Data Storage Corp 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures As of the end of the period covered by this Annual Report, under the supervision and with the participation of the Company’s management, including its principal executive officer and principal financial officer, the Company conducted an evaluation of its disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Rule 13a-15(e) under the Exchange Act defines “disclosure controls and procedures” as controls and other procedures of a company that are designed to ensure that the information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to a company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that its disclosure controls and procedures were not effective at the reasonable assurance level at December 31, 2025 due to the material weakness described below. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Due to its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Accordingly, the Company’s disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of its disclosure control system are met. As set forth above, the Company’s Chief Executive Officer and Chief Financial Officer have concluded, based on the evaluation as of the end of the period covered by this Annual Report, that the Company’s disclosure controls and procedures were not effective to provide reasonable assurance that the objectives of its disclosure control system were met. Management’s Annual Report on Internal Control Over Financial Reporting The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15. Internal control over financial reporting is defined in Rule 13a-15(f) and 15(d)-15(f) under the Exchange Act as a process designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making these assessments, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on management’s assessments and those criteria, management determined that the Company’s internal controls over financial reporting were not effective as of December 31, 2025. Identification of Material Weakness In connection with the preparation of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, management identified a material weakness in our internal control over financial reporting. The material weakness relates to the design and operating effectiveness of controls over the accounting and disclosure of significant and unusual transactions—specifically, those arising from the divestiture of a material portion of our business. Our controls were not effectively designed to ensure a complete and accurate technical review of the complex accounting and tax elements associated with this transaction. This deficiency identified during the third quarter of 2025 resulted in an error related to the income tax implications of the divestiture. Subsequently, in connection with the preparation of our Annual Report on Form 10-K for the year ended December 31, 2025 (this “Annual Report”), we identified an additional error stemming from the same material weakness regarding the treatment of certain warrants impacted by the divestiture. Specifically, on September 11, 2025, the closing of the divestiture triggered a cash-settlement provision within our Common Stock Purchase Warrants issued by the Company on July 21, 2021 to institutional investors (the “July 2021 Warrants”), requiring them to be reclassified from equity to a liability at fair value. We determined that the initial recognition of the $2,461,663 warrant liability was incorrectly recorded in the Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 as a component of Gain on sale of discontinued operations, net of tax, rather than as a reduction to Additional Paid-in Capital. Accordingly, within this Annual Report, we have restated certain financial statements previously included in the Quarterly Report on Form 10-Q for the period ended September 30, 2025, to reflect the initial recognition of the July 2021 warrant liability as a debit to equity, with subsequent changes in fair value of the warrant liability recognized in the consolidated statements of operations. As of December 31, 2025, this material weakness has not been remediated. 40 In order to remediate this material weakness, management has implemented the following actions to strengthen our internal control environment: ● Enhancing internal review procedures to ensure that significant and unusual transactions are identified, analyzed, and reviewed with appropriate rigor each quarter. ● Engaging appropriate internal and external resources to support the evaluation of complex transactions, where specialized expertise is required. ● Providing targeted training to relevant personnel on the accounting and disclosure requirements for significant and unusual transactions. Management will continue to monitor the effectiveness of these remediation efforts and will make further adjustments to the plan as necessary to ensure the material weakness is fully addressed. Changes in Internal Control over Financial Reporting Other than the changes in the material weakness identified above, there have been no changes in our internal control over financial reporting during the period covered that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION During the three months ended December 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “nonRule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not Applicable 41 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The following table sets forth the names, ages, and positions of the Company’s executive officers and directors. Executive officers are elected annually by its Board of Directors. Each executive officer holds his office until he resigns, is removed by the Board, or his successor is elected and qualified. Each director holds his office until his successor is elected and qualified or his earlier resignation or removal. Name Age Position Charles M. Piluso 72 Chairman of the Board, Chief Executive Officer Chris H. Panagiotakos 53 Chief Financial Officer Harold J. Schwartz 61 Director, Former President Thomas C. Kempster 59 Director, Former Executive Vice President John Argen 71 Director Lawrence A. Maglione, Jr. 64 Director Matthew Grover 58 Director Todd A. Correll 58 Director Clifford Stein 68 Director Nancy M. Stallone 65 Director Uwayne A. Mitchell 42 Director Charles M. Piluso, Chairman of the Board and, Chief Executive Officer Charles M. Piluso has served as Chairman of the Board and Chief Executive Officer of Data Storage Corporation since 2008 and as Treasurer since 2020. He co-founded CloudFirst Technologies Corporation, a subsidiary of Data Storage Corporation, in 2001. Previously, he founded North American Telecommunication Corporation, a facilities-based Competitive Local Exchange Carrier, serving as Chairman and President from 1997 to 2000. From 1990 to 1997, he was Chairman and Founder of International Telecommunications Corporation, a facilities-based international carrier licensed by the Federal Communications Commission. ITC was part of a consolidation strategy that went public in 1997 for $800 million. Piluso holds a bachelor’s degree, a Master of Arts in Political Science and Public Administration, and a Master of Business Administration from St. John’s University. He was an Instructor at St. John’s University’s College of Business from 1986 to 1988. He served on the Board of Trustees of Molloy College from 2001 to 2013, the Board of Governors at St. John’s University from 2001 to 2016, and is a Governor Emeritus. He currently serves on the Board of Advisors for the Nassau County Police Department Foundation. We believe that Mr. Piluso is qualified to serve as a member of our Board due to his technical expertise and management experience of technology and communications companies. Chris H. Panagiotakos, Chief Financial Officer Mr. Panagiotakos assumed the role of Chief Financial Officer for the Company on May 18, 2021. Additionally, he assumed the role of Treasurer in 2024. Prior to joining us, he served as the Vice President, Corporate Controller of Cineverse Corp., formerly Cinedigm Corp., from April 2017 to March 2021. In this capacity, he oversaw the company’s accounting function, managed external audits, ensured compliance, and implemented controls while also focusing on staff training and development. Preceding his tenure as Vice President, Corporate Controller, Mr. Panagiotakos held the position of Corporate Assistant Controller at Cinedigm Corp. from October 2013 to April 2017. With over 26 years of experience in public company accounting, Mr. Panagiotakos brings a wealth of expertise to our financial leadership team. His extensive background includes various roles within the accounting department at Young Broadcasting Inc. from September 2004 to October 2013, including serving as Controller of one of its divisions and as Assistant Corporate Controller. Mr. Panagiotakos is a Certified Public Accountant and holds a Bachelor of Business Administration in Accounting from Bernard M. Baruch College, as well as a Master of Business Administration from Texas A&M University-Commerce. His comprehensive knowledge and proficiency in public company accounting matters make him a valuable asset to our financial operations. 