2023 and September 30, 2024.

During the first quarter of 2024, the

Company identified credit weakness in VEII and an individual and has placed a reserve approximating $ 479,000

and $ 135,000 ,

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

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.

No additional reserves were deemed necessary as of September 30, 2024.

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

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

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

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

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

Previously, the Company identified credit weakness in

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

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

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

There has been no change to this amount.

Also, during the first

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

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

The Company identified

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

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 March 31, 2025.

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

$ 639,000 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.

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

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.

June 13, 2024, the Company sold its retail space in Lindon, Utah for the sales price, net of expenses, of approximately $ 5,758,000 .

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

March 27, 2025, the Company finalized the sale of its Plano, Tx.

Facility for a gross sales price of $ 9,500,000 .

The associated asset

was previously classified as Held for sale in the amount of $ 9,750,000 , resulting in a loss on the sale of approximately $ 684,000 after

related expenses.

International Limited , related party

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.

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

The fair value of the marketable security

as of September 30, 2024 and December 31, 2023, was approximately $ 3,167,000

and $ 3,269,000 ,

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 March 31, 2025 and December 31, 2024, was approximately $ 2,277,000 and $ 2,518,000 ,

respectively.

During the nine months ended September 30, 2024 and 2023, the Company recorded unrealized loss of approximately $ 102,000

and $ 407,000 ,

During the three months ended March 31, 2025 and 2024, the Company recorded unrealized loss of approximately $ 241,000 and

$ 916,000 , respectively.

1 unchanged sentence

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

(“WestPark”) and

Century TBD, Inc.

(“TBD”) where the parties agreed to prepare a note and stock exchange agreement whereby DSS will assign the TBD Note to WestPark and WestPark shall issue to DSS a stock certificate reflecting 7.5 %

of the issued and outstanding shares of West Park.

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

2022 and valued at approximately $ 500,000

and is included in Investments on the consolidated balance sheet on December 31, 2023 and as of September 30, 2024.

(“WestPark”) and Century

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

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

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

in Investments on the consolidated balance sheet on March 31, 20205 December 31, 2024.

Capital International LLC, related party

9 unchanged sentences

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

The Company’s portion of net loss in BMIC during the nine months ended September 30, 2024 and 2023, approximated $ 3,000

and $ 28,000 , respectively.

The Company’s portion of net loss in BMIC during the three months ended March 31, 2025 and 2024, approximated $ 3,000 and

$ 1,000 , respectively.

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

14 unchanged sentences

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.

This investment was 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,

5 unchanged sentences

Short-Term and Long-Term Debt

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

Bank of America, N.A.

(“BOA”) to secure financing approximating $ 3,710,000

to purchase and use as collateral, a new Heidelberg XL 106-7+L printing press.

The aggregate principal balance outstanding under the

BOA Note shall bear interest at a variable rate on or before the loan closing.

As of September 30, 2024, and December 31, 2023, the

outstanding principal on the BOA Note was $ 2,562,000

and $ 2,932,000 ,

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 and use as collateral, a new Heidelberg

XL 106-7+L printing press.

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

before the loan closing.

As of March 31, 2025, and December 31, 2024, the outstanding principal on the BOA Note was $ 2,308,000 and $ 2,436,000 ,

respectively and had an interest rate of 4.63 %.

As of September 30, 2024, $ 514,000

was included in the Current portion of long-term debt, net, and the remaining balance of approximately $ 2,049,000

is recorded as Long-term debt.

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.

Interest expense equaled $ 96,000

for the nine months ended September 30, 2024 and 2023, respectively.

The BOA Note contains certain covenants that are analyzed

As of September 30, 2024, Premier is in compliance with these covenants.

As of March 31, 2025, $ 526,000 was included in the Current portion of long-term debt,

net, and the remaining balance of approximately $ 1,783,000 is recorded as Long-term debt.

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.

BOA Note contains certain covenants that are analyzed annually.

