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 UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 Washington,
D.C. 20549

 Form

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

 SECURITIES
EXCHANGE ACT OF 1934

 For
the fiscal year ended December 31, 2024

 or

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

 SECURITIES
EXCHANGE ACT OF 1934

 For
the transition period from _________ to __________

 Commission
file number 001-32146

 IMPACT
BIOMEDICAL INC.

 (Exact
name of registrant as specified in its charter)

 85-3926944

 (State
 or other jurisdiction of

 incorporation
 or organization)

 (I.R.S.
 Employer

 Identification
 No.)

 1400
Broadfield Blvd., Suite 130

 Houston,
 TX 77084

 (Address
of principal executive offices)

 (281) 415-6576

 (Registrant's
telephone number, including area code)

 Securities
registered pursuant to Section 12(b) of the Act:

 Title
 of each class

 Trading
 Symbol

 Name
 of each exchange on which registered

 Common
 Stock, par value $0.001 per share

 N/A

 N/A

 Securities
registered pursuant to Section 12(g) of the Act: None

by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act. YES NO

by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES NO

by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. YES NO

by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files). YES NO

by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See definitions of "large accelerated filer", "accelerated filer", "smaller
reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act

 Large
 Accelerated Filer

 Accelerated
 Filer

 Non-Accelerated
 Filer

 Smaller
 Reporting Company

 Emerging
 growth company

 If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. Yes No

by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Act). Yes No

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to § 240.10D-1(b).

 The
aggregate market value of the registrant's common stock held by non-affiliates of the registrant computed by reference to the price
at which the common stock was last sold, as reported on the NYSE American LLC exchange on June 30, 2024 was $ 0.

 As
of February 26, 2025 there were 12,085,412 shares of the registrant's common stock, $ 0.001 par value, outstanding.

 DOCUMENTS
INCORPORATED BY REFERENCE

 None.

 IMPACT
BIOMEDICAL INC

 Table
of Contents

 PART
 I

 ITEM

 BUSINESS

 ITEM
 1A

 RISK
 FACTORS

 ITEM
 1B

 UNRESOLVED
 STAFF COMMENTS

 ITEM

 PROPERTIES

 ITEM

 LEGAL
 PROCEEDINGS

 ITEM

 MINE
 SAFETY DISCLOSURES

 PART
 II

 ITEM

 MARKET
 FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 ITEM

 SELECTED
 FINANCIAL DATA

 ITEM

 MANAGEMENT'S
 DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 ITEM
 7A

 QUANTITATIVE
 AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 ITEM

 FINANCIAL
 STATEMENTS AND SUPPLEMENTARY DATA

 ITEM

 CHANGES
 IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 ITEM
 9A

 CONTROLS
 AND PROCEDURES

 ITEM
 9B

 OTHER
 INFORMATION

 PART
 III

 ITEM

 DIRECTORS,
 EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 ITEM

 EXECUTIVE
 COMPENSATION

 ITEM

 SECURITY
 OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 ITEM

 CERTAIN
 RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 ITEM

 PRINCIPAL
 ACCOUNTANT FEES AND SERVICES

 PART
 IV

 ITEM

 EXHIBITS
 AND FINANCIAL STATEMENT SCHEDULES

 ITEM

 FORM
 10-K SUMMARY

 SIGNATURES

 PART
I

 ITEM
1 - BUSINESS

 Overview

Biomedical Inc. ("IBO". "Impact", "Impact BioMedical", "we", "us", "our"
or the "Company") discovers, confirms, and patents unique science and technologies which can be developed into new offerings
in human healthcare and wellness in collaboration with external partners through licensing, co-development, joint ventures, and other
relationships, and currently trades on the NYSE American under ticker symbol IBO.

 By
leveraging technology and new science with strategic partnerships, we provide advances in biopharmaceuticals, over the counter direct
to consumer wellness offerings, and drug discovery for the prevention, inhibition, and treatment of neurological, oncologic, and inflammatory
diseases. In addition to our existing efforts, we continually search for, and evaluate, other potential new offerings to add to our portfolio.

 Our
business model includes partnering and potentially direct sales for commercialization and distribution. Potential licensors and
development partners include pharmaceutical, consumer packaged goods companies and others, who would commercialize IBO technologies
in exchange for milestone, and royalty payments. Currently, our operations are conducted, and our assets are owned through our
principal subsidiaries: (i) Global BioLife, Inc. ("Global BioLife"), which was incorporated on April 14, 2017, (ii)
Impact BioLife Science, Inc. ("Impact BioLife"), which was incorporated on August 28, 2020, (iii) Global BioMedical,
Inc. ("Global BioMedical"), which was incorporated on April 18, 2017, and (iv) Sweet Sense, Inc. ("Sweet
Sense"), which was incorporated on April 30, 2018.

 By
leveraging technology and new science with strategic partnerships, we provide advances in biopharmaceuticals and over the counter direct
to consumer wellness offerings, and drug discovery for the prevention, inhibition, and treatment of neurological, oncology and immuno-related
diseases.

 In
addition to our existing efforts, we continually search and evaluate other potential new offerings to add to our portfolio.

 Below
is a list of our principal subsidiaries:

 BioLife Science, Inc.;

 Biomedical, Inc.;

 BioLife, Inc.; and

 Sweet
 Sense, Inc.

BioLife Science, Inc. We are the sole owner of the issued and outstanding common stock of Impact BioLife Science, Inc.

Biomedical, Inc. We own 90.9% of Global Biomedical, Inc. issued and outstanding common stock.

BioLife, Inc. Through our majority owned subsidiary Global Biomedical, Inc., we own 81.8% of the issued and outstanding common
stock of Global BioLife, Inc.

 Sweet
Sense, Inc. We are the owner of 95.5% of the issued and outstanding common stock of Sweet Sense.

BioMedical has several unique and proprietary technologies that are in continuing development.

is a platform of small molecule electrophilically enhanced polyphenol compounds with potential application in oncology (solid tumors),
inflammatory disorders, and neurology. Polyphenols are substances found in many nuts, vegetables, and berries. Linebacker compounds are
modified Myricetin, which is a common plant-derived flavonoid. Myricetin exhibits a wide range of activities that include strong antioxidant
and anti-inflammatory activities (source: NIH).

can potentially be developed as monotherapy or co-therapy to down-regulate PIM (proviral integration site for Moloney murine leukemia
virus) kinase which plays a key role as an oncogene in various cancers (e.g. colon, lung, prostate, breast). Additional potential applications
include inflammatory disorders and neurology.

 Linebacker-1
and Linebacker-2 compounds have been licensed to ProPhase Laboratories (NASDAQ: PRPH) for development and commercialization worldwide,
from which Impact Biomedical could receive future milestone and royalty payments.

 Composition
and method patents are issued to the Company for Linebacker in the U.S. and other countries.

technology demonstrates compelling potential in reducing caloric intake and glycemic index in foods, while also inhibiting tumor necrosis
factor alpha (TNF-), a cytokine associated with inflammatory chronic diseases (data on file with IBO).

 The
patented formulation has potential to inhibit the inflammatory and metabolic response of sugar alone and has potential applications in
therapeutic administration to reduce or limit inflammatory or metabolic diseases (e.g., diabetes). Use of Laetose in a daily diet, compared
to sugar, could result in 30% lower sugar consumption and lower caloric and glycemic index/load.

has a unique composition patent allowed in the United States and patents are pending in other countries worldwide.

 IBO
is actively seeking potential partners for further development and commercialization of Laetose as a consumer-packaged or biopharmaceutical
offering worldwide.

 Functional
Fragrance Formulation ("3F")

 3F
is a suite of "functional fragrances" containing specialized botanical ingredients (e.g., terpenes) with potential application
as an antimicrobial, or as an additive in insect repellents, detergents, lotions, shampoo, fabrics and other substances to increase effectiveness.

 IBO
has partnered with the Chemia Corporation (St. Louis, MO) to pursue development of the 3F technology. Chemia is a leading developer and
manufacturer of fragrances and flavors.

 In
addition to Chemia, IBO is actively seeking potential partners for further development and commercialization of 3F worldwide, given
the broad application of this technology.

 Composition
patents have been issued in the U.S. and are pending in other countries.

 Equivir

G technology is a novel blend of FDA Generally Recognized as Safe (GRAS) eligible polyphenols (e.g. Myricetin, Hesperetin, Piperine)
which have demonstrated antiviral effects with additional potential application as health supplements or medication. Polyphenols are
substances found in many nuts, vegetables, and berries. Myricetin is a member of the flavonoid class of polyphenolic compounds with antioxidant
properties. Hesperitin is a flavanone and Piperine is an alkaloid, commonly found in black pepper.

G is licensed to ProPhase Laboratories for development and commercialization worldwide. ProPhase Lab's initial focus is for use
as an over-the-counter offering for upper respiratory wellness. Additional applications could be pursued in the future.

 Method
and composition patents are issued in the U.S. and other countries.

 Emerging
Technology

BioMedical continually evaluates additional proprietary technologies that are in various phases of development. These include, and are
not limited to biopharmaceuticals, indoor air quality products, preservatives, bioplastics, personalized medicine (e.g. genomics, diagnostics),
nanotechnology, cannabis products and technology, pain management, and others.

 These
activities include discussions with potential companies/technologies which, subject to completion of diligence, and approval of the respective
management boards, could potentially expand the offerings of Impact Biomedical Inc. There is no assurance that anyone, or all, of these
will result in a material transaction and this is exemplary of consistent and ongoing search and discovery efforts within Impact Biomedical
Inc.

 2024
RECAP

 As
a relatively new public entity, Impact BioMedical (IBO) has already demonstrated an ability to establish an experienced leadership
team, attract investor confidence, build a robust intellectual property(IP) portfolio, and create partnerships for development,
registration, and commercialization. The company's technologies address critical health challenges, with significant market
potential in both developed and emerging markets.

 IBO
is built on a foundation of cutting-edge technologies, strong IP, and partnerships to improve human health and wellness. Progress advanced
considerably in 2024:

 Intellectual
Property:

 Three
new patent platforms were established in 2024 adding to the 36 issued and 50+ patents in the IBO portfolio. Accomplishments in 2024 include:

 The first U.S. Laetose patent representing a novel combination
of one or more sugars and myo-inositol, with the potential to inhibit the inflammatory and metabolic response of sugar alone. This could
be utilized as a diet supplement or biopharmaceutical, and discussions with potential partners to advance commercialization efforts continue.

 Expansion of the U.S. 3F patent estate with new compositions
and formulations of constituents found in plants and fragrances with application as a natural insect repellent. Applications range from
standalone repellents to integrations in shampoos and detergents.

 Regional expansion of the Linebacker patent estate with granting
of a Canadian patent for unique phenolic compounds and pharmaceutical compositions in treating inflammatory related diseases. This platform
offers potential relief for conditions such as arthritis, asthma, and inflammatory bowel disease, while mitigating the side effects associated
with traditional treatments.

 Commercialization/Revenue
Generation:

 The
Equivir platform, licensed to ProPhase Labs completed the first human study with potential application as a diet supplement in treating
upper respiratory infections. Final study results are anticipated in mid-2025, and contingent on meeting targeted marketing claims, Equivir
will launch in the U.S. for the 2025-2026 cold and flu season.

 Financial:

 Completion
of our Initial Public Offering(IPO) in September 2024, provided us with resources to accelerate our research and development initiatives,
expand our market presence, and enhance shareholder value.

 We
successfully restructured our long-term debt during the third quarter of 2024, which improves our financial flexibility, enabling repayment
of debt with company equity for 24 months, enabling cash preservation.

 In
summary, 2024 delivered an improved financial position, platform and regional expansion of IP estate, completion of the first human study
with IBO technology (Equivir) with potential for near-term revenue generation, and a dedicated leadership team.

 Reporting
Operating Segments:

 The
Company reports its segment information to reflect the manner in which the Company's chief operating decision maker ("CODM")
reviews and assesses performance. The Company's Chief Executive Officer and Chief Operating Officer have joint responsibilities
as the CODM and review and assess the performance of the Company as a whole.

 The
primary financial measures used by the CODM to evaluate performance and allocate resources are net income (loss) and operating income
(loss). The CODM uses net income (loss) and operating income (loss) to evaluate the performance of the Company's ongoing operations
and as part of the Company's internal planning and forecasting processes. Information on Net income (loss) and Operating income
(loss) is disclosed in the Consolidated Statements of Operations. Segment expenses and other segment items are provided to the CODM on
the same basis as disclosed in the Consolidated Statements of Operations.

 The
CODM does not evaluate performance or allocate resources based on segment assets, and therefore such information is not presented in
the notes to the financial statements

BioMedical currently operates as one business segment.

 Biotechnology:
 ("Biotech") Impact BioMedical, Inc. targets unmet, urgent medical needs and expands the borders of medical and pharmaceutical
science. Impact drives mission-oriented research, development, and commercialization of solutions for medical advances in human wellness
and healthcare. By leveraging technology and new science with strategic partnerships, Impact BioMedical provides advances in drug discovery
for the prevention, inhibition, and treatment of neurological, oncology and immuno-related diseases. Other exciting technologies include
a breakthrough alternative sugar aimed to combat diabetes and functional fragrance formulations aimed at the industrial and medical industry.

BioMedical has several important and valuable products, technology or compounds that are in continuing development and/or licensing stages:

 LineBacker:
 Multi-faceted therapeutic platform for metabolic, neurologic, cancer, and infectious diseases.

 Equivir:
 A polyphenol compound that is believed to be successful in antiviral infection treatments. Equivir/Nemovir technology is a novel
 blend of FDA Generally Recognized as Safe ("GRAS") eligible polyphenols ( e.g., Myricetin, Hesperetin, Piperine)
 which have demonstrated antiviral effects with additional potential application as health supplements or medication. Polyphenols
 are sourced from fruits, vegetables, and other natural substances. Myricetin is a member of the flavonoid class of polyphenolic compounds
 with antioxidant properties. Hesperitin is a flavanone and Piperine is an alkaloid, commonly found in black pepper.

 Procombin:
 Applications as food additive, and natural preservative for beauty and person care products as well as natural food preservative.

 VanXin:
 Food preservative booster made up of polyphenols that extend the shelf life.

 Bioplastics:
 Advanced bio-compatible plastics that mitigate accumulation of plastics in oceans and landfills and provide UVA and UVB protection
 for many types of material for including containers, hard surfaces, and fibers for clothing. The technology is presently in development
 and testing antimicrobial plastics for consumer products that control the spread of active pathogens such as SARS-CoV-2, Influenza,
 E. coli, Staph, and Rhinovirus, by exploiting key strategies found in the biological realm. These new plastics are specifically focused
 on solutions for common products such as cups, plates, utensils, plastic bags, and countertops. The first prototypes are currently
 undergoing antimicrobial resistance testing.

 Laetose:
 Laetose technology is derived from a unique combination of sugar and inositol, which demonstrates the ability to inhibit the inflammatory
 and metabolic response of sugar alone. A sugar alternative which is believed to lower human glycemic indexes and is believed to be
 a breakthrough alternative sugar aimed to combat diabetes. The use of Laetose in a daily diet, compared to sugar, could result in
 30% lower sugar consumption and lower glycemic index/load.

 3F:
 A botanical compound believed to serve as an insect repellent and anti-microbial agent. 3F is a unique formulation of specialized
 ingredients ( e.g. terpenes) from botanical sources with demonstrated effect as an insect repellent and an antimicrobial.

 3F
 Mosquito Repellent: 3F repellent contains botanical ingredients that mosquitos avoid. These ingredients are scientifically proven1
 to affect the mosquito's receptors, essentially making the insect blind to a human's presence. This can be utilized as
 a stand-alone repellent or as an additive in detergents, lotions, shampoo, and other substances to provide mosquito protection.

 3F
 Antimicrobial: 3F antimicrobial contains botanical ingredients known to kill viruses. These ingredients are scientifically proven
 to inhibit viral replication. This can be utilized as a stand-alone antimicrobial or as an additive in detergents, lotions, shampoo,
 fabrics, and other substances.

 Quantum:
 The solution to the Patent Cliff accomplished by creating a new class of medicinal chemistry that uses advanced methods to increase
 effectiveness and persistence of natural compounds and existing drugs. The safety attributes of the original molecules are maintained.
 Typically, drug discovery processes modify functional groups. Quantum's new techniques alter behavior of molecules at the sub-molecular
 level. It is estimated that 65% of the World Health Organization Essential Medicines List can be improved and re-patented using Quantum
 and these methods can be used to enhance and patent natural compounds including many substances used in traditional medicines around
 the world.

 Bio
 Med (license): A probiotic gut health product that helps to regulate many physiological functions, ranging from energy regulation
 and cognitive processes to toxin neutralization and immunity against pathogens.

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

 1)
 Impact develops valuable and unique patented technologies which will be licensed to pharmaceutical, large consumer package goods
companies and venture capitalists in exchange for usage licensing and royalties.

 2)
 Impact utilizes the DSS ecosystem to leverage its sister companies that have in place distribution networks on a global scale. Impact
will engage in branded and private labelling of certain products for sales generation through these channels. This global distribution
model will give direct access to end users of Impact's nutraceutical and health related products.

 Intellectual
Property

 We
strive to protect the intellectual property that we believe is important to our business, including seeking and maintaining patent protection
intended to cover the composition of matter of our product candidates, their methods of use, their methods of production, related technologies
and other inventions. In addition to patent protection, we also rely on trade secrets to protect aspects of our business that are not
amenable to, or that we do not consider appropriate for, patent protection, including certain aspects of technical know-how.

 Our
commercial success depends in part upon our ability to obtain and maintain patent and other proprietary protection for commercially important
technologies, inventions and know-how related to our business, defend and enforce our intellectual property rights, particularly our
patent rights, preserve the confidentiality of our trade secrets and operate without infringing valid and enforceable intellectual property
rights of others.

 The
patent positions for companies like us are generally uncertain and can involve complex legal, scientific and factual issues. In addition,
the coverage claimed in a patent application can be significantly reduced before a patent is issued, and its scope can be reinterpreted
and even challenged after issuance. As a result, we cannot guarantee that any of our product candidates will be protectable or remain
protected by enforceable patents. We cannot predict whether the patent applications we are currently pursuing will be issued as patents
in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors.
Any patents that we hold may be challenged, circumvented or invalidated by third parties.

Biomedical's discovery and development capabilities generate intellectual property which is owned and/or licensed from our direct
efforts and our research partners.

 We
currently have rights or ownership to eight (8) issued patents and more than forty(40) pending patents in countries worldwide. These
include composition and method patents.

 Issued
Patents:

 -Oncology

 -Neurology

 -Inflammatory
Disease

 -Infectious
Disease

 -Anti-Virals(e.g.
Influenza, Rhinovirus, Ebola, Cholera, Coronavirus)

 -Insect
Repellents

 Pending
Patents:

 -Food
Preservatives

 -Bio-Plastics

 -Biopharmaceuticals

 -Sugar/Diet
Substitutes

 This
foundation of intellectual property enables our out-licensing and commercialization efforts.

 Patents

 Related
to our Impact BioMedical Division that maintains important key patents and patent applications that we will use as the foundation for
foster product development and licensing. We currently have 5 patents with claims directed to compositions, the manufacture of, and/or
the use of use and for some of our key products including compositions referred to as Linebacker, Equivir/Nemovir, Laetose, and 3F. Our
intellectual property will enable us to be protected as we further these technologies and pave the road to commercialization.

 We
own patents with claims directed to covering semiconductors, light emitting diodes, and wireless peripheral technologies, respectively.
We also have several patent applications in process, including provisional and Patent Cooperation Treaty ("PCT") patent applications
in various jurisdictions including the United States, Canada, and Europe. Our issued patents have remaining durations ranging from 1
to 16 years.

 Trademarks

 We
have several trademarks related to Impact BioMedical.

 Websites:

 The
primary corporate website we maintain is www.impactbiomedinc.com.

 Markets
and Competition

Biomedical is focused on the discovery, development, and commercialization of products and technologies to address unmet needs in human
healthcare and wellness. Specific areas of focus include specialty biopharmaceuticals, antivirals, antimicrobials, and consumer healthcare
and wellness products, often derived from naturally sourced elements. These efforts compete with many different sources, including major
pharmaceutical, specialty pharmaceutical, and biotechnology companies, academic institutions and governmental agencies, and public and
private research institutions.

 Customers

 The
business model of Impact BioMedical includes licensing and potentially direct sales for commercialization and distribution. Potential
licensors and development partners include pharmaceutical, food, consumer package goods companies and others in exchange for milestone,
and royalty licensing payments.

 Raw
Materials

 None.

 Environmental
Compliance

 It
is the Company's policy to conduct its operations in accordance with all applicable laws, regulations, and other requirements.
While it is not possible to quantify with certainty the potential impact of actions regarding environmental matters, particularly remediation
and other compliance efforts that the Company may undertake in the future, in the opinion of management, compliance with the present
environmental protection laws, before taking into account estimated recoveries from third parties, will not have a material adverse effect
on the Company's consolidated annual results of operations, financial position or cash flows.