42 Harold J. Schwartz, Director Mr. Schwartz has served as a member of our Board since December 2016 and served as Treasurer from 2016 to 2020. He also served as our President beginning 2016 and as CloudFirst’s President and a member of its board of directors beginning July 2022, until our sale of the CloudFirst business in September 2025. From 1994-2016, Mr. Schwartz served as vice president of ABC Services, Inc., which he co-founded. He has been responsible for the strategic direction, operations, business development of ABC and other companies. Over the past three decades, Mr. Schwartz has used his expertise in IBM business systems, business continuity, and cybersecurity helping organizations increase IT performance, protect their data and reduce costs. In addition, Mr. Schwartz is the founder of Systems Trading, Inc., a technology leasing company established in 1997, where Mr. Schwartz serves as the company’s CEO and president. Prior to founding these two businesses, Mr. Schwartz worked with other IBM business partners and an equipment leasing company. Mr. Schwartz earned his bachelor’s degree in business from California State University in San Bernardino. We believe that Mr. Schwartz has the leadership and qualifications to serve as president and as a member of our Board due to his proven ability to lead, strengthen and improve the operations of the companies he has been a part of based on his experience in marketing, sales and business development and his deep knowledge of the industry. Thomas C. Kempster , Director Mr. Kempster served as our Executive Vice President beginning December 2016 until our sale of the CloudFirst business in September 2025 and serves as a member of our Board since December 2016. He also served as the Chief Experience Officer (CXO) of our CloudFirst subsidiary from January 2024 until September 2025. Prior to these positions, Mr. Kempster served as the Chief Executive Officer of Flagship until 2024 and our President of Service Delivery until 2021. Prior to joining the Company, Mr. Kempster founded ABC Services in 1994 and served as its President until 2016. ABC Services provided Managed Services, equipment, software sales and specialized in IBM Power systems. In 2012, ABC Services launched a joint venture with the Company to provide IaaS and Disaster Recovery-as-a- Service (DRaaS) to IBM Power system customers in North America. The joint venture formed was SIAS. In 2016, ABC Services was acquired by the Company. We believe that Mr. Kempster is qualified to serve as a member of our Board because of his practical experience in a broad range of competencies including his industry experience. John Argen, Director Mr. Argen has served as a member of our Board since October 2008. Mr. Argen is a Business Consultant and Developer specializing in the information technology, telecommunications, and construction industries. He is a seasoned professional that brings over 40 years of experience and entrepreneurial success from working with small business owners to Fortune 500 firms. Mr. Argen has been a board director on several companies as well as a charity organization. From 1992 to 2003, Mr. Argen was the CEO and founder of DCC Systems, a privately held nationwide Technology Design / Build Construction Development and Consulting Solutions firm. Mr. Argen built DCC Systems from the ground up, re-engineering the firm several times to meet the needs of its clientele and enabling DCC Systems to produce gross revenues exceeding 100 million dollars in 2000. Mr. Argen has been a guest speaker at numerous corporate seminars and industry shows. He has been featured on NBC’s “Business Now” which accredited his Technology Construction Management methodology as an innovative process for implementing high tech projects on time and within budget. Before DCC Systems Mr. Argen held senior management positions at ITT/Metromedia (15 years) and was VP of Engineering & Operations at DataNet, a Wilcox & Gibbs company (2 years). Throughout his corporate tenure he has worked in Operations, Marketing, Systems Engineering, Telecommunications, and Information Technology. In a career that spans 40 years he has had full responsibility for technology related and construction projects worth over a billion dollars. Mr. Argen graduated from Pace University with a BPS in Finance. His commitment to continued education is reflected in his completion of over 2,000 hours of corporate-sponsored courses. Mr. Argen also holds a Federal Communication Commission (FCC) Radio Telephone 1st Class License. 43 We believe that Mr. Argen is qualified to serve as a member of our Board because of his practical experience in managing the growth of companies, including technology and communication companies, and his general knowledge and experience of the industry. Lawrence A. Maglione, Jr., Director Mr. Maglione has served as a member of our Board since October 2008. He has also been a director of CloudFirst since August 29, 2001. Mr. Maglione has been a partner in the accounting firm Eisner & Maglione CPAs, LLC since January 2007. Mr. Maglione, a co-founder of DSC, is a financial management veteran with more than 40 years of experience. Prior to joining the Company in 1991, Mr. Maglione was a co-founder of North American Telecommunications Corporation (“NATC”), a local telecommunications service provider which provides local and long-distance services and data connectivity to small and medium-sized businesses, where Mr. Maglione served as NATC’s Chief Financial Officer and Executive Vice President from September 1997 through January 2001 where he was responsible for all finance, legal and administration functions. Prior to NATC, Mr. Maglione spent over 14 years in public accounting, and he brings a broad range of experience related to companies in the technology, retail services and manufacturing industries. Mr. Maglione holds a Bachelor of Science degree in Accountancy from Hofstra University, a Master of Science in Taxation from LIU Post, and is a Certified Public Accountant. Mr. Maglione is a member of the New York State Society of CPAs. We believe that Mr. Maglione is qualified to serve as a member of our Board because of his practical accounting knowledge, leadership experience and general industry familiarity. Todd A. Correll, Director Mr. Correll previously served as a member of our Board from August 2014 until September 6, 2017, and then was reappointed to serve as a Director on November 5, 2019. Mr. Correll has served as a financial and operations executive consultant and board member for SACo, a leading online retail operation. From 2001 through 2017, Mr. Correll founded and served as CEO of Broadsmart Florida, Inc. (“Broadsmart”), a facility-based VoIP carrier. Under Mr. Correll’s leadership as its CEO, Broadsmart grew from a local phone company to a nationwide carrier delivering IP based dial tone, broadband and ancillary services. Broadsmart was acquired by Magic Jack in 2016 for $42 million, and Mr. Correll continued to serve as its CEO until 2017. Mr. Correll attended Syracuse University. Mr. Correll holds a pilot’s license. We believe that Mr. Correll’s experience, particularly in the telecommunications and technology sectors, along with his proven track record of leadership and strategic insight, make him an invaluable addition to our Board, contributing to our continued growth and success. Matthew Grover, Director Mr. Grover has served as a member of our Board since November 5, 2019. Mr. Grover recently retired from a 23 year career at Altice USA, where he held various leadership positions, with his most recent position being Chief Revenue Officer (CRO). Altice USA is one of the largest broadband communications and video services providers in the United States, delivering broadband, pay television, mobile, proprietary content and advertising services to approximately 4.9 million residential and business customers across 21 states through its Optimum and Suddenlink brands. The company operates an advanced advertising and data business, which provides audience-based, multiscreen advertising solutions to local, regional and national businesses and advertising clients. Altice USA also offers hyper-local, national, international and business news through its News 12 and i24NEWS networks. Mr. Grover began his 23-year Altice USA career in 2001 when he joined Altice USA’s Lightpath division as Director of Sales Planning. Since then, he has held various positions with increasing responsibilities. In 2010 Mr. Grover assumed the position of Vice President and General Manager of Optimum West Commercial Services, overseeing sales and sales operations in the Rocky Mountain States of Montana, Wyoming, Colorado, and Utah, until it was sold to Charter Communications in August 2013. From 2013 to 2018, he was Senior Vice President of Commercial Sales, Product, and Marketing. Prior to joining Altice USA, Mr. Grover held various management positions over the course of nearly ten years, including Vice President of Sales at North American Telecom, Global Account Manager at AT&T in Los Angeles, CA, and District Sales Manager at AT&T in New York, New York. He serves on our Advisory Board and is a former member of the Board of Trustees at Molloy College in Rockville Centre, New York. Mr. Grover attained his BA in Economics from Stony Brook University and earned his MBA from the University of Southern California. 