As of March 31, 2025, 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

7 unchanged sentences

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

The affective interest rate at September 30, 2024 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, which serves as collateral for the Shelton Agreement.

purchase price has been allocated as $ 4,640,000 , $ 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 years.

net book value of these assets as of September 30, 2024 approximated $ 6,199,000 .

Of the total financed, approximately $ 213,000 of principal

and accrued interest is classified as current portion of long-term debt, net, and the remaining balance of approximately $ 4,257,000 recorded

as long-term debt, net of $ 33,000 in deferred financing costs.

Interest expense for the nine months ended September 30, 2024 and 2023 approximated

$ 147,000 and $ 153,000 , respectively.

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, which serves as collateral for the Shelton Agreement.

The purchase price has been allocated as $ 4,640,000 , $ 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 years.

The net book value of these assets as of March 31, 2025, and

December 31, 2024,approximated $ 6,332,000 .

As of March 31, 2025, the outstanding principal and interest of approximately $ 4,376,000 ,

net of $ 21,000 in deferred financing costs, is classified as Current portion of long-term debt on assets held -for-sale, net on the consolidated

balance sheet.

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

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

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 September 30, 2024 and December 31, 2023, $ 464,000 and $ 547,000 , respectively,

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

As of March 31, 2025, and December

31, 2024, the outstanding principal and interest of approximately $ 464,000 and $ 463,000 , respectively, are included in Current portion

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

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

1 unchanged sentence

Wilson Loan matures on October 12, 2022 , and contains an auto renewal period of nine months.

As of September 30, 2024, $ 1,070,000 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.

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

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

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

The purchase price has been allocated as $ 32,100,000 ,

$ 12,100,000 ,

and $ 1,500,000 for

the facility, land and site improvements, respectively.

Also included in the value of the property is $ 15,901,000 of

intangible assets with estimated useful lives ranging from 1 to 11 years.

The net book value of the assets acquired as of September 30, 2024 is approximately $ 41,570,000 .

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

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

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

first such installment being payable on August 29, 2022 and subsequent installments being payable on the first day of each

succeeding month thereafter until the maturity date, at which time any outstanding principal and interest is due in

The affective interest rate at

September 30, 2024 was 9.5 %.

As of December 31, 2023, the outstanding principal and interested approximates $ 41,331,000 and

is included in current portion of long-term debt, on the consolidated balance sheet.

As of September 30, 2024, the outstanding

principal and interested approximates $ 45,147,000 and

is included in current portion of long-term debt, on the consolidated balance sheet.

Interest expense for the nine months ended September

30, 2024 and 2023 approximated $ 2,939,000 and

$ 2,632,000 ,

As of March 31, 2025, and December 31, 2024,

the outstanding principal and interest of approximately $ 145,000 and $ 145,000 , respectively, are included in Current portion of long-term

debt – related party, net on the consolidated balance sheet.

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

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

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

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

These assets are classified

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

The purchase price

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

Also included

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

value of the assets acquired as of March 31, 2025 is approximately $ 24,722,000 .

The LifeCare Agreement calls for the principal amount

of the in equal, consecutive monthly installments based upon a twenty-five (25) year amortization of the original principal amount of

the LifeCare Agreement at an initial rate of interest equal to the interest rate determined in accordance as of July 29, 2022 provided,

however, such rate of interest shall not be less than 4.28 %, with the first such installment being payable on August 29, 2022 and subsequent

installments being payable on the first day of each succeeding month thereafter until the maturity date, at which time any outstanding

principal and interest is due in full.

The affective interest rate at March 31, 2025 was 8.6 %.

As of March 31, 2025, and December 31,

2024, the outstanding principal and interest of the LifeCare agreement approximates $ 38,360,000 and $ 46,069,000 , respectively, 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

three months ended March 31, 2025 and 2024 approximated $ 867,000 and $ 977,000 , respectively.

