IMPACT BIOMEDICAL INC. 10-K

ITEM 9A - CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures An evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934 as of December 31, 2025. Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2025, to ensure that information required to be disclosed by the Company in the reports that the Company 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 the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure. We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there were resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Management’s Annual Report on Internal Control over Financial Reporting Our management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. In making this assessment, management used the framework established in “Internal Control—Integrated Framework” promulgated by the Committee of Sponsoring Organizations of the Treadway Commission in 2013, commonly referred to as the “COSO” criteria. Based on our assessment, we concluded that, as of December 31, 2025, our internal control over financial reporting was not effective based on those criteria. 42 In connection with management’s assessment of our internal control over financial reporting described above, the following weakness have been identified in the Company’s internal control over financial reporting as of December 31, 2025: 1. The Company did not maintain a sufficient complement of qualified accounting personnel and controls associated with segregation of duties over complex transactions. 2. There was no systematic method of documenting that timely and complete monthly reconciliation and closing procedures take place. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report. Changes in Internal Control over Financial Reporting Remediation of the Material Weaknesses Management believes it has taken significant steps during 2025 to strengthen our overall internal controls and eliminate the material weakness of those controls. During the 2026 fiscal year, the Company will document and test the remediations put in place. Such remediation includes the following: ● The Company has centralized its accounting functions across all divisions. The goal of this process is to support the segregation of duties and to allow the Chief Financial Officer to focus on ensuring reporting packages, reconciliations, and other financial reports are accurate and timely reported. ● A monthly operations and financial review is performed with key members of the management team, executive committee, and accounting team which has enhanced the timeliness, formality and rigor of our financial statement preparation, review and reporting process. ● Routine account reconciliations for all key balance sheet accounts have been initiated. These account reconciliations are reviewed timely by an independent person. ● The Company will engage an external, independent expert to review significant and/or complex accounting transactions, when appropriate, to ensure the proper accounting treatment is applied. The Company is committed to maintaining a strong internal control environment and believes that these remediation efforts will represent significant improvements in our controls. The Company has started to implement these steps, however, some of these steps will take time to be fully integrated and confirmed to be effective and sustainable. Additional controls may also be required over time. Changes in Internal Control over Financial Reporting While changes in the Company’s internal control over financial reporting occurred during the year ended December 31, 2025 as the Company continued to implement the remediation steps described above, we have not been able to fully document and test these controls to ensure their effectiveness over financial reporting during the year ended December 31, 2025, and thus cannot conclude that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. ITEM 9B – OTHER INFORMATION None . 43 PART III ITEM 10 - DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The following table sets forth the name, age and position of each of our executive officers, key employees and directors. Name Age Position Frank D. Heuszel 69 Chief Executive Officer and Director Mark Suseck 65 Chief Operating Officer Todd D. Macko 53 Chief Financial Officer Jason Grady 52 Director Dr. Elise Brownell 72 Director Melissa Sims 57 Director David Keene 68 Director Christian Zimmerman 48 Director Castel Hibbert 67 Director Ambrose Chan Heng Fai 81 Director Biographical and certain other information concerning the Company’s officers and directors is set forth below. There are no familial relationships among any of our directors. Except as indicated below, none of our directors is a director in any other reporting companies. None of our directors has been affiliated with any company that has filed for bankruptcy within the last ten years. We are not aware of any proceedings to which any of our directors, or any associate of any such director is a party adverse to us or any of our subsidiaries or has a material interest adverse to us or any of our subsidiaries. Each executive officer serves at the pleasure of the Board of Directors. 44 Frank D. Heuszel , 69, currently serves as the Chairman of the Board and Chief Executive Officer of Impact Biomedical Inc. He manages the strategic direction, growth, day-to-day operations, and governance of this Texas based multinational company operating businesses in human health and wellness markets. Mr. Heuszel, 69, became Impact’s Chairman and Chief Executive Officer on August 23, 2024. He has served as a member of Impact’s board of directors since 2020 and served as the company’s President until the 2025 promotion. Prior to becoming the CEO of Impact, Mr. Heuszel served as the Chief Executive Officer of DSS, Inc. (“DSS”), a NYSE:American publicly traded company. In that role he managed the strategic direction, growth, day to day operations, and governance of the New York based multinational company operating businesses in biohealth and bioscience, healthcare, securities trading and management platforms, blockchain technology, direct marketing, real estate, alternative energy, brand protection technology and securitized digital assets, with