44 We believe that Mr. Grover is qualified to serve as a member of our Board because of his practical experience in a broad range of competencies including his public company experience. Clifford Stein, Director Mr. Stein was appointed to the board of directors on January 12, 2024, and is the Chief Executive Officer of Savitar Realty Advisors, a real estate investment and advisory firm founded by him in 1988. Savitar, along with its affiliates, invests in and manages real estate projects in many areas of the US, and develops and invests in oil and gas properties in the Northern US, and provides consulting and management services to lenders and financial institutions on nonperforming real estate assets. He is an attorney and has been a member of the Florida Bar Association since 1982. Mr. Stein has acted as an expert witness in various litigation matters involving real estate transactions and has been appointed as a Receiver, an Examiner and a Trustee in state and federal courts. Mr. Stein previously served on our board of directors from June 2010 to November 2020. We believe that Mr. Stein is qualified to serve as a member of our Board because of his leadership and legal experience. Nancy M. Stallone, Director Nancy Stallone is Executive Vice President, Corporate Treasurer and Assistant Corporate Secretary at Comtech Telecommunications Corp., a Nasdaq-listed company, a leading provider of satellite and space communications technologies, terrestrial and wireless network solutions, Next Generation 911 (NG911) emergency services, and cloud native capabilities to commercial and government customers around the world. Prior, she was Vice President of Finance from 2006 to 2016 and Corporate Secretary through October 2023. Prior to joining Comtech, Ms. Stallone served in key leadership financial positions including, from 2004 to 2006, Vice President, Internal Audit at Atkins Nutritionals, Inc., a diet program provider, and prior Chief Financial Officer of North America for Techpack America, Inc., a division of Albéa Group, a global packaging manufacturer and wholesaler. Previously, Ms. Stallone was Senior Manager at the accounting firm Deloitte & Touche LLP, where she served a number of public and private companies in the manufacturing, distribution and service industries. Ms. Stallone is a Certified Public Accountant in New York State and holds a Bachelor of Science in Accounting from Long Island University and an Executive MBA from St. Joseph’s University, where she previously served as an adjunct professor in accounting. We believe that Ms. Stallone is qualified to serve as a member of our Board because of her accounting and business experience. Uwayne A. Mitchell, Director Mr. Mitchell was appointed to the Company’s Board of Directors on March 5, 2024, and has served since December 2021 as privacy counsel to Riskonnect Inc. providing privacy legal advice on business projects and initiatives. From April 2021 until December 2021, he served as counsel to the data privacy team at The Government Employees Insurance Company (GEICO). From May 2018 until April 2021, he was an associate at the Law Office of Goldstein, Flecker & Hopkins. In 2005, upon graduation from New York Institute of Technology, Mr. Mitchell worked at the Company as a computer technician. In 2009, he worked full-time at the Company in the daytime and attended law school at St. John’s Law School, evening division, at night. Mr. Mitchell holds a Juris Doctor from St. John’s University School of Law. We believe that Mr. Mitchell is qualified to serve as a member of our Board because of his industry and legal experience. Composition of our Board of Directors Our Board of Directors currently consists of ten members. Our directors hold office until their successors have been elected and qualified or until the earlier of their death, resignation, or removal. There are no family relationships among any of our directors or executive officers. 45 Director Independence Under the rules of the Nasdaq Stock Market, independent directors must comprise a majority of our Board of Directors. The Listing Rules of the Nasdaq Stock Market (the “Nasdaq Listing Rules”), as well as those of the SEC, impose several requirements with respect to the independence of our directors. Our Board of Directors conducts an annual review of its proposed composition, the composition of its proposed committees and the independence of each director in accordance with these rules. With the exception of Charles M. Piluso, Harold J. Schwartz and Thomas C. Kempster, our Board determined, that all of our directors are independent, in accordance with the Nasdaq Listing Rules. Our Board has determined that, under the Nasdaq Listing Rules, Charles M. Piluso is not independent due to his role as Chief Executive Officer of the Company and, Harold J. Schwartz and Thomas C. Kempster are not independent directors because they were employees of the Company or its subsidiaries. Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our Board has determined that John Argen, Nancy M. Stallone, Matthew Grover, Todd A. Correll, Clifford Stein, Lawrence A. Maglione, Jr. and Uwayne Mitchell do not have relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the Nasdaq Listing Rules and the SEC. In making this determination, our Board of Directors considered relationships that each director has with the Company, including the transactions described in Part III, Item 13 – Certain Relationships and Related Transactions, and Director Independence. Our Board has also determined that: John Argen (Chair), Clifford Stein and Nancy M. Stallone are independent under the Nasdaq Listing Rules’ independence standards for the members of our Board’s audit committee (the “Audit Committee”); Matthew Grover (Chair) and Todd A. Correll are independent under the Nasdaq Listing Rules independence standards for the members of our Board’s compensation committee (the “Compensation Committee”); and Lawrence A. Maglione, Jr. (Chair) and John Argen are independent under the Nasdaq Listing Rules’ independence standards for the members of our Board’s Nominating & Corporate Governance committee (the “Nominating & Corporate Governance Committee”). Term of Office Our directors are elected for one-year terms to hold office until the next annual meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our Board and hold office until removed by the Board. Committees of the Board of Directors The Board of Directors has a standing Audit Committee, Compensation Committee, Nominating & Corporate Governance Committee, Merger & Acquisition Committee and Cyber Security and Risk Committee. We also formed a Tender Offer Committee in fiscal 2025 in connection with the Tender Offer. Audit Committee The Company has an Audit Committee consisting of non-executive directors each of whom the Board has determined is an independent director pursuant to the Nasdaq Listing Rules. The Audit Committee members are John Argen (Chair), Clifford Stein and Nancy M. Stallone. The Board has determined that Nancy M. Stallone is an “Audit Committee Financial Expert” as defined by SEC rules and regulations. The Audit Committee operates pursuant to a written charter adopted by the Board, which is available on our website at www.dtst.com . The charter describes in more detail the nature and scope of responsibilities of the Audit Committee. Compensation Committee The Company has a Compensation Committee consisting of non-executive directors each of whom the Board has determined is an independent director pursuant to the Nasdaq Listing Rules. The Compensation Committee members are Matthew Grover (Chair), Todd A. Correll, and Clifford Stein. The Compensation Committee operates pursuant to a written charter adopted by the board of directors, which is available on our website at www.dtst.com . The charter describes in more detail the nature and scope of responsibilities of the Compensation Committee. 46 Nominating & Corporate Governance Committee The Company has a Nominating & Corporate Governance Committee consisting of non-executive directors, each of whom the Board has determined is an independent director pursuant to the Nasdaq Listing Rules. The Nominating & Corporate Governance Committee members include Lawrence A. Maglione, Jr. (Chair) and John Argen. The Nominating & Corporate Governance Committee operates pursuant to a written charter adopted by the board of directors, which is available on our website at www.dtst.com . The charter describes in more detail the nature and scope of responsibilities of the Nominating & Corporate Governance Committee. The Company does not have a formal diversity policy. However, the Nominating & Corporate Governance Committee evaluates each individual in the context of the Board as a whole, with the objective of recommending individuals that can best perpetuate the success of our business and represent stockholder interests through the exercise of sound business judgment and diversity of experience in various areas. We believe our current directors possess diverse professional experiences, skills, and backgrounds, in addition to, among other characteristics, high standards of personal and professional ethics, proven records of success in their respective fields, and valuable knowledge of our business and industry. Merger and Acquisition Committee The Company has a merger and acquisition committee (the “M&A Committee”) consisting of non-executive directors. The Merger and Acquisition Committee members are Lawrence A. Maglione, Jr. (Chair), John Argen, and Todd A. Correll. Cyber Security & Risk Committee The Company has a cyber security & risk committee (the “Cyber Security & Risk Committee”) consisting of non-executive directors. The Cyber Security & Risk Committee members are Matthew Grover (Chair) and Uwayne A. Mitchell. Family Relationships One full-time employee is the son of and directly reports to John Camello, President of Nexxis Inc. Code of Ethics The Company has adopted a Code of Ethics and Conduct applicable to its Directors, Officers, and Employees. A copy of our Code of Ethics and Conduct is available on our website at www.dtst.com . In addition, we intend to post on our website all disclosures that are required by law or the Nasdaq Capital Market rules concerning any amendments to, or waivers from, any provision of the Code of Ethics and Conduct. The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be a part of this Annual Report. Delinquent Section 16(a) Reports Section 16(a) of the Securities Exchange Act requires that our directors and executive officers and persons who beneficially own more than 10% of our Common Stock (referred to herein as the “reporting persons”) file with the SEC various reports as to their ownership of and activities relating to our Common Stock. Such reporting persons are required by the SEC regulations to furnish us with copies of all Section 16(a) reports they file. Based solely on our review of copies of the reports filed with the SEC and the written representations of our directors and executive officers, we believe that the following reports were untimely: Form 4 filed by each of Uwayne Mitchell, Lawrence Maglione, Todd Correll, Charles Piluso, Harold Schwartz, John Argen, Nancy Stallone, Matthew Grover and Clifford Stein on June 11, 2025, each of which reported one transaction. 