This note is in default and demand was made

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

As of March 31, 2025, this amount is past due.

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

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

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

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

The purchase price has been allocated as $ 3,200,000 , $ 1,000,000 , and $ 222,000 for the facility, land and site and tenant improvements,

respectively.

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

term loan (“Pinnacle Loan”) whereas Pinnacle lent to AMRE Winter Haven the principal sum of $ 2,990,000 ,

maturing on March

7, 2024 (later extended to July 7, 2024) to acquire a medical facility located in Winter Haven, Florida for a purchase price

of $ 4,500,000 .

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

Pinnacle Loan.

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

$ 1,000,000 ,

and $ 222,000

for the facility, land and site and tenant improvements, respectively.

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

of intangible assets with an estimated useful life of approximately 5

The net book value of the assets acquired as of September 30, 2024 is approximately $ 4,380,000 .

Payments are to be made in equal, consecutive installments based on a 25 -year

amortization period with interest at 4.28 %.

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

The net book value of the assets acquired as of March 31, 2025 is approximately $ 4,396,000 .

Payments are to be made in equal,

consecutive installments based on a 25 -year amortization period with interest at 4.28 %.

The first installment is due January 1, 2023.

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

The outstanding principal and interest, net of debt issuance costs of $ 17,000 ,

approximates $ 2,977,000

and is included in the current portion of long-term debt, net on the accompanying consolidated balance sheet at December 31, 2023.

The outstanding principal and interest, approximates

and is included in current portion of long-term debt, net on the accompanying consolidated balance sheet at September 30, 2024.

Interest expense equaled $ 179,000

and $ 185,000

for the nine months ended September 30, 2024 and 2023, respectively.

This note was assumed by SMS Financial on August 15, 2024.

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

This amount is past due.

$ 3,058,000 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 March 31, 2025.

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

Interest expense approximates $ 71,000 and $ 38,000 for the three months ended March 31, 2025 and 2024, respectively.

was assumed by SMS Financial on August 15, 2024.

This note is in default and demand was made for final payment to be made by December

As of March 31, 2025, this amount is past due.

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

3 unchanged sentences

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

As of September 30, 2024, the outstanding principal and interest approximates $ 634,000 of which $ 121,000 was included in the current

As of March 31, 2025, the outstanding principal and interest approximates $ 575,000 of which $ 125,000 was included in the current

portion of long-term debt, net, and the remaining balance of approximately $ 450,000 recorded as long-term debt.

2 unchanged sentences

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

Interest expense equaled $ 38,000 and $ 0 for the

nine months ended September 30, 2024 and

summary of scheduled principal payments of long-term debt, not including revolving lines of credit, subsequent to September 30, 2024,

are as follows:

Interest expense for the three months ended March

31, 2025 and 2024 approximated $ 11,000 and $ 13,000 , respectively.

summary of scheduled principal payments of long-term debt, not including revolving lines of credit, subsequent to March 31, 2025, are

Schedule of Notes Payable and Long-term Debt

Notes payable

Notes payable - related party

Notes payable - assets held-for-sale

Lease Liability

Company has operating leases predominantly for operating facilities.

As of September 30, 2024, the remaining lease terms on our operating

leases range from less than one to twelve years .

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

options are not reasonably certain of exercise by the Company.

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

upon expiration.

As of March 31, 2025, the remaining lease terms on our operating

leases range from less than 1

Renewal options to extend our leases have

not been exercised due to uncertainty.

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

There is no transfer

of title or option to purchase the leased assets upon expiration.

There are no residual value guarantees or material restrictive covenants.

There are no significant finance leases as

of September 30, 2024.

minimum lease payments as of September 30, 2024 are as follows:

There are no significant finance leases as of March 31, 2025.

minimum lease payments as of March 31, 2025 are as follows:

of Lease Liability:

Schedule of Future Minimum Lease Payments

of Future Minimum Lease Payments

Total lease payments

4 unchanged sentences

Weighted-average discount rate

cash paid for leases during the nine months ended September 30, 2024 and 2023 approximated $ 786,000 and $ 931,000 , respectively.

cash paid for leases during the three months ended March 31, 2025 and 2024 approximated $ 220,000 and $ 220,000 , respectively.