offices in Houston, Tx., and W. Henreitta, NY. Mr. Heuszel became DSS’s Chief Executive Officer and Interim Chief Financial Officer in April 2019. He served as a member of DSS’s board of directors from July 2018 until his resignation in August 2024 that allowed him to spearhead Impact BioMedical’s growth and IPO. Heuszel has extensive expertise in a wide array of strategic, business, turnaround, and regulatory matters across several industries as a result of his executive management, educational, and operational experience. Prior to joining DSS, Mr. Heuszel had a very successful career in commercial banking. For over 40+ years, Heuszel served in many senior executive roles with major US and international banking organizations. As a banker, Mr. Heuszel has served as General Counsel, Director of Special Assets, Senior Credit Officer, Chief Financial Officer, Controller, Senior Lender, and Director of Internal Audit. Mr. Heuszel also operates a successful law practice focused on the regulation and operation of banks, management of bank litigation, corporate restructurings, and mergers and acquisitions. In addition to being an attorney and executive manager, Mr. Heuszel is also a Certified Public Accountant (retired), and a Certified Internal Auditor (retired), and Certified Trust and Financial Advisor. Mr. Heuszel also currently serves as a director of a Texas community bank, Herring Bank of Amarillo, Texas since May 2022, where he serves upon several Board Committees, including the Audit Committee which he is the Chairman. He also serves on the Board of Herring Bancorp, Inc., where he also serves on multiple board committees, including Chair of the Audit Committee. Frank D. Heuszel was born in Branson, Missouri, graduated from the University of Texas at Austin from the McCombs School of Business in 1979 and received his Doctor of Jurisprudence with honors from South Texas College of Law in 1990. Frank received his certification as a Certified Public Accountant and as a Certified Internal Auditor in 1985 and certified as Certified Trust and Financial Advisor (CTFA) in 2025. Mr. Heuszel is also a member of the Texas State Bar, the Houston Bar Association, and the State Bar of Texas Bankruptcy Section. Mark Suseck , 65, has served as Chief Operating Officer of the Company since August 2023. Mr. Suseck served as the chief operating officer of DSS BioHealth Holdings Inc., a subsidiary of DSS, Inc., from 2020-2023, where he led company strategy, operations, licensing, acquisitions and commercialization. From 2021 to 2022, Mr. Suseck served as the chief executive officer of Vivacitas Oncology Inc., where he led company strategy, clinical development, operations and financing. From 2018-2019, Mr. Suseck was vice president of global sales and marketing at Helius Medical Technologies Inc. Mr. Suseck received his undergraduate degree in economics from Rutgers University, with minors in education and philosophy. He completed the Executive Management Program in residence at the University of Michigan Business School. Todd D. Macko , 53, has been Secretary and Treasurer of the Company since January 2021 and in May 2023 became Chief Financial Officer of the Company. Mr. Macko has served as the Chief Financial Officer of DSS since August 16, 2021. Mr. Macko previously served as the Vice President of Finance of DSS. As the Vice President of Finance, Mr. Macko’s responsibilities included assisting DSS’s Interim Chief Financial Officer in all aspects of financial and regulatory reporting. In addition, his responsibilities included the day-to-day management of the Company’s Accounting and Finance team and the financial leadership in the directing and improving of the accounting, reporting, audit, and tax activities. Prior to his role as Vice President of Finance for the Company, Mr. Macko joined the wholly owned subsidiary of DSS, Premier Packaging Corporation in January 2019, as its Vice President of Finance. Mr. Macko is a Certified Public Accountant with over 25 years of public and corporate financial management, business leadership and corporate strategy. Mr. Macko brings a wealth of experience with strengths in financial planning and analysis, business process re-engineering, budgeting, merger and acquisitions, financial reporting systems, project evaluation and treasury and capital management. Prior to joining the Company, Mr. Macko served as the Corporate Controller for Baldwin Richardson Foods, a leading custom ingredients manufacturer for the food and beverage industry from November 2015 until January 2019. Prior to that, Mr. Macko served as the Controller for The Outdoor Group, LLC., Genesis Vision, Inc., Complemar Partners, Inc., and Level 3 Communications, Inc. Mr. Macko obtained his Bachelor of Science degree in Accounting from Rochester Institute of Technology. Jason Grady , 52, has served as Interim Chief Executive Officer of DSS, Inc since October 2024. He is a seasoned executive recognized for his expertise in turnaround management, executive leadership, corporate strategy, and disciplined shareholder communication. In his role as CEO, Mr. Grady is responsible for setting strategic direction, driving operational and financial performance, and aligning leadership execution with long-term value creation. He works closely with the Board of Directors, investors, and strategic partners, with a focus on accountability, capital discipline, and sustainable profitability across the enterprise. Prior to assuming the CEO role, Mr. Grady served as Chief Operating Officer since August 2019, where he led enterprise-wide operational restructuring, improved cost discipline, and enhanced execution across a diversified portfolio of businesses. His tenure as COO was marked by hands-on leadership, performance-based management systems, and a strong emphasis on transparency and results. Since July 2018, Mr. Grady has also served as President and CEO of Premier Packaging Corporation, a world class folding carton and consumer packaging manufacturer. Under his leadership, Premier has strengthened its operational foundation, expanded into higher-value end markets, and reinforced a quality-first, customer-centric culture. His impact across the broader DSS platform has been central