DEFR14A: DSS Amends Proxy, Sets 2025 Annual Meeting Agenda

DSS, Inc. filed an amendment to its definitive proxy statement, confirming the agenda for its 2025 Annual Meeting of Stockholders on December 3, 2025, which includes director elections, auditor ratification, and an advisory vote on executive compensation.

Summary

• An Amendment No. 1 to Schedule 14A was filed to include the form of proxy card that was inadvertently omitted from the original Proxy Statement filed on October 20, 2025.
• The 2025 Annual Meeting of Stockholders will be held on Wednesday, December 3, 2025, at 9:00 a.m. Eastern time.
• The agenda for the Annual Meeting includes the election of 7 director nominees, the ratification of HTL International, LLC. as the independent registered public accounting firm for fiscal year ending December 31, 2025, and an advisory vote on executive compensation.
• The record date for stockholders entitled to vote at the Annual Meeting was fixed as the close of business on October 6, 2025, with 9,092,518 shares of common stock outstanding.
• The Board of Directors recommends a vote FOR all proposals, including the election of all director nominees, the ratification of HTL International, LLC., and the approval of executive compensation.
• Jason Grady was elected Interim Chief Executive Officer effective August 23, 2024, following Frank D. Heuszel's resignation to lead a subsidiary.
• Significant related party transactions were disclosed, including investments, promissory notes, and recent private placements of common stock to related entities and the Chairman, Ambrose Chan Heng Fai.

Sentiment

Score: 5

Explanation: The filing is largely procedural, focusing on an amendment to a proxy statement and outlining routine annual meeting proposals. While it discloses concerning related party transactions, including fully reserved notes and unrealized investment losses, it also highlights standard corporate governance practices. The interim nature of key executive roles introduces some uncertainty, but the capital raises from related parties provide funding. Overall, the information is mixed, preventing a strong positive or negative sentiment.

Positives

• The company is proceeding with its annual meeting, demonstrating adherence to corporate governance schedules.
• The Board of Directors has separated the roles of Chief Executive Officer and Chairman, which can enhance corporate oversight and strategic focus.
• The Audit Committee confirmed that the previous auditor's report for the fiscal year ended December 31, 2024, contained no adverse opinion, disclaimer, qualification, or modification.
• The company maintains a Code of Ethics and structured committees (Audit, Compensation, Nominating & Corporate Governance) to oversee key areas of governance and risk.

Negatives

• Several promissory notes from related parties, including BMI Capital, Inc. and VEII, Inc., have significant outstanding balances, with some fully reserved for as of December 31, 2024, indicating potential credit risk or impairment.
• An investment in Alset International Limited, a related party, resulted in unrealized losses of approximately $750,000 in 2024 and $50,000 in 2023.
• Key executive roles, including Interim Chief Executive Officer (Jason Grady) and Chief Financial Officer (Todd D. Macko), are currently under month-to-month interim agreements, suggesting a lack of long-term contractual stability in leadership.
• The filing itself was an amendment due to the inadvertent omission of the proxy card, indicating a procedural oversight.

Risks

• The reliance on interim employment agreements for the Chief Executive Officer and Chief Financial Officer introduces uncertainty regarding long-term leadership stability and succession planning.
• Extensive related party transactions, including significant beneficial ownership by the Chairman and loans to/from related entities, pose potential conflicts of interest and may not always be on arm's-length terms.
• The full reservation of certain notes receivable from related parties highlights credit risk and potential financial losses from these dealings.
• Unrealized losses on the investment in Alset International Limited indicate market volatility and potential impairment risks associated with related party investments.

Future Outlook

The Compensation and Management Resources Committee will consider the outcome of the non-binding advisory vote on executive compensation when evaluating future executive compensation arrangements. The company will continue to file periodic reports and other information with the SEC.

Management Comments

• "The Board of Directors recommends that you vote FOR the proposals set forth in this Notice of Annual Meeting of Stockholders and the Proxy Statement."
• "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 Companys stockholders."
• "The Board does not believe that our compensation program encourages excessive or inappropriate risk-taking."