Commitments and Contingencies

5 unchanged sentences

costs shall not exceed $ 1,250,000 .

As of September 30, 2024 and December 31, 2023, $ 13,000 and $ 200,000 , respectively, has been accrued for

in relation to the Equivir License as development of the Equivir technology.

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

Equivir License.

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

pursuant to which Chemia transferred to the Company all of its right to 3F (Functional Fragrance Formulation).

This agreement has a 20-year

term and auto renews for a period of 1 year unless mutually agreed upon by both parties.

3F consists of 3F Mosquito Repellant and 3F

Anti-Viral formulations.

Based on the Royalty Agreement, the Company should cover all the costs to prepare and finalize necessary patent

application and other intellectual property related to 3F.

Chemia agreed to support the Company in efforts leading to development of

3F intellectual property and it is licensing.

Based on Royalty Agreement any payments received from development, sales, licensing or

transfer of 3F technology will be paid 50% to the Company and 50% to Chemia.

On November 27, 2018, Company and Chemia signed an Addendum

to Royalty Agreement (“Addendum”), according to which the Company granted Chemia a royalty-based limited license for purposes

of making and selling fragrances embodying the 3F technology.

Based on the Addendum, Chemia should pay the Company 5% of net sales in

On November 8, 2019, both companies entered into Amendment no.1 to Royalty Agreement, based on which certain expenses borne

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

the three months ended March 31, 2025 and 2024, there were no reimbursements or royalties paid to the Company and the Company cannot

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

Stockholders’ Equity

transactions –

April 10, 2023, the Company issued 1,247,078 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 for 20 .

As of December 31, 2023 there were 140,264,240 shares of our

Common Stock issued and outstanding, which was converted to 7,066,772 .

Compensation –

Company records stock-based payment expense related to options and warrants based on the grant date fair value in accordance with FASB

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

awards include option grants, warrant grants, and restricted stock awards.

During the nine months ended September 30, 2024, there were none .

During the nine months ended September 30, 2023, the Company’s did not have stock compensation associated with these items, and 5,333

options were forfeited.

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

As of December 31, 2023 there were

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

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

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

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

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

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

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

beneficially owned by Mr.

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

2020 Employee, Director and

Consultant Equity Incentive Plan (the “Plan”), HFHL was awarded 1,000,000 shares of the Company’s common stock, approximating $ 870,000 , under

the Plan, for services rendered.

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

March 21, 2025, DSS, the parent company of Impact Biomedical, Inc.

completed the sale of 499,800 shares of Impact Biomedical common stock.

These shares were acquired by DSS during Impact's initial public offering on September 16, 2024.

The sale of these shares, which were

previously held by DSS as part of its ownership interest in Impact, was completed for a total value of $ 1,500,000 , which represents the

consideration received from the transaction.

With this sale, the shares are now publicly held and are no longer held by DSS.

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.

During the three months ended March

31, 2025 and 2024, there were none .

BioMedical, Inc.

Equity Transactions –

May 10, 2023, the Company, the Company’s Board of Directors approved an amendment to the Articles of Incorporation of the Company

to increase the total number of shares of Common Stock to 4,000,000,000 shares with a par value of $ 0.001 .

Each share of Common Stock

when issued, shall have one (1) vote on all matters presented to the stockholders.

Our Amended and Restated Articles of Incorporation

also authorized 100,000,000 shares of preferred stock, par value $ 0.001 per share.

On May 11, 2023, the Company effected a forward split.

As a result, there were 3,877,282,251 shares of our Common Stock and no shares of preferred stock issued and outstanding.

split, there were 125,073,621 shares of our Common Stock and no shares of preferred stock issued and outstanding.

