Company: IPSI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110820
Chunk: 52

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 52
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 protection which reduced the exercise price of these warrants to between $0.0005 and $0.000585 from
$0.001105 to $0.005 per share, resulting in a decrease in potential proceeds receivable from the exercise price of such warrants
by $223,558. This resulted in a fair value adjustment charge of $9,976,484 of which $8,249,765, was recorded as a charge to the
statement of comprehensive loss as it related to warrants subject to derivative liability treatment and $1,726,719 was recorded
as a deemed dividend expense, as it related to a down round adjustment to the price of warrants issued during the current year, which
is not subject to derivative liability treatment.

25

INNOVATIVE PAYMENT SOLUTIONS, INC.

Notes to the Unaudited
Condensed Financial Statements

10STOCKHOLDERS’
EQUITY (continued)

d.Warrants
(continued)

The 2023, 2024
and 2025 Warrants contain exercise limitations providing that a holder thereof may not exercise the Warrants to the extent that, if after
giving effect to such exercise, the holder or any of its affiliates would beneficially own in excess of 4.99% (the “Maximum
Percentage”) of the outstanding shares of the Common Stock immediately after giving effect to such exercise. A holder may increase
or decrease its beneficial ownership limitation upon notice to the Company provided that in no event such limitation exceeds 9.99%,
and that any increase shall not be effective until the 61st day after such notice.

The fair value
of the warrants granted, repriced and issued, as described above, were determined by using a Black Scholes valuation model using the following
assumptions:

    Nine months
 ended 
September 30,
 2025 
  
    Exercise price 
    $0.0005 to 0.084 
  
    Risk free interest rate 
     3.77 to 4.46%
  
    Expected life 
     1 month to 5 years 
  
    Expected volatility of underlying stock 
     183.1 to
352.45%
  
    Expected dividend rate 
     0%

A summary of
warrant activity during the period January 1, 2024 to September 30, 2025 is as follows:

    Shares Underlying Warrants  
    Exercise price per share