Industry Context

This filing is a routine definitive proxy statement amendment, common across all publicly traded companies, detailing proposals for an upcoming annual meeting and executive compensation. The company's diversified business interests, spanning packaging, real estate, and digital transformation, make direct industry comparisons challenging without more specific operational details. The prevalence of related party transactions is a company-specific characteristic rather than a broad industry trend.

Comparison to Industry Standards

• NA

Management Changes

Corporate Governance

Legal Proceedings

• None of the directors or executive officers have been involved in any legal proceedings in the past 10 years that would require disclosure under Item 401(f) of Regulation S-K.

Related Party Transactions

• DSS owns approximately 4% of Alset International Limited, where Ambrose Chan (DSS Chairman and largest shareholder) is Executive Director and CEO. DSS recorded unrealized losses of $750,000 in 2024 and $50,000 in 2023 on this investment.
• DSS Financial Management Inc. entered into two promissory notes (Note 8 for $100,000 and Note 9 for $102,000) with BMI Capital, Inc. (BMIC), a related party where DSS owns 24.9%. Both notes had outstanding principal and interest fully reserved for as of December 31, 2024.
• APF and VEII, Inc. (where Ambrose Chan is on the board) entered a $1,000,000 promissory note (Note 10) with an amended due date of July 26, 2025. Approximately $480,000 of this note was reserved as of March 31, 2024.
• LVAM entered a $3,000,000 loan agreement with BMIC (related party) and another $3,000,000 loan agreement with Lee Wilson Tsz Kin (related party), both with auto-renewal periods.
• On December 10, 2024, DSS sold 820,597 common shares for approximately $803,000 to Alset Inc., a related party, in a private placement.
• On December 10, 2024, DSS sold 205,149 common shares for approximately $197,000 to Heng Fai Ambrose Chan, the Chairman of the Board and a related party, in a private placement.
• On February 6, 2025, Heng Fai Holdings Limited (beneficially owned by Ambrose Chan) was awarded 1,000,000 shares of DSS common stock as bonus compensation for services rendered.
• Ambrose Chan Heng Fai receives $120,000 annually from a consulting agreement with DSS.
• Lim Sheng Hon Danny receives $50,000 annually from a consulting agreement with DSS.

Stakeholder Impact

• **Shareholders**: Will participate in the annual meeting to vote on key governance matters. The significant beneficial ownership by the Chairman and related entities (66.2%) means their votes will largely determine the outcome of proposals. The extensive related party transactions, including share issuances and notes receivable/payable, directly impact shareholder value and the company's financial health.
• **Employees**: Executive compensation and equity incentive plans are detailed. The interim nature of the CEO and CFO roles could introduce uncertainty regarding long-term strategic direction and stability.
• **Creditors**: The disclosure of notes receivable from related parties, some of which are fully reserved, and loans from related parties, indicates a complex financial structure that creditors would need to evaluate for potential credit risks.

Next Steps

• Hold the 2025 Annual Meeting of Stockholders on December 3, 2025.
• Elect 7 director nominees to the Board of Directors.
• Ratify the appointment of HTL International, LLC. as the independent registered public accounting firm for the fiscal year ending December 31, 2025.
• Conduct an advisory vote on executive compensation.
• The Compensation and Management Resources Committee will consider the outcome of the stockholder vote on executive compensation when determining future arrangements.

Key Dates

Recommendation

This filing is a routine proxy statement amendment for an annual meeting, primarily addressing procedural and governance matters. It does not contain new operational or financial performance data that would typically drive significant share price movement. While the extensive related party transactions, including fully reserved notes and unrealized investment losses, warrant close monitoring due to potential conflicts of interest and financial risks, they are historical disclosures within a governance document. The interim status of key executive roles also adds a layer of uncertainty. Therefore, a 'hold' recommendation is appropriate, advising investors to maintain their current position while closely observing future operational results, financial performance, and the resolution of leadership and related party issues.

Keywords

DSS, SEC filing, Proxy Statement, Annual Meeting, Corporate Governance, Executive Compensation, Director Election, Auditor Ratification, Related Party Transactions, Financial Reporting, Stockholder Vote, NYSE American