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Notes Receivable | 3 Months Ended
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Mar. 31, 2024
Receivables [Abstract] |
Notes Receivable | 4. Notes Receivable Note 1 On May 14, 2021, DSS Pure Air, Inc. a subsidiary of the Company entered a convertible promissory note (“Note 1”) with Borrower 1, a company registered in the state of Texas. Note 1 has an aggregate principal balance up to $5,000,000, to be funded at the request of Borrower 1. Note 1, which incurs interest at a rate of 6.65% due quarterly, has a maturity date of May 1, 2023. Note 1 contains an optional conversion clause that allows the Company to convert all, or a portion of all, into newly issued member units of Borrower 1 with the maximum principal amount equal to 18% of the total equity position of Borrower 1 at conversion. The outstanding principal and interest as of March 31, 2024 and December 31, 2023, approximated $5,544,000 which is included in current notes receivable on the accompanying consolidated balance sheet. As of March 31, 2024 and December 31, 2023, the Company has a reserve of $2,772,000 and $2,772,000, respectively, against the principal and interest outstanding. Note 2 On September 23, 2021, APB entered into refunding bond anticipatory note (“Note 2”) with Borrower 2, which operates as a conservation and reclamation district pursuant to Chapter 3891, Texas Special District Local Laws Code; Chapter 375, Texas Local Government Code; and Chapter 49, Texas Water Code. The District Note was in the sum of $3,500,000 and incurs interest at a rate of 5.59% per annum. Principal and interest are due in full on September 22, 2022, and later amended to extend the maturity date to September 19, 2024. The outstanding principal and interest of $3,910,000 was included in the current portion of notes receivable on the consolidated balance sheet at December 31, 2023. Note 2 was repaid in full during March 2024. Note 3 On October 25, 2021, APB entered into a loan agreement (“Note 3”) with Borrower 3, a company registered in the state of Utah. Note 3 has an initial aggregate principal balance up to $1,000,000, to be funded at the request of Borrower 3, with an option to increase the maximum principal borrowing to $3,000,000. Note 3, which incurs interest at a rate of 8.0% with principal and interest due at the maturity date of October 25, 2022. This note contains an optional conversion feature allowing APB to convert the outstanding principal to a 10% membership interest. APB, as holder of Note 3, has the right to elect one member to the Board of Managers. This note is in default and the outstanding principal and interest of approximately $884,000 was reserved for fully as of December 31, 2022. Note 4 On December 28, 2021, APB entered into a promissory note (“Note 4”) with Borrower 4, a company registered in the state of California. Note 4 has a principal balance of $700,000. Note 4, which incurs interest at a rate of 12.0% with principal and interest due at the maturity date of December 28, 2022. On December 29, 2022, the maturity date of this note was extended to May 31, 2023. On November 27, 2023, the parties to Note 4 agreed to modify the payment terms of the note to be monthly payments of $50,000 until the outstanding principal and interest are paid in full. The outstanding principal and interest of $158,000 and $253,000 is included in the Current portion of notes receivable on the consolidated balance sheet at March 31, 2024 and December 31, 2023, respectively. Note 5 On January 24, 2022, APB and Borrower 5 entered into a promissory note (“Note 5”) in the principal sum of $100,000 with interest of 6%, due annually, and maturing in January 2024. The outstanding principal and interest at March 31, 2024 and December 31, 2023 approximates $107,000 and $103,000, respectively, and is included in Current portion of notes receivable on the accompanying consolidate balance sheet. The terms of this note are currently being renegotiated. Note 6 On March 2, 2022, APB and Borrower 6, a corporation organized under the laws of the Republic of Korea entered into a promissory note (“Note 6”). Under the terms of Note 6, APB at its discretion, may lend up to the principal sum of $893,000 with an interest rate of 8%, and matured in March 2024, with interest payable quarterly. The outstanding principal and interest at March 31, 2024 and December 31, 2023 is $458,000 and $446,000 (net of $3,500 of unamortized origination fees), respectively. APB and Borrower 6 are currently negotiating an extension of the maturity date of this note. Note 7 On May 9, 2022, DSS PureAir and Borrower 1 entered into a promissory note (“Note 7”) in the principal sum of $210,000 with interest of 10%, is due in three quarterly installments beginning on August 9, 2022, with the first two payment