47 Insider Trading Policy We have adopted a second amended and restated insider trading policy (the “Trading Policy”) that is designed to promote compliance with federal securities laws, rules and regulations, as well as the rules and regulations of the Nasdaq Stock Market. The Trading Policy prohibits trading in certain circumstances and applies to us and all of our directors, officers and employees as well as anyone associated with the Company who have access to material nonpublic information of the Company (the “Covered Persons”). It sets forth the Company’s standards on trading and causing the trading of our securities or securities of other publicly traded companies while in possession of material nonpublic information and provides that all Covered Persons shall not purchase securities or other financial instruments, or otherwise engage in transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of equity securities granted as compensation to, or held directly or indirectly by, those persons. The Insider Trading Policy also incorporates anti-pledging provisions. Consequently, no employee, executive officer or director may enter into a hedge or pledge of the Company’s Common Stock, including short sales, derivatives, put options, swaps and collars. Additionally, our Trading Policy imposes special additional trading restrictions applicable to all of our directors, executive officers and key employees. The Trading Policy is annexed to this Annual Report as an exhibit and the full text of the Trading Policy is available on our website at www.dtst.com . ITEM 11. EXECUTIVE COMPENSATION Compensation of Executive Officers The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the named executive officers paid by the Company during the fiscal years ended December 31, 2025 and December 31, 2024, in all capacities for the accounts of our executive officers, including the Chief Executive Officer. Summary Compensation Table Name & Principal Position Year Salary Bonus Stock Awards (1) Option Awards (2) Non-Equity Incentive Plan Compensation All Other Compensation Total Charles M. Piluso, 2025 $ 250,000 $ 250,000 $ 97,375 $ 31,084 — $ 19,306 $ 647,765 Chief Executive Officer and Chairman of the Board 2024 $ 250,000 $ 200,000 $ 50,000 $ 34,907 — $ 17,298 $ 552,205 Harold Schwartz, 2025 $ 171,000 $ 121,301 — — — $ 23,319 $ 315,620 Former President 2024 $ 245,000 $ 175,000 $ 50,000 $ 34,907 — $ 27,368 $ 532,275 Chris H. Panagiotakos, 2025 $ 235,000 $ 208,750 $ 29,375 $ 29,374 — $ 60 $ 502,559 Chief Financial Officer and Treasurer 2024 $ 235,000 $ 100,625 $ 53,052 $ 52,967 — $ 9,073 $ 450,717 (1) The Company follows the requirements of FASB ASC 718-10-10, Share-Based Payments with regards to stock-based compensation issued to employees and non-employees. Please see Note 2 to Consolidated Financial Statements included in this Annual Report for more information regarding the valuation assumptions used in determining such amounts. These amounts do not correspond to the actual value that may be realized upon vesting or exercise of such awards. 48 (2) The valuation methodology used to determine the fair value of the options issued during the year is the Black-Scholes option-pricing model. Please see Note 2 to Consolidated Financial Statements included in this Annual Report for more information. (3) Mr. Schwartz only received salary payments until September 11, 2025 when the CloudFirst business was sold. However, he did not officially resign as our President until February 12, 2026. (4) All other compensation consists of Employer portion of health insurance and 401k match. Employment Agreements Executive Employment Agreements Mr. Piluso’s Employment Agreement On March 28, 2023, the Company entered into an employment agreement, as amended (the “Piluso Employment Agreement”) with Mr. Charles M. Piluso, the Company’s Chief Executive Officer. The Piluso Employment Agreement was for an initial term of three years, and was automatically renewable for consecutive one-year terms at the end of the initial term. The Piluso Employment Agreement was amended to, among other things, extend the term, as further discussed below. Mr. Piluso received an annual base salary of $225,000 for 2023, $250,000 for 2024 and 2025 and was eligible to earn a performance bonus ranging from $75,000 to $300,000. Mr. Piluso was also entitled to an equity award for a total value of $100,000 per annum, which was equally split between RSUs and stock options. Pursuant to the Piluso Employment Agreement, Mr. Piluso was also entitled to an equity award of 75,000 performance share units (the “PSUs”), one-third (1/3) of which would have vested upon the Company’s market capitalization reaching each of (i) $35,000,000, (ii) $50,000,000 and (iii) $75,000,000 (each a “Market Cap Target”), provided , however , that no PSUs could vest earlier than March 28, 2024 and each Market Cap Target must be maintained for at least twenty (20) trading days. The $35,000,000 Market Cap Target was achieved by September 28, 2024. In place of the 25,000 PSUs that should have been issued to Mr. Piluso, Mr. Piluso requested that 12,500 RSUs be granted to him and 12,500 RSUs to Mr. Schwartz. One-third (1/3) of the PSUs were forfeited on March 28, 2026, as a result of the $50,000,000 Market Cap Target not being achieved by such date. The remaining 25,000 PSUs shall be forfeited if the $75,000,000 Market Cap Target is not achieved by September 28, 2027. If any PSUs are issued to Mr. Piluso upon the Company’s market capitalization reaching $75 million by September 28, 2027, Mr. Piluso has agreed to issue one-half of such PSUs to Harold Schwartz, with the remaining one-half issued to Mr. Piluso, which alternate equity compensation arrangement the Board has approved. On February 13, 2026, the Company and Mr. Piluso entered into an amendment to the Piluso Employment Agreement (the “Amended Piluso Employment Agreement”) in accordance with the recommendation of the Compensation Committee of the Board and as approved by the Board. The Amended Piluso Employment Agreement is effective as of January 1, 2026 for an initial term of three years (the “Piluso Extended Term”), which Piluso Extended Term shall automatically be extended for successive one-year terms unless the Company or Mr. Piluso gives 90 days written notice of their intention not to renew prior to the expiration of the then current term (the “Employment Term”). Pursuant to the Amended Piluso Employment Agreement, he will receive an annual base salary of $275,000 per year during the Employment Term. Upon execution of the Amended Piluso Employment Agreement, pursuant to the terms thereof, Mr. Piluso received one-time equity awards pursuant to the Company’s 2021 Stock Incentive Plan, as amended and restated (the “Incentive Plan”), consisting of stock options to purchase up to 250,000 shares of Common Stock and 60,000 restricted stock units (“RSUs”), which stock options and RSUs vest one-third on each of May 20, 2027, May 20, 2028, and May 20, 2029. Upon the Company’s consummation of the acquisition of an entity that has $3,000,000 in trailing twelve months (“TTM”) revenue, Mr. Piluso will also receive 30,000 vested performance stock units (“PSUs”) pursuant to the Incentive Plan. He will also receive three grants of 75,000 PSUs (up to an aggregate of 225,000 PSUs), which awards will vest upon the Company’s market capitalization reaching each of: (i) $30 million, (ii) $60 million and (iii) $90 million for a period of twenty (20) trading days. Pursuant to the Piluso Amended Employment Agreement, Mr. Piluso is also eligible for: (i) an annual cash bonus ranging from 0% to 200% of his annual base salary, with a target of 100%, for each calendar year during the Employment Term; (ii) a one-time cash bonus of $100,000 for each completed acquisition of an entity that has $3,000,000 in TTM revenue: (iii) and a one-time cash bonus of $250,000 upon the completion of a reverse merger. 