On October 31, 2023,

the Company effected a reverse stock split of 1 for 55 .

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 %.

As of September 30, 2024 and December 31, 2023,

there were 11,503,955 and 10,000,000 , respectively, shares of our Common Stock and 60,496,041 shares of preferred stock issued and outstanding.

Transactions - On May 10, 2023, the Company, the Company’s Board of Directors approved an amendment to the Articles of

Incorporation of the Company to increase the total number of shares of Common Stock to 4,000,000,000 shares with a par value of $0.001.

Each share of Common Stock when issued, shall have one (1) vote on all matters presented to the stockholders.

Our Amended and Restated

Articles of Incorporation also authorized 100,000,000 shares of preferred stock, par value $ 0.001 per share.

On May 11, 2023, the Company

effected a forward split.

As a result, there were 3,877,282,251 shares of our Common Stock and no shares of preferred stock issued and

Prior to the split, there were 125,073,621 shares of our Common Stock and no shares of preferred stock issued and outstanding.

On October 31, 2023, the Company effected a reverse stock split of 1 for 55 .

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 %.

As of September 30, 2024

and December 31, 2023, there were 11,503,955 and 10,000,000 , respectively, shares of our Common Stock and 60,496,041 shares of preferred

stock issued and outstanding.

August 8, 2023 DSS, the Company’s largest shareholder, distributed to its shareholders of record on July 10, 2023 4 shares of Impact

3 unchanged sentences

subject to the discretion of the Company to lift the restriction sooner.

On October 31, 2023, the Company

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 %.

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

On September 17, 2024, the Company closed the Offering, and as of September 30, 2024 there were 11,497,703

shares of common stock issued and outstanding.

The total net proceeds to the Company from the Offering, after deducting discounts,

expenses allowance and expenses, was approximately $ 3,726,000

(inclusive of approximately $ 1.5 million contributed by DSS).

final prospectus relating to this Offering was filed with the Commission on September 16, 2024.

The shares of Common Stock were

approved to list on the NYSE American under the symbol “IBO” and began trading there on September 16, 2024.

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).

Representative’s Warrants are exercisable for a price per share equal to 125% of the public offering price.

The warrants are

exercisable at any time, in whole or in part, commencing nine (9) months from the date of commencement of sales of the offering and

ending on the third anniversary thereof.

As of September 30, 2024, only the 1,500,000

shares included in the Offering are freely tradable on the NYSE.

The remaining outstanding common shares of Impact Biomedical of 9,997,703

are restricted from trading for 180 days from the Offering date.

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.

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”)

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 results of operations of the discontinued operation:

Schedule of Major Classes of Assets and Liabilities Held for Sale and Results of Operations

Services Global Corporation

of Operations Loss - Discontinued Operations

the Nine Months Ended September 30,

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 )

October 31, 2023, the Company 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

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

On September 17, 2024, the Company closed the Offering, and as of September 30, 2024 there were 11,497,703 shares of common

stock issued and outstanding.

The total net proceeds to the Company from the Offering, after deducting discounts, expenses allowance

and expenses, was approximately $ 3,726,000 (inclusive of approximately $ 1.5 million contributed by DSS).

A final prospectus relating

to this Offering was filed with the Commission on September 16, 2024.

The shares of Common Stock were approved to list on the NYSE American

under the symbol “IBO” and began trading there on September 16, 2024.

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 thereof.

As of September 30, 2024, only the 1,500,000 shares

included in the Offering are freely tradable on the NYSE.

The remaining outstanding common shares of Impact Biomedical of 9,997,703 are

restricted from trading for 180 days from the Offering date.

February 25, 2025, the Company completed the acquisition of certain assets owned by DSS Pure Air, Inc.

(DSS PureAir”), a related

party, for $ 1,150,000 to be paid by 545,024 shares of the Company’s common stock calculated on a 10-day VWAP.