to improving operational rigor and strategic focus. From April 2010 to July 2018, Mr. Grady served as Vice President of Sales and Business Development, where he was instrumental in driving revenue growth, expanding key customer relationships, and positioning the Company for long-term expansion. Before joining DSS, Mr. Grady held senior leadership roles including Vice President of Marketing at Parlec Corporation, Director of Business Development at Berlin Packaging Corporation, and sales and marketing leadership positions at OutStart, Inc. He brings a rare blend of operational depth, strategic clarity, and communication discipline, with a leadership style grounded in accountability, adaptability, and execution under pressure. Mr. Grady holds a bachelor’s degree in marketing and communications and an Masters of Business Administration (MBA) from the Rochester Institute of Technology. Dr. Elise Brownell , 72, has served as a director of the Company since January 2021. Dr. Brownell has more than 30 years of biotechnology and pharmaceutical project management experience with a proven track record of advancing programs through clinical development. She serves as a Life Sciences entrepreneurial advisor for ASTIA, the nation’s premier entrepreneurial organization focused on women-led businesses. Dr. Brownell is also a member of the Editorial Advisory Board for Contract Pharma Magazine, and previous Chair of the Leaders Network program of Women in Consulting. She is the co-founder of ZephyrBiotech, LLC, a project management firm dedicated to advancing therapeutic candidates through development to key inflection points for clients. Earlier, Dr. Brownell was a founding member, head of project management and senior director of Aerovance, Inc., a venture-backed biotechnology company spun out from Bayer Healthcare, where she created and managed effective team processes to bring product candidates into full scale clinical Phase 1 and 2 developments. Prior to Aerovance, Dr. Brownell acted as head of project management for Bayer’s Biotechnology Unit, where she integrated project strategies to meet therapeutic and market needs. Other roles included building and negotiating partnerships with third parties to support development programs, leading research teams through early bench-to-clinic development phases, as well as entrepreneurial investment experience with Angel’s Forum and How Women Invest. Dr. Brownell received her M.S., M.Phil. and Ph.D. degrees in biology from Yale University and her B.S. degree in biology from Allegheny College. 45 Melissa Sims , 57, has served as a director of the Company since May 2023. Ms. Sims is an Illinois licensed attorney having practiced law since 1995. Following graduation from Northern Illinois University College of Law, Ms. Sims started the general practice of law representing clients in banking, health care, real estate, criminal, dissolution, municipal and probate matters in state and appellate courts. In 2006, she represented the Village of DePue, Illinois regarding legacy pollution from a Superfund site and set national precedent before the Court of Appeals for the Seventh Circuit. In 2021, the United States Supreme Court cited the Village of DePue v. ExxonMobil as precedent in the Atlantic Richfield v. Christian case. Starting in August of 2017, Ms. Sims has been employed with Milberg PLLC, where she currently serves as Senior Counsel. She has represented clients in some of the top class action and mass tort lawsuits in the country, including her work in the National Opioid multidistrict litigation in the Northern District of Ohio. She also represents municipalities across the country in tort actions in state, federal and appellate courts. In 2023, Ms. Sims was named to TIME magazine’s Top 100 Climate Influencers list in recognition of her leadership in environmental justice and climate-related litigation. David Keene , 68, is an executive level banker with 45 years of commercial banking experience with progressive responsibilities in all facets of credit risk management in both community and regional bank environments. Mr. Keene is currently retired as of late 2024. He was the chief credit officer of Unity National Bank, the only minority owned bank in Texas; a position he has held since September 2022. As chief credit officer, he oversaw loan policy compliance, loan collections, loan operations, credit administration, and all credit underwriting and analysis, problem loan workouts. From May 2018 to September 2022, Mr. Keene was a senior credit risk officer at Community Bank of Texas in Houston, Texas. In this position, he was, among other tasks, responsible for the support of the credit underwriting of high-net-worth individuals, partnerships, and companies. Mr. Keene received a Bachelor of Business Administration degree from Baylor University in 1979. He majored in both economics and finance. Christian Zimmerman , 48, is currently an accounting executive with Third Coast Bank (“TCB”), focusing on merger-related items. Prior to joining Third Coast Bank, Mr. Zimmerman served as the executive vice president—chief financial officer of Keystone Bank, SSB, from April 2019 until its merger into TCB. In that role, he reviewed and prepared monthly, quarterly, and year-end financial reports. From December 2015 to April 2019, Mr. Zimmerman was the executive vice president—controller of Community Bank of Texas, N.A., where he managed regulatory reporting for the bank and its holding company and prepared financial reports. He also worked on the holding company’s initial public offering, focusing on financial statements and analysis. Mr. Zimmerman is a certified public accountant and earned both a Bachelor of Business Administration and a Master’s degree in Professional Accounting from the University of Texas at Austin. Castel Hibbert , 67, Recently retired as an EVP and Managing Director from Veritex Bank after 41 years in Corporate Banking. During his long tenure he held various management, underwriting and line responsibilities including managing a $250 million portfolio. Mr. Hibbert currently serves as the CFO of a non-profit organization. Mr. Hibbert received a Bachelor of Science degree in Employee Relations from Michigan State