49 As a full-time employee of the Company, Mr. Piluso is also eligible to participate in the Company’s benefit programs. Mr. Panagiotakos’ Employment Agreement On March 28, 2023, the Company entered into an employment agreement, as amended (the “Panagiotakos Employment Agreement”) with Mr. Chris H. Panagiotakos, the Company’s Chief Financial Officer. The Panagiotakos Employment Agreement was for an initial term of three years, and was automatically renewables for consecutive one-year terms at the end of the initial term. The Panagiotakos Employment Agreement was amended to, among other things, extend the term, as further discussed below. Mr. Panagiotakos received an annual base salary of $215,000 for 2023, $235,000 for 2024 and 2025 and was eligible to earn a performance bonus of 25% of his base salary. Mr. Panagiotakos was also entitled to an equity award for a total value equal to 25% of his base salary per annum, which was to be equally split between RSUs and stock options, a financial achievement bonus of $45,000 and a long-term incentive bonus of stock options and RSUs equal to 25% of his base salary. On February 13, 2026, the Company and Mr. Panagiotakos entered into an amendment to the Panagiotakos Employment Agreement (the Panagiotakos Employment Agreement, as amended, is referred to as the “Amended Panagiotakos Employment Agreement”), in accordance with the recommendation of the Compensation Committee of the Board and as approved by the Board. The Amended Panagiotakos Employment Agreement is effective as of January 1, 2026 for an initial term of three years (the “Panagiotakos Extended Term”), which Panagiotakos Extended Term shall automatically be extended for successive one-year terms unless the Company or Mr. Panagiotakos gives 90 days written notice of their intention not to renew prior to the expiration of the then current term (the “Employment Term”). Pursuant to the Amended Panagiotakos Employment Agreement, he will receive an annual base salary of $270,000 per year during the Employment Term. Upon execution of the Amended Panagiotakos Employment Agreement by the Company and Mr. Panagiotakos, pursuant to the terms thereof, Mr. Panagiotakos received one-time equity awards pursuant to the Incentive Plan, consisting of stock options to purchase up to 125,000 shares of Common Stock and 60,000 RSUs, which stock options and RSUs vest one-third on each of May 20, 2027, May 20, 2028, and May 20, 2029. Mr. Panagiotakos is eligible for an annual cash bonus ranging from 0% to 200% of his annual base salary, with a target of 50%, for each calendar year during the Employment Term pursuant to the Amended Panagiotakos Employment Agreement. As a full-time employee of the Company, Mr. Panagiotakos is eligible to participate in the Company’s benefit programs. Termination and Change in Control In the event that the employment of Mr. Piluso and/or Mr. Panagiotakos (each, an “Executive”) are terminated by the Company for Cause (as such term is defined in the Amended Employment Agreement), the Company is only required to pay the Executive his base salary and accrued vacation through the last day of employment and all non-vested equity awards are automatically forfeited. If the Executive is terminated due to death, disability or resigns without Good Reason (as such term is defined in the Amended Employment Agreement), the Company is obligated to pay the Executive, in a single lump sum, his base salary and accrued vacation through the last day of employment, as well as a pro rata portion of his applicable annual target bonus for the fiscal year in which termination occurs, and, in the event of termination due to death or disability, the immediate vesting of all outstanding equity awards. If the Executive is terminated, prior to the expiration of the Piluso Extended Term or the Panagiotakos Extended Term, as applicable, by the Company without Cause (and not due to death or disability) or by the Executive upon resignation for Good Reason, the Executive is entitled to receive his base salary for the remainder of the Piluso Extended Term or the Panagiotakos Extended Term, as applicable, the acceleration of all outstanding equity awards, and a one-time severance payment equal to one times the base salary he was receiving at the time of termination, plus an amount equal to the pro rata portion of his last annual cash bonus he received. If the Executive is terminated by the Company without Cause (and not due to death or disability) or upon resignation by the Executive for Good Reason within 24 months of a Change in Control (as such term is defined Amended Employment Agreement), the Executive is entitled to receive his base salary for the remainder of the Piluso Extended Term or the Panagiotakos Extended Term, as applicable, the acceleration of all outstanding equity awards, and a one-time lump sum severance payment equal to one times the base salary he was receiving at the time of termination, plus an amount equal to the last annual cash bonus he received, irrespective of whether the Piluso Extended Term or the Panagiotakos Extended Term, as applicable, has expired at the time of the Change in Control. All severance payments are conditioned upon the execution of a general release by the Executive. 50 Other Employment Arrangements The Company did not have a formal employment agreement with Harold J. Schwartz. His salary was determined by the Compensation Committee and was evaluated on a yearly basis. Mr. Schwartz’s annual base salary for the fiscal year ended December 31, 2022 was $171,717, which was increased to $215,000 for the fiscal year ended December 31, 2023 and $245,000 for the fiscal years ended December 31, 2024 and 2025. Mr. Schwartz was eligible to earn RSUs and stock options, in addition to a cash bonus which was determined by the Compensation Committee. 2010 Incentive Award Plan On August 12, 2010, the Company adopted the Data Storage Corporation 2010 Incentive Award Plan (the “2010 Plan”) that provided for 2,000,000 shares of Common Stock reserved for issuance under the terms of the 2010 Plan; which was amended on September 25, 2013, to increase the number of shares of Common Stock reserved for issuance under the 2010 Plan to 5,000,000 shares of Common Stock; which was further amended on June 20, 2017 to increase the number of shares of Common Stock reserved for issuance under the 2010 Plan to 8,000,000 shares of Common Stock; and further amended on July 1, 2019, to increase the number of shares of Common Stock reserved for issuance under the 2010 Plan to 10,000,000 shares of Common Stock. On April 23, 2012, the Company amended and restated the 2010 Plan to change the name to the “Amended and Restated Data Storage Corporation Incentive Award Plan”. The 2010 Plan was intended to promote the interests of the Company by attracting and retaining exceptional employees, consultants, directors, officers and independent contractors (collectively referred to as the “Participants”) and enabling such Participants to participate in the long-term growth and financial success of the Company. Under the 2010 Plan, the Company had the right to grant stock options, which are intended to qualify as “incentive stock options” under Section 422 of the Internal Revenue Code of 1986, as amended, non-qualified stock options, stock appreciation rights and restricted stock awards, which were restricted shares of Common Stock (collectively referred to as “Incentive Awards”). Incentive Awards were granted pursuant to the 2010 Plan for 10 years from the Effective Date. There are 6,250 options outstanding and exercisable under the 2010 Plan as of December 31, 2025. The 2010 Plan expired on October 21, 2020, and accordingly, there are no shares available for future grants. 2021 Stock Incentive Plan On March 8, 2021, our Board and stockholders owning in excess of 50% of our outstanding voting securities approved and adopted the 2021 Stock Incentive Plan (the “2021 Plan”). Pursuant to the terms of the 2021 Plan we can grant stock options, restricted stock unit awards and other awards at levels determined appropriate by our Board and/or compensation committee. The 2021 Plan also allows us to utilize a broad array of equity incentives and performance cash incentives in order to secure and retain the services of our employees, directors, and consultants, and to provide long-term incentives that align the interests of our employees, directors and consultants with the interests of our stockholders. An aggregate of 15,000,000 shares of our Common Stock may be issued under the 2021 Plan, subject to equitable adjustment in the event of future stock splits, and other capital changes. There are 217,406 options outstanding and exercisable under the 2021 Plan as of December 31, 2025. Outstanding Equity Awards at Fiscal Year- End December 31, 2025 The following table sets forth information concerning the number of shares of Common Stock underlying outstanding equity awards for each of our named executive officers as of December 31, 2025: 51 Option Awards Stock Awards Name Option Or RSU Grant Date Number of Securities Underlying Unexercised Options (#)Exercisable Number of Securities Underlying Unexercised Options Unexercisable Option Exercise Price ($) Option Expiration Date Number Of Shares Or Units Of Stock That Have Not Vested (#) Market Value Of Shares Or Units Of Stock That Have Not Vested ($) Charles M. Piluso (1) 3/1/2023 29,412 — $ 1.96 2/28/2028 — — (1) 3/28/2023 28,249 — $ 1.77 3/27/2028 — — (1) 1/2/2024 15,528 — $ 3.22 1/2/2029 — — (1) 1/17/2025 13,748 — $ 4.59 1/17/2030 Harold J. Schwartz (2) Chris Panagiotakos (1) 3/1/2023 14,706 — $ 1.78 2/28/2033 — — (1) 3/28/2023 16,693 — $ 1.61 3/27/2033 — — (1) 1/2/2024 19,198 — $ 2.93 1/2/2034 — — (1) 1/17/2025 8,019 — $ 4.18 1/17/2035 (1) These option awards vested/vest 33.33% on each of the one- year, two- year and three- year anniversary following the grant date. As of September 11, 2025 all options were fully vested. (2) Mr. Schwartz did not have any outstanding equity awards as of December 31, 2025. Clawback Policy The Board has adopted a clawback policy which allows us to recover performance-based compensation, whether cash or equity, from a current or former executive officer in the event of an Accounting Restatement. The clawback policy defines an Accounting Restatement as an accounting restatement of our financial statements due to our material noncompliance with any financial reporting requirement under the securities laws. Under such policy, we will recoup incentive-based compensation previously received by an executive officer that exceeds the amount of incentive-based compensation that otherwise would have been received had it been determined