 Government
Regulation

 We
are faced with potential government regulations. 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 our patent monetization efforts and, in turn, our assets,
expenses and revenue. United States patent laws have been amended by the Leahy-Smith America Invents Act. The America Invents Act includes
several significant changes to U.S. patent law. In general, the legislation attempts to address issues surrounding the enforceability
of patents and the increase in patent litigation by, among other things, establishing new procedures for patent litigation. For example,
the America Invents Act changes the way that parties may be joined in patent infringement actions, increasing the likelihood that such
actions will need to be brought against individual parties allegedly infringing by their respective individual actions or activities.
In addition, the U.S. Department of Justice ("DOJ") has conducted reviews of the patent system to evaluate the impact of
patent assertion entities, such as our Company, on industries in which those patents relate. It is possible that the findings and recommendations
of the DOJ could adversely impact our ability to effectively license and enforce standards-essential patents and could increase the uncertainties
and costs surrounding the enforcement of any such patented technologies.

 Moreover,
new rules regarding the burden of proof in patent enforcement actions could significantly increase the cost of our enforcement actions,
and new standards or limitations on liability for patent infringement could negatively impact our revenue derived from such enforcement
actions.

 Corporate
History

BioMedical, Inc., incorporated in the State of Nevada on October 16, 2018, through the utilization of its intellectual property rights,
or through investment in, or through acquisition of companies in the biohealth and biomedical fields, focuses on the advancement of drug
discovery and prevention, inhibition, and treatment of neurological, oncological, and immune related diseases. The Company is also developing
open-air defense initiatives, which curb transmission of air-borne infectious diseases, such as tuberculosis and influenza. See the "Overview"
section above for further details about our Company.

 Employees

 The
Company currently has two full-time employee and six shared employees with DSS as of December 31, 2024.

 Available
information

 Our
website address is www.impactbiomedinc.com. Information on our website is not incorporated herein by reference. We make available
free of charge through our website our press releases, Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on
Form 8-K and all amendments to those reports as soon as reasonably practicable after electronically filed with or furnished to the Securities
and Exchange Commission.

 ITEM
1A – RISK FACTORS

 An
investment in our securities is highly speculative and involves a high degree of risk. In determining whether to purchase the Company's
securities, an investor should carefully consider all of the material risks described below, together with the other information contained
in this annual report. We cannot assure you that any of the events discussed below will not occur. These events could have a material
and adverse impact on our business, financial condition, results of operations and prospects. If that were to happen, the trading price
of our common stock could decline, and you could lose all or part of your investment.

 Risks
Related to Liquidity, the Company's Business and Industry

 If
we do not adequately protect our intellectual property rights, our operations may be materially harmed.

 We
rely 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
our 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 ours or that we will be able to
successfully resolve these types of conflicts to our satisfaction. Our failure to protect our 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.

 We
spend a significant amount of resources on our 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 our 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.

 Our
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 we 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. We pursue 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.

 We
are subject to risks related to corporate social responsibility and reputational matters.

 Our
reputation and the reputation of our brands, including the perception held by our customers, end-users, business partners, investors,
other key stakeholders and the communities in which we do business are influenced by various factors. There is an increased focus from
our stakeholders on ESG practices and disclosure - and if we fail, or are perceived to have failed, in any number of ESG matters, such
as environmental stewardship, inclusion and diversity, workplace conduct and support for local communities, or to effectively respond
to changes in, or new, legal or regulatory requirements concerning climate change or other sustainability concerns, our reputation or
the reputation of our brands may suffer. Such damage to our reputation and the reputation of our brands may negatively impact our business,
financial condition and results of operations. In addition, negative or inaccurate postings or comments on social media or networking
websites about the Company or our brands could generate adverse publicity that could damage our reputation or the reputation of our brands.
If we are unable to effectively manage real or perceived issues, including concerns about product quality, safety, corporate social responsibility
or other matters, sentiments toward the Company or our products could be negatively impacted, and our financial results could suffer.

 We
may not have adequate funds to implement our business plan.

 Although
we have received capital from our parent company to meet our working capital and financing needs in the past, and have successfully
completed our IPO, additional financing may be required in order to meet our current and projected cash requirements for operations.
We cannot be assured that we will secure all or any of the funding we anticipate. If our entire original capital is fully expended
and additional costs cannot be funded from borrowings or capital from other sources, then our financial condition, results of
operations and business performance would be materially adversely affected. We cannot assure you that we will have adequate capital
or financing to conduct our business or to grow.

 Our
ability to resell and/or license our products will depend upon successful clinical trials.

 Only
a small number of research and development programs result in the development of a product that obtains FDA approval. Success in preclinical
work or early stage clinical trials does not ensure that later stage or larger scale clinical trials will be successful. Conducting clinical
trials is a complex, time-consuming and expensive process. Our ability to complete our clinical trials in a timely fashion depends in
large part on a number of key factors including protocol design, regulatory and institutional review board approval, the rate of patient
enrollment in clinical trials, and compliance with extensive current Good Clinical Practices. If we fail to adequately manage the design,
execution and regulatory aspects of our clinical trials, our studies and ultimately our regulatory approvals may be delayed, or we may
fail to gain approval for our product candidates. Clinical trials may indicate that our product candidates have harmful side effects
or raise other safety concerns that may significantly reduce the likelihood of regulatory approval, result in significant restrictions
on use and safety warnings in any approved label, adversely affect placement within the treatment paradigm, or otherwise significantly
diminish the commercial potential of the product candidate. Also, positive results in a registrational trial may not be replicated in
any subsequent confirmatory trials. Even if later stage clinical trials are successful, regulatory authorities may disagree with our
view of the data or require additional studies and may fail to approve or delay approval of our product candidates or may grant marketing
approval that is more restricted than anticipated, including indications for a narrower patient population than expected and the imposition
of safety monitoring or educational requirements or risk evaluation and mitigation strategies. In addition, if another company is the
first to file for marketing approval of a competing drug candidate, that company may ultimately receive marketing exclusivity for its
drug candidate, thereby reducing the value of our product.

 We
face significant competition from other biopharmaceutical and consumer product companies.

 While
we believe that our technology, development experience and scientific knowledge provide competitive advantages, we face potential competition
from many different sources, including major pharmaceutical, specialty pharmaceutical, and biotechnology companies, academic institutions
and governmental agencies, and public and private research institutions. Many of our existing or potential competitors have substantially
greater financial, technical and human resources than we do and significantly greater experience in the development of drug candidates
as well as in obtaining regulatory approvals of those drug candidates in the United States and in foreign countries.

 Mergers
and acquisitions in the pharmaceutical and biotechnology industries could result in even more resources being concentrated among a small
number of our competitors. Competition may increase further as a result of advances in the commercial applicability of technologies and
greater availability of capital for investment in these industries. Our competitors may succeed in developing, acquiring or licensing,
on an exclusive basis, drug candidates that are more effective or less costly than any drug candidate that we may develop.

 Our
ability to compete successfully will depend largely on our ability to:

 attract
 qualified scientific, product development and commercial personnel;

 obtain
 patent or other proprietary protection for our drugs and technologies;

 obtain
 required regulatory approvals; successfully collaborate with pharmaceutical companies in the discovery, development and commercialization
 of new drugs; and

 negotiate
 competitive pricing and reimbursement with third party payors

 The
availability of our competitors' technologies could limit the demand, and the price we are able to charge for our services and
for any drug candidate we develop. The inability to compete with existing or subsequently introduced drug development technologies would
have a material adverse impact on our business, financial condition and prospects.

 Established
pharmaceutical companies and research institutions may invest heavily to accelerate discovery and development of novel compounds or to
in license novel compounds that could make our products less competitive, which would have a material adverse impact on our business.

 We
are dependent on our collaborative agreements for the development of products and business development, which exposes us to the risk
of reliance on the viability of third parties.

 In
conducting our research and development activities, we currently rely, and will in the future rely, on collaborative agreements with
third parties such as manufacturers, contract research organizations, commercial partners, universities, governmental agencies and not-for-profit
organizations for both strategic and financial resources. The loss of, or failure to perform by us or our partners under, any applicable
agreements or arrangements, or our failure to secure additional agreements for other products in development, would substantially disrupt
or delay our research and development and commercialization activities. Any such loss would likely increase our expenses and materially
harm our business, financial condition and results of operation.

 We
are a human healthcare and consumer wellness company with no significant revenue. We have incurred operating losses since our inception,
and we expect to incur losses for the foreseeable future and may never achieve profitability.

 We
have incurred significant operating losses since our inception. To date, we have not generated any revenue and we may not generate any
revenue from sales of our clinical analytics services or drug candidates for the foreseeable future. We expect to continue to incur significant
operating losses and we anticipate that our losses may increase substantially as we expand our drug development programs.

 To
achieve profitability, we must successfully develop, register and commercialize multiple technologies in biopharmaceuticals and over
the counter consumer products. Even if we succeed in developing and commercializing one or more technologies, we may not be able to generate
sufficient revenue and we may never be able to achieve or sustain profitability.

 We
are increasingly dependent on information technology systems to operate our business and a cyber-attack or other breach of our systems,
or those of third parties on whom we may rely, could subject us to liability or interrupt the operation of our business.

 We
are increasingly dependent on information technology systems to operate our business. A breakdown, invasion, corruption, destruction
or interruption of critical information technology systems by employees, others with authorized access to our systems or unauthorized
persons could negatively impact operations. In the ordinary course of business, we collect, store and transmit confidential information
and it is critical that we do so in a secure manner to maintain the confidentiality and integrity of such information. Additionally,
we outsource certain elements of our information technology systems to third parties. As a result of this outsourcing, our third party
vendors may or could have access to our confidential information, making such systems vulnerable. Data breaches of our information technology
systems, or those of our third party vendors, may pose a risk that sensitive data may be exposed to unauthorized persons or to the public.
For example, the loss of clinical trial data from completed or ongoing clinical trials or preclinical studies could result in delays
in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. While we believe that we have
taken appropriate security measures to protect our data and information technology systems and have been informed by our third party
vendors that they have as well, there can be no assurance that our efforts will prevent breakdowns or breaches in our systems, or those
of our third party vendors, that could materially adversely affect our business and financial condition.

 If
we are unable to obtain U.S. and/or foreign regulatory approval, we will be unable to resell or license our drug candidates.

 Our
drug candidates will be subject to extensive governmental regulations relating to, among other things, research, testing, development,
manufacturing, safety, efficacy, record keeping, labeling, marketing and distribution of drugs. Rigorous preclinical testing and clinical
trials and an extensive regulatory approval process are required in the U.S. and in many foreign jurisdictions prior to the commercial
sale of drug candidates. Satisfaction of these and other regulatory requirements is costly, time-consuming, uncertain and subject to
unanticipated delays. It is possible that no drug candidate that we present to the FDA will obtain marketing approval which will significantly
diminish the value and desirability of our product candidates. In connection with the clinical trials for our drug candidates, we face
risks that:

 the
 drug candidate may not prove to be efficacious;

 the
 drug candidate may not prove to be safe;

 the
 drug candidate may not be readily co-administered or combined with other drugs or drug candidates;

 the
 results may not confirm the positive results from earlier preclinical studies or clinical trials;

 the
 results may not meet the level of statistical significance required by the FDA or other

 regulatory
 agencies; and

 the
 FDA or other regulatory agencies may require us to carry out additional studies.

 We
have limited experience in conducting and managing later stage clinical trials necessary to obtain regulatory approvals, including approval
by the FDA. However, this risk would be mitigated in the event the Company is successful entering into a co-development agreement with
a pharma partner for late stage clinical development. The time required to complete clinical trials and for the FDA and other countries'
regulatory review processes is uncertain and typically takes many years. Our analysis of data obtained from preclinical and clinical
trials is subject to confirmation and interpretation by regulatory authorities, which could delay, limit or prevent regulatory approval.
We may also encounter unanticipated delays or increased costs due to government regulation from future legislation or administrative
action or changes in FDA policy during the period of product development, clinical trials, and FDA regulatory review.

 We
will rely on third parties for manufacturing of our clinical drug supplies; our dependence on these manufacturers may impair the development
of our drug candidates.

 We
have no ability to internally manufacture the drug candidates that we need to conduct our clinical trials for the products that we acquire.
For the foreseeable future, we expect to continue to rely on third-party manufacturers and other third parties to produce, package and
store sufficient quantities of our drug candidates and any future drug candidates for use in our clinical trials. We may face various
risks and uncertainties in connection with our reliance on third-party manufacturers, including:

 reliance
 on third-party manufactures for regulatory compliance and quality assurance;

 the
 possibility of breach of the manufacturing agreement by the third-party manufacturer because of factors beyond our control;

 the
 possibility of termination or nonrenewal of our manufacturing agreement by the third-party manufacturer at a time that is costly
 or inconvenient for us;

 the
 potential that third-party manufacturers will develop know-how owned by such third-party

 manufacturer
 in connection with the production of our drug candidates that is necessary for the manufacture of our drug candidates; and

 reliance
 on third-party manufacturers to assist us in preventing inadvertent disclosure or theft of our proprietary knowledge.

 Our
drug candidates may be complicated and expensive to manufacture. If our third-party manufacturers fail to deliver our drug candidates
for clinical use on a timely basis, with sufficient quality, and at commercially reasonable prices, we may be required to delay or suspend
clinical trials or otherwise discontinue development of our drug candidates. While we may be able to identify replacement third-party
manufacturers or develop our own manufacturing capabilities for these drug candidates, this process would likely cause a delay in the
availability of our drug candidates and an increase in costs. In addition, third-party manufacturers may have a limited number of facilities
in which our drug candidates can be manufactured, and any interruption of the operation of those facilities due to events such as equipment
malfunction or failure or damage to the facility by natural disasters could result in the cancellation of shipments, loss of product
in the manufacturing process or a shortfall in available drug candidates.

 Risks
Related to Intellectual Property Rights

 We
rely on various intellectual property rights, including patents and licenses, in order to operate our business.

 Our
intellectual property rights may not be sufficiently broad or otherwise may not provide us a significant competitive advantage. In addition,
the steps that we have taken to maintain and protect our intellectual property may not prevent it from being challenged, invalidated,
circumvented or designed-around, particularly in countries where intellectual property rights are not highly developed or protected.
In some circumstances, enforcement may not be available to us because an infringer has a dominant intellectual property position or for
other business reasons, or countries may require compulsory licensing of our intellectual property. Our failure to obtain or maintain
intellectual property rights that convey competitive advantage, adequately protect our intellectual property or detect or prevent circumvention
or unauthorized use of such property, could adversely impact our competitive position and results of operations. We also rely on nondisclosure
and noncompetition agreements with employees, consultants and other parties to protect, in part, trade secrets and other proprietary
rights. There can be no assurance that these agreements will adequately protect our trade secrets and other proprietary rights and will
not be breached, that we will have adequate remedies for any breach, that others will not independently develop substantially equivalent
proprietary information or that third parties will not otherwise gain access to our trade secrets or other proprietary rights.

 As
we expand our business, protecting our intellectual property will become increasingly important. The protective steps we have taken may
be inadequate to deter our competitors from using our proprietary information. In order to protect or enforce our patent rights, we may
be required to initiate litigation against third parties, such as infringement lawsuits. Also, these third parties may assert claims
against us with or without provocation. These lawsuits could be expensive, take significant time and could divert management's
attention from other business concerns. The law relating to the scope and validity of claims in the technology field in which we operate
is still evolving and, consequently, intellectual property positions in our industry are generally uncertain. We cannot assure you that
we will prevail in any of these potential suits or that the damages or other remedies awarded, if any, would be commercially valuable.

 The
Company could be negatively impacted if found to have infringed on intellectual property rights.

 Technology
companies frequently enter into litigation based on allegations of patent infringement or other violations of intellectual property rights.
In addition, patent holding companies seek to monetize patents they have purchased or otherwise obtained. As the Company grows, the intellectual
property rights claims against it will likely increase. The Company intends to vigorously defend infringement actions in court and before
the U.S. International Trade Commission. The plaintiffs in these actions frequently seek injunctions and substantial damages. Regardless
of the scope or validity of such patents or other intellectual property rights, or the merits of any claims by potential or actual litigants,
the Company may have to engage in protracted litigation. If the Company is found to infringe one or more patents or other intellectual
property rights, regardless of whether it can develop non-infringing technology, it may be required to pay substantial damages or royalties
to a third-party, or it may be subject to a temporary or permanent injunction prohibiting the Company from marketing or selling certain
products. In certain cases, the Company may consider the desirability of entering into licensing agreements, although no assurance can
be given that such licenses can be obtained on acceptable terms or that litigation will not occur. These licenses may also significantly
increase the Company's operating expenses. Regardless of the merit of particular claims, litigation may be expensive, time-consuming,
disruptive to the Company's operations and distracting to management. In recognition of these considerations, the Company may enter
into arrangements to settle litigation. If one or more legal matters were resolved against the Company's consolidated financial
statements for that reporting period could be materially adversely affected. Further, such an outcome could result in significant compensatory,
punitive or trebled monetary damages, disgorgement of revenue or profits, remedial corporate measures or injunctive relief against the
Company that could adversely affect its financial condition and results of operations.

 We
rely heavily on our technology and intellectual property, but we may be unable to adequately or cost-effectively protect or enforce our
intellectual property rights, thereby weakening our competitive position and increasing operating costs.

 To
protect our rights in our services and technology, we rely on a combination of copyright and trademark laws, patents, trade secrets,
confidentiality agreements and protective contractual provisions. We also rely on laws pertaining to trademarks and domain names to protect
the value of our corporate brands and reputation. Despite our efforts to protect our proprietary rights, unauthorized parties may copy
aspects of our services or technology, obtain and use information, marks, or technology that we regard as proprietary, or otherwise violate
or infringe our intellectual property rights. In addition, it is possible that others could independently develop substantially equivalent
intellectual property. If we do not effectively protect our intellectual property, or if others independently develop substantially equivalent
intellectual property, our competitive position could be weakened.

 Effectively
policing the unauthorized use of our services and technology is time-consuming and costly, and the steps taken by us may not prevent
misappropriation of our technology or other proprietary assets. The efforts we have taken to protect our proprietary rights may not be
sufficient or effective, and unauthorized parties may copy aspects of our services, use similar marks or domain names, or obtain and
use information, marks, or technology that we regard as proprietary. We may have to litigate to enforce our intellectual property rights,
to protect our trade secrets, or to determine the validity and scope of others' proprietary rights, which are sometimes not clear
or may change. Litigation can be time consuming and expensive, and the outcome can be difficult to predict.

 We
rely on agreements with third parties to provide certain services, goods, technology, and intellectual property rights necessary to enable
us to implement some of our applications.

 Our
ability to implement and provide our applications and services to our clients depends, in part, on services, goods, technology, and intellectual
property rights owned or controlled by third parties. These third parties may become unable to or refuse to continue to provide these
services, goods, technology, or intellectual property rights on commercially reasonable terms consistent with our business practices,
or otherwise discontinue a service important for us to continue to operate our applications. If we fail to replace these services, goods,
technologies, or intellectual property rights in a timely manner or on commercially reasonable terms, our operating results and financial
condition could be harmed. In addition, we exercise limited control over our third-party vendors, which increases our vulnerability to
problems with technology and services those vendors provide. If the services, technology, or intellectual property of third parties were
to fail to perform as expected, it could subject us to potential liability, adversely affect our renewal rates, and have an adverse effect
on our financial condition and results of operations.

 If
any third-party owners of intellectual property we may license in the future do not properly maintain or enforce the patents underlying
such licenses, our competitive position and business prospects will be harmed.

 We
may enter into licenses for third-party intellectual property in the future. Our success will depend in part on the ability of our licensors
to obtain, maintain and enforce patent protection for their intellectual property, in particular, those patents to which we have secured
exclusive rights.

 If
applicable, our licensors may not successfully prosecute the patent applications to which we are licensed. Even if patents issue in respect
of any such patent applications, our licensors may fail to maintain these patents, may determine not to pursue litigation against other
companies that are infringing these patents, or may pursue such litigation less aggressively than we would. In addition, our licensors
may terminate their agreements with us in the event we breach the applicable license agreement and fail to cure the breach within a specified
period of time. Without protection for the intellectual property we license, other companies might be able to offer substantially identical
products for sale, which could materially adversely affect our competitive business position, business prospects and financial condition.

 Because
our research and development of drug candidates often incorporates compounds and other information that is the intellectual property
of third parties, we depend on continued access to such intellectual property to conduct and complete our preclinical and clinical research
and commercialize the drug candidates that result from this research. We expect that future licenses would impose, numerous obligations
on us. For example, under our existing and future license agreements, we may be required to pay (i) annual maintenance fees until a drug
candidate is sold for the first time, (ii) running royalties on net sales of drug candidates, (iii) minimum annual royalties after a
drug candidate is sold for the first time, and (iv) one-time payments upon the achievement of specified milestones. We may also be required
to reimburse patent costs incurred by the licensor, or we may be obligated to pay additional royalties, at specified rates, based on
net sales of our drug candidates that incorporate the licensed intellectual property rights. We may also be obligated under some of these
agreements to pay a percentage of any future sublicensing revenues that we may receive. Future license agreements may also include payment
obligations such as milestone payments or minimum expenditures for research and development. We expect that any future licenses will
contain reporting, insurance and indemnification requirements. We are actively reviewing and preparing additional patent applications
to expand our patent portfolio, but there can be no assurances that patents related to our existing patent applications or any applications
we may file in the future will be issued or that any issued patents will provide meaningful protection for our drug candidates, which
could materially adversely affect our competitive business position, business prospects and financial condition.

 Confidentiality
agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information and may
not adequately protect our intellectual property.