University in 1981 and a Master in Business Administration degree from the University of Texas at Austin in 1983. Ambrose Chan Heng Fai , 81, has served as a director of the Company since March 2025. Mr. Chan has over 45 years of experience in banking and finance and has led the restructuring of numerous companies across multiple industries and jurisdictions. Mr. Chan currently serves as Chairman and/or Chief Executive Officer of several public companies, including Alset Inc., Alset International Limited and HWH International Inc., and has served on the boards of numerous U.S., Hong Kong, Singapore and Australian public companies. Board of Directors and Committees The Company has determined that each of Dr. Elise Brownell, Ms. Melissa Sims, Mr. David Keene, Mr. Christian Zimmerman, and Mr. Castel Hibbert qualify as independent directors (as defined under Section 803 of the NYSE American LLC Company Guide). In 2025, each of the Company’s independent directors attended or participated in approximately 95% or more of the aggregate of (i) the total number of meetings of the Board of Directors held during the period in which each such director served as a director and (ii) the total number of meetings held by all committees of the Board of Directors during the period in which each such director served on such committee. All directors attended last year’s annual general meeting. During the fiscal year ended December 31, 2025, the Board held one meetings and acted by written consent on twelve occasions. Audit Committee . On September 28, 2023, our Board established the audit committee. The Company has separately designated an Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The audit committee is appointed by the Board to assist the Board in its duty to oversee the Company’s accounting, financial reporting, and internal control functions and the audit of the Company’s financial statements. The role of the audit committee is to: ● oversee management in the performance of its responsibility for the integrity of the Company’s accounting and financial reporting and its systems of internal controls, ● the performance and qualifications of the Company’s independent auditor, including the independent auditor’s independence, ● the performance of the Company’s internal audit function; and ● the Company’s compliance with legal and regulatory requirements. Our audit committee consist of Mr. Castel Hibbert, Mr. Christian Zimmerman, Mr. David Keene, with Mr. Zimmerman serving as chair. Our Board has affirmatively determined that each meets the definition of “independent director” under the rules of NYSE American, and that they meet the independence standards under Rule 10A-3. Each member of our audit committee meets the financial literacy requirements of NYSE American’s rules. The Audit Committee held three meetings in 2024 and acted by written consent on one occasion. Our Board has adopted a written charter for the audit committee. 46 Compensation Committee . On September 28, 2023, the Board established the compensation committee. The compensation committee is responsible for reviewing and recommending, among other things: ● the adequacy and form of compensation of the Board; ● the compensation of Chief Executive Officer, including base salary, incentive bonus, stock option and other grant, award and benefits upon hiring and on an annual basis; ● the compensation of other senior management upon hiring and on an annual basis; and ● the Company’s incentive compensation and other equity-based plans and recommending changes to such plans to our Board, when necessary. Our compensation committee consist of Dr. Elise Brownell, Ms. Melissa Sims and Mr. Castel Hibbert with Dr. Brownell serving as chair. Our Board has adopted a written charter for the compensation committee. The Compensation Committee acted by written consent on one occasion. Nominating and Corporate Governance Committee . On September 28, 2023, the board established the nominating and corporate governance committee. The nominating committee is responsible for, among other things: ● developing criteria for membership on the board of directors and committees; ● identifying individuals qualified to become members of the board of directors; ● recommending persons to be nominated for election as directors and to each committee of the board of directors; ● annually reviewing our corporate governance guidelines; and ● monitoring and evaluating the performance of the board of directors and leading the board in an annual self-assessment of its practices and effectiveness. Our nominating and corporate governance committee consist of Ms. Melissa Sims, Mr. David Keene and Dr. Brownell with Ms. Sims serving as chair. Our Board has adopted a written charter for the nominating and corporate governance committee. The Nomination Committee acted by written consent on one occasion. Term of office All directors hold office until the next annual meeting of the stockholders of the company and until their successors have been duly elected and qualified. Officers are elected by and serve at the discretion of our Board. Code of Business Conduct and Ethics On September 28, 2023, the Board adopted a Business Code of Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. Our Business Code of Ethics has been made available on our website. Involvement in Certain Legal Proceedings None of our directors or executive officers has been involved in any legal proceedings in the past 10 years that would require disclosure under Item 401(f) of Regulation S-K. Delinquent Section 16(a) Reports Section 16(a) of the Exchange Act requires the Company’s directors and executive officers, and persons who own more than ten percent of a registered class of the Company’s equity securities to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of the Company. Officers, directors and holders of more than ten percent of the Company’s Common Stock are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file. To the Company’s knowledge, based solely upon review of the copies of such reports filed with the SEC and written representations that no other reports were required, during the fiscal year ended December 31, 2025 all Section 16(a) filing requirements applicable to the Company’s officers, directors and holders of more than ten percent of the Company’s common stock were satisfied. 