Mr. Frank D. Heuszel, the Company’s principal accountant for the current year and the fiscal year ended December 31, 2019, and his representative plan to participate the Annual Meeting either in person or virtually via a video conference application. At the Annual Meeting, Mr. Frank D. Heuszel plans to make a brief statement and will make himself available to respond to appropriate questions about all of the proposals provided in this Proxy Statement.

PROPOSAL NO. 1 — ELECTION OF DIRECTORS

Proposal

Eight directors are to be elected at the Annual Meeting to serve until the next annual meeting of the Company’s stockholders. Unless otherwise instructed, the persons named in the accompanying proxy intend to vote the shares represented by the proxy for the election of the nominees listed below. Although it is not contemplated that any nominee will decline or be unable to serve as a director, in such event, proxies will be voted by the proxy holder for such other persons as may be designated by the Board of Directors, unless the Board of Directors reduces the number of directors to be elected.

The following table sets forth the nominees for directors on the Board of Directors. Certain biographical information about the nominees as of the Record Date can be found above in the section titled “Directors, Executive Officers and Corporate Governance.”

Nominees for Directors

Required Stockholder Vote and Recommendation of Our Board of Directors

Director nominees must receive a majority of the votes cast on such director’s election, which means that the nominee must receive more “FOR” votes than “WITHHOLD” votes.

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF ALL THE NOMINEES NAMED ABOVE.

PROPOSAL NO. 2 — RATIFICATION OF THE APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

Proposal

The Company’s stockholders are being asked to ratify the Board of Directors’ appointment of Freed Maxick CPAs, P.C. as the Company’s independent registered public accounting firm for fiscal 2020.

In the event that the ratification of this selection is not approved by an affirmative majority of the votes cast on the proposal at the Annual Meeting, the Board of Directors will review its future selection of the Company’s independent registered public accounting firm.

Representatives of Freed Maxick CPAs, P.C. are not expected to attend the Annual Meeting.

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 principal accountant, Freed Maxick CPAs, P.C., for audit and review services for the fiscal years ended December 31, 2019 and 2018 were approximately $154,600 and $125,117, respectively.

Audit Related Fees

The aggregate fees billed for audit related services by our principal accountant, Freed Maxick CPAs, P.C., pertaining to comfort letter related to our registered offering during the years, consents for related registration statements and the audit of the Company’s employee benefit plan and review of the stand-alone financial statements for one of the Company’s subsidiaries, for the years ended December 31, 2019 and 2018 were approximately $51,450 and $26,800, respectively.

Tax Fees

The aggregate fees billed for professional services rendered by our principal accountant, Freed Maxick CPAs, P.C., for tax compliance, tax advice and tax planning during the years ended December 31, 2019 and 2018 were approximately $29,500 and $33,305, respectively.

All Other Fees

There were no fees billed for professional services rendered by our principal accountant, Freed Maxick CPAs, P.C., for other related services during the years ended December 31, 2019 and 2018.

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 by our principal accountant, Freed Maxick CPAs, P.C. These services may include audit services, audit-related services, tax services and other services. 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 Freed Maxick CPAs, P.C.

Required Stockholder Vote and Recommendation of Our Board of Directors

Approval of our independent registered public accounting firm requires the affirmative vote of a majority of the votes cast at the Annual Meeting, whether in person or by proxy, provided that a quorum is present. An abstention will not be counted for or against the proposal, and therefore will not affect the vote outcome.

PROPOSAL 1—NO. 3 - ADVISORY VOTE ON EXECUTIVE COMPENSATION

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) requires the Company’s stockholders to have the opportunity to cast a non-binding advisory vote regarding the approval of the compensation disclosed in this Proxy Statement of the Company’s Named Executive Officers included in the summary compensation table and related disclosures. As discussed in the “Executive Compensation” section below, the Company has disclosed the compensation of the Named Executive Officers pursuant to rules adopted by the SEC.

We believe that our compensation policies for the Named Executive Officers are designed to attract, motivate and retain talented executive officers and are aligned with the long-term interests of the Company’s stockholders. This advisory stockholder vote, commonly referred to as a “say-on-pay vote,” gives you as a stockholder the opportunity to approve or not approve the compensation of the Named Executive Officers that is disclosed in this Proxy Statement by voting for or against the following resolution (or by abstaining with respect to the resolution):

RESOLVED, that the stockholders of Document Security Systems, Inc. approve all of the compensation of the Company’s executive officers who are named in the Summary Compensation Table of the Company’s 2020 Proxy Statement, as such compensation is disclosed in the Company’s 2020 Proxy Statement pursuant to Item 402 of Regulation S-K, which disclosure includes the Proxy Statement’s Summary Compensation Table and other executive compensation tables and related narrative disclosures.

Because your vote is advisory, it will not be binding on either the Board of Directors or the Company. However, the Company’s Compensation and Management Resources Committee will take into account the outcome of the stockholder vote on this proposal at the Annual Meeting when considering future executive compensation arrangements. In addition, your non-binding advisory votes described in this Proposal 3 will not be construed: (1) as overruling any decision by the Board of Directors, any Board committee or the Company relating to the compensation of the Named Executive Officers, or (2) as creating or changing any fiduciary duties or other duties on the part of the Board of Directors, any Board committee or the Company.

PROPOSAL NO. 4 — TO APPROVE, PURSUANT TO RULE 713 OF THE NYSE AMERICAN, THE POTENTIAL ISSUANCE OF SHARES OF DSS COMMON STOCK ANDUPON CONVERSION OF SERIES A CONVERTIBLE PREFERRED BY INCREASING THE BENEFICIAL OWNERSHIP LIMITATION

SERIESBackground

We are asking our stockholders to approve, pursuant to Rule 713 of the NYSE American, the potential issuance of shares of the Corporation’s common stock, par value $0.02 per share (“Common Stock”), representing equal to or greater than 20% or more of presently outstanding stock, issuable upon conversion of our Series A PREFERRED STOCK IN CONNECTION WITH THE ACQUISITION OF IMPACTConvertible Preferred Stock (“Series A Preferred Stock”) issued by the Company to Global BioMedical (a defined below) on August 21, 2020 in accordance with the Share Exchange Agreement dated April 27, 2020 (the “Share Exchange Agreement”), by increasing the 19.9% beneficial ownership conversion limitation (the “Ownership Limitation”) to 50.99% (the “Ownership Limitation Increase”). In particular, we are asking our stockholders to approve an amendment to our certificate of incorporation to effect the Ownership Limitation Increase.

BIOMEDICAL, INC.The Ownership Limitation currently prohibits Global BioMedical from converting all or any portion of any share of Series A Preferred Stock to the extent that after giving effect to such issuance, Global BioMedical would beneficially own in excess of 19.99% of the Common Stock of the number of shares of the Common Stock outstanding immediately after giving effect to such issuance. Following the approval of the stockholders of the Company of the Ownership Limitation Increase, which approval is being sought pursuant to this Proposal 4, Global BioMedical will not be able to convert all or any portion of any share of Series A Preferred Stock to the extent any such conversion would cause Global BioMedical to beneficially own more than 50.99% of the outstanding Common Stock. Key terms of the Share Exchange Agreement and the Certificate of Amendment to the Certificate of Incorporation filed by the Company on August 18, 2020 with the Secretary of State of New York to establish the Series A Preferred Stock (the “Series A COD”) are summarized below. A copy of the Share Exchange Agreement and the Series A COD has been filed as Exhibit 10.1 to our Current Report on Form 8-K filed with the SEC on May 1, 2020 and as Exhibit 3.1 to our Current Report on Form 8-K filed with the SEC on August 27, 2020, respectively, and you are encouraged to review the full text of such Current Report, including the exhibits. The below summary of the Share Exchange Agreement and the transaction contemplated thereby do not purport to be complete and is subject to, and is qualified in its entirety by, the full text of such agreement.