 We
rely on trade secrets to protect our technology, especially where we do not believe patent protection is appropriate or obtainable. However,
trade secrets are difficult to protect. In order to protect our proprietary technology and processes, we also rely in part on confidentiality
and intellectual property assignment agreements with our corporate partners, employees, consultants, outside scientific collaborators
and sponsored researchers and other advisors. These agreements may not effectively prevent disclosure of confidential information nor
result in the effective assignment to us of intellectual property and may not provide an adequate remedy in the event of unauthorized
disclosure of confidential information or other breaches of the agreements. In addition, others may independently discover our trade
secrets and proprietary information, and in such case, we could not assert any trade secret rights against such party. Enforcing a claim
that a party illegally obtained and is using our trade secrets is difficult, expensive and time-consuming, and the outcome is unpredictable.
In addition, courts outside the U.S. may be less willing to protect trade secrets. Costly and time-consuming litigation could be necessary
to seek to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could
materially adversely affect our business and financial condition.

 Risks
Related to Ownership of Our Securities

 The
market price of our common stock may be highly volatile, and you could lose all or part of your investment.

 The
trading price of our common stock is likely to be volatile. Our stock has a relatively small public float, and the concentrated ownership
of our common stock among our executive officers and directors, and greater than 5% stockholders. As a result of our small public float,
our common stock may be less liquid and have greater stock price volatility than the common stock of companies with broader public ownership.

 Our
stock price could be subject to wide fluctuations in response to a variety of other factors, which include:

 sales
 of our common stock by our stockholders, executives, and directors;

 volatility
 and limitations in trading volumes of our shares of common stock;

 our
 ability to obtain financing to conduct and complete research and development activities;

 our
 ability to attract new customers;

 in the development status of the drugs we acquire;

 failures
 to meet external expectations or management guidance;

 in our capital structure or dividend policy or future issuances of securities;

 our
 cash position;

 announcements
 and events surrounding financing efforts, including debt and equity securities;

 reputational
 issues;

 announcements
 of acquisitions, partnerships, collaborations, joint ventures, new products, capital commitments, or other events by us or our competitors;

 in general economic, political and market conditions in or any of the regions in which we conduct our business;

 in industry conditions or perceptions;

 in valuations of similar companies or groups of companies;

 analyst
 research reports, recommendation and changes in recommendations, price targets, and withdrawals of coverage;

 departures
 and additions of key personnel;

 disputes
 and litigations related to intellectual property rights, proprietary rights, and contractual obligations;

 in applicable laws, rules, regulations, or accounting practices and other dynamics; and

 other
 events or factors, many of which may be out of our control.

 In
addition, if the market for stocks in our industry or industries related to our industry, or the stock market in general, experiences
a loss of investor confidence, the trading price of our common stock could decline for reasons unrelated to our business, financial condition
and results of operations. If any of the foregoing occurs, it could cause our stock price to fall and may expose us to lawsuits that,
even if unsuccessful, could be costly to defend and a distraction to management.

 We
do not anticipate paying any dividends in the foreseeable future. Consequently, any gains from an investment in our common stock will
likely depend on whether the price of our common stock increases.

 To
date we have not paid any dividends, and we currently intend to retain our future earnings, if any, to fund the development and growth
of our business. In addition, the terms of any future indebtedness we may incur could preclude us from paying dividends. As a result,
capital appreciation, if any, of our common stock will be your sole source of gain from an investment in our common stock for the foreseeable
future. Consequently, in the foreseeable future, you will likely only experience a gain from your investment in our common stock if the
price of our common stock increases.

 Our
certificate of incorporation grants our Board of Directors the power to designate and issue additional shares of common and/or preferred
stock.

 Our
authorized capital consists of 4,000,000,000 shares of common stock and 100,000,000 shares of preferred stock. Our preferred stock may
be designated into series pursuant to authority granted by our certificate of incorporation, and on approval from our Board. The Board,
without any action by our stockholders, may designate and issue shares in such classes or series as the Board deems appropriate and establish
the rights, preferences and privileges of such shares, including dividends, liquidation and voting rights. The rights of holders of other
classes or series of stock that may be issued could be superior to the rights of holders of our common stock. The designation and issuance
of shares of capital stock having preferential rights could adversely affect other rights appurtenant to shares of our common stock.

 We
are an "emerging growth company" under the federal securities laws and we cannot be certain if the reduced disclosure requirements
applicable to emerging growth companies will make our common stock less attractive to investors.

 We
are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities
Act"), and we may take advantage of certain exemptions from various reporting requirements that are not applicable to other public
companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor
attestation requirements of section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in
our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation
and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common
stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there
may be a less active trading market for our common stock and our stock price may be more volatile.

 In
addition, an "emerging growth company" may take advantage of the extended transition period provided in Section 7(a)(2)(B)
of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company"
can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing
to take advantage of the extended transition period for complying with new or revised accounting standards.

 We
will remain an "emerging growth company" until the last day of the fiscal year following the fifth anniversary of the date
of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose
that status sooner if our revenues exceed $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three year period,
or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently
completed second fiscal quarter.

 Investors
may be unable to compare our business with other companies in our industry if they believe that our financial accounting is not as transparent
as other companies in our industry. If we are unable to raise additional capital as and when we need it, our financial condition and
results of operations may be materially and adversely affected.

 ITEM
1B – UNRESOLVED STAFF COMMENTS

 None.

 ITEM
1C - CYBERSECURITY

 We
have a range of security measures that are designed to protect against the unauthorized access to and misappropriation of our information,
corruption of data, intentional or unintentional disclosure of confidential information, or disruption of operations. These security
measures include controls, security processes and monitoring of our manufacturing systems. We have cloud security tools and governance
processes designed to assess, identify and manage material risks from cybersecurity threats. In addition, we maintain an information
security training program designed to address phishing and email security, password security, data handling security, cloud security,
operational technology security processes, and cyber-incident response and reporting processes.

 Our
Company is committed to maintaining the highest standards of cybersecurity to protect our data, intellectual property, and customer information
from cyber threats. As part of this commitment, we leverage a sophisticated cybersecurity framework that integrates the robust capabilities
of the Microsoft cloud ecosystem with the specialized services of a leading third-party cybersecurity service provider.

 The
Microsoft cloud ecosystem, including Microsoft 365, Azure, SharePoint Online, Microsoft Defender, and Microsoft InTune, forms the backbone
of our cybersecurity infrastructure. These platforms offer advanced security features such as data encryption in transit and at rest,
network security controls, identity and access management, and threat protection capabilities. Microsoft's constant investment
in cybersecurity research and development ensures that we benefit from cutting-edge security technologies and practices.

 In
addition to utilizing the Microsoft cloud ecosystem, we have engaged a third-party service provider to enhance our cybersecurity posture
further. This provider brings additional layers of security through services including:

 Software
 Security Management: Ensuring that applications such as Office 365 and Azure are configured, maintained and following best security
 practices.

 Security
 Monitoring and Consultation Services: Continuous monitoring of our systems for suspicious activities and providing expert consultation
 to address and mitigate potential threats.

 Data
 Storage and Backup of Source Systems: Implementing robust data storage solutions and backup protocols to ensure data integrity and
 availability.

 Security
 Policy Management: Developing and enforcing comprehensive security policies that govern all aspects of our cybersecurity efforts.

 Threat
 Response Management: Rapid identification and response to security incidents to minimize impact.

 Security
 Software Implementation: Deployment of state-of-the-art security software solutions that complement the security features of the
 Microsoft cloud ecosystem.

 Our
approach to cybersecurity is proactive and multifaceted, combining the scalability and reliability of the Microsoft cloud services with
the agility and expertise of our third-party cybersecurity partner. Together, these resources form a comprehensive defense mechanism
against a wide range of cyber threats, from phishing and malware attacks to sophisticated nation-state sponsored cyber-attacks. We continuously
evaluate and adapt our cybersecurity strategy to respond to evolving threats and to align with best practices and regulatory requirements.
Our commitment to cybersecurity is integral to our business operations, and we believe our strategic investments in this area significantly
mitigate the risk of cybersecurity incidents that could impact our company's reputation, financial position, or operational capabilities.

 Governance

 The
management of the Company is responsible for overseeing risk for the Company and has delegated to the VP, Engineering & Technology
("VPE&T") the responsibility for overseeing the cybersecurity risk management strategy for the Company. Management receives
regular updates on our cybersecurity risk management process from the VPE&T. The VPE&T reviews our comprehensive cybersecurity
framework, including reviewing our cybersecurity reporting protocol that provides for the notification, escalation and communication
of significant cybersecurity events to the management team.

 The
Company's cybersecurity program is overseen by our VPE&T, who is responsible for global information technology, including cybersecurity. Our VPE&T is primarily responsible for assessing and managing material risks from cybersecurity threats, including monitoring the
measures used for prevention, detection, mitigation and remediation of cybersecurity incidents. The information security organization
is comprised of internal IBO employees and external security suppliers who provide security monitoring and response.

 ITEM
2 - PROPERTIES

 Office
space is provided to us by DSS. The office space is 1,997 square feet. The lease term is from October 1, 2022 to September 30, 2026.
The fee for this space was approximately $5,500 per month through September 2024 and increased to approximately $7,200 per month in October
2024.

 ITEM
3 - LEGAL PROCEEDINGS

 There
are no material proceedings to which any director or officer, or any associate of any such director or officer, is a party that is adverse
to our Company or any of our subsidiaries or has a material interest adverse to our Company or any of our subsidiaries. No director or
executive officer has been a director or executive officer of any business which has filed a bankruptcy petition or had a bankruptcy
petition filed against it during the past ten years. No current director or executive officer has been convicted of a criminal offense
or is the subject of a pending criminal proceeding during the past ten years. No current director or executive officer has been the subject
of any order, judgment or decree of any court permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement
in any type of business, securities or banking activities during the past ten years. No current director or officer has been found by
a court to have violated a federal or state securities or commodities law during the past ten years.

 From
time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation
is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.

 ITEM
4 - MINE SAFETY DISCLOSURES

 Not
applicable.

 Part
II

 ITEM
5 - MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 Market
Information

 Our
common stock is currently not listed on any exchange. We intend to apply to the NYSE American LLC ("NYSE") for listing on
its exchange.

 Holders
of Record

 As
of January 25, 2025 we had 608 record holders of our common stock. This number does not include the number of persons whose shares are
in nominee or in "street name" accounts through brokers.

 Dividends

 We
did not pay dividends during 2024 or 2023. We anticipate that we will retain any earnings and other cash resources for investment in
our business. The payment of dividends on our common stock is subject to the discretion of our board of directors and will depend on
our operations, financial position, financial requirements, general business conditions, restrictions imposed by financing arrangements,
if any, legal restrictions on the payment of dividends and other factors that our board of directors deems relevant.

 Securities
Authorized for Issuance Under Equity Compensation Plans

 As
of December 31, 2024, securities issued and securities available for future issuance under our 2023 Employee, Director and Consultant
Equity Incentive Plan (the "Plan") is as follows:

 Restricted
 stock to be issued upon vesting

 of securities to be issued upon exercise of outstanding options, warrants and rights

 Weighted
 average exercise price of outstanding options, warrants and rights

 of securities
 remaining
 available for
 future
 issuance (under equity compensation
 Plans
 (excluding
 securities
 reflected in
 column
 (a & b))

 Plan
 Category

 (a)

 (b)

 (c)

 (d)

 Equity compensation plans approved by security
 holders

 2023 Employee,
 Director and Consultant Equity Incentive Plan - options

 -

 880,000

 $
 3.00

 -

 2023 Employee, Director
 and Consultant Equity Incentive Plan - warrants

 -

 75,000

 $
 3.75

 -

 2023
 Employee, Director and Consultant Equity Incentive Plan

 -

 -

 $
 -

 18,037,079

 Total

 -

 955,000

 $
 3.06

 18,037,079

 Recent
Issuances of Unregistered Securities

 None.

Repurchased by the Registrant

 We
did not purchase or repurchase any of our securities in the fiscal year ended December 31, 2024.

 ITEM
6 - SELECTED FINANCIAL DATA

 Not
applicable.

 ITEM
7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 FORWARD-LOOKING
STATEMENTS

 Certain
statements contained herein this report constitute "forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 (the "1995 Reform Act"). Except for the historical information contained herein, this report
contains forward-looking statements (identified by words such as "estimate," "project", "anticipate",
"plan", "expect", "intend", "believe", "hope", "strategy" and
similar expressions), which are based on our current expectations and speak only as of the date made. These forward-looking statements
are subject to various risks, uncertainties and factors that could cause actual results to differ materially from the results anticipated
in the forward-looking statements.

 Overview

Biomedical Inc. ("IBO". "Impact", "Impact BioMedical", "we", "us", "our"
or the "Company") discovers, confirms, and patents unique science and technologies which can be developed into new offerings
in human healthcare and wellness in collaboration with external partners through licensing, co-development, joint ventures, and other
relationships, and currently trades on the NYSE American under ticker symbol IBO.

 By
leveraging technology and new science with strategic partnerships, we provide advances in biopharmaceuticals, over the counter direct
to consumer wellness offerings, and drug discovery for the prevention, inhibition, and treatment of neurological, oncologic, and inflammatory
diseases. In addition to our existing efforts, we continually search for, and evaluate, other potential new offerings to add to our portfolio.

 Our
business model includes partnering and potentially direct sales for commercialization and distribution. Potential licensors and development
partners include pharmaceutical, consumer packaged goods companies and others, who would commercialize IBO technologies in exchange for
milestone, and royalty payments. Currently, our operations are conducted, and our assets are owned through our principal subsidiaries:
(i) Global BioLife, Inc. ("Global BioLife"), which was incorporated on April 14, 2017, (ii) Impact BioLife Science, Inc.
("Impact BioLife"), which was incorporated on August 28, 2020, (iii) Global BioMedical, Inc. ("Global BioMedical"),
which was incorporated on April 18, 2017, and (iv) Sweet Sense, Inc. ("Sweet Sense"), which was incorporated on April 30,
2018.

 Below
is a list of our principal subsidiaries:

 BioLife Science, Inc.;

 Biomedical, Inc.;

 BioLife, Inc.; and

 Sweet
 Sense, Inc.

BioLife Science, Inc. We are the sole owner of the outstanding equity of Impact BioLife Science, Inc.

Biomedical, Inc. We own 90.9% of Global Biomedical, Inc. outstanding equity.

BioLife, Inc. Through our majority owned subsidiary Global Biomedical, Inc., we own 81.8% of the outstanding equity of Global
BioLife, Inc.

 Sweet
Sense, Inc. We are the owner of 95.5% of the outstanding equity of Sweet Sense.

BioMedical has several unique and proprietary technologies that are in continuing development.

is a platform of small molecule electrophilically enhanced polyphenol compounds with potential application in oncology (solid tumors),
inflammatory disorders, and neurology. Polyphenols are substances found in many nuts, vegetables, and berries. Linebacker compounds are
modified Myricetin, which is a common plant-derived flavonoid. Myricetin exhibits a wide range of activities that include strong antioxidant
and anti-inflammatory activities (source: NIH).

can potentially be developed as monotherapy or co-therapy to down-regulate PIM (proviral integration site for Moloney murine leukemia
virus) kinase which plays a key role as an oncogene in various cancers (e.g. colon, lung, prostate, breast). Additional potential applications
include inflammatory disorders and neurology.

 Linebacker-1
and Linebacker-2 compounds have been licensed to ProPhase Laboratories (NASDAQ: PRPH) for development and commercialization worldwide,
from which Impact Biomedical could receive future milestone and royalty payments.

technology demonstrates compelling potential in reducing caloric intake and glycemic index in foods, while also inhibiting tumor necrosis
factor alpha (TNF-), a cytokine associated with inflammatory chronic diseases (data on file with IBO).

 The
patented formulation has potential to inhibit the inflammatory and metabolic response of sugar alone and has potential applications in
therapeutic administration to reduce or limit inflammatory or metabolic diseases (e.g., diabetes). Use of Laetose in a daily diet, compared
to sugar, could result in 30% lower sugar consumption and lower caloric and glycemic index/load.

has a unique composition patent allowed in the United States and patents are pending in other countries worldwide.

 IBO
is actively seeking potential partners for further development and commercialization of Laetose as a consumer-packaged or biopharmaceutical
offering worldwide.

 Functional
Fragrance Formulation ("3F")

 3F
is a suite of "functional fragrances" containing specialized botanical ingredients (e.g., terpenes) with potential application
as an antimicrobial, or as an additive in insect repellents, detergents, lotions, shampoo, fabrics and other substances to increase effectiveness.

 IBO
has partnered with the Chemia Corporation (St. Louis, MO) to pursue development of the 3F technology. Chemia is a leading developer and
manufacturer of fragrances and flavors.

 In
addition to Chemia, IBO is actively seeking potential partners for further development and commercialization of 3F worldwide, given
the broad application of this technology.

 Composition
patents have been issued in the U.S. and are pending in other countries.

 Equivir

G technology is a novel blend of FDA Generally Recognized as Safe (GRAS) eligible polyphenols (e.g. Myricetin, Hesperetin, Piperine)
which have demonstrated antiviral effects with additional potential application as health supplements or medication. Polyphenols are
substances found in many nuts, vegetables, and berries. Myricetin is a member of the flavonoid class of polyphenolic compounds with antioxidant
properties. Hesperitin is a flavanone and Piperine is an alkaloid, commonly found in black pepper.

G is licensed to ProPhase Laboratories for development and commercialization worldwide. ProPhase Lab's initial focus is for use
as an over-the-counter offering for upper respiratory wellness. Additional applications could be pursued in the future.

 Method
and composition patents are issued in the U.S. and other countries.

 Emerging
Technology

BioMedical continually evaluates additional proprietary technologies that are in various phases of development. These include, and are
not limited to biopharmaceuticals, indoor air quality products, preservatives, bioplastics, personalized medicine (e.g. genomics, diagnostics),
nanotechnology, cannabis products and technology, pain management, and others.

 These
activities include discussions with potential companies/technologies which, subject to completion of diligence, and approval of the respective
management boards, could potentially expand the offerings of Impact Biomedical Inc. There is no assurance that anyone, or all, of these
will result in a material transaction and this is exemplary of consistent and ongoing search and discovery efforts within Impact Biomedical
Inc.

 The
information in the two paragraphs below does not assume or give effect to (1) a 1:55 reverse split of the Company's outstanding
common stock and (2) an exchange by a shareholder of common stock for Series A Convertible Preferred Stock.

 The
Company was incorporated in the State of Nevada as a for-profit company on October 16, 2018, and established a fiscal year end of December
31st. The Company issued 9,000 shares to Global BioMedical Pte. Ltd., which was wholly–owned by Alset International Limited (formally
Singapore eDevelopment Limited), a multinational public company, listed on the Singapore Exchange Securities Trading Limited ("SGXST").
On March 31, 2020, the Company issued 125,064,621 shares of common stock to its sole shareholder Global BioMedical Pte. Ltd. On July
24, 2020, the Board approved the Stock Split, pursuant to which each share of the Company's common stock issued and outstanding
was split into nine shares of the Company's common stock. The numbers of authorized common stock and issued and outstanding common
stock in the reporting periods were retrospectively adjusted for the stock split.

 On
March 12, 2020 Alset International Limited ("Alset"), a related party, Global BioMedical Pte Ltd., a related party, DSS,
Inc ("DSS"), a related party, and DSS BioHealth Security Inc. ("DSS BioHealth"), a related party, signed Term
Sheets and subsequently on April 21, 2020, these four companies entered into Share Exchange Agreement ("Share Exchange"),
based on which Global BioMedical Pte Ltd., agreed to sell all of the issued and outstanding shares of the Company to DSS BioHealth in
exchange for the combination of common and preferred shares of DSS. Under the terms of the Share Exchange, DSS issued 483,334 shares
of the DSS Common Stock nominally valued at $6.48 per share, and 46,868 newly issued shares of the DSS Series A Convertible Preferred
Stock ("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. Due to several factors, including a discount for illiquidity, the value of the Series A Preferred Stock was discounted
from $46,868,000 to $35,187,000, thus reducing the final consideration given to approximately $38,319,000. The Company's Chairman,
Heng Fai Ambrose Chan, a related party, who is also the largest shareholder of Alset, at the time of the signing of the Share Exchange
Agreement was the beneficial owner of approximately 18.3% of the outstanding shares of DSS and is the Chairman of the Board of Directors
of DSS. On August 21, 2020, the transaction was concluded, and the Company became a direct wholly owned subsidiary of DSS BioHealth.
In connection with the acquisition, and the related accounting determination, DSS BioHealth has elected to apply push-down accounting
and reflect in its financial statements of Impact BioMedical, the fair value of its assets and liabilities. Utilizing an income approach,
the Company has completed its valuations of certain developed technology and pending patents assets acquired in the transaction as well
the fair value of the non-controlling interests. More specifically, a Multi-Period Excess Earnings Method ("MPEEM") estimates
the value of an intangible asset by quantifying the amount of residual (or excess) estimated cash flows generated by the asset and discounting
those cash flows to the present. These have been valued at approximately $22,260,000 and $3,910,000, respectively, and are included on
the Consolidated Balance Sheet on December 31, 2020. Estimated useful life of these assets is twenty years, based on the remaining terms
of the related patents, with annual amortization approximating $1,113,000. The Company has also completed its valuation of goodwill and
deferred tax liabilities of Impact BioMedical, and has recorded goodwill of approximately $25,093,000, driven by other intangible assets
that do not qualify for separate recognition, and a deferred tax liability of approximately $5,234,000. The goodwill is not deductible
for tax purposes and has been allocated to Impact BioMedical in totality as a single reporting unit. The Company is committed to both
funding research and developing intellectual property portfolio.