47 ITEM 11 - EXECUTIVE COMPENSATION Compensation paid to our executive officers or directors during the past two fiscal years. Name and principal position Year Salary Bonus Stock Awards (1) Option Awards Non-Equity Incentive Plan Compensation Nonqualified Deferred Compensation Earnings All Other Compensation (2) Total Frank D. Heuszel, Chief Executive Officer 2025 $ 215,385 54,000 - - - - 32,644 $ 302,029 2024 $ 43,706 - 11,100 - - - - $ 54,806 Mark Suseck, Chief Operating Officer 2025 $ 256,361 - - - - - 37,415 $ 293,776 2024 $ 126,689 - 32,000 - - - - $ 158,689 Todd D. Macko, CFO 2025 $ - - - - - - - $ - 2024 - 555 - - - - $ 555 (1) Represents the total grant date fair value of stock options awards computed in accordance with FASB ASC 718. Our policy and assumptions made in the valuation of share-based payments are contained in Note 10. (2) Includes health insurance premiums, retirement matching funds paid by the Company. Employment Agreements On October 3, 2024, the Company and Mr. Frank D. Heuszel, the Company’s Chief Executive Officer, Chairman, and President (the “ Executive ”) entered into an Executive Employment Agreement (the “ Executive Employment Agreement ”). Under the Executive Employment Agreement, the Executive will be employed in his current capacity as the Company’s Chief Executive Officer. The Executive’s employment term shall be from October 3, 2024, to October 3, 2027 (the “ Employment Term ”), and the Executive shall receive an annual base salary (the “ Base Salary ”) of $200,000 for the first year of the Employment Term, $250,000 for the second year of the Employment Term, and $250,000 for the third year of the Employment Term. In addition to the Executive’s Base Salary, he will be awarded a mandatory bonus (the “ Mandatory Bonus ”) as follows: (i) $150,000 for the first year of the Employment Term; (ii) $100,000 for the second year of the Employment Term; and (iii) $100,000 for the third year of the Employment Term. The Executive must remain continuously employed by the Company pursuant to the Executive Employment Agreement through the anniversary of each award date for the Mandatory Bonus to be fully earned by the Executive. In addition to the Executive’s Base Salary, the Executive shall be eligible to be awarded discretionary bonuses that may be authorized and declared by the board of director’s to the Executive and/or to the senior management executives from time to time, at the Board’s sole discretion. The Executive will also be granted an option to purchase Shares of the Company pursuant to the Impact Biomedical 2023 Employee, Director and Consultant Equity Incentive Plan in the amount of 300,000 shares at a purchase price of $3.00 per share. On November 11, 2024, the Company and Mr. Mark Suseck entered into an Employment Agreement (the “Employment Agreement”) with a term that runs through September 16, 2027 during which Mr. Suseck will act as the Company’s Chief Operating Officer. Mr. Suseck will receive an annual base salary of $250,000 retroactive to April 1, 2024. Mr. Suseck is also entitled to a discretionary bonus to be awarded in either cash or Company common stock. Mr. Suseck will also be granted an option to purchase shares of the Company pursuant to the Impact Biomedical 2023 Employee, Director and Consultant Equity Incentive Plan in the amount of 400,000 at a purchase price of $3.00 per share. Director Compensation The table below represents compensation for 2025: Name Fees Earned or Paid in Cash Stock Awards (1) All Other Compensation (2) Total Current Directors Heng Fai Ambrose Chan $ 4,016 $ - $ - $ 4,016 Christian Zimmerman $ 5,000 $ - $ - $ 5,000 Melissa K. Sims $ 5,000 $ - $ - $ 5,000 Elise Brownell $ 5,000 $ - $ - $ 5,000 Castel Hibbert $ 5,000 $ - $ - $ 5,000 David Keene $ 5,000 $ - $ - $ 5,000 Jason Grady $ 5,000 $ - $ - $ 5,000 (1) Represents the total grant date fair value of stock options awards computed in accordance with FASB ASC 718. Our policy and assumptions made in the valuation of share-based payments are contained in Note 10. Outstanding Equity Awards at Fiscal Year-End There are no outstanding equity awards held by the Company’s named executive officers or directors as of December 31, 2025. 2023 Equity Incentive Plan Our Board has adopted the 2023 Equity Incentive Plan, or 2023 Plan. For the year ended December 31, 2024, 880,000 option grants with a purchase price of $3.00 per share were awarded to certain officers, directors and consultants of the Company. These options have various vesting periods, and all expire on October 31, 2031. These options were forfeited in November 2025. In November of 2025, stock grants totally 3,200,000 were awarded to certain officers, directors and consultants of the Company. These grants vested in January 2026. The Company recorded stock-based compensation expense of approximately $13,000 and $19,000 for the year ended December 31, 2025 and 2024, respectively, and is included in Sales, general and administrative compensation (inclusive of stock based compensation) on the accompanying Statement of Operations. 48 ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth certain information regarding the beneficial ownership of our common stock and Series A Convertible Preferred Stock as of December 31, 2025 by: ● each of our named executive officers; ● each of our directors; ● all of our current directors and executive officers as a group; and ● each stockholder known by us to own beneficially more than five percent of our common stock. Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities. Shares of common stock that may be acquired by an individual or group within 60 days of December 31, 2025, pursuant to the exercise of options or warrants and convertible debt are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group. Percentage of ownership of common stock is based on 107,821,231 shares of common stock outstanding on March 6, 2026. Except as indicated in footnotes to this table, we believe that the stockholders named in this table have sole voting and investment power with respect to all shares of common stock. Unless otherwise indicated, the address of all listed stockholders is c/o Impact BioMedical Inc., 1400 Broadfield Blvd., Suite 130, Houston, Texas TX 77084. Beneficial Ownership of Common Stock Percentage of Number of Shares Outstanding Share Name Beneficially Owned Beneficially Owned Heng Fai Ambrose Chan 300,000 * Christian Zimmerman 300,000 * Melissa K. Sims 300,000 * Elise Brownell 300,000 * Castel Hibbert 300,000 * David Keene 300,000 * Jason Grady 300,182 * Frank Heuszel 495,475 * Mark Suseck 300,000 * Todd D. Macko 200,122 * All officers and directors as a group (10 persons) 3,095,779 2.9 % 5% Shareholders DSS, Inc 32,484,802 30.1 % DSS BioHealth Security, Inc 60,496,041 56.1 % * Less than 1% 49 Equity Compensation Plans Information The following table sets forth information about our equity compensation plans as of December 31, 2025. Restricted stock to be issued upon vesting Number of securities to be issued upon exercise of outstanding options, warrants and rights 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 & b)) Plan Category (a) (b) (c) (d) Equity compensation plans approved by security holders 2023 Employee, Director and Consultant Equity Incentive Plan - options - - - - 2023 Employee, Director and Consultant Equity Incentive Plan - warrants - - - - 2023 Employee, Director and Consultant Equity Incentive Plan - - - 18,037,079 Total - - - 18,037,079 ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Related Party Transactions There are certain general and administrative costs incurred by DSS, a related party, on behalf of the Company which are passed through to the Company on a monthly basis. These costs consist of primarily payroll costs for certain DSS employees and are allocated based on estimated time spent on behalf of the Company. Beginning in January 2024 and through September 2024, these costs are approximately $31,000 per month. Beginning October 2024, these costs are approximately $26,000 per month. As of December 31, 2025, the Company incurred approximately $312,000 in related expenses. As of December 31, 2024, the Company incurred approximately $357,000 in related expenses. On December 31, 2020, and later amended, the Company executed a Revolving Promissory Note (“Note”) with DSS, a related party, which accrues interest at a rate of 4.25% and is due in full at the maturity date of September 30, 2030. The Note was further amended on July 24, 2024 with an effective date of September 16, 2024 to i) allow the Company to pay certain principal and/or interest payments owing under the repayment terms in an exchange for potential of equity in the Company, ii) change the quarterly interest due dates to the last day of each calendar quarter (i.e. December 31, March 31, June 30 and September 30), iii) to adjust the On Demand feature so that it starts after the 24th month, iv) continue the planned repayment program commencing on the 37th month and on the last day of each month thereafter through August 31, 2030 to pay a fixed monthly payment of $126,381, v) to continue the scheduled maturity date of September 30, 2030, and vi) adjusts the interest rate to be the WSJ Prime Rate plus 0.50%. This Note is secured by the assets of the Company. As of December 31, 2024 the outstanding balance, inclusive of interest was $8,878,000 (net of change in fair value of the Note of $5,068,000) The $8,878,000 is recorded in Note payable, related party at December 31, 2024 (Note 9). On October 16, 2025, the Company converted its Note payable, related party to 31,939,778 shares common stock as agreed upon by the Company and DSS (lender), which represents a calculation of the outstanding principal and interest approximating $15 million and a stock price utilizing a 10-day Vwap as of June 18, 2025. There are no restrictions placed on the disposition of these shares. As a result of the conversion, the Company recorded a Change in fair value of the note payable, related party of $9,388,000 which is included on the accompanying statement of consolidated operations. On 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. Impact BioMedical Inc. from time to time receives funding from DSS to cover its capital needs. DSS, Inc., beneficially owns approximately 86% of the Company’s voting shares. As of December 31, 2025 and 2024, amounts due to DSS approximate $621,000 and $399,000, respectively. These balances relate to noninterest-bearing funding provided by DSS, and are unsecured, 50 Director Independence The Company has adopted the standards of NYSE American for determining the independence of its directors. These independence standards specify the relationships deemed sufficiently material to create the presumption that a director is not independent. No director qualifies as independent unless the Company’s Board affirmatively determines that the director does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In addition, Section 803A of the NYSE American Company Guide (and related commentary) sets forth the following non-exclusive list of persons who shall not be considered independent: (a) a director who is, or during the past three years was, employed by the Company, other than prior employment as an interim executive officer (provided the interim employment did not last longer than one year); (b) a director who accepted or has an immediate family member who accepted any compensation from the Company in excess of $120,000 during any period of twelve consecutive months within the three years preceding the determination of independence, other than the following: (i) compensation for Board or Board committee service, (ii) compensation paid to an immediate family member who is an employee (other than an executive officer) of the Company, (iii) compensation received for former service as an interim executive officer (provided the interim employment did not last longer than one year), or (iv) benefits under a tax-qualified retirement plan, or non-discretionary compensation; (c) a director who is an immediate family member of an individual who is, or at any time during the past three years was, employed by the Company as an executive officer; (d) a director who is, or has an immediate family member who is, a partner in, or a controlling shareholder or an executive officer