Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 369

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1B
Chunk 369
---
 net of unamortized debt discount of $0.1 million. The notes
contain certain covenants, such as restrictions on: (i) distributions on capital stock, (ii) stock repurchases, and (iii) sales and the
transfer of assets. The notes bear interest at a rates ranging from 8% to 24.98% per annum. and are convertible into our common
stock at conversion prices ranging from fixed conversion prices of $0.084 per share (as adjusted for stock splits, stock combinations,
dilutive issuances and similar events), to variable conversion prices of 60% to 70% of lowest trading prices over a 10 to 20-trading
day period. Should the investors choose not to convert these convertible notes, we may need to repay these notes together with interest
thereon which will impact on our liquidity.

Given our losses and
negative cash flows, we will be required to raise significant additional funds by issuing equity or equity-linked securities to progress
our existing business model with IPSIPay Express. Additional debt financing, if available, may involve covenants restricting our operations
or our ability to incur additional debt. Any additional debt financing or additional equity that we raise may contain terms that are
not favorable to us or our stockholders and require significant debt service payments, which diverts resources from other activities.
Moreover, there is a risk that financing may be unavailable to support our operations on favorable terms, or at all.

There is also a significant
risk that none of our plans to raise financing will be implemented in a manner necessary to sustain us for an extended period of time.
If adequate funds are not available to us when needed, we may be required to continue with reduced or discontinued operations or to obtain
funds through arrangements that may require us to relinquish rights to technologies or potential markets, any of which could have a material
adverse effect on our Company. In addition, our inability to secure additional funding when needed could cause our business to fail
or become bankrupt or force us to wind down or discontinue operations, accordingly, there is substantial doubt relating to our ability
to continue as a going concern.

We do not have any off
balance sheet financing arrangements as of the date of this Report.

Capital Expenditures

Our capital expenditure
is dependent on our cash resources, currently we are not forecasting any additional capital expenditure for the 2025 fiscal year.

27

Critical Accounting
Policies

Preparation of our consolidated