Structure of the AcquisitionShare Exchange Agreement

On April 27, 2020, the Board of Directors of Company, (the “Board”) approved and the Company entered into the Share Exchange Agreement with DSS BioHealth Security, Inc., a Nevada corporation and wholly owned subsidiary of the Company (“DBHS”), Singapore eDevelopment Limited, a Singapore corporation (“Singapore eDevelopment”) that is listed on the Singapore Exchange, and Global BioMedical Pte Ltd, a Singapore corporation and wholly owned subsidiary of Singapore eDevelopment (“Global BioMedical”). Pursuant to, entered into the Share Exchange Agreement, and upon an affirmative vote for this Proposal,pursuant to which DBHS willwas to acquire of all of the outstanding capital stock (the “Impact Shares”) of Impact BioMedical Inc., a Nevada corporation and wholly owned subsidiary of Global BioMedical (“Impact”Impact BioMedical”), in exchange for DSS.

On August 21, 2020, the Company completed its acquisition of Impact BioMedical, pursuant to the Share Exchange Agreement, which was approved by the Company’s stockholders on August 10, 2020 at a special meeting of stockholders (the “Share Exchange”). Under the terms of the Share Exchange, the Company issued 483,334 shares of Common Stock, nominally valued at $6.48 per share, and 46,868 shares of Series A Preferred Stock, with Impact becoming a direct wholly owned subsidiary of the DBHS (the “Share Exchange”).

The aggregate consideration for the Impact Shares will be the following to be issued to Global BioMedical by DSS: (i) 483,334 newly issued shares of Common Stock of DSS, nominally valued at $3,132,000, or $6.48 per share; and (ii) 46,868 newly issued shares of a new series of perpetual Series A Convertible Preferred Stock of DSS (“Series A Preferred Stock”) with a stated value of $46,868,000, or $1,000 per share, for a total consideration valued at $50 million. TheAs a result of the Share Exchange, Impact BioMedical is now a wholly-owned subsidiary of DSS BioHealth, the Company’s wholly-owned subsidiary.

As previously disclosed, Heng Fai Ambrose Chan is the Chief Executive Officer and largest stockholder of Singapore eDevelopment, as well as the Chairman of the Board and largest stockholder of the Company.

Series A Convertible Preferred Stock Certificate of Designation

As described above, in accordance with the terms of the Share Exchange Agreement, the Company issued 46,868 shares of Series A Preferred Stock, will have such terms,with a stated value of $46,868,000, or $1,000 per share, to Global BioMedical as partial consideration in exchange for the Impact Shares.

The rights obligations and preferences of the Series A Preferred Stock set forth in the Designation of Series A Convertible Preferred Stock of the Company (the “Certificate of Designations”), to be filed with the Secretary of State of the State of New York prior to the closing of the Share Exchange. The terms of the Share Exchange Agreement and the Share Exchange were previously reported in the Form 8-K fileddesignated by the Company on March 13, 2020.

As previously reported, on May 7, 2020, following the date of the Share Exchange Agreement we effected a 30-1 reverse stock split. As a result, the number of Common Stock shares to be issued by DSS pursuant to the Share Exchange have been appropriately adjusted.

Designation ofCompany’s Board in the Series A Preferred Stock

UnderCOD, pursuant to which the Certificate of Designations, each shareCompany authorized 46,868 shares of Series A Preferred Stock will be convertible into shares of Common Stock of DSS, subject to a 19.9% beneficial ownership conversion limitation (“Beneficial Ownership Limitation”) based on the total issued outstanding shares of Common Stock of DSS beneficially owned by Global BioMedical.Stock. Holders of the Series A Preferred Stock will have no voting rights, except as required by applicable law or regulation, and no dividends will accrue or beare payable on the Series A Preferred Stock. The holders of Series A Preferred Stock will beare entitled to a liquidation preference at a liquidation value of $1,000 per share, and the Company will havehas the right to redeem all or any portion of the then outstanding shares of Series A Preferred Stock, pro rata among all holders, at a redemption price per share equal to such liquidation value per share.

The Series A Preferred Stock ranks senior to Common Stock and any other class of securities that is specifically designated as junior to the Series A Preferred Stock with respect to rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, in respect of a liquidation preference equal to its par value of $1,000. In addition, under the Certificate of Designation,Series A COD, the Company will havehas the right to convert all or any portion of the then outstanding shares of Series A Preferred Stock, pro rata among all holders, into an aggregate number of shares of Common Stock as is determined by (i) multiplying the number of shares to be converted by the liquidation value per share, and then (ii) dividing the result by the applicable conversion price then in effect.

As a holder of Series A Preferred Stock, Global BioMedical has no right to convert all or any portion of any share of Series A Preferred Stock as and to the extent giving effect to such issuance after conversion that Global BioMedical would beneficially own in excess of the Ownership Limitation. Following the approval of the stockholders of the Company Overviewof the Ownership Limitation Increase, which approval is being sought pursuant to this Proposal 4, Global BioMedical will not be able to convert all or any portion of any share of Series A Preferred Stock to the extent any such conversion would cause Global BioMedical to beneficially own more than 50.99% of the outstanding Common Stock.

Stockholder Approval Requirement

Document Security Systems, Inc.As noted above, the Share Exchange Agreement contemplates that the number of shares to be issued to Global BioMedical is limited to the 19.99% Ownership Limitation.

Rule 713 of the NYSE American requires stockholder approval of a global company involvedtransaction, other than a public offering, involving the sale, issuance or potential issuance by an issuer of Common Stock (or securities convertible into or exercisable for Common Stock) at a price less than the greater of book or market value which together with sales by officers, directors or principal stockholders of the issuer equals 20% or more of presently outstanding Common Stock, or equal to 20% or more of presently outstanding stock for less than the greater of book or market value of the stock, or when the issuance or potential issuance of additional shares will result in a change of control of the issuer. Stockholder approval of this Proposal 1 will constitute stockholder approval for purposes of Rule 713 of the NYSE American.

We are seeking stockholder approval of the Ownership Limitation Increase, which will permit the issuance to Global BioMedical upon conversion of the Series A Preferred Stock of up to 50.99% of our outstanding Common Stock.

If our stockholders do not approve this Proposal, the Ownership Limitation will remain at 19.99%.

Reasons for Transaction

The Board believes that the Ownership Limitation Increase is in the developmentbest interests of the Company and deliveryits stockholders to help simplify the Company’s balance sheet in order to help investors and others better understand, compare and analyze our operating performance from period to period.