of, any organization to which the Company made, or from which the Company received, payments (other than those arising solely from investments in the Company’s securities or payments under non-discretionary charitable contribution matching programs) that exceed 5% of the organization’s consolidated gross revenues for that year, or $200,000, whichever is more, in any of the most recent three fiscal years; (e) a director who is, or has an immediate family member who is, employed as an executive officer of another entity where at any time during the most recent three fiscal years any of the issuer’s executive officers serve on the compensation committee of such other entity; or (f) a director who is, or has an immediate family member who is, a current partner of the Company’s outside auditor, or was a partner or employee of the Company’s outside auditor who worked on the Company’s audit at any time during any of the past three years. Directors serving on the Company’s audit committee must also comply with the additional, more stringent requirements set forth in Section 803B of the NYSE American Company Guide and Rule 10A-3 of the Securities Exchange Act of 1934, as amended. Consistent with these considerations, the Board affirmatively determined that Mr. Castel Hibbert, Mr. Christian Zimmerman, Mr. David Keene, Dr. Elise Brownell and Ms. Melissa Sims each meets the definition of “independent director” under the rules of NYSE American. Directors serving on the Company’s compensation committee must also comply with the additional, more stringent requirements as set forth in Section 805(c) of the NYSE American Company Guide. Parent of the Company DSS BioHealth Securities, Inc., a wholly-owned subsidiary of DSS, Inc. owns approximately 56% of the voting shares of the Company while DSS directly owns approximately 30% of the voting shares of the Company. Combined DSS beneficially owns approximately 86% of the Company. 51 ITEM 14 - PRINCIPAL ACCOUNTING FEES AND SERVICES Audit Fees Audit fees consist of fees for professional services rendered for the audit of the Company’s consolidated financial statements included in the Company’s Annual Report on Form 10-K, the review of financial statements included in the Company’s Quarterly Reports on Form 10-Q, and for services that are normally provided by the auditor in connection with statutory and regulatory filings or engagements. The aggregate fees billed for professional services rendered by our independent public accounting firm, Grassi & Co. CPAs, P.C., Jericho, NY (“Grassi & Co.”), for audit and review services for the fiscal year ended December 31, 2024 were approximately $210,000. The aggregate fees billed for professional services rendered by Grassi & Co for audit and review services for the fiscal year ended December 31, 2025 was approximately $140,000. The anticipated fees associated with the audit of the year ended December 31, 2026, is expected to range between $70,000 and $85,000. Tax Fees Impact BioMedical for the years ended December 31, 2025 and 2024 is included in the consolidated tax return of DSS, Inc. and does not file separate federal or state tax returns. Impact BioMedical engaged Greendyke Jencik & Associates CPAs, PLLC to render an annual tax provisions. The aggregate fees for 2025 and 2024 were approximately $2,000 and $2,000. All Other Fees There were fees billed for professional services rendered by our principal accountant, Grassi & Co. CPAs, P.C., associated with the Company’s S-1 filings approximating $87,000 for the years ended December 31, 2024.No such fees were incurred during the year ended December 31, 2025. Administration of the Engagement; Pre-Approval of Audit and Permissible Non-Audit Services The Company’s Audit Committee Charter requires that the Audit Committee establish policies and procedures for pre-approval of all audit or permissible non-audit services provided by the Company’s independent auditors. Our Audit Committee, approved, in advance, all work performed for year ended December 31, 2025 and nine-months ended September 30, 2026, by our principal accountant, Grassi & Co. CPAs, P.C. The Audit Committee may establish, either on an ongoing or case-by-case basis, pre-approval policies and procedures providing for delegated authority to approve the engagement of the independent registered public accounting firm, provided that the policies and procedures are detailed as to the particular services to be provided, the Audit Committee is informed about each service, and the policies and procedures do not result in the delegation of the Audit Committee’s authority to management. In accordance with these procedures, the Audit Committee pre-approved all services performed by Grassi & Co. CPAs, P.C. 52 PART IV ITEM 15 – EXHIBITS, FINANCIAL STATEMENT SCHEDULES The following exhibits to this registration statement included in the Index to Exhibits are incorporated by reference. Exhibit Number Exhibit Description 1.1 Form of Underwriting Agreement between the Company and Aegis Capital Corp. incorporated by reference to Exhibit 1.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 3.1 Amended and Restated Articles of Incorporation of Impact BioMedical Inc. dated July 29, 2020 incorporated by reference to Exhibit 3.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 3.2 Certificate of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit 3.2 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 3.3 Certificate of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit 3.3 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023 . 3.4 Certificate of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit 3.4 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 3.5 Bylaws of the Company incorporated by reference to Exhibit 3.5 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 3.6 Certificate of Designation of Series A Convertible Preferred Stock incorporated by reference to Exhibit 3.6 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 4.1 Form of Underwriter Warrant incorporated by reference to Exhibit 4.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.1 Share Exchange Agreement dated as of April 27, 2020, among Document Security Systems, Inc., DSS BioHealth Security, Inc., Singapore Development Limited and Global BioMedical Pte Ltd. incorporated by reference to Exhibit 10.