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<P STYLE="margin: 0">&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>SECURITIES AND EXCHANGE
COMMISSION </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>Washington, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>CURRENT REPORT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>Pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0">Date of Report (Date of
earliest event reported): February 29, 2012</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>DOCUMENT SECURITY SYSTEMS,
INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; margin-right: 0; margin-left: 0"><B>(Exact name of registrant
as specified in its charter) </B></P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; font-weight: bold; text-align: center">New York</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; font-weight: bold; text-align: center">001-32146</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center"><B>16-1229730</B></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; font-weight: bold; text-align: center">(State or other jurisdiction of incorporation)</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: top; font-weight: bold; text-align: center">(Commission File Number)</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top; font-weight: bold; text-align: center">(IRS Employer Identification No.)</TD></TR>
<TR>
    <TD COLSPAN="3">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3">&nbsp;</TD></TR>
<TR>
    <TD COLSPAN="3" STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>First Federal Plaza, Suite 1525</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>28 East Main Street</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Rochester, NY </B></P></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; font-weight: bold; text-align: center">14614</TD></TR>
<TR>
    <TD COLSPAN="3" STYLE="vertical-align: top; font-weight: bold; text-align: center">(Address of principal executive offices)</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: top; font-weight: bold; text-align: center">(Zip Code)</TD></TR>
<TR>
    <TD STYLE="width: 36%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 22%">&nbsp;</TD>
    <TD STYLE="width: 6%">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 31%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">Registrant&rsquo;s telephone
number, including area code: <B>(585) 325-3610</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><B>__________________</B>____________________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><B>(Former name or former
address, if changed since last report.) </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-right: 0; margin-left: 0">&nbsp;&nbsp;Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):</P>

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<TR STYLE="vertical-align: top">
    <TD STYLE="width: 4%"><FONT STYLE="font: 10pt Wingdings; color: black">&uml;</FONT></TD>
    <TD STYLE="width: 96%">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings"></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings">&uml;</TD>
    <TD>Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings"></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings">&uml;</TD>
    <TD>Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings"></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-family: Wingdings">&uml;</TD>
    <TD>Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 6pt"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Item 1.01 Entry into a Material Definitive Agreement.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 29, 2012, Document Security Systems,
Inc. (the &ldquo;Company&rdquo;) entered into a Purchase, Amendment and Escrow Agreement (the &ldquo;Purchase Agreement&rdquo;)
among Barry Honig (&ldquo;Honig&rdquo;), Neil Neuman (&ldquo;Neuman&rdquo;) and Grushko &amp; Mittman, P.C. The Purchase Agreement
provides, among other things, for the sale of a commercial term note, dated June 29, 2011, among the Company, Plastic Printing
Professionals, Inc., a wholly owned subsidiary of the Company, and Neuman, as lender, in the original principal amount of $650,000
(the &ldquo;Note&rdquo;) to Honig for a purchase price of $578,396.42. The terms of the original Note are more fully described
in the Company&rsquo;s Current Report on Form 8-K as filed with the Securities and Exchange Commission on June 30, 2011. In connection
with the sale and transfer of the Note to Honig, the Company agreed to amend certain terms of the Note pursuant to an allonge entered
into on February 29, 2012 (the &ldquo;Allonge&rdquo;). Under the Purchase Agreement any security interest in the Note terminated
at the closing of the purchase of the Note; accordingly, Honig does not possess a security interest in any assets of the Company
as a result of his purchase of the Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Pursuant to the Allonge, the maturity date
of the Note was extended to July 1, 2013. Honig has the right to convert the principal and any interest due under the Note into
shares of the Company&rsquo;s common stock at a conversion price of $3.30 per share, subject to adjustment upon certain corporate
events as set forth in the Allonge. Honig agreed not to convert the Note if the number of shares of common stock beneficially owned