based on the restated amounts in the Accounting Restatement. The Board has the sole discretion to determine the form and timing of the recovery, which may include repayment, forfeiture and/or an adjustment to future performance-based compensation payouts or awards. The remedies under the clawback policy are in addition to, and not in lieu of, any legal and equitable claims available to the Company. The clawback policy is annexed to this Annual Report as an exhibit. Recovery of Erroneously Awarded Compensation In connection with the preparation of this Annual Report, we determined that a restatement (the “Restatement”) of the financial statements as appearing in our Quarterly Report on Form 10-Q for the period ended September 30, 2025, specifically our unaudited condensed consolidated balance sheets as of September 30, 2025, our unaudited condensed consolidated statement of operations for the three and nine months ended September 30, 2025, our unaudited condensed consolidated statement of shareholders’ equity for the nine months ended September 30, 2025, and our unaudited condensed consolidated statements of cash flows for the nine months ended September 30, 2025 (collectively, the “Restated Financial Statements”), was required. As such, we conducted a clawback analysis in connection with the Restatement as required by the Company’s policies and concluded that recovery of erroneously awarded compensation was not required under the clawback policy as no excess incentive-based compensation was paid to any subject executive officer based on the financial results related to Restated Financial Statements. Equity Compensation Policy While we do not have a formal written policy in place with regard to the timing of awards of options in relation to the disclosure of material nonpublic information, the Compensation Committee does not seek to time equity grants to take advantage of information, either positive or negative, about our company that has not been publicly disclosed. It has been our practice to grant equity awards to our officers and directors upon their appointment. We intend to issue equity grants to our officers and/or directors at the same time each year, typically in connection with our first meeting of the Board each fiscal year. Option grants are effective on the date the award determination is made by the Compensation Committee, and the exercise price of options is the closing market price of our Common Stock on the business day of the grant or, if the grant is made on a weekend or holiday, on the prior business day. 52 During the fiscal year ended December 31, 2025, we did not award any options to a named executive officer in the period beginning four business days before the filing of an Annual Report on Form 10-K, Quarterly Report on Form 10-Q or a Current Report on Form 8-K that disclosed material nonpublic information and ending one business day after the filing or furnishing of such reports. Compensation of Directors The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the Company’s non-employee directors and directors who were employees but not named executive officers during the fiscal year ended December 31, 2025. Director Name Fees earned or paid in cash Stock awards(1) Option awards (3) Non-equity incentive plan Non- qualified deferred compensation earnings All other compensation Total Thomas C. Kempster — — — — — $ 434,168 (2) $ 434,168 Lawrence A. Maglione, Jr. $ 7,500 $ 29,998 — — — $ 37,498 John Argen $ 7,500 $ 29,998 — — — $ 37,498 Matthew Grover $ 7,500 $ 29,998 — — — $ 37,498 Todd A. Correll $ 7,500 $ 29,998 — — — $ 37,498 Clifford Stein $ 7,500 $ 29,998 — — — $ 37,498 Nancy M. Stallone $ 7,500 $ 29,998 — — — $ 37,498 Uwayne A. Mitchell $ 7,500 $ 29,998 — — — $ 37,498 (1) The Company follows the requirements of FASB ASC 718-10-10, Share-Based Payments with regard to stock-based compensation issued to employees and non-employees. Please see Note 2 to Consolidated Financial Statements included in this Annual Report for more information regarding the valuation assumptions used in determining such amounts. These amounts do not correspond to the actual value that may be realized upon vesting or exercise of such awards. (2) All other compensation includes $164,678 and $69,315 earned as salary and bonus, respectively, by Mr. Kempster as Executive Vice President of the Company prior to his resignation as an executive officer in September 2025. (2) The table below shows the aggregate number of option awards and stock awards outstanding at fiscal year-end of our non-employee directors. Name Number of Shares Subject to Outstanding Options as of December 31, 2025 Thomas C. Kempster 28,764 John Argen 5,000 Todd A. Correll 5,000 Matthew Grover 5,000 Lawrence A. Maglione, Jr. 5,000 Clifford Stein 5,000 Nancy M. Stallone 3,333 Uwayne Mitchell 3,333 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth certain information, as of April 14, 2026, with respect to the beneficial ownership of the outstanding Common Stock by (i) any holder of more than five (5%) percent; (ii) each of the Company’s named executive officers and directors; and (iii) the Company’s directors and current executive officers as a group. The information in the table below is based upon 2,167,138 shares of Common Stock outstanding as of April 14, 2026. Except as otherwise indicated, each of the stockholders listed below has sole voting and investment power over the shares beneficially owned. Unless otherwise indicated, the address for each person is c/o Data Storage Corporation, 244 5th Avenue, Second Floor, Suite 2821, New York, New York 10001. 53 Name of Beneficial Owner Shares Beneficially Owned (1) Percentage Ownership Charles M. Piluso and affiliated entities (2) 336,368 13.93 % Harold J. Schwartz (3) 79,363 3.60 % Thomas C. Kempster (4) 28,764 1.31 % Lawrence A. Maglione, Jr. (5) 5,000 * John Argen (6) 5,000 * Matthew Grover (7) 5,000 * Todd A. Correll (8) 21,415 * Chris Panagiotakos (9) 99,124 4.45 % Clifford Stein (10) 5,000 * Nancy M. Stallone(11) 3,333 * Uwayne A. Mitchell (12) 3,333 * All Current Executive Officers and Directors as a group (11 persons) 591,700 23.02 % * Less than 1% (1) The securities “beneficially owned” by a person are determined in accordance with the definition of “beneficial ownership” set forth in the regulations of the SEC and accordingly, may include securities owned by or for, among others, the spouse, children, or certain other relatives of such person, as well as other securities over which the person has or shares voting or investment power or securities which the person has the right to acquire within 60 days of April 14 2026. (2) Includes: (i) 89,432 shares of Common Stock owned directly by Mr. Piluso; (ii) 160,000 shares of Common Stock underlying RSUs that will vest on May 20, 2026; and (iii) 86,936 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (3) Includes 41,706 shares of Common Stock and 37,657 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (4) Includes 28,764 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (5) Includes 5,000 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (6) Includes 5,000 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026 . (7) Includes 5,000 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (8) Includes 16,415 shares of Common Stock and 5,000 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (9) Includes 40,508 shares of Common Stock and 58,616 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (10) Includes 5,000 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (11) Includes 3,333 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. (12) Includes 3,333 shares of Common Stock underlying stock options that are exercisable within 60 days of April 14, 2026. 54 Changes In Control None. Equity Compensation Plan Information The following table contains information about the Company’s equity compensation plans as of December 31, 2025: Number of securities to be issued upon exercise of outstanding options and warrants Weighted- average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a) Plan Category (a) (b) (c) Equity compensation plans approved by security holders 2010 Plan 6,250 $ 5.20 0 2021 Plan 217,406 $ 3.14 857,291 Equity compensation plans not approved by stockholders N/A N/A N/A Total 223,656 $ 3.20 857,291 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Pursuant to our charter, our Audit Committee shall review on an on-going basis for potential conflicts of interest, and approve if appropriate, all our “Related Party Transactions”. Other than the compensation arrangements, including employment, termination of employment and change in control arrangements, with our directors and executive officers, including those discussed in the section titled “Executive Compensation,” the following is a description of each transaction since January 1, 2024 or any currently proposed transaction in which: ● we have been or are to be a party to; ● the amount involved exceeded or exceeds $120,000 or 1% of the average of our total assets as of the end of the last two completed fiscal years; and ● any of our directors, executive officers or holders of more than 5% of our outstanding capital stock, or any immediate family member of, or person sharing the household with, any of these individuals or entities, had or will have a direct or indirect material interest. The Company received funds of $3,247 and $7,348 during the years ended December 31, 2025, and 2024, respectively, from Nexxis Capital LLC, a company owned by Charles Piluso and Harold Schwartz. Nexxis Capital LLC was formed to purchase equipment and provide equipment leases to the Company’s customers. 