Effect on Current Stockholders; Dilution

If Proposal 4 is approved, our existing stockholders will suffer additional dilution in voting rights upon the issuance of better productsCommon Stock upon conversion of shares of Series A Preferred Stock above the Ownership Limitation. As described above, if Proposal 4 is approved, Global BioMedical will not be able to convert all or any portion of any share of Series A Preferred Stock to the extent any such conversion would cause Global BioMedical to beneficially own more than 50.99% of the outstanding Common Stock.

Specifically, if Proposal 4 is approved, based on the conversion of all Series A Preferred Stock held by Global BioMedical, , subject to the Ownership Limitation Increase, up to ________ shares of the Common Stock would be issuable. Based on the number of shares of Common Stock outstanding as of the Record Date, such shares would represent ___% of our total outstanding shares (giving effect to such issuance). The sale into the public market of these newly-issued shares of Common Stock could adversely affect the market price of our Common Stock. The issuance of such shares may result in significant dilution to our stockholders and technologyafford them a smaller percentage interest in the voting power, liquidation value and aggregate book value of the Company. This means that our current stockholders will own a smaller interest in our Company and will have less ability to individualsinfluence significant corporate decisions requiring stockholder approval.

As noted above, the Share Exchange Agreement contemplates that the Company shall not issue, and industry. We operate nine business lines through subsidiaries located aroundGlobal BioMedical shall not acquire, any shares of our Common Stock upon conversion of Series A Preferred Stock if such shares proposed to be issued and sold, when aggregated with all other shares of our Common Stock then owned beneficially by Global BioMedical and its affiliates, would result in the globe.beneficial ownership by Global BioMedical and its affiliates in excess of the Ownership Limitation. If approved, the Ownership Limitation Increase would limit the number of shares Global BioMedical may beneficially own at any one time to 50.99% of our outstanding Common Stock. Consequently, the number of shares Global BioMedical may beneficially own in compliance with the Ownership Limitation Increase may increase over time as the number of outstanding shares of our Common Stock increases over time. Global BioMedical may be in a position to exert influence over the Company and there is no guarantee that the interests of Global BioMedical will align with the interests of other stockholders.

The rights and privileges associated with all shares of Common Stock issuable upon conversion of Series A Preferred Stock, however, are identical to the rights and privileges associated with the Common Stock held by our existing stockholders, and will not include preemptive, conversion or other rights to subscribe for additional shares of Common Stock.

Votes Required for Approval

The approval of the amendment to our certificate of incorporation to effect the Ownership Limitation Increase requires the affirmative vote of a majority of the shares of the Company’s Common Stock present in person or by proxy and voting at the Annual Meeting.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” PROPOSAL 4.

PROPOSAL 5 - REINCORPORATION OF THE COMPANY FROM NEW YORK TO TEXAS

OfBackground

Our Board has unanimously approved and recommends to our stockholders this proposal to change the nine business lines, four have historically been the core business linesCompany’s state of incorporation from New York to Texas (the “Reincorporation”), subject to stockholder approval. The Reincorporation would be effected pursuant to a merger (the “Merge” with Alset, Inc., a wholly-owned subsidiary of the Company:Company incorporated in Texas (“Alset”). The Company will enter into an Agreement and Plan of Merger (the “Merger Agreement”)in the form attached to this proxy statement under Exhibit [_], whereby the Company will merge with and into Alset.. In addition, following the Reincorporation, the Company will no longer be a New York corporation governed by the Company’s current Certificate of Incorporation (the “New York Charter”) and its current By-laws (the “New York By-laws” and, together with the New York Charter, the “New York Governing Documents”) and will instead` be a Texas corporation governed by the proposed Texas Certificate of Formation (the “Texas Charter”) and the proposed Texas By-laws (the “Texas By-laws” and, together with the Texas Charter, the “Texas Governing Documents”), each in the form attached to this proxy statement under Exhibits [] and [], respectively. Our Board has determined that the terms of the Merger Agreement, the Merger, the Texas Charter and the Texas By-laws are fair to, and in the best interests of, the Company and our stockholders.

For the reasons discussed below, the Board recommends that the stockholders vote “FOR” the Reincorporation Proposal. Approval of the Reincorporation Proposal will constitute adoption of the Merger Agreement and approval of the Texas Charter and Texas By-laws. All descriptions of the Texas Governing Documents are qualified by and subject to the more complete information set forth in those documents.

Upon the Effective Time of the Merger:

In addition to these four core business lines, in 2019 and early 2020 we established five new wholly owned subsidiaries:

BackgroundThe Reincorporation will become effective upon filing of certificates of merger with the Secretary of State of each of New York and Texas, which filings are expected to be made as soon as practicable after stockholder adoption of the Share ExchangeMerger Agreement. Pursuant to the terms of the Merger Agreement, the Reincorporation may be abandoned by the Board at any time before the Effective Time (whether before or after approval by the Company’s stockholders). In addition, the Company and Alset may amend the Merger Agreement at any time before the Effective Time (whether before or after approval by the Company’s stockholders), provided that after approval by the Company’s stockholders, no amendment may be made that by law requires further approval by the Company’s stockholders without obtaining such further approval.

In November 2019, we announcedNo regulatory approval (other than various filings with Secretary of State of Texas and Texas discussed above) is required to effect the Company’s new strategic business plan, which focuses on strengthening our organization, investing in our core lines of business, improving top line revenues and net margins, controlling costs and creating new long-term recurring revenue streams. OneReincorporation. The terms of the core elements of the strategic business plan includes implementing business diversification initiatives asReincorporation and Merger are described in more detail below.

Implementing Business Diversification Initiatives – We plan to both internally develop and to acquire profitable new businesses, which will in some cases be complimentary to our core businesses and addressable markets. In other instances, we intend to explore opportunities for expansion into new business lines in which we believe we can successfully compete, which are scalable, and which generate sustainable reoccurring revenue. Management has already taken steps toward this diversification by performing initial research and cost analysis into specific new business lines, and in 2019 we formed the five new subsidiaries as described in more detail above, in an effort to grow and expand our technologies and market reach, including DSS BioHealth Security, Inc., referred to in this proxy statement as DBHS.

DSS BioHealth Security, Inc. This business will be principally involved in the bio-medical sector, including investing in companies that hold bio-medical intellectual property and/or have, or are securing, strategic alliances, partnershipsMerger Agreement and distribution rights for bio-medical and security products, technologies or enterprises. This new division will focus on open-air defense initiatives that seek to curb transmission of airborne infectious diseases such as tuberculosis and influenza, among others, in open areas.

Consistent with this growth initiative, on March 12, 2020, the Company announced that the Board approved and Company had entered into a binding term sheet (the “Term Sheet”) to acquire Impact BioMedical, a company engaged in the development and marketing of biohealth security technologies, pursuant to which Impact BioMedical would become a wholly-owned subsidiary of DSS BioHealth Security, Inc. Pursuant to the Term Sheet, the proposed share exchange transaction was capped at a purchase price capped at $50 million, subject to completion of due diligence and an independent valuation.

On April 27, 2020, prior to the executionall descriptions of the Share Exchange Agreement, Impact BioMedical’s ownership of a suite of antiviralReincorporation are qualified by and medical technologies was valued at $382 million through a required independent valuation that was completed by Destum Partners. Because the valuation was higher than the previously agreed value, the purchase price to be paid be the Company was capped at a value of $50 million.

