Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 948

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 4
Chunk 948
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 for the years ended December 31, 2024 and 2023, respectively, a decrease of $378,465 or 99.4%. The decrease is primarily
due to the depreciation of the software platform and purchased software of $374,298, prior to the novation of the platform to a third
party during the prior year.

Loss on convertible
notes

Loss on convertible
notes was $4,764,680 and $164,323 for the years ended December 31, 2024 and 2023, respectively, an increase of $4,600,357. The loss on
convertible notes during the current year related to; (i) a loss of $4,318,669 realized on an anti-dilution adjustment to the conversion
feature of certain convertible notes; (ii) a loss of $56,329 realized on the conversion feature of a convertible note which through a
no notice default clause, triggered a variable priced conversion liability; (iii) a loss of $170,246 realized on conversion of certain
convertible notes at prices lower than the current market price during the current year; (iv) a loss on 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