 Year
 ended
 31, 2024

 Year
 ended

 %

 License revenue

 $
 -

 $
 -

 NA

 Total

 $
 -

 $
 -

 NA

 - The Company has not generated revenue for the years ended December 31,
2024 or 2023.

 Costs
and expenses

 Year
 ended December 31, 2024

 Year
 ended December 31,2023

 %

 Sales, general and administrative
 compensation

 $
 699,000

 $
 315,000

 %

 Stock based compensation

 -

 N/A

 Sales and marketing

 633,000

 65,000

 %

 Professional Fees

 446,000

 724,000

 -38
 %

 Research and development

 278,000

 1,685,000

 -84
 %

 Depreciation and Amortization

 1,119,000

 1,120,000

 %

 Rent and utilities

 32,000

 -

 N/A

 Impairment of fixed assets

 263,000

 -

 N/A

 Impairment of goodwill

 -

 N/A

 Other operating expenses

 171,000

 119,000

 %

 Total
 costs and expenses

 $
 28,753,000

 $
 4,028,000

 %

 Selling,
general and administrative compensation costs increased 122% for the year ended December 31, 2024, as compared to the year ended
December 31, 2023 due to increases in head count at the Company due to increased cost incurred associated with the Company's registration
with the SEC and the NYSE American, and efforts toward the Company's IPO.

 Stock
based compensation includes expense charges for all stock-based awards to employees, directors, and consultants. Such awards can
include option grants, warrant grants, and restricted and unrestricted stock awards. These types of awards were not used prior to the
Company's IPO in September 2024.

 Sales
and marketing costs, which includes internet and trade publication advertising, travel and entertainment costs, sales-broker commissions,
and trade show participation expenses, increase 874% during 2024 as compared to 2023, primarily due to increased associated with cost
to attend trade shows and marketing efforts pre and post IPO

 Professional
fees decreased 38% for the year ended December 31, 2024, as compared to year ended December 31, 2023. These costs consist primarily
of consulting and legal services associated with developing and implementing Impact BioMedical's business plan, These costs decreased
in 2024 in anticipation of the Company's IPO.

 Research
and development costs represent costs consisting primarily of independent, third-party testing of the various properties of each
technology the Company owns possesses as well as research on new technologies. Research and development decreased 84% for the year ended
December 31, 2024, as compared to year ended December 31, 2023 due to several cost-cutting activities inclusive of the cessation of the
Company's research and development contract with GRDG at the end of 2023.

 Depreciation
and amortization expense remained flat for year ended December 31, 2024 compared to year ended December 31, 2023 and represents the
amortization of the associated with the developed technology and patents acquired as part of the acquisition of Impact BioMedical by
DSS. Amortization of these assets began on January 1, 2021, and will have a 20-year term.

 Rent
and utilities represents cost associated with office space located at 1400 Broadfield Blvd, Suite 100 Houston TX which the Company
began subletting from DSS during the first quarter of 2024.

 Impairment of fixed asset is
the impairment of marketing assets in development that the Company decided to forego completion.

 Impairment
of goodwill during the 4th quarter of 2024, the Company performed qualitative and quantitative assessments of the goodwill value
associated with the Company determined that as of December 31, impairment was required (see Note 7).

 Other
operating expenses consist primarily of office supplies, IT support, sales and marketing costs, travel and insurance costs. These
costs increased 44% for year ended December 31, 2024, as compared to year ended December 31, 2023, primarily due to increased IT support
and travel costs.

 Other
Income (Expense)

 Year
 ended

 31, 2024

 Year
 ended

 %

 Interest income

 $

 $

 %

 Other income (expense)

 -

 52,000

 -100
 %

 Change in fair value of note payable, related
 party

 5,068,000

 -

 N/A

 Interest expense

 (1,065,000
)

 (444,000
)

 %

 Total
 other income (expense)

 $
 4,016,000

 $
 (379,000
)

 1160
 %

 Interest
income is recognized on the Company's notes receivables. Interest income remained flat for year ended December 31, 2024 as
compared to the year ended December 31, 2023 as the outstanding principal balance remained flat.

 Other
income represents income generated from the Company's distribution agreement with BioMed Technologies ("BioMed").
during the first quarter of 2023. BioMed's products focus on natural probiotics.

in fair value of note payable, related party is related to the promissory note with DSS ("DSS Note"). During the fiscal
year ended 2024, the Company amended the terms of its outstanding principal balance of the DSS Note. Previously, the Note required repayment
solely in cash; however, pursuant to the second amendment executed which went into effect on September 16, 2024, the Company now has
the option to settle the Note in either cash or shares of the Company's common stock, subject to certain conditions. In accordance with
ASC 480, Distinguishing Liabilities and Equity, and ASC 825, Financial Instruments, the Company remeasured the fair value
of the DSS Note as of the modification date and again as of December 31, 2024. As a result, the Company recognized a fair value adjustment
of $5,068,000 for the year ended December 31, 2024 (see Note 9).

 Interest
expense is recognized on the Company's debt to DSS increased year over year due to the increase in debt balance year over year.

 Net
Loss

 Year
 ended
 31, 2024

 Year
 ended

 %

 Net
loss

 $
 (24,770,000
)

 $
 (4,407,000
)

 -462
 %

 For
the year ended December 31, 2024, the Company recorded net loss of $24,770,000, as compared to a net loss of $4,407,000 for the year
ended December 31, 2023. The increase in net loss over year is attributable to the Company's impairment of
goodwill as of December 31, 2024 offset by cost cutting measures in taken with both its professional and research and development
costs as the Company shifts efforts to taking to market its existing technologies as well as the change in fair value of with the
amended Note payable, related party.

 Liquidity
and Capital Resources

 The
Company has historically met its liquidity and capital requirements primarily through debt financing. On September 16, 2024, the Company
completed an initial public offering raising $3,726,000 net of issuance costs and is currently listed on the NYSE American under the
ticker symbol IBO. The Company's management intends to take additional actions necessary to continue as a going concern. Management's
plans concerning these matters include, among other things, monetization of its intellectual properties, and tightly controlling operating
costs.

 Cash
Flow from Operating Activities

 Net
cash used by continuing operating activities was $3,919,000 for the year ended December 31, 2024 as compared to cash used for
operating activities of $2,851,000 for the year ended December 31, 2023. This increase is driven by the increase in Operating loss
adjusted for reconciling items from operations of approximately $300,000 year over year as well as the decrease in accounts payable and
the increase of prepaid expenses and other current assets.

 Cash
Flow from Investing Activities

 Net
cash provided by investing activities was $2,000 for the year ended December 31, 2024 as compared to net cash used of $15,000 for the
year ended December 31, 2023. This fluctuation is driven by the purchase of property, plant and equipment of $18,000 during the year
ended December 31, 2023 without similar activities during 2024.

 Cash
Flow from Financing Activities

 Net
cash provided by financing activities for the year ended December 31, 2024 was $5,915,000 and represents $2,189,000 in borrowings from
DSS and $3,726,000 in proceeds from the Company's IPO, net of issuances costs. Net cash provided by financing activities for the
year ended December 31, 2023 was $2,865,000 and represents borrowings from DSS.

 Continuing
Operations and Going Concern

 The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. This basis
of accounting contemplates the recovery of our assets and the satisfaction of liabilities in the normal course of business. As reflected
in the accompanying financial statements the Company has incurred operating losses as well as negative cash flows from operating activities over the past two years. These factors raise substantial doubt about the Company's ability to continue as
a going concern within one year of the date that the financial statements are issued. These consolidated financial statements do not
include any adjustments to the specific amounts and classifications of assets and liabilities, which might be necessary should we be
unable to continue as a going concern.

 To
continue as a going concern, the Company completed an initial public offering on September 16, 2024 raising $3,726,000 net of issuance
costs and is currently listed on the NYSE American under the ticker symbol IBO. The Company's management intends to take additional
actions necessary to continue as a going concern. Management's plans concerning these matters include, among other things, monetization
of its intellectual properties, and tightly controlling operating costs.

 Off-Balance
Sheet Arrangements

 We
do not have any off-balance sheet arrangements that have, or are reasonably likely to have, an effect on our financial condition, financial
statements, revenues or expenses.

 Inflation

 Although
our operations are influenced by general economic conditions, we do not believe that inflation had a material effect on our results of
operations during 2024 or 2023.

 Critical
Accounting Policies

 The
preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make judgments, assumptions
and estimates that affect the amounts reported in our financial statements and accompanying notes. The financial statements as of December
31, 2024, describe the significant accounting policies and methods used in the preparation of the financial statements. There have been
no material changes to such critical accounting policies as of the Annual Report on Form 10-K for the year ended December 31, 2024.

 Fair
Value of Financial Instruments

 Fair
value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The Fair Value Measurement Topic of the Financial Accounting Standards Board ("FASB")
Accounting Standards Codification ("ASC") establishes a three-tier fair value hierarchy which prioritizes the inputs used
in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets
or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets.

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted
prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active;
and

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions,
such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

 The
carrying amounts reported in the balance sheet of cash and cash equivalents, prepaids, accounts payable and accrued expenses approximate
fair value because of the immediate or short-term maturity of these financial instruments. The fair value of notes receivable approximates
their carrying value as the stated or discounted rates of the notes do reflect recent market conditions. The Company's investments
are recorded at cost as the fair value of these investment in is not readily available. The fair value of notes payable approximates
its carrying value as the stated interest rate reflects recent market conditions.

 Investments

 Investments
in equity securities with a readily determinable fair value, not accounted for under the equity method, are recorded at fair value with
unrealized gains and losses included in earnings. For equity securities without a readily determinable fair value, the investment is
recorded at cost, less any impairment, plus or minus adjustments related to observable transactions for the same or similar securities,
with unrealized gains and losses included in earnings.

 For
equity method investments, the Company regularly reviews its investments to determine whether there is a decline in fair value below
book value. If there is a decline that is other-than-temporary, the investment is written down to fair value.

is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities assumed in a business
combination. Goodwill is subject to impairment testing at least annually and will be tested for impairment between annual tests if an
event occurs or circumstances change that would indicate the carrying amount may be impaired. FASB ASC Topic 350 provides an entity with
the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination
that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Some of the qualitative factors
considered in applying this test include consideration of macroeconomic conditions, industry and market conditions, cost factors affecting
the business, and overall financial performance of the business. If, after completing the assessment, it is determined that it is more
likely than not that the fair value of a reporting unit is less than its carrying value, the Company will proceed to a quantitative test.
If qualitative factors are not deemed sufficient to conclude that the fair value of the reporting unit more likely than not exceeds its
carrying value, then a one-step approach is applied in making an evaluation. The evaluation utilizes multiple valuation methodologies,
including a market approach (market price multiples of comparable companies) and an income approach (discounted cash flow analysis).
The computations require management to make significant estimates and assumptions, including, among other things, selection of comparable
publicly traded companies, the discount rate applied to future earnings reflecting a weighted average cost of capital, and earnings growth
assumptions. The Company believes the estimates and assumptions used in our impairment assessments are reasonable and based on available
market information, but variations in any of the assumptions could result in materially different calculations of fair value and determinations
of whether or not an impairment is indicated. A discounted cash flow analysis requires management to make various assumptions about future
sales, operating margins, capital expenditures, working capital, and growth rates. Cash flow projections are derived from one-year budgeted
amounts plus an estimate of later period cash flows, all of which are determined by management. Subsequent period cash flows are developed
for each reporting unit using growth rates that management believes are reasonably likely to occur. Impairment of goodwill is measured
as the excess of the carrying amount of goodwill over the fair values of recognized and unrecognized assets and liabilities of the reporting
unit. Impairment testing was performed as of December 31, 2024 and the Company deemed it appropriate to fully impair goodwill as of December
31, 2024.

 Intangible
Assets

 The
estimated fair values of acquired intangibles are generally determined based upon future economic benefits such as earnings and cash
flows. Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated useful lives. Acquired
intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually as of December 31 st,
or more frequently whenever events or changes in circumstances indicate that the carrying amounts of those assets are below their estimated
fair values. Impairment is tested under ASC 350. No impairment was recognized as of December 31, 2024 or year ended December 31, 2023.

 Continuing
Operations and Going Concern

 The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. This basis
of accounting contemplates the recovery of our assets and the satisfaction of liabilities in the normal course of business. As reflected
in the accompanying financial statements the Company has incurred operating losses as well as negative cash flows from operating activities
over the past two years. These factors raise substantial doubt about the Company's ability to continue as a going concern within
one year of the date that the financial statements are issued. These consolidated financial statements do not include any adjustments
to the specific amounts and classifications of assets and liabilities, which might be necessary should we be unable to continue as a
going concern.

 To
continue as a going concern, the Company completed an initial public offering on September 16, 2024 raising $3,726,000 net of issuance
costs and is currently listed on the NYSE American under the ticker symbol IBO. The Company's management intends to take additional
actions necessary to continue as a going concern. Management's plans concerning these matters include, among other things, monetization
of its intellectual properties, and tightly controlling operating costs.

 The
Company has adopted ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"). The Company enters
into licensing and development agreements with collaborators for the development of its technologies. The terms of these agreements contain
multiple performance obligations which may include (i) licenses, or options to obtain licenses, to the Company's technology, (ii)
rights to future technological improvements, and/or (iii) research activities to be performed on behalf of the collaborative partner,
Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments based upon the achievement
of certain milestones, and royalties on product sales. Revenue is recognized when a customer obtains control of promised goods or services,
in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In determining
the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following
steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services
are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction
price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and
(v) recognition of revenue when or as the Company satisfies each performance obligation.

 The
Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it
is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined
to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that
are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the
amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied.

 ITEM
7A - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 Not
applicable.

 ITEM
8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 Financial
Statements

 IMPACT
BIOMEDICAL INC

 TABLE
OF CONTENTS

 Page

 Report of Independent Registered Public Accounting Firm (PCAOB ID: 606)

 Financial Statements:

 Balance Sheets

 Statements of Operations

 Statements of Cash Flows

 Statements of Changes in Stockholders' Equity

 Notes
 to the Consolidated Financial Statements

 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To the Board of Directors and Stockholders of

Biomedical, Inc.

 Opinion
on the Financial Statements

 We
have audited the accompanying consolidated balance sheets of Impact Biomedical, Inc., and its subsidiaries (the "Company")
as of December 31, 2024 and 2023, and the related consolidated statements of operations, changes in stockholders' equity, and cash
flows for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial
statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the
Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the year then ended, in conformity
with accounting principles generally accepted in the United States of America.

 Substantial
Doubt Regarding the Company's Ability to Continue as a Going Concern

 The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note
2 to the financial statements, the Company has incurred operating losses as well as negative cash flows from operating activities over
the past two years. These factors raise substantial doubt about the Company's ability to continue as a going concern within one
year of the date that the financial statements are issued. Management's plans in regard to these matters are described in Note
2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not
modified with respect to this matter.

 Basis
for Opinion

 These
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting
Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits,
we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

 GRASSI
 & CO., CPAs, P.C.

 We
have served as the Company's auditor since 2022.

 Jericho,
New York

 March

 I mpact
BioMedical, Inc. and Subsidiaries

Balance Sheets

 As
of December 31,

 2024

 2023

 ASSETS

 Current assets:

 Cash and cash
 equivalents

 $

 $
 1,000

 Other
 receivables

 -

 128,000

 Current portion of notes
 receivable

 184,000

 203,000

 Prepaid
 expenses and other current assets

 265,000

 -

 Total current assets

 2,448,000

 332,000

 Property, plant and equipment, net

 17,000

 287,000

 Notes receivable

 17,000

 -

 -

 Other intangible assets,
 net

 17,808,000

 18,921,000

 Total
 assets

 $
 20,290,000

 $
 44,633,000

 LIABILITIES AND STOCKHOLDERS'
 EQUITY

 Current liabilities:

 Accounts payable

 $
 713,000

 $
 832,000

 Accrued
expenses

 194,000

 230,000

 Note
 payable, related party

 8,878,000

 12,074,000

 Total current liabilities

 9,785,000

 13,136,000

 Deferred tax liability,
 net

 3,268,000

 3,235,000

 Total liabilities

 13,053,000

 16,371,000

 Commitments and contingencies
 (Note 12)

 -

 -

 Stockholders' equity

 Preferred stock, $.001 par value; 100,000,000
 shares authorized, 60,496,041 shares issued and outstanding ( 60,496,041 on December 31, 2023); Liquidation value $ 0.001 per share,
 $ 60,000 aggregate. $ 60,000 on December 31, 2023).

 Common stock, $.001 par value; 4,000,000,000
 shares authorized, 11,503,955 shares issued and outstanding ( 10,000,000 on December 31, 2023)

 11,000

 10,000

 Additional paid-in capital

 41,857,000

 Accumulated
 deficit

 ( 37,669,000
)

 ( 12,961,000
)

 Total
 stockholders' equity of the Company

 4,259,000

 25,222,000

 Non-controlling
 interest in subsidiaries

 2,978,000

 3,040,000

 Total stockholders'
 equity

 7,237,000

 28,262,000

 Total
 liabilities and stockholders' equity

 $
 20,290,000

 $
 44,633,000

 See
accompanying notes.

 I mpact
BioMedical, Inc. and Subsidiaries

Statements of Operations

 For
the Years Ended December 31,

 2024

 2023

 2024

 2023

 Costs and expenses:

 Sales,
 general and administrative compensation (inclusive of stock based compensation)

 $
 718,000

 $
 315,000

 Sales and marketing

 633,000

 65,000

 Professional Fees

 446,000

 724,000

 Research and development

 278,000

 1,685,000

 Depreciation and Amortization

 1,119,000

 1,120,000

 Rent and utilities

 32,000

 -

 Impairment of fixed assets

 263,000

 -

 Impairment of goodwill

 -

 Other
 operating expenses

 171,000

 119,000

 Total costs and expenses

 28,753,000

 4,028,000

 Operating loss

 ( 28,753,000
)

 ( 4,028,000
)

 Other
 income (expense):

 Interest income

 Other income

 -

 52,000

 Change in fair value of
 note payable, related party

 5,068,000

 -

 Interest
 expense

 ( 1,065,000
)

 ( 444,000
)

 Loss from
 operations before income taxes

 ( 24,737,000
)

 ( 4,407,000
)

 Income tax expense

 ( 33,000
)

 -

 Net
 loss

 $
 ( 24,770,000
)

 $
 ( 4,407,000
)

 Loss
 from operations attributed to noncontrolling interest

 62,000

 71,000

 Net
 income (loss) attributable to common stockholders

 $
 ( 24,708,000
)

 $
 ( 4,336,000
)

 Earnings (loss) per common
 share:

 Basic

 $
 ( 2.30
)

 $
 ( 0.07
)

 Diluted

 $
 ( 2.30
)

 $
 ( 0.07
)

 Shares used earnings (loss) per common share:

 Basic

 10,757,147

 60,248,078

 Diluted

 10,757,147

 60,248,078

 See
accompanying notes.

 I mpact
BioMedical, Inc. and Subsidiaries

Statements of Cash Flows

 For
the Years Ended December 31,

 2024

 2023

 Cash flows from operating
 activities:

 Net loss

 $
 ( 24,770,000
)

 $
 ( 4,407,000
)

 Adjustments
 to reconcile net loss to net cash used by operating activities:

 Depreciation and amortization

 1,119,000

 1,120,000

 Stock based compensation

 -

 Change in fair value of
 note payable, related party

 ( 5,068,000
)

 -

 Change in deferred tax liability

 33,000

 -

 Impairment
 of fixed assets

 263,000

 -

 Impairment of goodwill

 Decrease (increase) in
 assets:

 Other receivable

 128,000

 ( 128,000
)

 Prepaid expenses and other
 current assets

 ( 265,000
)

 104,000

 Increase (decrease) in
 liabilities:

 Accounts payable

 ( 436,000
)

 293,000

 Accrued
 expenses

 ( 35,000
)

 167,000

 Net cash used by operating
 activities

 ( 3,919,000
)

 ( 2,851,000
)

 Cash flows from investing
 activities:

 Purchase of property, plant
 and equipment

 -

 ( 18,000
)

 Payments
 received on notes receivable

 2,000

 3,000

 Net
 cash provided (used) by investing activities

 2,000

 ( 15,000
)

 Cash flows from financing
 activities:

 Borrowings from revolving
 lines of credit, net

 2,189,000

 2,865,000

 Issuances
 of common stock, net of issuance costs

 3,726,000

 -

 Net cash provided by
 financing activities

 5,915,000

 2,865,000

 Net increase (decrease)
 in cash

 1,998,000

 ( 1,000
)

 Cash
 and cash equivalents at beginning of year

 1,000

 2,000

 Cash
 and cash equivalents at end of year

 $

 $
 1,000

 See
accompanying notes.

