Company: IPSI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110820
Chunk: 163

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 163
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reduced the exercise price of these warrants to between $0.0005 and $0.000585 per share from exercise prices ranging from $0.005
to $0.084 per share, resulting in a decrease in potential proceeds receivable from the exercise price of such warrants by $223,558.

The value of the derivative liability
related to the anti-dilution price protected convertible debt and warrants was evaluated immediately prior to the Triggering Event and
immediately after the Triggering Event, resulting in an additional derivative liability of $16,925,719 on the convertible
debt and $8,250,569 on the warrants.

On August 13, 2025, the Company entered
into an agreement to modify the conversion price of certain notes issued to Mercer, Cavalry and affiliated entities from conversion prices
ranging from $0.0005 to $0.084 per share, to a conversion price of $0.01 per share of common stock. A total of $2,009,024 of the convertible
debt is subject to derivative liability, resulting in a gain on repricing of convertible debt of $11,955,877. In addition convertible
debt with a fixed conversion price and not subject to derivative liability was repriced resulting in a deemed dividend expense of $33.378 and certain warrants were repriced resulting in a deemed dividend
expense of $704, resulting in a total deemed dividend expense of $34,082.

The net mark-to-market movement of
the derivative liability for the three months ended September 30, 2025 was a net mark-to-market debit of $33,292,940 and for the nine
months ended September 30, 2025 was $30,657,632, determined by using a Black-Scholes valuation model.

The following assumptions were used
in the Black-Scholes valuation model:

    Nine months
 ended September 30,
 2025  
    Year ended December 31,
 2024 

    Conversion price 
    $0.0005 to 0.01  
    $0.0364 to 0.345 
  
    Risk free interest rate 
     3.72 to 4.44% 
     3.58 to 5.50%
  
    Expected life of derivative liability 
     3 to 29 months  
     1 to 41 months