Assets acquired included

accounts receivable, inventory and intellectual property of the Celios air purification system.

February 26, 2025, the Company issued 36,433 shares of the Company’s common stock as payment of legal fees incurred associated

with the Company’s IPO, registration of shares associated with its equity incentive plan as well as other related services.

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.

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 $ 2,000

for the three month and year ended March 31, 2025 and December 31, 2024,

respectively, and is included in Sales, general and administrative compensation (inclusive of stock based compensation) on the accompanying

Statement of Operations.

Supplemental Cash Flow Information

following table summarizes supplemental cash flows for the six months ended September 30, 2024 and 2023:

following table summarizes supplemental cash flows for the three months ended March 31, 2025 and 2024:

Schedule of Supplemental Cash Flow Information

Cash paid for interest

Shares issued in lieu of cash bonus

Segment Information

Company’s nine businesses lines are organized, managed, and internally reported as five operating segments.

One of these operating

segments, Product Packaging, is the Company’s packaging and printing group.

Product Packaging operates in the paper board folding

carton, smart packaging, and document security printing markets.

It markets, manufactures, and sells mailers, photo sleeves, sophisticated

custom folding cartons, and complex 3-dimensional direct mail solutions.

Company’s businesses lines are organized, managed, and internally reported as five operating segments.

One of these operating segments,

Product Packaging, is the Company’s packaging and printing group.

Product Packaging operates in the paper board folding carton,

smart packaging, and document security printing markets.

It markets, manufactures, and sells mailers, photo sleeves, sophisticated custom

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

These products are designed to provide functionality and marketability

22 unchanged sentences

sharing marketplaces.

It specializes in marketing and licensing its products and services through its subsidiary and partner network,

It specializes in marketing and distributing its products and services through its subsidiary and partner network,

using the popular gig economic marketing strategy as a form of direct marketing.

Direct marketing products include, among other things,

nutritional and personal care products sold throughout North America, Asia Pacific and Eastern Europe (see Note 1, Deconsolidation of

Sharing Services Global Corporation).

The fifth business line, Commercial Banking, is organized for the purposes of being a financial

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

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

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

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

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

From this financial platform, the Company shall provide

an integrated suite of financial services for businesses that shall include commercial business lines of credit, land development financing,

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

information concerning the Company’s operations by reportable segment for the three and nine months ended September 30, 2024 and

2023 is as follows.

The Company relies on intersegment cooperation and management does not represent that these segments, if operated

independently, would report the results contained herein:

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

The fifth business line, Commercial

Banking, is organized for the purposes of being a financial network holding company, focused providing commercial loans and on acquiring

equity positions in (i) undervalued commercial bank(s), bank holding companies and nonbanking licensed financial companies operating

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

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

equipment leasing, problem asset management, SPAC (special purpose acquisition company) consulting, and advisory capital raising services.

From this financial platform, the Company shall provide an integrated suite of financial services for businesses that shall include commercial

business lines of credit, land development financing, inventory financing, third party loan servicing, and services that address the

financial needs of the world Gig Economy.

information concerning the Company’s operations by reportable segment for the three months ended March 31, 2025 and 2024 is as

The Company relies on intersegment cooperation and management does not represent that these segments, if operated independently,

would report the results contained herein:

Schedule of Operations by Reportable Segment

Three Months Ended September 30, 2024

Product Packaging

Commercial Lending

Direct Marketing

Biotechnology

Cost of revenue

Gross profit (loss)

( 1,286,000 )

( 1,004,000 )

Operating expense

Operating income (loss)

( 1,178,000 )

( 2,187,000 )

( 4,671,000 )

Other income (expense)

( 1,030,000 )

Net income (loss) from continuing operations before taxes

( 1,751,000 )

( 1,851,000 )

( 1,603,000 )

( 5,701,000 )

Three Months Ended September 30,2023

Months Ended March 31, 2025

Product Packaging

4 unchanged sentences

Gross profit (loss)