 I mpact
BioMedical, Inc. and Subsidiaries

Statements of Changes in Stockholders' Equity

 For
the Years Ended December 31,

 Capital

 Deficit

 Equity

 Subsidiary

 Total

 Common
 Stock

 Preferred
 Stock

 Additional
 Paid-in

 Accumulated

 Total

 Non-
 controlling Interest in

 Capital

 Deficit

 Equity

 Subsidiary

 Total

 Balance, December 31, 2022

 70,496,041

 $
 70,000

 -

 $
 -

 $

 $
 ( 8,625,000
)

 $
 29,558,000

 3,111,000

 $
 32,669,000

 Conversion of common stock to preferred stock

 ( 60,496,041
)

 ( 60,000
)

 -

 -

 -

 -

 -

 Net loss

 -

 -

 -

 -

 -

 ( 4,336,000
)

 ( 4,336,000
)

 ( 71,000
)

 ( 4,407,000
)

 Balance, December 31,
 2023

 10,000,000

 $
 10,000

 $

 $

 $
 ( 12,961,000
)

 $
 25,222,000

 $
 3,040,000

 $
 28,262,000

 Balance, December 31, 2023

 10,000,000

 $
 10,000

 $

 $

 $
 ( 12,961,000
)

 $
 25,222,000

 $
 3,040,000

 $
 28,262,000

 Balance

 10,000,000

 $
 10,000

 $

 $

 $
 ( 12,961,000
)

 $
 25,222,000

 $
 3,040,000

 $
 28,262,000

 Issuance of common stock, net of expenses

 1,500,000

 1,000

 -

 -

 3,725,000

 -

 3,726,000

 -

 3,726,000

 Fractional shares as a result of reverse stock
 split

 3,955

 -

 -

 -

 -

 -

 -

 -

 -

 Stock based payments

 -

 -

 -

 -

 -

 -

 Net (loss) income

 -

 -

 -

 -

 -

 ( 24,708,000
)

 ( 24,708,000
)

 ( 62,000
)

 ( 24,770,000
)

 Balance, December 31,
 2024

 11,503,955

 $
 11,000

 $

 $
 41,857,000

 $
 ( 37,669,000
)

 $
 4,259,000

 $
 2,978,000

 $
 7,237,000

 Balance

 11,503,955

 $
 11,000

 $

 $
 41,857,000

 $
 ( 37,669,000
)

 $
 4,259,000

 $
 2,978,000

 $
 7,237,000

 See
accompanying notes.

BioMedical Inc and Subsidiaries

 NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS

 1.
 DESCRIPTION OF BUSINESS

 By
leveraging technology and new science with strategic partnerships, we provide advances in biopharmaceuticals, over the counter direct
to consumer wellness offerings, and drug discovery for the prevention, inhibition, and treatment of neurological, oncologic, and inflammatory
diseases. In addition to our existing efforts, we continually search for, and evaluate, other potential new offerings to add to our portfolio.

 Our
business model includes partnering and potentially direct sales for commercialization and distribution. Potential licensors and development
partners include pharmaceutical, consumer packaged goods companies and others, who would commercialize IBO technologies in exchange for
milestone, and royalty payments. Currently, our operations are conducted, and our assets are owned through our principal subsidiaries:
(i) Global BioLife, Inc. ("Global BioLife"), which was incorporated on April 14, 2017, (ii) Impact BioLife Science, Inc.
("Impact BioLife"), which was incorporated on August 28, 2020, (iii) Global BioMedical, Inc. ("Global BioMedical"),
which was incorporated on April 18, 2017, and (iv) Sweet Sense, Inc. ("Sweet Sense"), which was incorporated on April 30,
2018.

is a platform of small molecule electrophilically enhanced polyphenol compounds with potential application in oncology (solid tumors),
inflammatory disorders, and neurology. Polyphenols are substances found in many nuts, vegetables, and berries. Linebacker compounds are
modified Myricetin, which is a common plant-derived flavonoid. Myricetin exhibits a wide range of activities that include strong antioxidant
and anti-inflammatory activities (source: NIH).

can potentially be developed as monotherapy or co-therapy to down-regulate PIM (proviral integration site for Moloney murine leukemia
virus) kinase which plays a key role as an oncogene in various cancers (e.g. colon, lung, prostate, breast). Additional potential applications
include inflammatory disorders and neurology.

 Linebacker-1
and Linebacker-2 compounds have been licensed to ProPhase Laboratories (NASDAQ: PRPH) for development and commercialization worldwide,
from which Impact Biomedical could receive future milestone and royalty payments.

technology demonstrates compelling potential in reducing caloric intake and glycemic index in foods, while also inhibiting tumor necrosis
factor alpha (TNF-), a cytokine associated with inflammatory chronic diseases (data on file with IBO).

 The
patented formulation has potential to inhibit the inflammatory and metabolic response of sugar alone and has potential applications in
therapeutic administration to reduce or limit inflammatory or metabolic diseases (e.g., diabetes). Use of Laetose in a daily diet, compared
to sugar, could result in 30% lower sugar consumption and lower caloric and glycemic index/load.

 Functional
Fragrance Formulation ("3F")

 3F
is a suite of "functional fragrances" containing specialized botanical ingredients (e.g., terpenes) with potential application
as an antimicrobial, or as an additive in insect repellents, detergents, lotions, shampoo, fabrics and other substances to increase effectiveness.
Global BioLife is seeking to commercialize this product. Together with Chemia, we are 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 20- year Royalty Agreement.

 Equivir

G technology is a novel blend of FDA Generally Recognized as Safe (GRAS) eligible polyphenols (e.g. Myricetin, Hesperetin, Piperine)
which have demonstrated antiviral effects with additional potential application as health supplements or medication. Polyphenols are
substances found in many nuts, vegetables, and berries. Myricetin is a member of the flavonoid class of polyphenolic compounds with antioxidant
properties. Hesperitin is a flavanone and Piperine is an alkaloid, commonly found in black pepper. Equivir/Equivir G is licensed to ProPhase
Laboratories for development and commercialization worldwide

 2.
 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 Principles
of Consolidation – The Company's consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America ("U.S. GAAP"). The consolidated financial statements include
all accounts of the Company and its majority owned and controlled subsidiaries. The Company consolidates entities in which it owns more
than 50 % of the voting common stock and controls operations. All intercompany transactions and balances among consolidated subsidiaries
have been eliminated. Non–controlling interest represents the minority equity investment in the Company's subsidiaries, plus
the minority investors' share of the net operating results and other components of equity relating to the non–controlling
interest.

 The
consolidated financial statements include all accounts of the entities as of the reporting period ending dates and for the reporting
periods as follows:

 SCHEDULE
OF CONSOLIDATED FINANCIAL STATEMENTS INCLUDE ENTITIES REPORTING PERIOD AND ATTRIBUTABLE INTEREST

 Name of consolidated

 subsidiary

 State or
 other
 jurisdiction of
 incorporation or
 organization

 Date of
incorporation

 or formation

 Attributable

 interest as of
 December 31, 2024

 Attributable

 interest as of
 December 31, 2023

 Global BioMedical, Inc.

 April 18, 2017

 90.9
 %

 90.9
 %

 Global BioLife, Inc.

 April 14, 2017

 81.8
 %

 81.8
 %

 BioLife Sugar, Inc

 April 23, 2018

 90.9
 %

 90.9
 %

 Happy Sugar Inc

 August 17, 2018

 81.8
 %

 81.8
 %

 Sweet Sense Inc.

 April 30, 2018

 95.5
 %

 95.5
 %

 Global Sugar Solutions Inc.

 November 7, 2019

 %

 %

 As
of December 31, 2024, and December 31, 2023, the aggregate noncontrolling interest was equity of $ 2,978,000 and $ 3,040,000, respectively,
which are separately disclosed on the Consolidated Balance Sheets.

 Use
of Estimates – The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
as of the dates of the balance sheets and reported amounts of revenues and expenses during the reporting periods. Actual results could
differ from these estimates.

 Reclassifications
 - Costs associated with Professional fees for the years ended December 31, 2024, and 2023 have been reclassified to Research
and development to conform with current period presentation. For the year ended December 31, 2023, Sales and marketing costs have been reclassified from Other operating costs
to Sales and marketing to conform with current period presentation.

 Earnings
(Loss) per Share - Basic earnings (loss) per share is computed by dividing the net income (loss) attributable to the common
stockholders by weighted average number of shares of common stock outstanding during the period. Fully diluted earnings (loss) per share
is computed like basic income (loss) per share except that the denominator is increased to include the number of additional common shares
that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Dilutive
financial instruments issued or outstanding for the years ended December 31, 2024 include 60,496,041 shares of Series A Convertible Preferred
Shares which are not eligible for conversion until April 10, 2027, 880,000 options priced at $ 3.00 per share expiring on October 31,
2031 and 75,000 warrants priced at $ 3.75 per share expiring on June 13, 2025.

 There
were no dilutive financial instruments issued or outstanding for the year ended December 31, 2023.

 Fair
Value of Financial Instruments – Fair value is defined as the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurement Topic
of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") establishes a
three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to
unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable
inputs (Level 3 measurements). These tiers include:

Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets.

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted
prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active;
and

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions,
such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

 The
carrying amounts reported in the balance sheet of cash, other receivables, accounts payable and accrued expenses approximate fair value because
of the immediate or short-term maturity of these financial instruments. The fair value of notes receivable approximates their carrying
value as the stated or discounted rates of the notes do reflect recent market conditions. Notes payable, related party are recorded at fair value based on several factors (see Note 9).

 Notes
receivable, unearned interest, and related recognition – The Company records all future payments of principal and interest
on notes as notes receivable, which are then offset by the amount of any related unearned interest income. For financial statement purposes,
the Company reports the net investment in the notes receivable on the consolidated balance sheet as current or long-term based on the
maturity date of the underlying notes. Such net investment is comprised of the amount advanced on the loans, adjusting for net deferred
loan fees or costs incurred at origination, amounts allocated to warrants received upon origination, and any payments received in advance,
if applicable. The unearned interest is recognized over the term of the notes and the income portion of each note payment is calculated
so as to generate a constant rate of return on the net balance outstanding. Net deferred loan fees or costs, together with discounts
recognized in connection with warrants acquired at origination, are accreted as an adjustment to yield over the term of the loan.

 Recent
Accounting Standards - The Financial Accounting Standards Board (FASB) issues various Accounting Standards Updates relating to
the treatment and recording of certain accounting transactions. There are several new accounting pronouncements issued by FASB which
are not yet effective. Each of these pronouncements, as applicable, has been or will be adopted by the Company. As of December 31, 2024,
none of these pronouncements is expected to have a material effect on the financial position, results of operations or cash flows of
the Company.

 In
November 2023, the Financial Accounting Standards Board ("FASB"), issued Accounting Standards Update ("ASU")
2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which improves reportable segment disclosure
through enhanced disclosures about significant segment expenses. The amendment is effective for fiscal years beginning after December
15, 2023 and for interim periods within fiscal years beginning after December 15, 2024 and early adoption is permitted. The amendments
should be applied retrospectively to all prior periods presented in the financial statements. The Company has adopted the enhanced segment
disclosures of the year ended December 31, 2024. The Company reports its segment information to reflect the manner in which the Company's
chief operating decision maker ("CODM") reviews and assesses performance. The Company's Chief Executive Officer and
Chief Operating Officer have joint responsibilities as the CODM and review and assess the performance of the Company as a whole.

 The
primary financial measures used by the CODM to evaluate performance and allocate resources are net income (loss) and operating income
(loss). The CODM uses net income (loss) and operating income (loss) to evaluate the performance of the Company's ongoing operations
and as part of the Company's internal planning and forecasting processes. Information on Net income (loss) and Operating income
(loss) is disclosed in the Consolidated Statements of Operations. Segment expenses and other segment items are provided to the CODM on
the same basis as disclosed in the Consolidated Statements of Operations.

 The
CODM does not evaluate performance or allocate resources based on segment assets, and therefore such information is not presented in
the notes to the financial statements

 In
December 2023, the FASB issued ASU 2023-09, "Improvements to Income Tax Disclosures" which is intended to simplify various
aspects related to accounting for income taxes. ASU 2023-09 removes certain exceptions to the general principles in Topic 740
and also clarifies and amends existing guidance to improve consistent application. The amendments in ASU 2023-09 are effective
for public business entities for fiscal years beginning after December 15, 2024, including interim periods therein. Early adoption of
the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued.
The Company is currently evaluating this ASU, but does not expect it to have material impact to its financial statements.

 In
November 2024, the FASB issued ASU No. 2024-03 ("ASU 2024-03"), Disaggregation of Income Statement Expenses ("DISE"). ASU
2024-03 requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 does
not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain
expense captions into specified categories in disclosures within the footnotes to the financial statements. As revised by ASU No. 2025-01,
Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, the provisions of ASU 2024-03 are
effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027,
with early adoption permitted. With the exception of expanding disclosures to include more granular income statement expense categories,
we do not expect the adoption of ASU 2024-03 to have a material effect on our consolidated financial statements taken as a
whole.

 Property,
Plant and Equipment – Property, plant and equipment are recorded at cost. Depreciation is computed using the straight-line
method over the estimated useful lives or lease period of the assets whichever is shorter. Expenditures for renewals and betterments
are capitalized. Expenditures for minor items, repairs and maintenance are charged to operations as incurred. Any gain or loss upon sale
or retirement due to obsolescence is reflected in the operating results in the period the event takes place.

 Research
and Development - Research and development costs are expensed as incurred. Total research and development costs were $ 555,000
for the year ended December 31, 2024, and $ 1,685,000 for year ended December 31, 2023.

 Goodwill –
Goodwill is the excess of cost of an acquired entity over the fair value of amounts assigned to assets acquired and liabilities
assumed in a business combination. Goodwill is subject to impairment testing at least annually and will be tested for impairment
between annual tests, which takes place during the fourth quarter, if an event occurs or circumstances change that would indicate
the carrying amount may be impaired. FASB ASC Topic 350 provides an entity with the option to first assess qualitative factors to
determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair
value of a reporting unit is less than its carrying amount. Some of the qualitative factors considered in applying this test include
consideration of macroeconomic conditions, industry and market conditions, cost factors affecting the business, and overall
financial performance of the business. If, after completing the assessment, it is determined that it is more likely than not that
the fair value of a reporting unit is less than its carrying value, the Company will proceed to a quantitative test. If qualitative
factors are not deemed sufficient to conclude that the fair value of the reporting unit more likely than not exceeds its carrying
value, then a one-step approach is applied in making an evaluation. The evaluation utilizes an income approach (discounted cash flow
analysis). The computations require management to make significant estimates and assumptions, including, among other things,
selection of comparable publicly traded companies, the discount rate applied to future earnings reflecting a weighted average cost
of capital, and earnings growth assumptions. The Company believes the estimates and assumptions used in our impairment assessments
are reasonable and based on available market information, but variations in any of the assumptions could result in materially
different calculations of fair value and determinations of whether or not an impairment is indicated. A discounted cash flow
analysis requires management to make various assumptions about future sales, operating margins, capital expenditures, working
capital, and growth rates. Cash flow projections are derived from one-year budgeted amounts plus an estimate of later period cash
flows, all of which are determined by management. Subsequent period cash flows are developed for each reporting unit using growth
rates that management believes are reasonably likely to occur. Impairment of goodwill is measured as the excess of the carrying
amount of goodwill over the fair values of recognized and unrecognized assets and liabilities of the reporting unit. As of December
31, 2024, the Company fully impaired goodwill. No
impairment was recognized during the year ended December 31, 2023. (Note 7)

 Intangible
Assets - The estimated fair values of acquired intangibles are generally determined based upon future economic benefits such
as earnings and cash flows. Acquired identifiable intangible assets are recorded at fair value and are amortized over their estimated
useful lives. Acquired intangible assets with an indefinite life are not amortized but are reviewed for impairment at least annually
as of December 31 st, or more frequently whenever events or changes in circumstances indicate that the carrying amounts of
those assets are below their estimated fair values. Impairment is tested under ASC 350. No impairment was recognized as of year ended
December 31, 2024 or the year ended December 31, 2023. (Note 9).

 Recoverability
of Long-Lived Assets - We evaluate long-lived assets such as property, equipment and definite lived intangible assets, such as
patents, for impairment whenever events or circumstances indicate that the carrying value of the assets recognized in our financial statements
may not be recoverable. Factors that we consider include whether there has been a significant decrease in the market value of an asset,
a significant change in the way an asset is being utilized, or a significant change, delay or departure in our strategy for that asset,
or a significant change in the macroeconomic environment, such as the impact of the COVID-19 pandemic. Our assessment of the recoverability
of long-lived assets involves significant judgment and estimation. These assessments reflect our assumptions, which, we believe, are
consistent with the assumptions hypothetical marketplace participants use. Factors that we must estimate when performing recoverability
and impairment tests include, among others, forecasted revenue, margin costs and the economic life of the asset. If impairment is indicated,
we determine if the total estimated future cash flows on an undiscounted basis are less than the carrying amounts of the asset or assets.
If so, an impairment loss is measured and recognized.

 Our
impairment loss calculations require that we apply judgment in identifying asset groups, estimating future cash flows, determining asset
fair values, and estimating asset's useful lives. The Company reviews identifiable amortizable intangible assets for impairment
whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Determination of recoverability
is based on the lowest level of identifiable estimated undiscounted cash flows resulting from use of the asset and its eventual disposition.
Measurement of any impairment loss is based on the excess of the carrying value of the asset over its fair value. Based on the uncertainty
of forecasts inherent with a new product, events such as the failure to generate forecasted revenue from new products could result in
a non-cash impairment in future periods.

 - The Company has adopted ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"). The Company
enters into licensing and development agreements with collaborators for the development of its technologies. The terms of these agreements
contain multiple performance obligations which may include (i) licenses, or options to obtain licenses, to the Company's technology,
(ii) rights to future technological improvements, and/or (iii) research activities to be performed on behalf of the collaborative partner,
Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments based upon the achievement
of certain milestones, and royalties on product sales. Revenue is recognized when a customer obtains control of promised goods or services,
in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In determining
the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following
steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services
are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction
price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and
(v) recognition of revenue when or as the Company satisfies each performance obligation.

 The
Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it
is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined
to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that
are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the
amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied.

 Provision
for Credit Losses - The Company adopted amended accounting guidance ASC Topic 326 which requires an allowance for
credit losses to be deducted from the amortized cost basis of financial assets to present the net carrying value at the amount that
is expected to be collected over the contractual term of the asset considering relevant information about past events, current
conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. In estimating expected
losses in the loan and lease portfolio, borrower-specific financial data and macro-economic assumptions are utilized to project
losses over a reasonable and supportable forecast period. Assumptions and judgment are applied to measure amounts and timing of
expected future cash flows, collateral values and other factors used to determine the borrowers' abilities to repay
obligations. After the forecast period, the Company utilizes longer-term historical loss experience to estimate losses over the
remaining contractual life of the loans. As of December 31, 2024 and 2023 the Company has deemed that no reserve on credit losses
were necessary.

 Continuing
Operations and Going Concern - The accompanying consolidated financial statements have been prepared assuming that the Company
will continue as a going concern. This basis of accounting contemplates the recovery of our assets and the satisfaction of liabilities
in the normal course of business. As reflected in the accompanying financial statements the Company has incurred operating losses as
well as negative cash flows from operating activities over the past two years. These factors raise substantial doubt about
the Company's ability to continue as a going concern within one year of the date that the financial statements are issued. These
consolidated financial statements do not include any adjustments to the specific amounts and classifications of assets and liabilities,
which might be necessary should we be unable to continue as a going concern.

 To
continue as a going concern, the Company completed an initial public offering on September 16, 2024 raising $ 3,726,000
 net of issuance costs and is currently listed
on the NYSE American under the ticker symbol IBO. Although there is no certainty that management plans will be able to satisfy the requirements
to continue operating as a going concern, management intends to take additional actions necessary to continue as a going concern. Management's
plans concerning these matters include, among other things, monetization of its intellectual properties, and tightly controlling operating
costs.

 3.
 Financial Instruments

 Cash, Note payable, related party

 The following tables show the Company's cash,
cash equivalents, and note payable, related party by significant investment category as of:

 Schedule of Cash,
Cash Equivalents, Restricted Cash, and Note Payable Related Party by Significant Investment Category

 2024

 Adjusted
 Cost

 Unrealized
 Gain/(Loss)

 Fair
 Value

 Cash and
 Cash
 Equivalents

 Note Payable, Related Party

 Level 1

 Cash

 $

 $
 -

 $

 $

 $
 -

 Level 2

 Note payable, related party

 13,946,000

 ( 5,068,000
)

 8,878,000

 -

 8,878,000

 Total

 $
 15,945,000

 $
 ( 5,068,000
)

 $
 10,877,000

 $

 $
 8,878,000

 2023

 Adjusted
 Cost

 Unrealized
 Gain/(Loss)

 Fair
 Value

 Cash and
 Cash
 Equivalents

 Level 1

 Cash

 $
 1,000

 $
 -

 $
 1,000

 $
 1,000

 Total

 $
 1,000

 $
 -

 $
 1,000

 $
 1,000

 4.
 Notes Receivable

 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, 2026. Monthly payments
are due on the twenty-first day of each month and continuing each month thereafter until February 19, 2026. This note is secured by certain
real property situated in Collier County, Florida. The outstanding principal and interest as of December 31, 2024 is approximately $ 201,000
with $ 184,000 classified in Current portion of notes receivable and $ 17,000 classified as Notes receivable on the accompanying consolidated
balance sheet. The outstanding principal and interest as of December 31, 2023, approximately $ 203,000 and is classified in current notes
receivable on the accompanying consolidated balance sheet.