consisting of interest only. All unpaid principal and interest are due on February 9, 2023. This loan is currently in default and terms are currently being re-negotiated. The outstanding principal and interest at March 31, 2024 and December 31, 2023 approximates $224,000 of which $112,000 has been reserved for and is included in Current portions of notes receivable on the accompanying consolidate balance sheet. Note 8, related party On August 29, 2022, DSS Financial Management Inc and Borrower 8, a related party, entered into a promissory note (“Note 8”) in the principal sum of $100,000 with interest of 8%, is due in three quarterly installments beginning on September 14, 2022. All unpaid principal and interest is due on August 29, 2025. The outstanding principal and interest at March 31, 2024 approximated $101,000, of which approximately $76,000 has been reserved for with the net balance is included Current portions of notes receivable. At December 31, 2023, the balance approximated $100,000 of which $76,000 is included in the Current portion of notes receivable and $24,000 is included in the long-term portion of notes receivable. DSS owns 24.9% of the outstanding common shares of Borrower 8. Note 9, related party On May 8, 2023, DSS Financial Management Inc and Borrower 8 entered into a promissory note (“Note 9”) in the principal sum of $102,000 with interest at the prime rate plus 2% (10.5% at March 31, 2024 and December 31, 2023) with a maturity date of May 7, 2026. The outstanding principal and interest at March 31, 2024 approximated $110,000, of which approximately $82,000 has been reserved for with the net balance included of approximately $28,000 included in the long-term portion of notes receivable. At December 31, 2023 approximates $107,000 with approximately $53,000 of principal and accrued interest classified as Current portion notes receivable, and the remaining balance of approximately $54,000 is recorded as notes receivable, on the accompanying consolidated balance sheet. DSS owns 24.9% of the outstanding common shares of Borrower 8. Note 10, related party On July 26, 2022, APB and Borrower 10 entered into a promissory note (“Note 10”) in the principal sum of $1,000,000 with interest of 8%. All unpaid principal and interest due on July 26, 2024. The outstanding principal and interest on March 31, 2024 approximates $949,000, net of $10,000 of unamortized origination fees and is included in notes receivable on the accompanying consolidate balance sheet. Approximately $475,000 of Note 10 was reserved for as of March 31, 2024. The outstanding principal and interest on December 31, 2023, approximates $939,000, net of $20,000 of unamortized origination fees and is included in notes receivable on the accompanying consolidate balance sheet. Heng Fai Ambrose Chan, the Chairman of DSS, Inc is also the on the board of directors of Borrower 10. Note 11 On February 19, 2021, Impact BioMedical, Inc, entered into a promissory note with an individual. The Company loaned the principal sum of $206,000, with interest at a rate of 6.5%, and maturity date of August 19, 2022 later amended to February 19, 2024. Monthly payments are due on the twenty-first day of each month and continuing each month thereafter until February 19, 2024. This note is secured by certain real property situated in Collier County, Florida. The outstanding principal and interest as of March 31, 2024 and December 31, 2023, was approximately $203,000, and is classified in Current notes receivable on the accompanying consolidated balance sheets. The maturity date of this note is currently being renegotiated. Note 12 On June 27, 2023, DSS and Borrower 15 entered into a convertible promissory note (“Note 15”) in the principal sum of $1,400,000 with a discount of $300,000 and interest rate of 10% and maturity date of September 1, 2024. The outstanding principal, interest, and associated discount was fully reserved for as of December 31, 2023. Note 13 On March 31,2023, DSS Biohealth Security, Inc and Borrower 13 entered into a promissory note (“Note 13”) in the principal sum of $140,000 and interest rate floating daily to Wall Street Journal Prime rate per annum (8.5% at March 31, 2024 and December 31, 2023) with the total outstanding principal and interest due at the maturity date of March 31, 2025. The outstanding principal and interest at December 31, 2023 approximates $133,000. Of the total financed, approximately $99,000 of principal and accrued interest is classified as Current portion of notes receivable and the remaining balance of approximately $34,000 is recorded as Notes receivable on the accompanying consolidated balance sheet at December 31, 2023. As of March 31, 2024, the outstanding balance sheet approximating $135,000 was fully reserved for.

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