by the holder and his affiliates issuable upon the conversion of the Note would result in beneficial ownership by the holder and
its affiliates of more than 4.99% of the outstanding shares of common stock, except that this restriction may be waived upon 61
days prior notice from Honig to increase such percentage to 9.99%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company agreed to pay Hong as liquidated
damages $100 per business day for each $10,000 of Note principal amount and interest being converted for which shares of common
stock are not timely delivered. If the Company fails to timely deliver conversion shares and if Honig purchases shares of common
stock in the market, then the Company is obligated to pay, as liquidated damages, the amount by which (A) Honig's total purchase
price (including brokerage commissions, if any) for the shares of common stock so purchased exceeds (B) the aggregate principal
and/or interest amount of the Note for which such conversion shares were not timely delivered, together with interest thereon at
a rate of 15% per annum, accruing until such amount and any accrued interest thereon is paid in full.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company is required to pay Honig, as liquidated
damages, $100 per business day for each $10,000 of purchase price for unlegended shares which are not timely delivered. If during
any 360 day period, the Company fails to deliver unlegended shares for an aggregate of 30 days, then Honig may require the Company
to redeem all or any portion of the shares subject to such default at a price per share equal to the greater of (i) 120%, or (ii)
a fraction in which the numerator is the highest closing price of the common stock during the such 30- day period and the denominator
of which is the lowest conversion price during such 30- day period, multiplied by the price paid by the holder for such common
stock. If the Company fails to timely deliver unlegended shares and if Honig purchases shares of common stock in the market, then
the Company is obligated to pay to the holder, as liquidated damages, the amount by which (A) the holder's total purchase price
(including brokerage commissions, if any) for the shares of common stock so purchased exceeds (B) the aggregate purchase price
of the shares of common stock delivered to the Company for reissuance as unlegended shares, together with interest thereon at a
rate of 15% per annum accruing until such amount and any accrued interest thereon is paid in full.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The forgoing description is a summary only,
does not purport to set forth the complete terms of the Purchase Agreement and the Allonge, and is qualified in its entirety by
reference to the Purchase Agreement and the Allonge, which are filed as Exhibit 10.1 to this Current Report on Form 8-K.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>Item 9.01 Financial Statements and Exhibits.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(d)&#9;Exhibits</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.1</TD><TD STYLE="text-align: justify">Purchase, Amendment and Escrow Agreement, dated as of February 29, 2012, among Barry Honig, Neil
Neuman,, Document Security Systems, Inc., and Grushko &amp; Mittman, P.C.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">SIGNATURES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 24.5pt">Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="width: 47%">&nbsp;</TD>
    <TD STYLE="width: 1%; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="width: 4%">&nbsp;</TD>
    <TD STYLE="width: 1%; vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="width: 47%">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom">DOCUMENT SECURITY SYSTEMS, INC.</TD></TR>
<TR>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; padding-left: 12pt; text-indent: -12pt">Dated: March 2, 2012</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-left: 12pt; text-indent: -12pt">By:</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">/s/ Patrick A. White</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"></P></TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; text-align: center">Patrick A. White</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; font-style: italic; text-align: center">Chief Executive Officer</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>

<P STYLE="margin: 0">&nbsp;</P>

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[{"type": "8-K", "sequence": "1", "filename": "v304566_8k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 18624}]
{"company-data": {"conformed-name": "DOCUMENT SECURITY SYSTEMS INC", "cik": "0000771999", "assigned-sic": "7373", "irs-number": "161229730", "state-of-incorporation": "NY", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-32146", "film-number": "12662937"}, "business-address": {"street1": "36 WEST MAIN ST", "street2": "SUITE 710", "city": "ROCHESTER", "state": "NY", "zip": "14614", "phone": "585 232 1500"}, "mail-address": {"street1": "36 W MAIN ST", "street2": "SUITE 710", "city": "ROCHESTER", "state": "NY", "zip": "14614"}, "former-company": [{"former-conformed-name": "NEW SKY COMMUNICATIONS INC", "date-changed": "19920703"}, {"former-conformed-name": "THOROUGHBREDS USA INC", "date-changed": "19861118"}]}
UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of
earliest event reported): February 29, 2012
DOCUMENT SECURITY SYSTEMS,
INC.