 5.
 Prepaid Expenses and other current assets

 Prepaid
expenses at December 31, 2024 of $ 265,000 driven by $ 263,000 of prepaid insurance. There were no prepaid expenses for year ended December

 6.
 Property, Plant and Equipment, Net

 Property,
plant and equipment consisted of the following as of:

 Schedule
of Property, Plant and Equipment

 Estimated

 December 31,

 December 31,

 Useful
 Life

 2024

 2023

 Machinery and equipment

 5 - 10 years

 $
 30,000

 $
 25,000

 Construction in progress

 -

 263,000

 Total Cost

 30,000

 293,000

 Less accumulated depreciation

 6,000

 Property, plant and
 equipment, net

 $
 17,000

 $
 287,000

 Depreciation
expense for the years ended December 31, 2024 and 2023 were approximately $ 7,000
and $ 6,000,
respectively.

 7.

balances and activity for the year ended December 31, 2024 and year ended December 31, 2023 consisted of the following:

 Schedule
of Goodwill

 Balance at December 31, 2023

 $

 adjustment

 ( 25,093,000
)

 Balance at December 31, 2024

 $
 -

 As
of December 31, 2024, management performed annual goodwill impairment testing., A quantitative analysis was prepared utilizing the Market Approach and Income Approach
valuing the Company and an impairment of goodwill was identified as result of these tests.

 For
the year ended December 31, 2023, management performed annual goodwill impairment testing and no impairment was deemed necessary.
The guideline public company Market Approach produced a mean business enterprise value indication using estimated 2026 results of
$ 49.8
million. The Income Approach was based upon the use of a discounted pro forma cash flow model and produced a business enterprise
value indication of $ 44.9
million. A weighting of 30 %
to the weighted value indicated was applied under the Market Approach, and a weighting of 70 %
to the value indicated under the Income Approach. A lower weighting was applied to the Market Approach due to the fact of using
forecasted earnings of the Company. Based upon the above weightings, an initial value of $ 46.4
million for Impact was calculated. Adding cash of $ 201,000
to the initial business enterprise value produced a concluded business enterprise value of $ 46.6
million (rounded) for Impact. Subtracting interest-bearing debt of $ 11.9
million, results in a Fair Value for the common equity of Impact of $ 34.7
million. As of September 30, 2023, the indicated equity value exceeded the carrying amount by approximately $ 5.1
million or 14.7 %.

 8.
 Intangible Assets

 The
definite-lived intangible assets, to be amortized over 20 years, balances, and activity for the year ended December 31, 2024 and year ended
December 31, 2023 consisted of the following:

 Schedule
of Intangible Assets

 2024

 2023

 Useful Life

 Gross
 Carrying

 Accumulated
 Amortization

 Net
 Carrying

 Gross
 Carrying

 Accumulated
 Amortization

 Net
 Carrying

 Developed technology assets

 20 years

 $
 22,260,000

 $
 4,452,000

 $
 17,808,000

 $
 22,260,000

 $
 3,339,000

 $
 18,921,000

 $
 22,260,000

 $
 4,452,000

 $
 17,808,000

 $
 22,260,000

 $
 3,339,000

 $
 18,921,000

 The
following table represents future amortization of developed technologies for the years ending December 31:

 Schedule
of Future Amortization of Developed Technologies

 2025

 $

 2026

 $

 2027

 $

 2028

 $

 2029

 $

 Thereafter

 $
 12,243,000

 9.
 NOTE PAYABLE, RELATED PARTY

 On
December 31, 2020, and later amended, the Company executed a Revolving Promissory Note ("Note") with DSS, a related
party, which accrues interest at a rate of 4.25 %
and is due in full at the maturity date of September
30, 2030. The Note was further amended on
July 24, 2024 with an effective date of September 16, 2024 to i) allow the Company to pay certain principal and/or interest payments
owing under the repayment terms in an exchange for potential of equity in the Company, ii) change the quarterly interest due dates
to the last day of each calendar quarter (i.e. December 31, March 31, June 30 and September 30), iii) to adjust the On Demand
feature so that it starts after the 24th month, iv) continue the planned repayment program commencing on the 37th month and on the
last day of each month thereafter through August 31, 2030 to pay a fixed monthly payment of $ 126,381,
v) to continue the scheduled maturity date of September 30, 2030, and vi) adjusts the interest rate to be the WSJ Prime Rate plus 0.50 %.
This Note is secured by the assets of the Company. As of December 31, 2024 and December 31, 2023 the outstanding balance, inclusive
of interest was $ 8,878,000 (net
of change in fair value of the Note of $ 5,068,000)
and $ 12,074,000,
respectively. The $ 8,878,000 is
recorded in Note payable, related party at December 31, 2024. The $ 12,074,000 at
December 31, 2023 is included in Current portion of note payable, related party.

 The Company accounts for this Note as a liability
under ASC 480, Distinguishing Liabilities form Equity ("ASC 480"). In accordance with ASC 825-10, the carrying value
of the Note will be recorded at fair value and will be remeasured at each reporting period with the changes in fair value recognized in
earnings.

 We considered various valuation methodologies
in our analysis of the embedded derivative. Valuation methodologies can generally be aggregated into the following three approaches:
the Market Approach, the Income Approach, and the Cost Approach. Based on our analysis of the facts and circumstances, in estimating
the fair value of the Note payable, related party, we utilized a discounted cash flow method (income approach), in the form of a Monte
Carlo simulation of the Company's stock price and volume weighted average price ("VWAP") throughout 36-month period
from the Effective Date relative to its closing stock price and VWAP as of the Valuation Date, or $2.00 and $2.38, respectively. The
simulated analysis estimates the expected note cash flow from the date the first payment is due and until the equity conversion rights
expire under the terms of the Note payable, related party based on the following steps:

 1)

 Developed
 the Note Payable repayment schedule

 2)

 Developed
 the following inputs underlying the simulation analysis

 i)

 Stock
 price

 ii)

 VWAP

 3)

 Inputs
 (i) and (ii), were assigned a normal probability distribution, which has a mean of 0 and a standard deviation of 1, and a correlation
 of.9885 based on analysis of the guideline public companies

 4)

 Ran
 a simulation with 25,000 trials for purposes of capturing the key inputs discussed above (i.e., forecasting the stock price and VWAP).

 5)

 For
 the period from the 37th payment to maturity date, the DCF Method includes the remaining payments required to be made in cash.

 6)

 Captured
 the results of the simulation and concluded based on the simulation results

 10.
 STOCKHOLDERS' EQUITY

 On May 10, 2023, the Company's Board of Directors approved an amendment to the Articles of Incorporation of
the Company to increase the total number of shares of Common Stock to 4,000,000,000 shares with a par value of $ 0.001. Each share of Common
Stock when issued, shall have one (1) vote on all matters presented to the stockholders. Our Amended and Restated Articles of Incorporation
also authorized 100,000,000 shares of preferred stock, par value $ 0.001 per share. On May 11, 2023, the Company effected a forward split.
As a result, there were 3,877,282,251 shares of our Common Stock and no shares of preferred stock issued and outstanding. Prior to the
split, there were 125,073,621 shares of our Common Stock and no shares of preferred stock issued and outstanding. On October 31, 2023,
the Company effected a reverse stock split of 1 for 55. Also on October 31, 2023, DSS BioHealth Securities, Inc., the Company's
largest shareholder converted 60,496,041 shares of Common Stock into 60,496,041 shares of Series A Convertible Preferred Shares, reducing its ownership of the Company's Common Stock from approximately 88% to approximately 12%. As of December 31, 2023, there were 10,000,000
shares of our Common Stock and 60,496,041 shares of preferred stock issued and outstanding.

 On
August 8, 2023 DSS, the Company's largest shareholder, distributed to its shareholders of record on July 10, 2023 4 shares of Impact
Bio's stock for 1 share they owned. Each share of Impact BioMedical distributed as part of the distribution will not be eligible
for resale until 180 days from the date Impact BioMedical's initial public offering becomes effective under the Securities Act,
subject to the discretion of the Company to lift the restriction sooner.

 On
October 31, 2023, the Company effected a reverse stock split of 1 for 55. As of December 31, 2023 there were 3,877,282,251
 shares of our Common Stock issued and outstanding
which was converted to 70,496,041
 shares. Also on October 31, 2023, DSS BioHealth
Securities, Inc., the Company's largest shareholder converted 60,496,041
 shares of Common Stock into 60,496,041
 shares of Series A Convertible Preferred Shares, reducing its ownership of the Company's Common Stock from approximately 88% to approximately 12%. The Series A Convertible Preferred Shares are
not eligible for conversion until April 10, 2027.

 On September 16, 2024, Impact Biomedical
Inc., entered into an underwriting agreement (the "Underwriting Agreement") with Revere Securities, LLC., as representative
(the "Representative") of the underwriters named therein (the "Underwriters"), pursuant to which the Company
agreed to sell to the Underwriters in a firm commitment initial public offering (the "Offering") an aggregate of 1,500,000
 of the Company's shares of common stock, par value $ 0.001
 per share at a public offering price of $ 3.00
 per share. On September 17, 2024, the Company closed the Offering. The total net proceeds to the Company from the Offering, after
deducting discounts, expenses allowance and expenses, was approximately $ 3,726,000.
A final prospectus relating to this Offering was filed with the Commission on September 16, 2024. The shares of Common Stock were approved
to list on the NYSE American under the symbol "IBO" and began trading there on September 16, 2024. The Company also issued
warrants to the Representative and its affiliates (the "Representative's Warrants") warrants to purchase the number
of shares of Common Stock in the aggregate equal to 5 %
of the Common Stock to be issued and sold in this offering (including any Shares of Common Stock sold upon exercise of the over-allotment
option, if applicable). The Representative's Warrants are exercisable for a price per share equal to 125 %
of the public offering price. The warrants are exercisable at any time, in whole or in part, commencing nine (9) months from the date
of commencement of sales of the offering and ending on the third anniversary thereof. As of September 30, 2024, the Representative had
not exercised any of these warrants. As of September 30, 2024, only the 1,500,000
 shares included in the Offering are freely tradable on the NYSE. The remaining 9,997,703
 are restricted from trading for 180 days from the Offering date.

 Equity
Incentive Plan – During 2023, the Company's shareholders adopted the 2023 Employee, Director and Consultant Equity
Incentive Plan (the "2023 Plan"). The 2023 Plan provides for the issuance of an initial 18,762,000 shares of common stock
authorized to be issued for grants of options, restricted stock and other forms of equity to employees, directors and consultants. In
addition, on the first day of each calendar year, for a period of not more than ten (10) years, commencing January 1, 2025, or the first
business day of the calendar year if the first day of the calendar year falls on a Saturday or Sunday, the shares available under this
plan will automatically increase in an amount equal to the lesser of (i) two percent (2%) of the total number of shares of Common Stock
outstanding as of December 31 of the preceding fiscal year or (ii) such number of shares of Common Stock as determined by the Board of
Directors. Under the terms of the 2023 Plan, options granted thereunder may be designated as options which qualify for incentive stock
option treatment ("ISOs") under Section 422A of the Internal Revenue Code, or options which do not qualify ("NQSOs").
As of December 31, 2024, there are 18,037,079 shares available under this plan.

 Stock-Based
Compensation – The Company records stock-based payment expense related to options and warrants based on the grant date
fair value in accordance with FASB ASC 718. Stock-based compensation includes expense charges for all stock-based awards to employees,
directors and consultants. Such awards include option grants, warrant grants, and restricted stock awards. On October 1, 2024, 880,000
 option grants with a purchase price of $ 3.00
 per share were awarded to certain officers, directors
and consultants of the Company. These options have various vesting periods, and all expire on October 31, 2031. Potential proceeds of
these grants is $ 2,640,000
 and are fair valued using a Black-Scholes model
at approximately $ 50,000.
The Company record stock based compensation expense of approximately $ 19,000
 for the year ended December 31, 2024 and is included
in Sales, general and administrative compensation (inclusive of stock based compensation) on the accompanying Statement of Operations.
 There were no stock-based
payments made during the twelve months ended December 31, 2023.

 11.
 INCOME TAXES

 The
Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the
financial reporting and tax basis of assets and liabilities. Deferred tax assets are reduced, if deemed necessary, by a valuation allowance
for the amount of tax benefits which are not expected to be realized.

 The
components of income tax benefit for the years ended December 31, 2024, and 2023 are as follows:

 SCHEDULE OF COMPONENTS OF INCOME TAX BENEFIT

 Income Tax
 Expense (Benefit)

 Year
 Ended
 31, 2024

 Year
 Ended

 Current tax payable

 Federal

 $-

 $-

 State

 -

 -

 Total current tax payable

 -

 -

 Deferred tax

 Federal

 30,000

 ( 920,000
)

 State

 3,000

 ( 94,000
)

 Total
 deferred tax

 $
 33,000

 $
 ( 1,014,000
)

 Less increase in valuation
 allowance

 -

 1,014,000

 Total income tax expense

 $
 33,000

 $
 -

 Individual
components of deferred tax assets and liabilities are approximately as follows:

 SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

 Deferred Tax
 Assets & Liabilities:

 Deferred Tax assets:

 Impairment of investment

 $
 929,000

 $
 929,000

 Research & development
 cost

 519,000

 538,000

 Compensation

 18,000

 -

 Net
 Operating loss

 2,950,000

 2,087,000

 Gross deferred tax assets

 4,416,000

 3,554,000

 Deferred tax liability:

 Note payable, related party FMV adjustment

 ( 1,148,000
)

 -

 Intangible
 assets

 ( 3,912,000
)

 ( 4,164,000
)

 Gross deferred tax liability

 ( 5,060,000
)

 ( 4,164,000
)

 Less valuation allowance

 ( 2,625,000
)

 ( 2,625,000
)

 Net deferred tax liability

 $
 ( 3,269,000
)

 $
 ( 3,235,000
)

 SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

 2024

 2023

 Statutory United States federal
 rate

 21.0
 %

 21.0
 %

 State income taxes net of federal benefit

 %

 1.7
 %

 Change in valuation allowance

 %

 ( 22.7
)%

 Effective rate

 21.0
 %

 0.0
 %

 As
of December 31, 2024, and 2023, the Company has net operating loss carry forwards of approximately $ 13,020,000 and $ 9,209,000
 respectively. The Company does not have other
temporary differences associated with the amortization of intangible assets. As of December 31, 2024, and 2023, the total deferred tax
assets carry-forward were $ 4,416,000 and
$ 3,554,000,
respectively. The deferred tax assets could be carried forward indefinitely. The full utilization of the deferred tax assets in the future
is dependent upon the Company's ability to generate taxable income. Considering the development stage of the Company, management
believed that it was probable that the Company would not use tax assets in the near future. Accordingly, a valuation allowance of an
equal amount has been established.

 The
Company recognizes interest accrued and penalties related to unrecognized tax benefits in tax expense. During the years ended December
31, 2023 and 2022 the Company recognized no interest and penalties.

 12.
 COMMITMENTS AND CONTINGENCIES

 On
August 15, 2018, the Company entered into Royalty Agreement with Chemia Corporation ("Chemia") pursuant to which Chemia
transferred to the Company all of its right to 3F (Functional Fragrance Formulation). This agreement has a 20-year term and auto
renews for a period of 1 year unless mutually agreed upon by both parties. 3F consists of 3F Mosquito Repellant and 3F Anti-Viral
formulations. Based on the Royalty Agreement, the Company should cover all the costs to prepare and finalize necessary patent
application and other intellectual property related to 3F. Chemia agreed to support the Company in efforts leading to development of
3F intellectual property and it is licensing. Based on Royalty Agreement any payments received from development, sales, licensing or
transfer of 3F technology will be paid 50 %
to the Company and 50 %
to Chemia. On November 27, 2018, Company and Chemia signed an Addendum to Royalty Agreement ("Addendum"), according to
which the Company granted Chemia a royalty-based limited license for purposes of making and selling fragrances embodying the 3F
technology. Based on the Addendum, Chemia should pay the Company 5 %
of net sales in royalty. On November 8, 2019, both companies entered into Amendment no.1 to Royalty Agreement, based on which
certain expenses borne by the Company towards patent application and licensing should be reimbursed to the Company before any
royalty payments are made. For the years ended December 31, 2024 and 2023, there were no
reimbursements or royalties paid to the Company and the Company cannot be assured that Chemia's efforts will end up in any
future sales of the technology.

 On
February 15, 2022, the Company and its subsidiaries, Global BioLife, Inc. ("Global"), and Impact BioLife Sciences, Inc.
("BioLife Sciences"), and GRDG entered into a Licensing Proceeds Distribution Agreement ("GRDG Agreement"),
whereas GRDG would transfer its 20 %
equity position in both Global and BioLife Sciences to the Company in exchange for 20 %
interest in Global and/or BioLife Science revenue received from the exclusive or non-exclusive licensing of and/or the sale of
Global Intellectual Property to a Third Party, net of specific costs. This Licensing Agreement ended in September 2023 as core
technologies achieved significant development milestones.

 On
March 19, 2022, Impact BioMedical entered into a License Agreement ("Equivir License") with a third-party ("Licensee")
where the Licensor is granted the right, amongst other things, to develop, commercialize, and sell the Company's Equivir technology.
In exchange, the Licensee shall pay the Company a royalty of 5.5 % of net sales. Under the terms of the Equivir Agreement, the Company
shall reimburse the Licensee for 50 % of the development costs provided that the development costs shall not exceed $ 1,250,000. As of
December 31, 2024 and December 31, 2023, $ 200,000, and $ 200,000, respectively, have been recorded in relation to the Equivir License as development
of the Equivir technology.

 Employment Agreements – Impact
BioMedical has an employment agreement with it CEO Frank Heuszel in which Mr. Heuszel's agreement contains a mandatory bonus clause
of $ 150,000 for the first year of the employment term, $ 100,000 for the second year of the employment term, and $ 100,000 for the third
year of the employment term. As of December 31, 2024, approximately $ 38,000 is accrued for year one of Mr. Heuszel's bonus.

 Contingent
Litigation Payments – The Company retains the services of professional service providers, including law firms that specialize
in intellectual property licensing, enforcement and patent law. These service providers are often retained on an hourly, monthly, project,
contingent or a blended fee basis. In contingency fee arrangements, a portion of the legal fee is based on predetermined milestones or
the Company's actual collection of funds. The Company accrues contingent fees when it is probable that the milestones will be achieved,
and the fees can be reasonably estimated. As of December 31, 2024, the Company had no t accrued any contingent legal fees pursuant to
these arrangements.

 Contingent
Payments – The Company is not party to any agreements with funding partners who have rights to portions of intellectual
property monetization proceeds that the Company receives.

 13.
 Related Party Transactions

 Research
and Development Activities

 Based
on Shareholders Agreement entered into on April 26, 2017, the Company would fund the scientific operations of GRDG, a company involved
in research and development of biomedical products which is a minority stockholder of two of the Company's subsidiaries and is
owned by Daryl Thompson, a director of many subsidiaries of the Company, to do the development and research works on the biomedical products
for the Company. On February 15, 2022, the Company and its subsidiaries, Global BioLife, Inc. ("Global"), and Impact BioLife
Sciences, Inc. ("BioLife Sciences"), and GRDG entered into a Licensing Proceeds Distribution Agreement ("GRDG Agreement"),
whereas GRDG would transfer its 20 %
equity position in both Global and BioLife Sciences to the Company in exchange for 20 %
interest in Global and/or BioLife Science revenue received from the exclusive or non-exclusive licensing of and/or the sale of Global
Intellectual Property to a Third Party, net of specific costs. As of the date of this report, no contingent liability has been recognized
under the GRDG Agreement. As of December 31, 2024 and 2023, the Company incurred approximately $ 25,000
and $ 447,000,
respectively, in expenses.

 General
and Administrative Costs

 There
are certain general and administrative costs incurred by DSS, a related party, on behalf of the Company which are passed through to
the Company on a monthly basis. These costs consist of primarily payroll costs for certain DSS employees and are allocated based on
estimated time spent on behalf of the Company. Beginning in January 2024 and through September 2024, these costs are approximately
$ 31,000
per month. Beginning October 2024, these costs are approximately $ 26,000 per month. As of December 31, 2024, the Company incurred
$ 357,000
in related expenses. As of December 31, 2023, the Company incurred approximately $ 144,000
in related expenses.

 Note payable, related party

 On December 31, 2020, and later
amended, the Company executed a Revolving Promissory Note ("Note") with DSS, a related party, which accrues interest at
a rate of 4.25 %
and is due in full at the maturity date of September
30, 2030. The Note was further amended on July 24, 2024 with an effective date of September 16, 2024 to i) allow the Company
to pay certain principal and/or interest payments owing under the repayment terms in an exchange for potential of equity in the
Company, ii) change the quarterly interest due dates to the last day of each calendar quarter (i.e. December 31, March 31, June 30
and September 30), iii) to adjust the On Demand feature so that it starts after the 24th month, iv) continue the planned repayment
program commencing on the 37th month and on the last day of each month thereafter through August 31, 2030 to pay a fixed monthly
payment of $ 126,381, v) to
continue the scheduled maturity date of September 30, 2030, and vi) adjusts the interest rate to be the WSJ Prime Rate plus 0.50 %.
As of December 31, 2024 and December 31, 2023 the outstanding balance, inclusive of interest was $ 8,878,000 (net
of change in fair value of the Note of $ 5,068,000)
and $ 12,074,000, respectively. The $ 8,878,000 is
recorded in Note payable, related party at December 31, 2024. The $ 12,074,000 at
December 31, 2023 is included in Current portion of note payable, related party.