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.2 Subscription Agreement dated December 19, 2020, between the Company and BioMed Technologies Asia Pacific Holdings Limited incorporated by reference to Exhibit 10.2 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.3 Promissory Note with Dustin Michael Crum dated February 21, 2021 incorporated by reference to Exhibit 10.3 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.4 Stock Purchase Agreement dated March 15, 2021 between the Company and Vivacitas Oncology Inc. incorporated by reference to Exhibit 10.4 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.5 Convertible Promissory Note dated May 14, 2021 incorporated by reference to Exhibit 10.5 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 53 10.6 Revolving Promissory Note dated December 31, 2020 incorporated by reference to Exhibit 10.6 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.7 Royalty Agreement by and between Global BioLife Inc. and Chemia Corporation, dated August 15, 2018 incorporated by reference to Exhibit 10.7 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.8 Addendum to Royalty Agreement by and between Global BioLife Inc. and Chemia Corporation, dated November 27, 2018 incorporated by reference to Exhibit 10.8 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.9 Distribution Agreement by and between BioMed Technologies Asia Pacific Holdings Limited and Impact BioMedical Inc., dated December 9, 2020 incorporated by reference to Exhibit 10.9 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.10 Global BioLife, Inc. Stockholders’ Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech Limited, and GRDG Sciences, LLC, dated April 26, 2017 incorporated by reference to Exhibit 10.10 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.11 Amendment No. 1 to Global BioLife, Inc. Stockholders’ Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech Limited, and GRDG Sciences, LLC, dated May 22, 2018 incorporated by reference to Exhibit 10.11 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.12 Amendment No. 2 to Global BioLife, Inc. Stockholders’ Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech Limited, and GRDG Sciences, LLC, dated August 2020 incorporated by reference to Exhibit 10.12 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.13 Impact BioLife Science, Inc. Stockholders Agreement among Impact BioLife Science, Inc., Impact BioMedical Inc. and GRDG Sciences, LLC, dated December 11, 2020 incorporated by reference to Exhibit 10.13 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.14 Licensing Proceeds Distribution Agreement with GRDG Sciences, LLC dated May 16, 2022 incorporated by reference to Exhibit 10.14 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.15 Amendment No. 1 to Revolving Promissory Note dated December 31, 2021 incorporated by reference to Exhibit 10.15 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.16 Amendment No. 2 to Revolving Promissory Note dated March 31, 2022 incorporated by reference to Exhibit 10.16 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 54 10.17 License Agreement with ProPhase Labs, Inc. dated March 17, 2022 incorporated by reference to Exhibit 10.17 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.18 License Agreement with ProPhase Labs, Inc. dated July 18, 2022 incorporated by reference to Exhibit 10.18 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.19 Licensing Proceeds Distribution Agreement with GRDG Sciences, LLC dated February 15, 2022 incorporated by reference to Exhibit 10.19 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.20 Share Exchange Agreement between Impact BioMedical Inc. and DSS BioHealth Security, Inc. incorporated by reference to Exhibit 10.20 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 10.21 Amendment to Promissory Note effective January 18, 2024 between Impact BioMedical Inc. and DSS, Inc. incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (Commission File No. 333-253037) filed with the SEC on January 22, 2024. 10.22 Impact BioMedical Inc. 2023 Employee, Director, and Consultant Equity Incentive Compensation Plan 14.1 Impact BioMedical Employee Handbook incorporated by reference to Exhibit 14.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 16.1 Letter from Turner Stone & Company LLP incorporated by reference to Exhibit 16.1 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333- 275062 ) filed with the SEC on November 21, 2023. 21.1 List of subsidiaries of Impact BioMedical Inc. 23.2 Consent of Grassi & Co., CPAs, P.C. incorporated by reference to Exhibit 23.2 to the Company’s Amendment to the Registration Statement on Form S-1 (No. 333-275062) filed with the SEC on November 21, 2023. 31.1 Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act, as amended. 31.2 Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act, as amended. 32.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rules 13a-14(b) or 15d-14(b) of the Securities and Exchange Act, as amended, and 18 U.S.C. Section 1350. 101.INS Inline XBRL Instance Document 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) ITEM 16 – Form 10K SUMMARY None. 55 SIGNATURES Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized. Impact BioMedical, Inc. March 11, 2026 By: /s/ Frank D. Heuszel Frank D. Heuszel Chief Executive Officer (Principal Executive Officer) March 11, 2026 By: /s/ Todd D. Macko Todd D. Macko Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. March 11, 2026 By: /s/ Frank D. Heuszel Frank D. Heuszel Chief Executive Officer (Principal Executive Officer) March 11, 2026 By: /s/ Todd D. Macko Todd D. Macko Chief Financial Officer (Principal Financial and Accounting Officer) March 11, 2026 By: /s/ Mark Suseck Chief Operating Officer March 11, 2026 By: /s/ Jason Grady Jason Grady Director March 11, 2026 By: /s/ Elise Brownell Elise Brownell Director March 11, 2026 By: /s/ Melissa Sims Melissa Sims Director March 11, 2026 By: /s/ Castel Hibbert Castel Hibbert Director March 11, 2026 By: /s/ Christian Zimmerman Christian Zimmerman Director March 11, 2026 By: /s/ David Keene David Keene Director 56