(Exact name of registrant
as specified in its charter)
New York
001-32146
16-1229730
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
First Federal Plaza, Suite 1525
28 East Main Street
Rochester, NY
14614
(Address of principal executive offices)
(Zip Code)
Registrant's telephone
number, including area code:
(585) 325-3610
__________________
____________________________________
(Former name or former
address, if changed since last report.)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
On February 29, 2012, Document Security Systems,
Inc. (the "Company") entered into a Purchase, Amendment and Escrow Agreement (the "Purchase Agreement")
among Barry Honig ("Honig"), Neil Neuman ("Neuman") and Grushko & Mittman, P.C. The Purchase Agreement
provides, among other things, for the sale of a commercial term note, dated June 29, 2011, among the Company, Plastic Printing
Professionals, Inc., a wholly owned subsidiary of the Company, and Neuman, as lender, in the original principal amount of $650,000
(the "Note") to Honig for a purchase price of $578,396.42. The terms of the original Note are more fully described
in the Company's Current Report on Form 8-K as filed with the Securities and Exchange Commission on June 30, 2011. In connection
with the sale and transfer of the Note to Honig, the Company agreed to amend certain terms of the Note pursuant to an allonge entered
into on February 29, 2012 (the "Allonge"). Under the Purchase Agreement any security interest in the Note terminated
at the closing of the purchase of the Note; accordingly, Honig does not possess a security interest in any assets of the Company
as a result of his purchase of the Note.
Pursuant to the Allonge, the maturity date
of the Note was extended to July 1, 2013. Honig has the right to convert the principal and any interest due under the Note into
shares of the Company's common stock at a conversion price of $3.30 per share, subject to adjustment upon certain corporate
events as set forth in the Allonge. Honig agreed not to convert the Note if the number of shares of common stock beneficially owned
by the holder and his affiliates issuable upon the conversion of the Note would result in beneficial ownership by the holder and
its affiliates of more than 4.99% of the outstanding shares of common stock, except that this restriction may be waived upon 61
days prior notice from Honig to increase such percentage to 9.99%.
The Company agreed to pay Hong as liquidated
damages $100 per business day for each $10,000 of Note principal amount and interest being converted for which shares of common
stock are not timely delivered. If the Company fails to timely deliver conversion shares and if Honig purchases shares of common
stock in the market, then the Company is obligated to pay, as liquidated damages, the amount by which (A) Honig's total purchase
price (including brokerage commissions, if any) for the shares of common stock so purchased exceeds (B) the aggregate principal
and/or interest amount of the Note for which such conversion shares were not timely delivered, together with interest thereon at
a rate of 15% per annum, accruing until such amount and any accrued interest thereon is paid in full.
The Company is required to pay Honig, as liquidated
damages, $100 per business day for each $10,000 of purchase price for unlegended shares which are not timely delivered. If during
any 360 day period, the Company fails to deliver unlegended shares for an aggregate of 30 days, then Honig may require the Company
to redeem all or any portion of the shares subject to such default at a price per share equal to the greater of (i) 120%, or (ii)
a fraction in which the numerator is the highest closing price of the common stock during the such 30- day period and the denominator
of which is the lowest conversion price during such 30- day period, multiplied by the price paid by the holder for such common
stock. If the Company fails to timely deliver unlegended shares and if Honig purchases shares of common stock in the market, then
the Company is obligated to pay to the holder, as liquidated damages, the amount by which (A) the holder's total purchase price
(including brokerage commissions, if any) for the shares of common stock so purchased exceeds (B) the aggregate purchase price
of the shares of common stock delivered to the Company for reissuance as unlegended shares, together with interest thereon at a
rate of 15% per annum accruing until such amount and any accrued interest thereon is paid in full.
The forgoing description is a summary only,
does not purport to set forth the complete terms of the Purchase Agreement and the Allonge, and is qualified in its entirety by
reference to the Purchase Agreement and the Allonge, which are filed as Exhibit 10.1 to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d)	Exhibits
10.1
Purchase, Amendment and Escrow Agreement, dated as of February 29, 2012, among Barry Honig, Neil
Neuman,, Document Security Systems, Inc., and Grushko & Mittman, P.C.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
DOCUMENT SECURITY SYSTEMS, INC.
Dated: March 2, 2012
By:
/s/ Patrick A. White
Patrick A. White
Chief Executive Officer