On April 27, 2020, the Company issued a press release announcing the completion of the required independent valuation, allowing the Company to proceed with the Share Exchange Agreement. Following the press release, all the members of the Board voted to approve the Share Exchange transaction and authorize the execution of the Share Exchange Agreement and ancillary agreements, including this proxy statement to seek stockholder approval.

Effects of the Share Exchange on DSS Common Stock

Each share of our Common Stock that is issued and outstanding at the effective time of the Share Exchange will remain issued and outstanding after the acquisition of Impact BioMedical. However, because additional shares of our Common Stock will be issued as a result of the Share Exchange, the aggregate equity interest of our current common stockholders will be diluted from 100% of our issued and outstanding Common Stock prior to the Share Exchange to approximately 81% of our issued and outstanding Common Stock immediately after the completion of the Share Exchange. Furthermore, any conversion by Global BioMedical of the Series A Preferred Stock for shares of Common Stock, will also have the effect of diluting the equity interest of our current common stockholders. However, as discussed above, any such conversion by Global Biomedical is subject to the Beneficial Ownership Limitation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Shares of Series A Preferred Stock then outstanding will be entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment will be made to holders of our Common Stock.

Recommendations of our Board of Directors to our stockholders

Our Board has determined that the acquisition of Impact BioMedical is in the best interests of our stockholders, and recommends that you vote FOR the approval of the issuance of shares of our Common Stock and the Series A Preferred Stock for such purpose and FOR adjournment of the meeting if necessary to solicit additional proxies.

United States federal income tax considerations

The Share Exchange is intended to qualify as a tax-free exchange under Section 351 of the Internal Revenue Code for United States federal income tax purposes. Our current stockholders will not recognize any gain or loss for federal income tax purposes as a result of the Share Exchange. Such tax treatment is not a condition to completion of the Share Exchange.

In the event that the Company issues a dividend to its shareholders of shares of Impact BioMedical (the “Bonus Shares”), the U.S. federal income tax treatment of such issuance of the Bonus Shares to our shareholders is unclear at this stage. Accordingly, stockholders are encouraged to consult their own tax advisors as to the specific U.S. federal, state and local, and non-U.S. tax consequences to them of a possible distribution of the Bonus Shares. For more information, see the section titled “Anticipated Dividend of Impact BioMedical Shares” below.

Regulatory Approvals

We do not believe the Share Exchange to be subject to the reporting and waiting provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 which prevents transactions meeting certain size tests, and not otherwise exempt, from being completed until required information and materials are furnished to the Antitrust Division of the U. S. Department of Justice (“DOJ”) and the Federal Trade Commission (“FTC”) and the related waiting period expires or is terminated early. Accordingly, no filings have been made or are presently contemplated with the DOJ and FTC in relation to the Share Exchange.

Completion of the acquisition of Impact

The closing of the purchase and sale of the Impact Shares contemplated under the Share Exchange Agreement is subject to a number of customary and other conditions, including both the Company and Singapore eDevelopment having obtained approvals from their respective shareholders, Singapore eDevelopment having obtained requisite approval from the Singapore Exchange, and receipt by DSS of audited financial statements of Impact BioMedical, which are included in this proxy statement soliciting the vote of our stockholders.

The Share Exchange Agreement contains customary representations, warranties and covenants of the parties as well as certain indemnification provisions.

Where the law permits, a party to the Share Exchange Agreement could elect to waive one or more conditions required to complete the Share Exchange. We cannot be certain when (or if) the conditions to the Share Exchange will be satisfied or waived or that the Share Exchange will be completed.

If the required approvals are received at the Special Meeting we anticipate that the Share Exchange will occur shortly following the Special Meeting. However, we cannot assure you when or if the Share Exchange will occur.

Interests of certain persons in the Share Exchange

In considering the recommendation of the Board of Directors of the Company with respect to issuing shares of DSS Common Stock and Series A Preferred Stock pursuant to acquire Impact and the other matters to be acted upon at the Special Meeting, our Stockholders should be aware that our Chairman of the Board has interests in the Share Exchange that may be different from, or in addition to, the interests of DSS stockholders generally.

Mr. Chan is the Chief Executive Officer and largest shareholder of Singapore eDevelopment, as well as the Chairman of the Board and largest shareholder of the Company.

Mr. Chan also beneficially owns shares of DSS Common Stock which have approximately [  ]% of the voting rights of DSS stockholders as of the Record Date of the Special Meeting. Mr. Chan will beneficially own shares of DSS Common Stock equal to [  ] to the total shares of DSS Common Stock to be issued to the owners of Impact BioMedical in the Share Exchange. Upon completion of the Share Exchange, Mr. Chan will beneficially own approximately [  ]% of the total outstanding shares of DSS Common Stock.

Due to the related-party nature of the transaction, the Audit Committee discussed and evaluated Mr. Chan’s financial interest and material facts as Executive Chairman of Singapore eDevelopment, and subsequently approved, and recommended the Board approve, the Share Exchange Agreement and the transactions contemplated thereby.

Anticipated Dividend of Impact BioMedical Shares

The Company’s long-term plans include seeking to take Impact BioMedial public after the share exchange in an initial public offering (“IPO”). Prior to doing so, and in concert with this public offering, the Company anticipates a proposed dividend of Impact BioMedical shares to its shareholders, whereby for every one DSS share of Common Stock held, the shareholder would be entitled to a bonus of four Impact Shares, or as already referenced, the Bonus shares. The planned Bonus shared dividend would be divided into two tranches; the shareholders of record of a date to be determined but prior to initial public offering would be eligible for two shares for every share of DSS which they hold, and a second dividend of an additional two shares of Impact BioMedical if they were the shareholders of record on the second shareholder of record date of the IPO date of Impact BioMedical. The issuance of the Bonus shares would occur after the registration and the IPO of Impact BioMedical’s shares. While this statement represents the current intentions of DSS management and of its Board, there can beno assurance, however, that Impact BioMedical will be taken public and/or that any such Bonus Share distribution will occur.

Costs associated with the Share Exchange

We estimate that fees and expenses related to the Share Exchange, consisting of fees and expenses of our financial advisor, attorneys, and accountants, proxy statement printing and distribution and related charges, Securities and Exchange Commission (the “SEC”) and NYSE Amex filing fees, will total approximately $[____], whether or not the Share Exchange is completed.

Appraisal rights

Holders of our Common Stock will not have appraisal or dissenters’ rights in connection with the acquisition of Impact or the other proposals to be considered at the Special Meeting.

Board of directors and executive officers after the Share Exchange

There will be no change in the Company’s Board of Directors as a result of the completion of the Share Exchange.

Summary of risks associated with the Share Exchange

There are risks and uncertainties that we face in connection with the proposed acquisition of Impact. Among the risks are the following:

These are just some of the risks we face in connection with the proposed Share Exchange. For a more complete discussion of these and other risks related toinformation therein.

Reasons for the acquisition and the combined company; see the section entitled “Certain Risks Associated with the Share Exchange” and “About Impact BioMedical” below.

