Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 46

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 46
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 debt extinguishment of $102,353
and (v) a penalty incurred on default of convertible notes and penalties on conversion amounting to $117,083. In the prior year, the
loss on debt conversion was $90,761 and penalty on default was $9,306. In addition, an expense was incurred on debt extinguishment of
$64,256 by extending the maturity date of certain convertible notes.

Fair value on
price protected warrants

Fair value on price
protected warrants was $2,051,405 and $0 for the years ended December 31, 2024 and 2023, respectively. During the current year the exercise
price of certain warrants were reset due to the anti-dilution price protection and in the case of certain warrants, full ratchet price
protection, from an exercise price of $0.345 to $0.084. This resulted in a Black -Scholes derived valuation difference related to those
certain warrants of $2,051,405.

Loss on novation

Loss on novation was
$0 and $1,066,165 for the years ended December 31, 2024 and 2023, respectively, a decrease of $1,066,165 or 100%. In the prior year,
the loss on novation arose due the novation of the IPSIPay platform and all rights and obligations associated with the service agreement
with Frictionless to a third party.

Fair value of
warrants issued

Fair value of warrants
issued was $0 and $14,176 for the years ended December 31, 2024 and 2023, respectively, a decrease of $14,176 or 100.0%. In the prior
year, we issued a replacement warrant exercisable for 33,334 shares to an investor.

Interest expense

Interest expense was
$603,588 and $424,117 for the years ended December 31, 2024 and 2023, respectively, an increase of $179,471 or 42.3%. The increase is
related to new convertible note funding of $885,502, less repayments of $381,832 and $577,778 of promissory note funding during the current
year for working capital purposes.

Interest income

Interest income was
$32,838 and $0 for the years ended December 31, 2024 and 2023, respectively, an increase of $32,838 or 100.