Company: APCXW
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001683168-25-002130
Chunk: 442

Company: AppTech Payments Corp.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 5
Chunk 442
---
ed another reduction in the debenture conversion to $0.56.
The adjustment provision resulted in a revaluation of the warrant conversion repricing charge to additional paid-in capital and an accumulated
deficit of $15 thousand as of December 31, 2024.

Between August 29, 2024, and December 19, 2024, the
cashless Warrant was exercised in full resulting in 521,739 shares of common stock. The debenture was converted on multiple occasions,
resulting in the issuance of an aggregate of 1,975,606 shares of common stock. At December 31, 2024, the Company amortized the convertible
debt discount of $579 thousand and $26 thousand in interest expense. AppTech has no further obligations to the Purchaser.

NOTE 7 – RIGHT OF USE ASSET

Lease Agreement

In January 2020, the Company entered into a lease
agreement commencing February 8, 2020 for its corporate office in Carlsbad, California, which was set to expire in 2025. In December 2024,
the Company extended its lease for fourteen months through March 2026, with an option to extend for an additional fourteen months. At
inception of the lease, the Company recorded a right of use asset and liability. The Company used an incremental borrowing rate of 8.5%
within the calculation. The following are the expected future minimum lease payments as of December 31, 2024, including the total
amount of imputed interest related (in thousands):

    Schedule of right of use asset 

    2025 
    $73 
  
    2026 
     18 
  
    Minimum Future Lease Payments 
    $91 
  
    Less: Imputed interest 
     (5)
  
    Total Minimum Future Lease Payments 
    $86 

The rent expense was $80 thousand and $85 thousand
for the years ended December 31, 2024 and 2023, respectively.

     38 

NOTE 8 – COMMITMENTS AND CONTINGENCIES

The Company
may be involved in various claims and legal actions arising in the ordinary course of business. The Company establishes an accrued liability
for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable.

Convertible Note and Warrant Litigation

On
July 14, 2021, EMA Financial LLC (“EMAF”), filed