CERTAIN RISKS ASSOCIATED WITH THE SHARE EXCHANGE

In deciding whether to approve the issuance of Common Stock and Series A Preferred Stock to acquire Impact BioMedical in the Share Exchange and the other proposals related to the Share Exchange transaction, you should carefully consider the following risks. You should also review and consider the various risks and uncertainties related to our business which we have identified and discussed in our Registration Statement on Form S-1 filed with the SEC on May 21, 2020. If any of these risks actually occur, our business, financial condition or results of operations could be seriously harmed. In that event, the market price for our Common Stock could decline and you may lose all or part of your investment.

Risks related to the Share Exchange transaction

You will incur immediate ownership dilution.Reincorporation

In connection with the Share Exchange,Reincorporation, our Board has determined that it is advisable and in the ownersCompany’s best interest to change the Company’s name from “Document Security Systems, Inc.” to “Alset, Inc.” to better align it with the Company’s principal business operations (the “Name Change”). The Board believes the proposed new name recognizes the expanded scope of Impact BioMedicalour business and operation, however, the name of “Alset” is currently not available in the State of New York. The management of the Company discovered that the intended new name is available in the State of Texas and therefore suggested to the Board to re-incorporate in the Company in the State of Texas to be able to use the name of “Alset.”

The Company believes that the Texas legislature has demonstrated a willingness to maintain modern and effective corporation laws to meet changing business needs. While some regard NYBCL as an extensive and well-defined body of corporate law in the United States, the Company does not believe there is a significant risk to the Company or its stockholders if the Company is governed under TBOC rather than NYBCL. While there are some advantages under NYBCL to being a New York corporation, there are also advantages under TBOC law to being a Texas corporation.

The Company believes that, on balance, the impact on the Company of implementing the Reincorporation Proposal from a corporate law perspective will receive sharesbe positive to the Company and its stockholders. We have provided a discussion of differences between the NYBCL and TBOC below under the heading “Comparison of Stockholder Rights Before and After the Reincorporation.”

Name Change

The Board believes that the Name Change is in the best interest of the Company to create a name which is not related to the former business attempt, in which the Company may never again engage. The Board also believes that the Name Change will better reflects the nature of our anticipated operations. The Name Change is contingent and conditioned on stockholder approval of this Proposal, and, if the stockholders approve this Proposal 5, the Name Change will be effected through the filing of the Texas Charter.

Regulatory Approvals and Third-Party Consents

Other than receipt of stockholder approval and the filing of a Texas Merger Certificate with the Texas Secretary of State and a New York Merger Certificate with the New York Secretary of State, to our knowledge, there are no federal or state regulatory requirements or approvals that must be obtained in order for us to consummate the Reincorporation. Although the Reincorporation will require a technical relisting of our Common Stock which will represent approximately 19% ofon the NYSE American following the Reincorporation, our Common Stock whichwill continue to be traded on the NYSE American symbol and is expected to trade under the symbol “___” subject to approval by the Financial Industry Regulatory Authority (FINRA). To the extent the Reincorporation will require the consent or waiver of a third party (for example, the consent of the Company’s primary lender), the Company will use commercially reasonable efforts to obtain such consent or waiver before completing the Reincorporation. If a material consent cannot be obtained, the Company may determine not to proceed with the Reincorporation.

Employee and Director Benefit Matters

All employee benefit plans of the Company will be outstandingcontinued by the Alset. The Company’s other employee benefit arrangements will also be continued by Alset upon completion of the Share Exchange. Accordingly,terms and subject to the percentage of ownership which your Common Stock holdings representsconditions in effect prior to the Share ExchangeReincorporation. The Reincorporation will be diluted due tonot accelerate the issuancetime of our Commonpayment or vesting, or increase the amount of compensation or benefits under, any of the Company’s agreements with its directors and employees or any of its compensation and benefit programs.

Effect of the Reincorporation on Stock in the Share Exchange. This exchange ratio is not adjustable based on the market price of our Common Stock.Certificates

You may not realize a benefit fromIf this Reincorporation Proposal is approved, and the Share Exchange commensurateCompany proceeds with the ownership dilution youReincorporation, it will experience in connection with the Share Exchange.

If DSS does not realize strategic and financial benefits relatedbe necessary for stockholders to the acquisition of Impact BioMedical, DSS stockholders will have experienced dilution ofexchange their ownership interests in DSS without receiving any commensurate benefit, or only partial benefits from the Share Exchange.

The market price of our Common Stock following the Share Exchange may declineexisting stock certificates for Alset stock certificates. However, as a result of the acquisition of Impact BioMedicalReincorporation and Name Change, our Common Stock will receive a new CUSIP number, which and the number used to identify the Company’s equity securities. If at any time on or after the Effective Time a stockholder wishes to acquire a stock certificate with the new CUSIP number, the stockholder may do so by surrendering its, subsidiaries.his or her certificate with the old CUSIP number to the transfer agent for Alset with a request for a replacement certificate. Following the Reincorporation, the transfer agent for Alset will continue to be American Stock Transfer and Trust Company

The market priceReincorporation will have no effect on the transferability of DSSoutstanding stock certificates representing the Company’s Common Stock.

Dissenters’ Rights of Appraisal

Pursuant to New York law, if the Reincorporation is approved by the Company’s stockholders, stockholders who dissent from the Reincorporation will not be entitled to appraisal rights.

Certain U.S. Federal Income Tax Consequences of the Reincorporation

The following is a brief summary of certain U.S. federal income tax consequences to holders of the Company’s Common Stock may declinewho receive Alset Common Stock as a result of the Share ExchangeReincorporation. The summary sets forth such consequences to the Company’s stockholders who hold their shares as a capital asset (generally, an asset held for investment).

This summary is for general information only and does not purport to be a numbercomplete discussion or analysis of reasons if:all potential tax consequences that may apply to a stockholder. Stockholders are urged to consult their tax advisors to determine the particular tax consequences of the Reincorporation, including the applicability and effect of federal, state, local or foreign tax laws. This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), the Treasury Regulations promulgated thereunder, and rulings and decisions in effect as of the date of this proxy statement, all of which are subject to change, possibly with retroactive effect, and to differing interpretations.

The Company has neither requested nor received a tax opinion from legal counsel with respect to the U.S. federal income tax consequences of the Reincorporation. No rulings have been or will be requested from the Internal Revenue Service as to the federal income tax consequences of the Reincorporation.

The Reincorporation provided for in the Merger Agreement is intended to be treated as a “tax-free” reorganization as described in Section 368(a)(1)(F) of the Code. Assuming that the Reincorporation qualifies as a “tax-free” reorganization, no gain or loss will be recognized to the holders of the Company’s Common Stock as a result of the consummation of the Reincorporation, and no gain or loss will be recognized by the Company or Alset. The basis of the acquired assets in the hands of Alset will be the same as the Company’s basis in such assets. Each former holder of the Company’s Common Stock will have the same basis in Alset Common Stock received by that holder pursuant to the Reincorporation as was the basis in the Company Common Stock held at the time the reincorporation was consummated. Each stockholder’s holding period with respect to the Alset Common Stock will include the period during which that stockholder held the corresponding the Company’s Common Stock, provided the latter was held by such holder as a capital asset at the time the Reincorporation was consummated.