( 1,753,000 )

( 1,890,000 )

Operating expense

Operating income (loss)

( 1,140,000 )

Operating loss

( 1,053,000 )

4 unchanged sentences

( 1,637,000 )

Net income (loss) from continuing operations before taxes

( 1,283,000 )

( 1,011,000 )

Net loss from operations before taxes

( 1,012,000 )

2 unchanged sentences

( 5,363,000 )

Nine Months Ended September 30, 2024

Months Ended March 31,2024

Product Packaging

7 unchanged sentences

Operating expense

Operating income (loss)

( 1,562,000 )

( 2,665,000 )

( 6,809,000 )

( 2,164,000 )

( 14,287,000 )

Other income (expense)

( 1,638,000 )

Net loss from continuing operations

( 1,680,000 )

( 3,364,000 )

( 6,757,000 )

( 3,098,000 )

( 15,925,000 )

Nine Months Ended September 30,2023

Product Packaging

Commercial Lending

Direct Marketing

Biotechnology

Cost of revenue

Gross profit (loss)

( 2,662,000 )

Operating expense

Operating income (loss)

( 1,573,000 )

( 3,294,000 )

( 8,608,000 )

Operating loss

( 2,181,000 )

1 unchanged sentence

Other income (expense)

( 1,943,000 )

( 7,238,000 )

( 2,640,000 )

( 2,062,000 )

( 14,004,000 )

Net loss from continuing operations

( 1,800,000 )

( 8,811,000 )

( 5,934,000 )

Net income (loss) from operations before taxes

( 1,383,000 )

2 unchanged sentences

following tables disaggregate our business segment revenues by major source:

Printed Products Revenue Information:

Schedule of Disaggregation of Revenue

Three months ended September 30, 2024

Packaging Printing and Fabrication

Commercial and Security Printing

Total Printed Products

Three months ended September 30, 2023

Packaging Printing and Fabrication

Commercial and Security Printing

Total Printed Products

Nine months ended September 30, 2024

Printed Products Revenue Information:

Three months ended March 31, 2025

Packaging Printing and Fabrication

1 unchanged sentence

Total Printed Products

Nine months ended September 30, 2023

Three months ended March 31, 2024

Packaging Printing and Fabrication

1 unchanged sentence

Total Printed Products

Direct Marketing

Three months ended September 30, 2024

Direct Marketing Internet Sales

Total Direct Marketing

Three months ended September 30, 2023

Direct Marketing Internet Sales

Total Direct Marketing

Nine months ended September 30, 2024

Direct Marketing Internet Sales

Total Direct Marketing

Nine months ended September 30, 2023 (as restated)

Direct Marketing Internet Sales

Biotechnology

Three months ended March 31, 2025

Retail internet sales

Total Biotechnology Marketing

Three months ended March 31, 2024

Retail internet sales

Total Direct Marketing

Rental Income

Three months ended September 30, 2024

Rental income

Total Rental Income

Three months ended September 30, 2023

Rental income

Total Rental Income

Nine months ended September 30, 2024

Securities Revenue Information

Three months ended March 31, 2025

Rental income

Commission income

Total Rental Income

Nine months ended September 30, 2023

Three months ended March 31, 2024

Rental income

Total Rental Income

Commission income

Three months ended September 30, 2024

Commission income

Total commission income

Three months ended September 30, 2023

Commission income

Total commission income

Nine months ended September 30, 2024

Commission income

Total commission income

Nine months ended September 30, 2023

Commission income

Total commission income

Net Investment Income

Three months ended September 30, 2024

Total Rental Income

Commercial Lending Revenue

Three months ended March 31, 2025

Net Investment Income

Total Investment Income

Three months ended September 30, 2023

Three months ended March 31, 2024

Net Investment Income

Total Rental Income

Nine months ended September 30, 2024

Net investment income

Total Management fee income

Nine months ended September 30, 2023

Net Investment Income

Total Management fee income

Related Party Transactions

8 unchanged sentences

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

fair value of the marketable security as of September 30, 2024 and December 31, 2023, was approximately $ 3,167,000

and $ 3,269,000 ,

The fair value of the marketable security as of March 31, 2025 and December 31, 2024, was approximately $ 2,277,000 and $ 2,518,000 ,

respectively.