55 On January 1, 2022, the Company entered into a lease agreement with Systems Trading, Inc. (“Systems Trading”), a technology leasing company established by Mr. Schwartz, where he currently serves as Chief Executive Officer and President, effective January 1, 2022. This lease obligation is payable to Systems Trading with monthly installments of $7,145 and expired on April 1, 2025. The lease carried an interest rate of 8%. On April 1, 2022, the Company entered into a lease agreement with Systems Trading effective May 1, 2022. This lease obligation is payable to Systems Trading with monthly installments of $6,667 and expired on February 1, 2025. The lease carried an interest rate of 8%. Lawrence Maglione is a partner of Eisner & Maglione CPA’s LLC. The Company paid his firm $46,262 and $31,352 for accounting and due diligence services during the year ended December 31, 2025, and 2024, respectively. In connection with the vesting of equity awards held by Harold Schwartz (a Director and President), the Company erroneously remitted $47,479 in required tax withholding obligations during the fourth quarter of the year ended December 31, 2025, which was later determined to be an overpayment. The related balance reflected in other long-term assets on the consolidated balance sheet as of December 31, 2025 represents amounts settled on his behalf against vested equity compensation and does not represent a personal loan or extension of credit. No such balance existed at December 31, 2024. On January 14, 2026, our directors and officers tendered the following number of shares of Common Stock beneficially owned by them in connection with the Tender Offer: John Argen 57,207 Todd Correll 0 Matthew Grover 43,340 Thomas Kempster 881,472 Lawrence Maglione 24,752 Uwayne Mitchell 11,248 Charles Piluso 865,841 Nancy Stallone 11,248 Clifford Stein 280,850 Harold Schwartz 895,876 Director Independence See “Director Independence” in Part III, Item 10 – Directors, Executive Officers and Corporate Governance. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Audit Fees The following table sets forth the aggregate audit-related fees including expenses billed to us for the years ended December 31, 2025, and 2024 by Rosenberg Rich Baker Berman & Company P.A. December 31, December 31, 2025 2024 Audit Fees (1) $ 206,015 $ 168,000 Tax Fees $ 18,000 — (1) Audit fees and expenses were for professional services rendered for the audit and reviews of the consolidated financial statements of the Company, professional services rendered for issuance of consents and assistance with review of documents filed with the SEC. 56 The Audit Committee has adopted procedures for pre-approving all audit and non-audit services provided by the independent registered public accounting firm, including the fees and terms of such services. These procedures include reviewing detailed back-up documentation for audit and permitted non-audit services. The documentation includes a description of, and a budgeted amount for, particular categories of non-audit services that are recurring in nature and therefore anticipated at the time that the budget is submitted. Audit Committee approval is required to exceed the pre-approved amount for a particular category of non-audit services and to engage the independent registered public accounting firm for any non-audit services not included in those pre-approved amounts. For both types of pre-approval, the Audit Committee considers whether such services are consistent with the rules on auditor independence promulgated by the SEC and the PCAOB. The Audit Committee also considers whether the independent registered public accounting firm is best positioned to provide the most effective and efficient service, based on such reasons as the auditor’s familiarity with our business, people, culture, accounting systems, risk profile, and whether the services enhance our ability to manage or control risks, and improve audit quality. The Audit Committee may form and delegate pre-approval authority to subcommittees consisting of one or more members of the Audit Committee, and such subcommittees must report any pre-approval decisions to the Audit Committee at its next scheduled meeting. All of the services provided by the independent registered public accounting firm were pre-approved by the Audit Committee. Our audit committee pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the entire audit committee before the respective services were rendered. 57 PART IV ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES. (a)(1) The following financial statements are included in this Annual Report for the fiscal years ended December 31, 2025, and 2024: 1. Report of Independent Registered Public Accounting Firm. 2. Consolidated Balance Sheets as of December 31, 2025, and 2024. 3. Consolidated Statements of Operations for the years ended December 31, 2025, and 2024. 4. Consolidated Statements of Cash Flows for the years ended December 31, 2025, and 2024. 5. Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2025, and 2024. 6. Notes to Consolidated Financial Statements. (a)(2) All financial statement schedules have been omitted as the required information is either inapplicable or included in the Consolidated Financial Statements or related notes. (a)(3) The exhibits set forth in the accompanying exhibit index on the page preceding the signature page are either filed as part of this report or are incorporated herein by reference. 58 ITEM 16. FORM 10-K SUMMARY Not applicable. EXHIBIT INDEX Exhibit No. Description 2.1 Unit Purchase Agreement, by and among Data Storage Corporation, DTST Sub, LLC, CloudFirst Technologies Corporation, CloudFirst Technologies, LLC, and Total Server Solutions Holdings, LLC, dated July 11, 2025(incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K (File No. 001-35384) filed July 15, 2025) 3.1 Articles of Incorporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Registration Statement on Form SB-2 (File No. 333-148167) filed December 19, 2007). 3.2 Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 to Form 8-K (File No. 333-148167) filed October 24, 2008). 3.3 Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 on Form 8-K (File No. 333-148167) filed January 9, 2009). 3.4 Bylaws (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form SB-2 (File No. 333-148167) filed December 19, 2007). 3.5 Amended Bylaws (incorporated by reference to Exhibit 3.2 to Form 8-K (File No. 333-148167) filed October 24, 2008). 3.6 Form of Certificate of Amendment to the Articles of Incorporation, dated March 8, 2021 (incorporated by reference to Appendix A to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.7 Form of Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed October 7, 2008 (incorporated by reference to Appendix C to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.8 Form of Certificate of Validation and Ratification of the Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed October 7, 2008 (incorporated by reference to Appendix C to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.9 Form of Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed October 16, 2008 (incorporated by reference to Appendix D to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.10 Form of Certificate of Validation and Ratification of the Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed October 16, 2008 (incorporated by reference to Appendix D to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.11 Form of Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed January 6, 2009 (incorporated by reference to Appendix E to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.12 Form of Certificate of Validation and Ratification of the Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed January 6, 2009 (incorporated by reference to Appendix E to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 59 3.13 Form of Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed June 24, 2009 (incorporated by reference to Appendix F to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.14 Form of Certificate of Validation and Ratification of the Certificate of Correction to the Certificate of Amendment to the Articles of Incorporation, originally filed June 24, 2009 (incorporated by reference to Appendix F to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.15 Certificate of Designations, Preferences and Rights of Series A Preferred Stock of Data Storage Corporation, dated June 24, 2009 (incorporated by reference to Appendix F to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 3.16 Amendment to Bylaws, effective May 3, 2024 (incorporated by reference to Exhibit 3.1 to Form 8-K (File No. 001-35384) filed May 6, 2024). 4.1 Share Exchange Agreement, by and among, Euro Trend Inc., Data Storage Corporation and the shareholders of Data Storage Corporation named on the signature page thereto, dated October 20, 2008 (incorporated by reference to Exhibit 10.1 to Form 8-K/A (File No. 333-148167) filed June 29, 2009). 4.2 Data Storage Corporation 2010 Incentive Award Plan (incorporated by reference to Exhibit 10.1 on Form S-8/A (File No. 333-169042) filed October 25, 2010). 4.3 Amended and Restated Data Storage Corporation 2010 Incentive Award Plan, adopted April 23, 2012 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed April 26, 2012). 4.4 Data Storage Corporation 2021 Stock Incentive Plan, originally adopted March 8, 2021 (incorporated by reference to Appendix B to the Information Statement on Schedule 14C (File No. 001-35384) filed March 8, 2021). 4.5 Representative’s Warrant Agreement, dated May 18, 2021 (incorporated by reference to Exhibit 4.1 to Form 8-K (File No. 001-35384) filed May 18, 2021). 