Comparison of Stockholder Rights Before and After the Reincorporation

Subject to stockholder approval prior to the Effective Time, the Company will change its state of incorporation to Texas and will thereafter be governed by TBOC, the Texas Charter and the Texas By-laws. There are certain differences between the rights of our stockholders under:

Failure to complete the Share Exchange or delays in completing the Share Exchange could negatively impact our stock price, financial condition, future business and operations.

If the Share ExchangeSet forth below is not completed for any reason, we may be subject to a number of material risks, including the following:

Compliance with securities laws.

The Common Stock which will be issued in connection with the Share Exchange is being offered without registration under the Securities Act of 1933 pursuant to rules governing limited offers and sales without registration pursuant to the exemption available for sales without registration under Section 4(a)(2)table that summarizes some of the Securities Actsignificant differences in the Texas Rights and Rule 506 of Regulation D. If we should fail to comply with each and every one of the requirements ofNew York Rights. Unless otherwise specified in the available exemptionstable, the New York Governing Documents do not differ from registration, the investors may have the right to rescind their acquisition of such shares in connection with the Share Exchange.

The following description of the material information about the Share Exchange, including the summary of the material terms anddefault provisions of the Share Exchange Agreement,NYBCL and the Texas Governing Documents do not differ from the default provisions of the TBOC. The following summary does not purport to be a complete statement of the Texas Rights and the New York Rights, and is qualified in its entirety by reference to the more detailed appendices to this Proxy Statement. We urge you to read all of the appendices to this Proxy Statement in their entirety.

The Share Exchange Agreement has been included as Appendix A to provide you with information regarding its terms. It is not intended to provide any other factual information about us. Such information can be found elsewhere in this Proxy Statement and in the other public filings we make with the SEC, which are available without charge at www.sec.gov.

ABOUT IMPACT BIOMEDICAL AND ITS SUBSIDIARIES

Business Overview

Impact BioMedical leverages on its scientific know-how and intellectual property rights to provide solutions that have been plaguing the biomedical field for decades. Together with scientific partners, Impact BioMedical aims to drive mission-oriented research to advance drug discovery and development for the prevention, inhibition, and treatment of neurological, oncology and immuno-related diseases.

Impact BioMedical’s research and development efforts are headed by Mr. Daryl Thompson in his capacity as Director of Scientific Initiatives in Global BioLife Inc. (“Global BioLife”). Mr. Thompson has initiated research regarding universal therapeutics as part of an attempt to help cure some of the world’s deadliest diseases.

Impact BioMedical has two wholly owned subsidiaries and six partially owned subsidiaries. It is the single largest and controlling shareholder of Global BioLife, with an effective ownership of 63.64%. The other shareholders of Global BioLife include Holista CollTech Limited (“Holista CollTech”) (the majority shareholder of Singapore eDevelopment is also a significant shareholder in Holista CollTech) and an entity formed by the chief scientist overseeing Global BioLife’s projects.

Global BioLife has biomedical intellectual property, including intellectual property assigned to it by one of its shareholders. Global BioLife is a company devoted to research in four main areas: (i) the “Linebacker” project, which aims to develop a universal therapeutic drug platform; (ii) a new sugar substitute called “Laetose,”; (iii) a multi-use fragrance called “3F” (Functional Fragrance Formulation); and (iv) Equivir/Nemovir, a blend of natural polyphenols designed as an antimicrobial medication.

Linebacker

“Linebacker,” has demonstrated promising results in treating a range of diseases including neurological, anti-microbial, anti-viral and oncology diseases. Unlike the traditional approach to treat individual diseases with specific drugs, the Linebacker platform seeks to offer a breakthrough therapeutic option for multiple diseases. Linebacker is designed to work by inhibiting a cascade of inflammatory responses responsible for many diseases. Its design is in direct contrast to the traditional approach of targeting individual diseases with specific drugs. Charles River Laboratories International, Inc., an independent company that provides services to help pharmaceutical and biotechnology companies, government agencies and leading academic institutions around the globe, has performed the studies needed for Global BioLife Linebacker research and drug development efforts.

Laetose

Impact BioMedical has also developed a low-calorie, low glycemic level, natural modified sugar through Global BioLife. The product, “Laetose,” is a functional sugar with a calorie count 30% to 50% lower than regular sugar. Laetose is designed to possess low glycemic properties and mitigate inflammation. This product is at the commercialization stage. The company is presently seeking to license Laetose. Global BioLife established a joint venture, Sweet Sense, Inc. (“Sweet Sense”), with Quality Ingredients, LLC for the development, manufacture, and global distribution of the new sugar substitute. On November 8, 2019, the Company purchased 50% of Sweet Sense Inc. from Quality Ingredients, LLC for $91,000. Sweet Sense is now an 81.8% owned subsidiary of the Impact BioMedical.

Functional Fragrance Formulation (“3F”)

Through Global BioLife, Singapore eDevelopment has established a collaboration with U.S.-based Chemia Corporation to develop specialized fragrances to counter mosquito-borne diseases such as Zika and Dengue, among other medical applications. The 3F mosquito fragrance product, which is made from specialized oils sourced from botanicals that mosquitos avoid, has shown promising results in repelling mosquitos in laboratory testing. Global BioLife is seeking to commercialize this product. Together with Chemia, Impact BioMedical is attempting to license 3F. Any potential profits from the 3F project will be split between Global BioLife and Chemia pursuant to the terms of the Royalty Agreement, dated as of August 15, 2018, by and between Global BioLife and Chemia Corporation, and the Addendum thereto, dated as of November 27, 2018 and Amendment No. 1 to Royalty Agreement, dated as of November 8, 2019.

Equivir

Equivir was created for use in biological emergencies. Equivir is a patented medication, and our research has indicated that it has broad antiviral efficacy against multiple types of infectious disease. The ability of Equivir to inhibit viruses makes it a promising candidate.

Global BioLife and Sweet Sense have engaged a consulting firm in the biopharmaceutical and life sciences industry, to assist in our goal of licensing each of Linebacker, Laetose, 3F and Equivir/Nemovir.

Property

Impact BioMedical does not have offices, and at the present time, office space is provided to the Impact BioMedical by an affiliate of Singapore eDevelopment at no cost.

Commercialization Business Strategies

The business model of Impact BioMedical revolves mainly around two approaches – Licensing and Sales Distribution.

1. Licensing

The licensing strategy envisions that Impact BioMedical’s subsidiaries would develop valuable and unique patented technologies which would then be licensed to pharmaceutical companies or venture capitalists in exchange for an agreed payment (consisting of a fee or royalty). Impact BioMedical believes that interest in licensing certain projects may rise over time as validating data becomes available.

2. Sales Distribution

Certain affiliates of Impact BioMedical have relationships with developing global distribution networks. Impact BioMedical currently intends to engage in private labelling to go into production of products for sales generation. Impact BioMedical plans to expand its geographical presence globally and intends to launch more products to add on over time. In addition, the company intends to launch a new retail e-commerce site in 2020 to allow Impact BioMedical to take orders and deliver products.

Employees

Impact BioMedical has no employees; certain services are provided to Impact BioMedical and its subsidiaries by the employees of Impact BioMedical’s ownership, including employees of affiliates of Singapore eDevelopment. Services are provided to Global BioLife and its subsidiaries by GRDG Sciences, LLC pursuant to the Stockholders’ Agreement, dated as of April 26, 2017 among Global BioLife, Global BioMedical, Inc., Holista CollTech and GRDG Sciences, LLC (as amended). At the present time, Global BioLife pays GRDG Sciences, LLC $23,319 per month for services provided by GRDG Sciences, LLC.