 14.
 SUBSEQUENT EVENTS

 The
Company has evaluated all subsequent events and transactions through March 24, 2025, the date that the consolidated financial statements
were available to be issued and noted no subsequent events requiring financial statement recognition or disclosure other than what was
identified below:

 On
February 25, 2025, the Company completed the acquisition of certain assets owned by DSS Pure Air, Inc. ("DSS PureAir"),
a related party, for $ 1,150,000
to be paid by 545,024
shares of the Company's common stock calculated on a 10 day VWAP. Assets acquired included inventory and intellectual
property of the Celios air purification system.

 On February 26, 2025, the Company issued 36,433 shares of the Company's common stock as payment of legal fees incurred associated
with the Company's IPO, registration of shares associated with its equity incentive plan as well as other related services.

 The Company and DSS have agreed
to settle a portion of the outstanding indebtedness that Impact BioMedical owes to DSS under the Promissory Note in the amount of $ 8,697,142.80
through the issuance of 2,415,873 shares of the Company's common stock, at a conversion ratio of $ 3.60 per share, which was equal
to the closing market price of the Company's common stock on March 24, 2025.

 ITEM
9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 None

 ITEM
9A - CONTROLS AND PROCEDURES

 Evaluation
of Disclosure Controls and Procedures

 An
evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer
and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e)
under the Securities Exchange Act of 1934 as of December 31, 2024. Based on their evaluation, our Chief Executive Officer and Chief Financial
Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2024, to ensure that information
required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed,
summarized and reported, within the time periods specified in the SEC's rules and forms, and that such information is accumulated
and communicated to the Company's management, including the Company's CEO and CFO, as appropriate, to allow timely decisions
regarding required disclosure.

 We
do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and
procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the
disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there
were resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure
controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all
our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain
assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated
goals under all potential future conditions.

 Management's
Annual Report on Internal Control over Financial Reporting

 Our
management, including our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company's internal
control over financial reporting as of December 31, 2024. In making this assessment, management used the framework established in "Internal
Control—Integrated Framework" promulgated by the Committee of Sponsoring Organizations of the Treadway Commission in 2013,
commonly referred to as the "COSO" criteria. Based on our assessment, we concluded that, as of December 31, 2024, our internal
control over financial reporting was not effective based on those criteria.

 In
connection with management's assessment of our internal control over financial reporting described above, the following weakness
has been identified in the Company's internal control over financial reporting as of December 31, 2024:

 1.

 The
 Company did not maintain a sufficient complement of qualified accounting personnel and controls associated with segregation of duties
 over complex transactions.

 2.

 There
 was no systematic method of documenting that timely and complete monthly reconciliation and closing procedures take place.

 Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation
of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed,
have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect
to financial statement preparation and presentation.

 This
Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to rules of the
Securities and Exchange Commission that permit us to provide only management's report in this annual report.

 Changes
in Internal Control over Financial Reporting

 Remediation
of the Material Weaknesses

 Management
believes it has taken significant steps during 2023, and in 2024, to strengthen our overall internal controls and eliminate the material
weakness of those controls. During the 2025 fiscal year, the Company will document and test the remediations put in place. Such remediation
includes the following:

 The
 Company hired a Controller, Senior Accountant and Cost Accountant in 2022. The Company has re-assigned
 responsibilities of other staff members to assist in the Company's financial reporting as well as segregating duties to serve
 as a check and balance on employees' integrity and to maintain the best control system possible.

 The
 Company has centralized its accounting functions across all divisions. The goal of this process is to support the segregation of
 duties and to allow the Chief Financial Officer to focus on ensuring reporting packages, reconciliations, and other financial reports
 are accurate and timely reported.

 A
 monthly operations and financial review is performed with key members of the management team, executive committee, and accounting
 team which has enhanced the timeliness, formality and rigor of our financial statement preparation, review and reporting process.

 Routine
 account reconciliations for all key balance sheet accounts have been initiated. These account reconciliations are reviewed timely
 by an independent person.

 The Company will engage an external, independent expert to review significant and/or complex accounting transactions,
when appropriate, to ensure the proper accounting treatment is applied.

 The
Company is committed to maintaining a strong internal control environment and believes that these remediation efforts will represent
significant improvements in our controls. The Company has started to implement these steps, however, some of these steps will take time
to be fully integrated and confirmed to be effective and sustainable. Additional controls may also be required over time.

 Changes
in Internal Control over Financial Reporting

 While
changes in the Company's internal control over financial reporting occurred during the year ended December 31, 2024 as the Company
continued to implement the remediation steps described above, we have not been able to fully document and test these controls to ensure
their effectiveness over financial reporting during the year ended December 31, 2024, and thus cannot conclude that have materially affected,
or are reasonably likely to materially affect, the Company's internal control over financial reporting.

 ITEM
9B – OTHER INFORMATION

 None.

 PART
III

 ITEM
10 - DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 The
following table sets forth the name, age and position of each of our executive officers, key employees and directors.

 Name

 Age

 Position

 Frank
 D. Heuszel

 Chief
 Executive Officer and Director

 Mark
 Suseck

 Chief
 Operating Officer

 Todd
 D. Macko

 Chief
 Financial Officer

 Jason Grady

 Dr.
 Elise Brownell

 Melissa
 Sims

 David
 Keene

 Christian
 Zimmerman

 Castel
 Hibbert

 Biographical
and certain other information concerning the Company's officers and directors is set forth below. There are no familial relationships
among any of our directors. Except as indicated below, none of our directors is a director in any other reporting companies. None of
our directors has been affiliated with any company that has filed for bankruptcy within the last ten years. We are not aware of any proceedings
to which any of our directors, or any associate of any such director is a party adverse to us or any of our subsidiaries or has a material
interest adverse to us or any of our subsidiaries. Each executive officer serves at the pleasure of the Board of Directors.

 Frank
D. Heuszel, 64, has served as a Director of the Company since August 2020. From August 2020 to August 2023, Mr. Heuszel served as
President of the Company. Since April 2023, Mr. Heuszel has also served as Chief Executive Officer of the Company. Since April 11, 2019,
Mr. Heuszel has served as the Chief Executive Officer of DSS since April 11, 2019, DSS's Interim Chief Financial Officer from April
2019 to October 2020, and a director of DSS since July 30, 2018. Mr. Heuszel has extensive experience in a wide array of strategic, business,
turnaround, and regulatory matters across several industries as a result of his executive management, educational, and operational experience.
Prior to joining DSS, Mr. Heuszel had a very successful career in commercial banking. For over 35 years, Mr. Heuszel served in many senior
executive roles with major US and international banking organizations. As a banker Mr. Heuszel has served as General Counsel, Director
of Special Assets, Credit Officer, Chief Financial Officer and Auditor. Mr. Heuszel also operated a successful law practice focused on
the litigation, corporate restructures, and merger and acquisitions, and collections. In addition to being an attorney and executive
manager, Mr. Heuszel is also a Certified Public Accountant (retired), and a Certified Internal Auditor. Mr. Heuszel holds an undergraduate
degree in Business Administration from The University of Texas at Austin and a J.D. degree from The South Texas College of Law, Houston.

 Mark
Suseck, 62, has served as Chief Operating Officer of the Company since August 2023. Mr. Suseck served as the chief operating officer
of DSS BioHealth Holdings Inc., a subsidiary of DSS, Inc., from 2020-2023, where he leads company strategy, operations, licensing, acquisitions
and commercialization. From 2021 to 2022, Mr. Suseck served as the chief executive officer of Vivacitas Oncology Inc., where he led company
strategy, clinical development, operations and financing. From 2018-2019, Mr. Suseck was vice president of global sales and marketing
at Helius Medical Technologies Inc. Mr. Suseck received his undergraduate degree in economics from Rutgers University, with minors in
education and philosophy. He completed the Executive Management Program in residence at the University of Michigan Business School.

 Todd
D. Macko, 52, has been Secretary and Treasurer of the Company since January 2021 and in May 2023 became Chief Financial Officer of
the Company. Mr. Macko has served as the Chief Financial Officer of DSS since August 16, 2021. Mr. Macko previously served as the Vice
President of Finance of DSS. As the Vice President of Finance, Mr. Macko's responsibilities included assisting DSS's Interim
Chief Financial Officer in all aspects of financial and regulatory reporting. In addition, his responsibilities included the day-to-day
management of the Company's Accounting and Finance team and the financial leadership in the directing and improving of the accounting,
reporting, audit, and tax activities. Prior to his role as Vice President of Finance for the Company, Mr. Macko joined the wholly owned
subsidiary of DSS, Premier Packaging Corporation in January 2019, as its Vice President of Finance. Mr. Macko is a Certified Public Accountant
with over 25 years of public and corporate financial management, business leadership and corporate strategy. Mr. Macko brings a wealth
of experience with strengths in financial planning and analysis, business process re-engineering, budgeting, merger and acquisitions,
financial reporting systems, project evaluation and treasury and capital management. Prior to joining the Company, Mr. Macko served as
the Corporate Controller for Baldwin Richardson Foods, a leading custom ingredients manufacturer for the food and beverage industry from
November 2015 until January 2019. Prior to that, Mr. Macko served as the Controller for The Outdoor Group, LLC., Genesis Vision, Inc.,
Complemar Partners, Inc., and Level 3 Communications, Inc. Mr. Macko obtained his Bachelor of Science degree in Accounting from Rochester
Institute of Technology.

 Jason Grady, 50, Since
October 2024, Mr. Jason Grady has served as the Interim Chief Executive Officer (CEO) of the Company, driving its strategic vision, leadership,
and overall performance. In this role, he steers the organization's growth trajectory, ensuring profitability while aligning long-term
objectives with operational execution. He leads executive teams, fosters innovation, and cultivates key relationships with the Board of
Directors, investors, and strategic partners to propel the company forward. Before stepping into the CEO role, Mr. Grady was the Company's
Chief Operating Officer (COO) since August 2019, where he streamlined operations, optimized business processes, and spearheaded new business
development. Simultaneously, since July 2018, he has served as President of Premier Packaging Corporation, a leading folding carton and
consumer packaging manufacturer and a wholly owned subsidiary of the Company. His leadership within the broader DSS ecosystem has been
instrumental in driving business expansion and operational excellence. From April 2010 to July 2018, Mr. Grady served as Vice President
of Sales & Business Development, playing a pivotal role in accelerating revenue growth and expanding the Company's market presence.
Prior to joining DSS, he held key leadership positions, including Vice President of Marketing at Parlec Corporation, Director of Business
Development at Berlin Packaging Corporation, and sales and marketing executive at OutStart, Inc. Mr. Grady holds a bachelor's degree
in Marketing and Communications and an MBA from the Rochester Institute of Technology.

 Dr.
Elise Brownell, 70, has served as a director of the Company since January 2021. Dr. Brownell has more than 20 years of biotechnology
and pharmaceutical project management experience with a proven track record of advancing programs through clinical development. She serves
as a Life Sciences entrepreneurial advisor for ASTIA, the nation's premier entrepreneurial organization focused on women-led businesses.
Dr. Brownell is also a member of the Editorial Advisory Board for Contract Pharma Magazine, and previous Chair of the Leaders Network
program of Women in Consulting. She is the co-founder of ZephyrBiotech, LLC, a project management firm dedicated to advancing therapeutic
candidates through development to key inflection points for clients. Earlier, Dr. Brownell was a founding member, head of project management
and senior director of Aerovance, Inc., a venture-backed biotechnology company spun out from Bayer Healthcare, where she created and
managed effective team processes to bring product candidates into full scale clinical Phase 1 and 2 developments. Prior to Aerovance,
Dr. Brownell acted as head of project management for Bayer's Biotechnology Unit, where she integrated project strategies to meet
therapeutic and market needs. Other roles included building and negotiating partnerships with third parties to support development programs,
leading research teams through early bench-to-clinic development phases, as well as entrepreneurial investment experience with Angel's
Forum. Dr. Brownell received her M.S., M.Phil. and Ph. D. degrees in biology from Yale University and her B.S. degree in biology from
Allegheny College.

 Melissa
Sims, 54, has served as a director of the Company since May 2023. Ms. Sims is an Illinois licensed attorney having practiced law
since 1995. Following graduation from Northern Illinois University College of Law, Ms. Sims started the general practice of law representing
clients in banking, health care, real estate, criminal, dissolution, municipal and probate matters in state and appellate courts. In
2006, she represented the Village of DePue, Illinois regarding legacy pollution from a Superfund site and set national precedent before
the Court of Appeals for the Seventh Circuit. In 2021, the United States Supreme Court cited the Village of DePue v. ExxonMobil as
precedent in the Atlantic Richfield v. Christian case.

 Starting
in August of 2017, Ms. Sims has been employed with the international law firm, Milberg Coleman Bryson Phillps Grossman, PLLC and recently
represented clients in the National Opioid multidistrict litigation in the Northern District of Ohio. She also represents municipalities
across the country in tort actions in state, federal and appellate courts.

 Ms.
Sims brings to the Board her decades of plaintiff litigation with offer keen insight into potential matters which may be of importance
on behalf of the Company. The Board believes that her legal background, knowledge expertise, and litigation experience will add great
value to the board slate.

 David
Keene, 66, is an executive level banker with 44 years of commercial banking experience with progressive responsibilities in all facets
of credit risk management in both community and regional bank environments. Currently, Mr. Keene acts as chief credit officer of Unity
National Bank; a position he has held since September 2022. As chief credit officer, he oversees loan policy, collections, loan operations,
credit administration, and all credit underwriting and analysis, problem loan workouts. From May 2018 to September 2022, Mr. Keene was
a senior credit risk officer at Community Bank of Texas in Houston, Texas. In this position, he was, among other tasks, responsible for
the support of the credit underwriting of high-net-worth individuals, partnerships, and companies. Mr. Keene received a Bachelor of Business
Administration degree from Baylor University in 1979. The Board believes that his background, knowledge expertise, and experience will
add great value to the board slate.

 Christian
Zimmerman, 47, is currently the executive vice president—chief financial officer of Keystone Bank, SSB. Mr. Zimmerman has held
this position since April 2019. In this position, Mr. Zimmerman, among other tasks, reviews and prepares monthly, quarterly and year-end
financial reports. From December 2015 to April 2019, Mr. Zimmerman was the executive vice president – controller of Community Bank
of Texas, N.A. where he was involved in, among other responsibilities, regulatory reporting for the bank and its holding company, and
preparing financial reports. Mr. Zimmerman worked on the holding company's initial public offering with a focus on the financial
statements and analysis. Mr. Zimmerman is a certified public accountant and received a Bachelor of Business Administration degree and
a Master's degree in Professional Accounting from the University of Texas at Austin. The Board believes that Mr. Zimmerman's
experience with initial public offerings, financial reporting and regulatory reporting will add great value to the board slate.

 Castel
Hibbert, 64, has been involved in corporate banking for 39 years and has held various management, underwriting and line responsibilities.
Since August 2011, Mr. Hibbert has been an executive vice president and managing director at Veritex Community Bank. He currently works
with upper middle market companies whose annual revenues range from $75 million to $800 million. Mr. Hibbert received a Bachelor of Science
degree in employee relations from Michigan State University in 1981 and a Master in Business Administration degree from the University
of Texas at Austin in 1983.

 Committees
of our Board

 Audit
Committee. On September 28, 2023, our Board established the audit committee.

 The
audit committee is appointed by the Board to assist the Board in its duty to oversee the Company's accounting, financial reporting,
and internal control functions and the audit of the Company's financial statements.

 The
role of the audit committee is to:

 oversee
 management in the performance of its responsibility for the integrity of the Company's accounting and financial reporting and
 its systems of internal controls,

 the
 performance and qualifications of the Company's independent auditor, including the independent auditor's independence,

 the
 performance of the Company's internal audit function; and

 the
 Company's compliance with legal and regulatory requirements.

 Our
audit committee consist of Mr. Castel Hibbert, Mr. Christian Zimmerman, Mr. David Keene, with Mr. Zimmerman serving as chair. Our
Board has affirmatively determined that each meets the definition of "independent director" under the rules of NYSE American,
and that they meet the independence standards under Rule 10A-3. Each member of our audit committee meets the financial literacy requirements
of NYSE American's rules. Our Board has adopted a written charter for the audit committee.

 Compensation
Committee. On September 28, 2023, the Board established the compensation committee.

 The
compensation committee is responsible for reviewing and recommending, among other things:

 the
 adequacy and form of compensation of the Board;

 the
 compensation of Chief Executive Officer, including base salary, incentive bonus, stock option and other grant, award and benefits
 upon hiring and on an annual basis;

 the
 compensation of other senior management upon hiring and on an annual basis; and

 the
 Company's incentive compensation and other equity-based plans and recommending changes to such plans to our Board, when necessary.

 Our
compensation committee consist of Dr. Elise Brownell, Ms. Melissa Sims and Mr. Castel Hibbert with Dr. Brownell serving as chair.
Our Board has adopted a written charter for the compensation committee.

 Nominating
and Corporate Governance Committee. On September 28, 2023, the board established the nominating and corporate governance committee.

 The
nominating committee is responsible for, among other things:

 developing
 criteria for membership on the board of directors and committees;

 identifying
 individuals qualified to become members of the board of directors;

 recommending
 persons to be nominated for election as directors and to each committee of the board of directors;

 annually
 reviewing our corporate governance guidelines; and

 monitoring
 and evaluating the performance of the board of directors and leading the board in an annual self-assessment of its practices and
 effectiveness.

 Our
nominating and corporate governance committee consist of Ms. Melissa Sims, Mr. David Keene and Dr. Brownell with Ms. Sims serving
as chair. Our Board has adopted a written charter for the nominating and corporate governance committee.

 Term
of office

 All
directors hold office until the next annual meeting of the stockholders of the company and until their successors have been duly elected
and qualified. Officers are elected by and serve at the discretion of our Board.

 Code
of Business Conduct and Ethics

 On
September 28, 2023, the Board adopted a Business Code of Ethics that applies to our principal executive officer, principal financial
officer, principal accounting officer or controller, or persons performing similar functions. Our Business Code of Ethics has been made
available on our website.

 Involvement
in Certain Legal Proceedings

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

 ITEM
11 - EXECUTIVE COMPENSATION

 Compensation paid to our executive officers or directors during the past two fiscal years.

 Name and principal position

 Year

 Salary

 Bonus

 Stock Awards (1)

 Option Awards

 Non-Equity Incentive Plan Compensation

 Nonqualified Deferred Compensation Earnings

 All Other Compensation

 Total

 Frank D. Heuszel, Chief Executive Officer

 2023

 $
 -

 $
 -

 -

 -

 -

 -

 $
 -

 $
 -

 2024

 $
 43,706

 $
 -

 $
 11,100

 -

 -

 -

 $
 -

 $
 54,806

 Mark Suseck, Chief Operating Officer

 2023

 $
 -

 $
 -

 -

 -

 -

 -

 $
 -

 $
 -

 2024

 $
 126,689

 $
 -

 $
 32,000

 -

 -

 -

 $
 -

 $
 158,689

 Todd D. Macko, Chief Financial Officer

 2023

 $
 -

 $
 -

 -

 -

 -

 -

 $
 -

 $
 -

 2024

 $
 -

 $
 -

 $

 -

 -

 -

 $
 -

 $

 (1)

 Represents the total grant date fair value of stock options awards computed in accordance with FASB ASC 718. Our policy and assumptions
made in the valuation of share-based payments are contained in Note 10

 Employment
Agreements

 On October 3, 2024, the Company and Mr. Frank D. Heuszel,
the Company's Chief Executive Officer, Chairman, and President (the " Executive ") entered into an Executive Employment
Agreement (the " Executive Employment Agreement "). Under the Executive Employment Agreement, the Executive will be employed
in his current capacity as the Company's Chief Executive Officer. The Executive's employment term shall be from October 3,
2024, to October 3, 2027 (the " Employment Term "), and the Executive shall receive an annual base salary (the " Base
Salary ") of $200,000 for the first year of the Employment Term, $250,000 for the second year of the Employment Term, and $250,000
for the third year of the Employment Term. In addition to the Executive's Base Salary, he will be awarded a mandatory bonus (the
" Mandatory Bonus ") as follows: (i) $150,000 for the first year of the Employment Term; (ii) $100,000 for the second
year of the Employment Term; and (iii) $100,000 for the third year of the Employment Term. The Executive must remain continuously employed
by the Company pursuant to the Executive Employment Agreement through the anniversary of each award date for the Mandatory Bonus to be
fully earned by the Executive. In addition to the Executive's Base Salary, the Executive shall be eligible to be awarded discretionary
bonuses that may be authorized and declared by the board of director's to the Executive and/or to the senior management executives
from time to time, at the Board's sole discretion. The Executive will also be granted an option to purchase Shares of the Company
pursuant to the Impact Biomedical 2023 Employee, Director and Consultant Equity Incentive Plan in the amount of 300,000 shares at a purchase
price of $3.00 per share.

 On November 11, 2024, the Company and Mr. Mark Suseck entered into an Employment Agreement (the "Employment
Agreement") with a term that runs through September 16, 2027 during which Mr. Suseck will act as the Company's Chief Operating
Officer. Mr. Suseck will receive an annual base salary of $250,000 retroactive to April 1, 2024. Mr. Suseck is also entitled to a discretionary
bonus to be awarded in either cash or Company common stock. Mr. Suseck will also be granted an option to purchase shares of the Company
pursuant to the Impact Biomedical 2023 Employee, Director and Consultant Equity Incentive Plan in the amount of 400,000 at a purchase
price of $3.00 per share.

