Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 356

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1B
Chunk 356
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 wrongful termination
of employment in violation of public policy. Minkovich seeks $570,000 in damages, penalties, and attorneys’ fees plus shares equal
to five percent (5%) ownership of our Company. He bases his claim in part on the unilateral expectation that he receives 2.7 million
shares of the Company. Assuming he is owed any shares, a claim which we dispute, after the reverse 30-1 split he would receive only 90,000
shares.

Through prior counsel,
we and Mr. Corbett filed a motion to compel arbitration. The motion was denied on October 4, 2022. We and Mr. Corbett then appealed that
decision to the California Court of Appeal. As a result of the appeal, the court case was stayed until the appeal was decided. As a result
of the stay, the demurrer (the equivalent of a motion to dismiss) we filed through prior counsel was not decided.

On February 27, 2024,
the California Court of Appeal, Second District, reversed the Superior Court’s decision denying our motion to compel arbitration.
The Court of Appeal remanded the case to the Superior Court with directions to issue a new order compelling to arbitration the parties’
dispute regarding the enforceability of the arbitration clause. As the prevailing parties, the Company and Mr. Corbett were awarded costs
on appeal.

As expected, the plaintiff-initiated
arbitration before the American Arbitration Association (“AAA”) based on the appellate ruling. While, as the court order
states, the plaintiff may renew his challenge to the arbitration clause before the arbitrator, we believe such challenges are rare and
rarely succeed. Accordingly, we expect the dispute likely will be resolved through AAA arbitration. Management is vigorously defending
the claims and intends to continue to do so.

In mid-April 2024, the
Company and Mr. Corbett changed attorneys. The Law Offices of Jeffrey B. Neustadt replaced prior counsel. Mr. Neustadt’s office
submitted the cost bill and an attorneys’ fees motion that will be decided on September 10, 2024, by the trial court for the fees
incurred on the successful appeal. As with the Voloshin matter, we are contractually bound to proceed through arbitration and to that
end completed the process of selecting an arbitrator under the AAA rules. That appointment was made on August 7, 2024. Henceforth, the
Minkovich matter will track