Future Product Research Pipeline

In addition to the Impact BioMedical’s major projects, the company has several other early stage research projects that Impact BioMedical believes have potential for further research and development.

Duotics

Duotics is a new class of compounds that has the potential to treat infectious diseases caused by viruses, bacteria, and parasites, and defeat Anti-Microbial Resistance. GRDG has used its proprietary methods in molecular mapping and disease modeling to develop strategies intended to not only inhibit resistant microbes that cause infectious diseases, but to also prevent future resistance to treatment. Duotics harness the strategies used by nature to prevent and inhibit infections by stopping the survival and growth of disease. This project envisions leveraging top research institutions in the world, including Biosafety Level 3 and 4 testing facilities, to scientifically prove the effectiveness of this new class of compounds. If successful, this technology has the potential to integrate well into existing health programs.

Migraine Medical Food

GRDG has developed a technology with the potential to be deployed as a medical food or an Over the Counter (OTC) medication to treat and possibly prevent migraines. Using the proprietary methods of identifying neurological pathways and known remedies, the solution could be both effective, and unlike current migraine medication, free from adverse side effects. GRDG intends to leverage its network of connections with world-class laboratories to formulate, validate and test the medication for effectiveness in animals and humans.

Cannabinoid Research

GRDG intends to work in collaboration with research institutions to enhance a cannabinoid extract for the treatment of cancers and cancer-associated pain. GRDG will look to use the expertise of collaborating research institutions to synthesize, test and validate the compounds. The result of this one-year program will be looking at two therapeutic drugs that have been evaluated for in-vitro efficacy against Pancreatic, Lung, Breast, and Prostate Cancer; in-vivo efficacy against Pancreatic Cancer in an animal model; in-vivo efficacy against Pancreatic Cancer-induced pain in an animal model; and in-vivo Pharmacokinetic and toxicity in animals to include vital organ and blood plasma concentrations after administration, major cytokine activity, renal function, blood chemistry/hematology, cellular morphology, Mitotic index, and Maximum Tolerated Dose. These tests, conducted in rats, will attempt to determine how much of the drugs can be administered safely, the effects of the drugs on metabolism and organs, and their effective doses for the respective purposes.

Competition

The biohealth business is highly competitive. Existing and future competitors may introduce products and services in the same markets we serve, and competing products or services may have better performance, lower prices, better functionality and broader acceptance than our products. This competition could result in increased sales and marketing expenses, thereby materially reducing our operating margins, and could harm our ability to increase, or cause us to lose, market share.

Most, if not all, of our current and potential competitors may have significantly greater resources or better competitive positions in certain product segments, geographic regions or user demographics than we do. These factors may allow our competitors to respond more effectively than us to new or emerging technologies and changes in market conditions.

Impact BioMedical’s competitors may develop products, features or services that are similar to its own or that achieve greater acceptance, may undertake more far-reaching and successful product development efforts or marketing campaigns, or may adopt more aggressive pricing policies. Certain competitors could use strong or dominant positions in one or more markets to gain competitive advantage against Impact BioMedical in its target market or markets. As a result, Impact BioMedical’s competitors may acquire and engage customers or generate revenue at the expense of our own efforts.

Regulation of the Biohealth Business

In the United States, the drug, device and cosmetic industries have long been subject to regulation by various federal and state agencies, primarily as to product safety, efficacy, manufacturing, advertising, labeling and safety reporting. The U.S. Food and Drug Administration, or FDA, has broad regulatory powers. Extensive testing and documentation is required for FDA approval of new drugs and devices, increasing the expense of product introduction. Significant expenses are also evident in major markets outside of the United States.

The costs of human health care have been and continue to be a subject of study, investigation and regulation by governmental agencies and legislative bodies around the world. In the United States, attention has been focused on drug prices and profits and programs that encourage doctors to write prescriptions for particular drugs, or to recommend, use or purchase particular medical devices. The regulatory agencies under whose purview Impact BioMedical may operate in the future have administrative powers that may subject partners to whom Impact BioMedical licenses products to actions such as product withdrawals, recalls, seizure of products and other civil and criminal sanctions.

In addition, business practices in the health care industry have come under increased scrutiny, particularly in the United States, by government agencies and state attorneys general, and resulting investigations and prosecutions carry the risk of significant civil and criminal penalties.

Partners to whom we license products in the future may need to rely on global supply chains, and production and distribution processes, that are complex, subject to increasing regulatory requirements, and may be faced with unexpected changes that may affect sourcing, supply and pricing of materials used in products which we have or will develop. These processes also are subject to lengthy regulatory approvals.

Risk Factors related to Impact BioMedical’s Business Operations

If we do not adequately protect Impact BioMedical’s intellectual property rights, its operations may be materially harmed.

Impact BioMedical relies on and expect to continue to rely on agreements with parties with whom we have relationships, as well as patent, trademark and trade secret protection laws, to protect our intellectual property and proprietary rights. We cannot assure you that we can adequately protect its intellectual property or successfully prosecute potential infringement of its intellectual property rights. Also, we cannot assure you that others will not assert rights in, or ownership of, trademarks and other proprietary rights of Impact BioMedical or that we will be able to successfully resolve these types of conflicts to our satisfaction. Impact BioMedical’s failure to protect its intellectual property rights may result in a loss in potential revenue and could materially harm our operations and financial condition.

New legislation, regulations or rules related to obtaining patents or enforcing patents could significantly increase our operating costs and decrease any potential revenue we might otherwise make.

Impact BioMedical spends a significant amount of resources on its [?] patent assets. If new legislation, regulations or rules are implemented either by Congress, the U.S. Patent and Trademark Office (the “USPTO”) or the courts that impact the patent application process, the patent enforcement process or the rights of patent holders, these changes could negatively affect its expenses, potential revenue and could negatively impact the value of its assets.

Safety and effectiveness concerns can have significant negative impacts on sales and results of operations, lead to litigation and cause reputational damage.

Concerns about product safety, whether raised internally or by litigants, regulators or consumer advocates, and whether or not based on scientific evidence, can result in safety alerts, product recalls, governmental investigations, regulatory action on the part of the FDA (or its counterpart in other countries), private claims and lawsuits, payment of fines and settlements, declining sales and reputational damage. These circumstances can also result in damage to brand image, brand equity and consumer trust in products. Product recalls could in the future prompt government investigations and inspections, the shutdown of manufacturing facilities, continued product shortages and related sales declines, significant remediation costs, reputational damage, possible civil penalties and criminal prosecution.

Significant challenges or delays in our innovation and development of new products, technologies and indications could have an adverse impact on our long-term success.