4.6 Form of Common Stock Warrant, dated May 18, 2021 (incorporated by reference to Exhibit 4.2 to Form 8-K (File No. 001-35384) filed May 18, 2021). 4.7 Warrant Agency Agreement, by and between the Company and VStock Transfer LLC, dated May 18, 2021 (incorporated by reference to Exhibit 4.3 to Form 8-K (File No. 001-35384) filed May 18, 2021). 4.8 Form of Warrant (incorporated by reference to Exhibit 4.1 to Form 8-K (File No. 001-35384) filed July 20, 2021). 4.9 Description of Securities (incorporated by reference to Exhibit 4.10 to Annual Report on Form 10-K (File No. 001-35384) filed March 31, 2023). 10.1 Asset Purchase Agreement by and between ABC Services Inc., Harold Schwartz, Thomas Kempster, Data Storage Corporation Inc., a Delaware corporation, and Data Storage Corporation, a Nevada corporation, dated October 25, 2016 (incorporated by reference to Exhibit 10.1 to Form 8K (File No. 001-35384) filed October 31, 2016). 10.2 Asset Purchase Agreement by and between ABC Services II Inc., Harold Schwartz, Thomas Kempster, Data Storage Corporation Inc., a Delaware corporation, and Data Storage Corporation, a Nevada corporation, dated October 25, 2016 (incorporated by reference to Exhibit 10.2 to Form 8K (File No. 001-35384) filed October 31, 2016). 10.3 Form of Stockholders Agreement, by and between Data Storage Corporation, Nexxis Inc., and John Camello, dated November 13, 2017 (incorporated by reference to Exhibit 10.22 to Form 10Q (File No. 001-35384) filed November 19, 2018). 60 10.4 Form of Employment Agreement, by and between Data Storage Corporation, Nexxis Inc., and John Camello, dated November 13, 2017 (incorporated by reference to Exhibit 10.23 to Form 10-Q (File No. 001-35384) filed November 19, 2018). 10.5 Buyout Lease Agreement, by and between Data Storage Corporation and Systems Trading, Inc. dated April 12, 2018 (incorporated by reference to Exhibit 10.6 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.6 FMV Lease Agreement, by and between Data Storage Corporation and Systems Trading, Inc. dated October 3, 2018 (incorporated by reference to Exhibit 10.7 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.7 Buyout Lease Agreement DSC003, by and between Data Storage Corporation and Systems Trading, Inc. dated December 19, 2018 (incorporated by reference to Exhibit 10.8 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.8 Buyout Lease Agreement DSC004, by and between Data Storage Corporation and Systems Trading, Inc. dated December 19, 2018 (incorporated by reference to Exhibit 10.9 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.9 Addendum 1 to Lease DSC003, by and between Data Storage Corporation and Systems Trading, Inc. dated March 20, 2019 (incorporated by reference to Exhibit 10.10 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.10 Addendum 1 to Lease DSC004, by and between Data Storage Corporation and Systems Trading, Inc. dated March 20, 2019 (incorporated by reference to Exhibit 10.11 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.11 Buyout Lease Agreement DSC006, by and between Data Storage Corporation and Systems Trading, Inc. dated January 10, 2020 (incorporated by reference to Exhibit 10.12 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.12 Agreement and Plan of Merger, by and between Data Storage Corporation, Data Storage FL, LLC, and Flagship Solutions, LLC, and the owners of Equity Interests (as defined therein), dated February 4, 2021 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed February 10, 2021). 10.13 Amendment to the Agreement and Plan of Merger, by and between Data Storage Corporation, Data Storage FL, LLC, Flagship Solutions, LLC, and the owners of Equity Interests (as defined therein), dated February 12, 2021 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K (File No. 001-35384) filed February 16, 2021). 10.14 Buyout Lease Agreement DSC007, by and between Data Storage Corporation and Systems Trading, Inc. dated March 4, 2021 (incorporated by reference to Exhibit 10.15 to Form 10-K (File No. 001-35384) filed March 31, 2021). 10.15 Form of Securities Purchase Agreement, by and between Data Storage Corporation and certain purchasers identified on the signature page thereto, dated July 19, 2021 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed July 20, 2021). 10.16# Form of Employment Agreement, by and between Data Storage Corporation and Charles M. Piluso, effective as of January 1, 2023 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed March 31, 2023). 10.17# Form of Employment Agreement, by and between Data Storage Corporation and Chris H. Panagiotakos effective as of January 1, 2023 (incorporated by reference to Exhibit 10.2 to Form 8-K (File No. 001-35384) filed March 31, 2023). 10.18 Sublease Agreement, by and between Sentinel Benefits Group, LLC and Sentinel Benefits Group, Inc. and Data Storage Corporation, dated January 2024 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed March 27, 2024) 61 10.19# Employment Agreement Amendment, by and between Data Storage Corporation and Charles M. Piluso, effective January 1, 2024 (incorporated by reference to Exhibit 10.20 to Form 10-K (File No. 001-35384) filed March 31, 2024). 10.20# Employment Agreement Amendment, by and between Data Storage Corporation and Chris H. Panagiotakos, effective January 1, 2024 (incorporated by reference to Exhibit 10.21 to Form 10-K (File No. 001-35384) filed March 31, 2024). 10.21# Amendment No. 1 to the Data Storage Corporation 2021 Stock Incentive Plan, as amended and restated, dated June 20, 2024 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed June 24, 2024). 10.22 Equity Distribution Agreement, dated July 18, 2024, by and between Data Storage Corporation and Maxim Group LLC (Incorporated by reference to Exhibit 1.1 to Registration Statement on Form S-3 (File No. 333-280881) filed July 18, 2024) 10.23 Form of Support Agreement, by and between Total Server Solutions Holdings, LLC, Data Storage Corporation and stockholder identified on the signature page thereto, dated July 11, 2025 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed July 15, 2025) 10.24 Asset Contribution Agreement , by and among Data Storage Corporation, CloudFirst Technologies Corporation, Flagship Solutions, LLC, Secure Infrastructure & Services LLC and CloudFirst Global LLC, dated September 11, 2025 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed September 16, 2025) 10.25# Employment Agreement Amendment, by and between Data Storage Corporation and Charles M. Piluso, effective January 1, 2026 (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-35384) filed February 13, 2026) 10.26# Employment Agreement Amendment, by and between Data Storage Corporation and Chris Panagiotakos, January 1, 2026 (incorporated by reference to Exhibit 10.2 to Form 8-K (File No. 001-35384) filed February 13, 2026) 19.1 Second Amended and Restated Insider Trading Policy (incorporated by reference to Exhibit 19.1 to Form 10-K (File No. 001-35384) filed March 31, 2025) 21.1* List of Subsidiaries of Data Storage Corporation 23.1* Consent of Rosenberg Rich Baker Berman P.A., Independent Registered Accounting Firm 24.1 Power of Attorney – Signature Page 31.1* Certification of Principal Executive Officer Pursuant to Exchange Act Rule 13a-14(a), As adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2* Certification of Principal Financial Officer Pursuant to Exchange Act Rule 13a-14(a), As adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1* Certification by the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2* Certification by the Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 97.1 Clawback Policy (incorporated by reference to Exhibit 97.1 to Form 10-K (File No. 001-35384) filed March 31, 2024). 99.1 Unaudited Pro Forma Condensed Consolidated Balance Sheet as of June 30, 2025, and the Unaudited Pro Forma Condensed Consolidated Statement of Operations for the Six Months Ended June 30, 2025 and for the years ended December 31, 2024 and 2023 (incorporated by reference to Exhibit 99.2 to Form 8-K (File No. 001-35384) filed September 16, 2025) * Filed herewith # Indicates management contract or compensatory plan. 62 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this to this report to be signed on its behalf by the undersigned, thereunto duly authorized on the 14 th day of April, 2026. DATA STORAGE CORPORATION By: /s/ Charles M. Piluso Name: Charles M. Piluso Chief Executive Officer and Chairman of the Board (Principal Executive Officer) Date: April 14, 2026 By: /s/ Chris H. Panagiotakos Name: Chris H. Panagiotakos Title: Chief Financial Officer (Principal Financial and Principal Accounting Officer) Date: April 14, 2026 POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Charles M. Piluso, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this report, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitutes or substitute, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized. Signature Title Date /s/ Charles M. Piluso Chief Executive Officer (Principal Executive Officer) April 14, 2026 Charles M. Piluso /s/ Chris H. Panagiotakos Chief Financial Officer (Principal Financial Officer) April 14, 2026 Chris H. Panagiotakos /s/ Harold J. Schwartz Director April 14, 2026 Harold Schwartz /s/ Thomas C. Kempster Director April 14, 2026 Thomas Kempster /s/ John Argen Director April 14, 2026 John Argen /s/ Lawrence A. Maglione, Jr. Director April 14, 2026 Lawrence Maglione /s/ Matthew Grover Director April 14, 2026 Matthew Grover /s/ Todd A. Correll Director April 14, 2026 Todd Correll /s/ Clifford Stein Director April 14, 2026 Clifford Stein /s/ Nancy M. Stallone Director April 14, 2026 Nancy M. Stallone /s/ Uwayne A. Mitchell Director April 14, 2026 Uwayne A. Mitchell 63