Compensation

 The
Company has not paid any compensation to any directors during 2023. The table below represents compensation for 2024:

 Name

 Fees Earned or Paid in Cash

 Stock Awards (1)

 All Other Compensation

 Total

 Current Directors

 Jason Grady

 $
 -

 $

 $
 -

 $

 Elise Brownell

 $
 1,250

 $

 $
 -

 $
 2,175

 Melissa Sims

 $
 1,250

 $

 $
 -

 $
 2,175

 David Keene

 $
 1,250

 $

 $
 -

 $
 2,175

 Christian Zimmerman

 $
 1,250

 $

 $
 -

 $
 2,175

 Castel Hibbert

 $
 1,250

 $

 $
 -

 $
 2,175

 (1)

 Represents the total grant date fair value of stock options awards computed
in accordance with FASB ASC 718. Our policy and assumptions made in the valuation of share-based payments are contained in Note 10

 Outstanding
Equity Awards at Fiscal Year-End

 There
are no outstanding equity awards held by the Company's named executive officers or directors as of December 31, 2023.

 2023
Equity Incentive Plan

 Our
Board has adopted the 2023 Equity Incentive Plan, or 2023 Plan. For the year ended December 31, 2024, 880,000 option grants with a purchase price of $3.00 per share were awarded to certain officers,
directors and consultants of the Company. These options have various vesting periods, and all expire on October 31, 2031. Potential proceeds
of these grants is $2,640,000 and are fair valued using a Black-Scholes model at approximately $50,000. The Company record stock based compensation expense of approximately $19,000 for the year ended December 31, 2024 and is included in Sales,
general and administrative compensation (inclusive of stock based compensation) on the accompanying Statement of Operations. There were
no stock-based payments made during the twelve months ended December 31, 2023.

 ITEM
12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 The
following table sets forth certain information regarding the beneficial ownership of our common stock and Series A Convertible Preferred
Stock as of December 31, 2024 by:

 each
 of our named executive officers;

 each
 of our directors;

 all
 of our current directors and executive officers as a group; and

 each
 stockholder known by us to own beneficially more than five percent of our common stock.

 Beneficial
ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities.
Shares of common stock that may be acquired by an individual or group within 60 days of December 31, 2024, pursuant to the exercise of
options or warrants and convertible debt are deemed to be outstanding for the purpose of computing the percentage ownership of such individual
or group. Percentage of ownership of common stock is based on 11,503,955 shares of common stock outstanding on February 14, 2025. Percentage
of ownership of Series A Convertible Preferred Stock is based on 60,496,041 shares of issued and outstanding preferred stock as of February
14, 2025

 Except
as indicated in footnotes to this table, we believe that the stockholders named in this table have sole voting and investment power with
respect to all shares of common stock and Series A Convertible Preferred Stock shown to be beneficially owned by them, based on information
provided to us by such stockholders. Unless otherwise indicated, the address of all listed stockholders is c/o Impact BioMedical Inc.,
1400 Broadfield Blvd., Suite 130, Houston, Texas TX 77084.

 Beneficial
Ownership of Common Stock

 Percentage of

 Number of Shares

 Outstanding Share

 Name

 Beneficially Owned

 Beneficially Owned

 Frank D. Heuszel

 95,475

 *

 Mark Suseck

 -

 *

 Todd D. Macko

 *

 Jason Grady

 *

 Elise Brownell

 -

 *

 Melissa Sims

 -

 *

 David Keene

 -

 *

 Christian Zimmerman

 -

 *

 Castel Hibbert

 -

 *

 All officers and directors as a group (9 persons)

 95,779

 0.8
 %

 5% Shareholders

 DSS, Inc. (1)

 1,178,882

 10.2
 %

 Alset International limited

 1,553,904

 13.5
 %

 Alset, Inc.

 2,560,976

 22.3
 %

 *

 Less
 than 1%

 (1)

 DSS
 indirectly owns the shares through DSS BioHealth Security, Inc., its wholly-owned subsidiary.

 Beneficial
Ownership of Series A Convertible Preferred Stock

 Name of Beneficial
 Owner

 of
 Outstanding Series A Preferred Beneficially Owned

 Percentage
 of Outstanding Series A Preferred
 Beneficially Owned

 DSS, Inc. (1)

 %

 (1)

 DSS
 indirectly owns the shares through DSS BioHealth Security, Inc., its wholly-owned subsidiary. As of the date of this prospectus,
 the holder has not converted any of the shares of Series A Convertible Preferred Stock into shares of the Company's common
 stock.

 Equity
Compensation Plans Information

 The
following table sets forth information about our equity compensation plans as of December 31, 2023.

 Restricted
 stock
 to be
 issued
 upon vesting

 of
 securities
 to
 be
 issued
 upon
 exercise
 of outstanding options, warrants
 and
 rights

 Weighted
 average
 exercise
 price
 of outstanding options, warrants
 and
 rights

 of securities remaining available for future
 issuance
 (under
 equity compensation Plans (excluding securities reflected in column (a & b))

 Plan
 Category

 (a)

 (b)

 (c)

 (d)

 Equity compensation plans approved by security
 holders

 2023 Employee, Director and Consultant Equity
 Incentive Plan - options

 -

 880,000

 $
 3.00

 -

 2023 Employee, Director and Consultant Equity
 Incentive Plan - warrants

 -

 75,000

 $
 3.75

 -

 2023 Employee, Director
 and Consultant Equity Incentive Plan

 -

 -

 -

 18,037,079

 Total

 -

 955,000

 $
 3.06

 18,037,079

 ITEM
13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 Related
Party Transactions

 Based on Shareholders Agreement entered into on April
26, 2017, the Company would fund the scientific operations of GRDG, a company involved in research and development of biomedical products
which is a minority stockholder of two of the Company's subsidiaries and is owned by Daryl Thompson, a director of many subsidiaries
of the Company, to do the development and research works on the biomedical products for the Company. On February 15, 2022, the Company
and its subsidiaries, Global BioLife, Inc. ("Global"), and Impact BioLife Sciences, Inc. ("BioLife Sciences"),
and GRDG entered into a Licensing Proceeds Distribution Agreement ("GRDG Agreement"), whereas GRDG would transfer its 20%
equity position in both Global and BioLife Sciences to the Company in exchange for 20% interest in Global and/or BioLife Science revenue
received from the exclusive or non-exclusive licensing of and/or the sale of Global Intellectual Property to a Third Party, net of specific
costs. As of the date of this report, no contingent liability has been recognized under the GRDG Agreement. As of December 31, 2024 and
2023, the Company incurred approximately $25,000 and $447,000, respectively, in expenses.

 There are certain general and administrative costs
incurred by DSS, a related party, on behalf of the Company which are passed through to the Company on a monthly basis. These costs consist
of primarily payroll costs for certain DSS employees and are allocated based on estimated time spent on behalf of the Company. Beginning
in January 2024 and through September 2024, these costs are approximately $31,000 per month. Beginning October 2024, these costs are approximately
$26,000 per month. As of December 31, 2024, the Company incurred $357,000 in related expenses. As of December 31, 2023, the Company incurred
approximately 144,000 in related expenses.

 On December 31, 2020, and later amended, the Company executed a Revolving Promissory Note ("Note") with
DSS, a related party, which accrues interest at a rate of 4.25% and is due in full at the maturity date of September 30, 2030. The Note
was further amended on July 24, 2024 with an effective date of September 16, 2024 to i) allow the Company to pay certain principal and/or
interest payments owing under the repayment terms in an exchange for potential of equity in the Company, ii) change the quarterly interest
due dates to the last day of each calendar quarter (i.e. December 31, March 31, June 30 and September 30), iii) to adjust the On Demand
feature so that it starts after the 24th month, iv) continue the planned repayment program commencing on the 37th month and on the last
day of each month thereafter through August 31, 2030 to pay a fixed monthly payment of $126,381, v) to continue the scheduled maturity
date of September 30, 2030, and vi) adjusts the interest rate to be the WSJ Prime Rate plus 0.50%. As of December 31, 2024 and December
31, 2023 the outstanding balance, inclusive of interest was $8,878,000 (net of change in fair value of the note payable of $5,068,000)
and $12,074,000, respectively. Of the $8,878,000, $35,000 is included in Current portion of note payable, related party and the remaining
$7,971,000 is included in Long-term portion of note payable, related party at December 31, 2024. The $12,074,000 at December 31, 2023
is included in Current portion of note payable, related party.

Independence

 The
Company has adopted the standards of NYSE American for determining the independence of its directors.

 These
independence standards specify the relationships deemed sufficiently material to create the presumption that a director is not independent.
No director qualifies as independent unless the Company's Board affirmatively determines that the director does not have a relationship
that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In addition, Section
803A of the NYSE American Company Guide (and related commentary) sets forth the following non-exclusive list of persons who shall not
be considered independent:

 (a)

 a
 director who is, or during the past three years was, employed by the Company, other than prior employment as an interim executive
 officer (provided the interim employment did not last longer than one year);

 (b)

 a
 director who accepted or has an immediate family member who accepted any compensation from the Company in excess of $120,000 during
 any period of twelve consecutive months within the three years preceding the determination of independence, other than the following:

 (i)

 compensation
 for Board or Board committee service,

 (ii)

 compensation
 paid to an immediate family member who is an employee (other than an executive officer) of the Company,

 (iii)

 compensation
 received for former service as an interim executive officer (provided the interim employment did not last longer than one year),
 or

 (iv)

 benefits
 under a tax-qualified retirement plan, or non-discretionary compensation;

 (c)

 a
 director who is an immediate family member of an individual who is, or at any time during the past three years was, employed by the
 Company as an executive officer;

 (d)

 a
 director who is, or has an immediate family member who is, a partner in, or a controlling shareholder or an executive officer of,
 any organization to which the Company made, or from which the Company received, payments (other than those arising solely from investments
 in the Company's securities or payments under non-discretionary charitable contribution matching programs) that exceed 5% of
 the organization's consolidated gross revenues for that year, or $200,000, whichever is more, in any of the most recent three
 fiscal years;

 (e)

 a
 director who is, or has an immediate family member who is, employed as an executive officer of another entity where at any time during
 the most recent three fiscal years any of the issuer's executive officers serve on the compensation committee of such other
 entity; or

 (f)

 a
 director who is, or has an immediate family member who is, a current partner of the Company's outside auditor, or was a partner
 or employee of the Company's outside auditor who worked on the Company's audit at any time during any of the past three
 years.

 Directors
serving on the Company's audit committee must also comply with the additional, more stringent requirements set forth in Section
803B of the NYSE American Company Guide and Rule 10A-3 of the Securities Exchange Act of 1934, as amended.

 Consistent
with these considerations, the Board affirmatively determined that Mr. Castel Hibbert, Mr. Christian Zimmerman, Mr. David Keene, Dr.
Elise Brownell and Ms. Melissa Sims each meets the definition of "independent director" under the rules of NYSE American.

 Directors
serving on the Company's compensation committee must also comply with the additional, more stringent requirements as set forth
in Section 805(c) of the NYSE American Company Guide.

 Parent
of the Company

 DSS
BioHealth Securities, Inc., a wholly-owned subsidiary of DSS, Inc. owns approximately 86% of the voting shares of the Company which includes
60,496,041 shares of the Company's Series A Convertible Preferred Stock, which is 100% of the Company's issued and outstanding
Series A Convertible Preferred Stock,

 ITEM
14 - PRINCIPAL ACCOUNTING FEES AND SERVICES

 Audit
Fees

 Audit
fees consist of fees for professional services rendered for the audit of the Company's consolidated financial statements
included in the Company's Annual Report on Form 10-K, the review of financial statements included in the Company's
Quarterly Reports on Form 10-Q, and for services that are normally provided by the auditor in connection with statutory and
regulatory filings or engagements. The aggregate fees billed for professional services rendered by our independent public
accounting firm, Grassi & Co. CPAs, P.C., Jericho, NY ("Grassi & Co."), for audit and review services for the
fiscal year ended December 31, 2023 were approximately $210,000. The aggregate fees billed for professional services rendered by
Grassi & Co for audit and review services for the fiscal year ended December 31, 2024 was approximately $60,000.

 The
anticipated fees associated with the audit of the year ended December 31, 2025, is expected to range between $40,000 and $85,000.

 Tax
Fees

BioMedical for the years ended December 31, 2024 and 2023 is included in the consolidated tax return of DSS, Inc. and does not file separate
federal or state tax returns. Impact BioMedical engaged Greendyke Jencik & Associates CPAs, PLLC to render an annual tax provisions. The aggregate fees for 2024 and 2023 were approximately $2,000 and $2,000.

 All
Other Fees

 There
were fees billed for professional services rendered by our principal accountant, Grassi & Co. CPAs, P.C., associated with the Company's
S-1 filings approximating $87,000 for the years ended December 31, 2023.

 Administration
of the Engagement; Pre-Approval of Audit and Permissible Non-Audit Services

 The
Company's Audit Committee Charter requires that the Audit Committee establish policies and procedures for pre-approval of all audit
or permissible non-audit services provided by the Company's independent auditors. Our Audit Committee, approved, in advance, all
work performed for year ended December 31, 2024 and nine-months ended September 30, 2025, by our principal accountant, Grassi & Co.
CPAs, P.C. The Audit Committee may establish, either on an ongoing or case-by-case basis, pre-approval policies and procedures providing
for delegated authority to approve the engagement of the independent registered public accounting firm, provided that the policies and
procedures are detailed as to the particular services to be provided, the Audit Committee is informed about each service, and the policies
and procedures do not result in the delegation of the Audit Committee's authority to management. In accordance with these procedures,
the Audit Committee pre-approved all services performed by Grassi & Co. CPAs, P.C.

 PART
IV

 ITEM
15 – EXHIBITS, FINANCIAL STATEMENT SCHEDULES

 The
following exhibits to this registration statement included in the Index to Exhibits are incorporated by reference.

 Exhibit

 Exhibit
 Description

 1.1

 Form
 of Underwriting Agreement between the Company and Aegis Capital Corp. incorporated by reference to Exhibit 1.1 to the Company's
 Amendment to the Registration Statement on Form S-1 (No. 333- 275062) filed with the
 SEC on November 21, 2023.

 3.1

 Amended
 and Restated Articles of Incorporation of Impact BioMedical Inc. dated July 29, 2020 incorporated by reference to Exhibit 3.1 to
 the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 3.2

 Certificate
 of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit
 3.2 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 3.3

 Certificate
 of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit
 3.3 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 3.4

 Certificate
 of Amendment to the Amended and Restated Articles of Incorporation of Impact BioMedical Inc. incorporated by reference to Exhibit
 3.4 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 3.5

 Bylaws
 of the Company incorporated by reference to Exhibit 3.5 to the Company's Amendment to the Registration Statement on Form S-1
 (No. 333- 275062) filed with the SEC on November 21, 2023.

 3.6

 Certificate
 of Designation of Series A Convertible Preferred Stock incorporated by reference to Exhibit 3.6 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 4.1

 Form
 of Underwriter Warrant incorporated by reference to Exhibit 4.1 to the Company's Amendment to the Registration Statement on
 Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.1

 Share
 Exchange Agreement dated as of April 27, 2020, among Document Security Systems, Inc., DSS BioHealth Security, Inc., Singapore Development
 Limited and Global BioMedical Pte Ltd. incorporated by reference to Exhibit 10.1 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.2

 Subscription
 Agreement dated December 19, 2020, between the Company and BioMed Technologies Asia Pacific Holdings Limited incorporated by reference
 to Exhibit 10.2 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.3

 Promissory
 Note with Dustin Michael Crum dated February 21, 2021 incorporated by reference to Exhibit 10.3 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.4

 Stock
 Purchase Agreement dated March 15, 2021 between the Company and Vivacitas Oncology Inc. incorporated by reference to Exhibit 10.4
 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.5

 Convertible
 Promissory Note dated May 14, 2021 incorporated by reference to Exhibit 10.5 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.6

 Revolving
 Promissory Note dated December 31, 2020 incorporated by reference to Exhibit 10.6 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.7

 Royalty
 Agreement by and between Global BioLife Inc. and Chemia Corporation, dated August 15, 2018 incorporated by reference to Exhibit 10.7
 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.8

 Addendum
 to Royalty Agreement by and between Global BioLife Inc. and Chemia Corporation, dated November 27, 2018 incorporated by reference
 to Exhibit 10.8 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062
) filed with the SEC on November 21, 2023.

 10.9

 Distribution
 Agreement by and between BioMed Technologies Asia Pacific Holdings Limited and Impact BioMedical Inc., dated December 9, 2020 incorporated
 by reference to Exhibit 10.9 to the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.10

 BioLife, Inc. Stockholders' Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech Limited, and GRDG
 Sciences, LLC, dated April 26, 2017 incorporated by reference to Exhibit 10.10 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.11

 No. 1 to Global BioLife, Inc. Stockholders' Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech
 Limited, and GRDG Sciences, LLC, dated May 22, 2018 incorporated by reference to Exhibit 10.11 to the Company's Amendment to
 the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.12

 No. 2 to Global BioLife, Inc. Stockholders' Agreement among Global BioLife, Inc., Global BioMedical, Inc., Holista Colltech
 Limited, and GRDG Sciences, LLC, dated August 2020 incorporated by reference to Exhibit 10.12 to the Company's Amendment to
 the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.13

 BioLife Science, Inc. Stockholders Agreement among Impact BioLife Science, Inc., Impact BioMedical Inc. and GRDG Sciences, LLC, dated
 December 11, 2020 incorporated by reference to Exhibit 10.13 to the Company's Amendment to the Registration Statement on Form
 S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 10.14

 Licensing
 Proceeds Distribution Agreement with GRDG Sciences, LLC dated May 16, 2022 incorporated by reference to Exhibit 10.14 to the Company's
 Amendment to the Registration Statement on Form S-1 (No. 333- 275062) filed with the
 SEC on November 21, 2023.

 10.15

 No. 1 to Revolving Promissory Note dated December 31, 2021 incorporated by reference to Exhibit 10.15 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.16

 No. 2 to Revolving Promissory Note dated March 31, 2022 incorporated by reference to Exhibit 10.16 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.17

 License
 Agreement with ProPhase Labs, Inc. dated March 17, 2022 incorporated by reference to Exhibit 10.17 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.18

 License
 Agreement with ProPhase Labs, Inc. dated July 18, 2022 incorporated by reference to Exhibit 10.18 to the Company's Amendment
 to the Registration Statement on Form S-1 (No. 333- 275062) filed with the SEC on November

 10.19

 Licensing
 Proceeds Distribution Agreement with GRDG Sciences, LLC dated February 15, 2022 incorporated by reference to Exhibit 10.19 to the
 Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.20

 Share
 Exchange Agreement between Impact BioMedical Inc. and DSS BioHealth Security, Inc. incorporated by reference to Exhibit 10.20 to
 the Company's Amendment to the Registration Statement on Form S-1 (No. 333- 275062)

 10.21

 to Promissory Note effective January 18, 2024 between Impact BioMedical Inc. and DSS, Inc. incorporated by reference to Exhibit 10.1
 to the Company's Current Report on Form 8-K (Commission File No. 333-253037) filed with the SEC on January 22, 2024.

 14.1

 BioMedical Employee Handbook incorporated by reference to Exhibit 14.1 to the Company's Amendment to the Registration Statement
 on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 16.1

 Letter
 from Turner Stone & Company LLP incorporated by reference to Exhibit 16.1 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 21.1

 List
 of subsidiaries of Impact BioMedical Inc. incorporated by reference to Exhibit 21.1 to the Company's Amendment to the Registration
 Statement on Form S-1 (No. 333- 275062) filed with the SEC on November 21, 2023.

 23.2

 Consent
 of Grassi & Co., CPAs, P.C. incorporated by reference to Exhibit 23.2 to the Company's Amendment to the Registration Statement
 on Form S-1 (No. 333-275062) filed with the SEC on November 21, 2023.

 31.1

 Certification
 of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act, as amended.

 31.2

 Certification
 of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act, as amended.

 32.1

 Certification
 of Principal Executive Officer and Principal Financial Officer pursuant to Rules 13a-14(b) or 15d-14(b) of the Securities and Exchange
 Act, as amended, and 18 U.S.C. Section 1350.

 101.INS

 101.SCH

 101.CAL

 101.DEF

 101.LAB

 101.PRE

 Cover

 ITEM
16 – Form 10K SUMMARY

 None.

 SIGNATURES

 Pursuant
to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.

 BioMedical, Inc.

 March

 By:

 /s/
 Frank D. Heuszel

 Frank
 D. Heuszel

 Chief
 Executive Officer

 (Principal
 Executive Officer)

 March

 By:

 /s/
 Todd D. Macko

 Todd
 D. Macko

 Chief
 Financial Officer

 Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

 March

 By:

 /s/
 Frank D. Heuszel

 Frank
 D. Heuszel

 Chief Executive Officer

 (Principal Executive Officer)

 March

 By:

 /s/
 Todd D. Macko

 Todd
 D. Macko

 Chief
 Financial Officer

 (Principal
 Financial and Accounting Officer)

 March

 By:

 /s/
 Mark Suseck

 Chief Operating Officer

 March

 By:

 /s/ Jason Grady

 Jason Grady

 March 28, 2025

 By:

 /s/ Elise Brownell

 Elise Brownell

 March

 By:

 /s/
 Melissa Sims

 Melissa
 Sims

 March

 By:

 /s/
 Castel Hibbert

 Castel
 Hibbert

 March

 By:

 /s/
 Christian Zimmerman

 Christian
 Zimmerman

 March

 By:

 /s/
 David Keene

 David
 Keene