Impact BioMedical’s continued growth and success depend on our ability to innovate and develop new and differentiated products and services that address the evolving health care needs of patients, providers and consumers. Development of successful products and technologies may also be necessary to offset revenue losses should our products lose market share due to various factors such as competition and loss of patent exclusivity. We cannot be certain when or whether Impact BioMedical will be able to develop, license or otherwise acquire companies, products and technologies, whether particular product candidates will be granted regulatory approval, and, if approved, whether the products will be commercially successful. Impact BioMedical pursues product development through internal research and development as well as through collaborations, acquisitions, joint ventures and licensing or other arrangements with third parties. In all of these contexts, developing new products, particularly biotechnology products, requires a significant commitment of resources over many years. Only a very few biopharmaceutical research and development programs result in commercially viable products. The process depends on many factors, including the ability to discern patients’ and healthcare providers’ future needs; develop new compounds, strategies and technologies; achieve successful clinical trial results; secure effective intellectual property protection; obtain regulatory approvals on a timely basis; and, if and when they reach the market, successfully differentiate its products from competing products and approaches to treatment. New products or enhancements to existing products may not be accepted quickly or significantly in the marketplace for healthcare providers, and there may be uncertainty over third-party reimbursement. Even following initial regulatory approval, the success of a product can be adversely impacted by safety and efficacy findings in larger patient populations, as well as market entry of competitive products.

THE SHARE EXCHANGE AGREEMENT

Share exchange consideration

The Share Exchange Agreement provides that at the closing of the Share Exchange, DBHS will acquire of all of the Impact Shares in exchange for DSS Common Stock and Series A Preferred Stock.

The aggregate consideration for the Impact Shares will be the following to be issued to Global BioMedical by DSS: (i) 483,334 newly issued shares of Common Stock of DSS, nominally valued at $3,132,000, or $6.48 per share; and (ii) 46,868 newly issued shares of a new series of perpetual convertible preferred stock of DSS (“Convertible Preferred Stock”) with a stated value of $46,868,000, or $1,000 per share, for a total consideration valued at $50 million.

The terms of the Share Exchange Agreement and the Share Exchange were previously reported in the Form 8-K filed by the Company on March 13, 2020. As previously reported, on May 7, 2020, following the date of the Share Exchange Agreement we effected a 30-1 reverse stock split. As a result, the number of Common Stock shares to be issued by DSS pursuant to the Share Exchange have been appropriately adjusted.

Closing

The Share Exchange will be completed when the purchase and sale of the Impact Shares occurs at a closing (the “Closing”) to be held not later than two business days after the last of the conditions to the Closing have been satisfied or waived. As a result of the Share Exchange, DBHS will own 100% of Impact BioMedical and its subsidiaries.

Subject to the conditions to the Share Exchange Agreement, we anticipate that the completion of the Share Exchange will occur promptly after the approval of Proposal 1 at the Special Meeting. However, the completion of the Share Exchange could be delayed if there is a delay in satisfying conditions to the Share Exchange. There can be no assurances as to whether, or when, we will obtain the required approvals or complete the Share Exchange. If the Share Exchange is not completed on or before one hundred eight (180) days after April 27, 2020, either we or Global BioMedical may terminate the Share Exchange Agreement, unless the failure to complete the Share Exchange by that date is due to the material breach of the Share Exchange Agreement by the party seeking to terminate the agreement. See “Closing Conditions to the Share Exchange” immediately below.

Closing Conditions to the Share Exchange

The completion of the Share Exchange is subject to various conditions. While we anticipate that all of these conditions will be satisfied, there can be no assurance as to whether or when all of the conditions will be satisfied or, where permissible, waived.

The obligations of each party to effect the Share Exchange are subject to the following conditions:

For the full text of the closing conditions that each individual party’s obligations are subject to, seeNew York Governing Documents, the Share Exchange Agreement which has been included as Appendix A to provide you with information regarding its terms.Texas Governing Documents, the NYBCL and the TBOC.

Representations and warranties

The Share Exchange Agreement customary representations, warranties and covenants of the parties as well as certain indemnification provisions. For the full text of the representations and warranties, see the Share Exchange Agreement which has been included as Appendix A to provide you with information regarding its terms.

Reasonable best efforts to consummate the Share Exchange

Each party to the Share Exchange Agreement has agreed that it will not voluntarily undertake any course of action inconsistent with the provisions or intent of the Share Exchange Agreement and will use its reasonable best efforts to take, or cause to be taken, all action and to do, or cause to be done, all things reasonably necessary to expeditiously satisfy the closing conditions to the Share Exchange Agreement.

No Solicitation or Other Bids

From the date of the Share Exchange Agreement, each party to the Share Exchange Agreement will not authorize or permit any, affiliates and other representatives or those of any of their subsidiaries, directly or indirectly, to (i) encourage, facilitate or continue inquiries; (ii) enter into discussions or negotiations with, or provide any information to; or (iii) enter into any agreements or other instruments (whether or not binding) regarding an inquiry, proposal or offer from any person concerning, (x) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving Impact BioMedical or any of its subsidiaries; (y) the issuance or acquisition of shares of capital stock or other equity securities of Impact BioMedical or any of its subsidiaries; or (z) the sale, lease, exchange or other disposition of any significant portion of the properties or assets of Impact BioMedical and its subsidiaries.

Termination of the Share Exchange Agreement

The Share Exchange Agreement may be terminated prior to the closing on certain conditions, including:

In the event of the termination of the Share Exchange Agreement pursuant to one of the conditions listed above by one of the parties, the Share Exchange Agreement shall become void and have no effect, and there shall be no liability under the Share Exchange Agreement on the part of the parties except (i) in the event of breach of conditions listed above; (ii) in the event of breach by Singapore eDevelopment or Global Medical of confidentiality provisions contained in the Share Exchange Agreement; or (iii) as set forth in ARTICLE X – MISCELLANEOUS of the Share Exchange Agreement which has been included as Appendix A to provide you with information regarding its terms. Nothing in the Share Exchange Agreement shall relieve any party from liability for any willful breach of any provision contained in the Share Exchange Agreement.

Amendment, modification and waiver

The Share Exchange Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party thereto. No waiver by any party of any of the provisions thereof shall be effective unless explicitly set forth in writing and signed by party so waiving. No waiver by any Party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver.

No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from the Share Exchange Agreement shall operate or be construed as a waiver; nor shall any single or partial exercise of any right, remedy, power or privilege thereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

The foregoing summary of the Share Exchange Agreement is subject to, and qualified in its entirety by, the terms of the Share Exchange Agreement, a copy of which is attached hereto asAppendix A.

SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA

We are providing the following financial information to assist you in your analysis of the financial aspects of our proposed acquisition of Impact BioMedical and its subsidiaries. This information is only a summary and you should read it in conjunction with our historical consolidated financial statements, and the historical financial statements of Impact BioMedical and the other information included elsewhere in this proxy statement.

Selected Historical Financial Data of Impact BioMedical and its Subsidiaries

The following table sets forth selected historical financial information derived from Impact BioMedical’s audited financial statements as of and for the year ended December 31, 2019 and as of December 31, 2018 and unaudited financial statements for the period from January 1, 2020 through March 31, 2020. The historical results presented below are not necessarily indicative of the results to be expected for any future period.

REPORT OF INDEPENDENT AUDITORS

AND FINANCIAL STATEMENTS

Impact BioMedical Inc and Subsidiaries

December 31, 2019 and 2018

Table of Contents

Impact BioMedical Inc and Subsidiaries

Consolidated Balance Sheets

Impact Biomedical Inc. and Subsidiaries

Consolidated Balance Sheet