During the nine month ended September 30, 2024 and 2023, the Company recorded unrealized loss of approximately $ 102,000

and $ 407,000 ,

During the three months ended March 31, 2025 and 2024, the Company recorded unrealized loss of approximately $ 241,000 and

$ 916,000 , respectively.

9 unchanged sentences

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

The Company’s portion of net loss in BMIC during the nine months ended September 30, 2024 and 2023, approximated $ 3,000

and $ 28,000 , respectively.

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 September 30, 2024 and December 31, 2023, $ 464,000 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.

As of September 30, 2024, $ 1,070,000 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

The Company’s portion of net loss in BMIC during the three months ended March 31, 2025 and 2024, approximated $ 3,000 and

$ 1,000 , respectively.

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

Regulatory Authority, Inc.

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

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

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.

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 September 30, 2024 approximated $ 86,000 ,

and was fully reserved for as of September 30, 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.

The outstanding principal and interest at March 31,

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

DSS owns 24.9 % of the outstanding

common shares of BMIC.

May 8, 2023, DSS Financial Management Inc and BMIC entered into a promissory note (“Note 9”) in the principal sum of $ 102,000

with interest at the prime rate plus 2 % ( 10.5 % at September 30, 2024 and December 31, 2023) with a maturity date of May 7, 2026 .

The outstanding principal and interest at September 30, 2024 approximated $ 110,000 , and was fully reserved for as of September 30, 2024.

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.

owns 24.9 % of the outstanding common shares of BMIC.

outstanding principal and interest at March 31, 2025, and December 31, 2024 approximated $ 110,000 , and was fully reserved for as of December

DSS owns 24.9 % of the outstanding common shares of BMIC.

July 26, 2022, APF and VEII, Inc.

(“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 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 $ 480,000

of Note 10 was reserved for as of March 31, 2024.

No additional reserve was deemed necessary as of September 30, 2024.

outstanding principal and interest on December 31, 2023, approximates $ 939,000 ,

net of $ 20,000

of unamortized origination fees and is included in notes receivable on the accompanying consolidate balance sheet.

Heng Fai Ambrose

Chan, the Chairman of DSS, Inc is also the on the board of directors of VEII.

(“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 26, 2025.

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

Approximately $ 959,000 of this note was reserved for as of December 31, 2024.

The outstanding principal and interest on December

31, 2023, approximates $ 939,000 , net of $ 20,000 of unamortized origination fees and is included in notes receivable on the accompanying

consolidate balance sheet.

Heng Fai Ambrose Chan, the Chairman of DSS, Inc is also the on the board of directors of VEII.

October 13, 2021, LVAM entered into loan agreement with BMIC (“BMIC Loan”), a related party, whereas LVAM borrowed the principal

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

As of March 31, 2025, and December

31, 2024, the outstanding principal and interest of approximately $ 464,000 and $ 463,000 , respectively, are included in Current portion

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

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.

As of March 31, 2025, and December 31, 2024,

the outstanding principal and interest of approximately $ 145,000 and $ 145,000 , respectively, are included in Current portion of long-term

debt – related party, net on the consolidated balance sheet.

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.

Subsequent Events

Company has evaluated all subsequent events and transactions through November 13, 2024, the date that the condensed consolidated financial

Company has evaluated all subsequent events and transactions through May 15, 2025 the date that the condensed consolidated financial

statements were available to be issued and noted no subsequent events requiring financial statement recognition or disclosure.

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

What changed 10-Q

Item 1. Financial Statements