Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 253

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 253
---
 for 12-month non-convertible promissory notes in the amount of $482,000 (the “Exchange
Notes”) to each of Cavalry and Mercer. This exchange caused the cancellation of the Original Warrants for all purposes. The Company
accounted for the aggregate value of the notes issued of $964,000, less the fair value of the warrants exchanged for these notes of $43,608,
totaling $920,392 as a component of the loss on convertible debt.

The
Exchange Notes have a maturity date of December 30, 2023 and carry an interest rate of ten percent (10%). The Company had the
right, but not the obligation, in lieu of a cash payment upon maturity of the Exchange Notes, to issue a total of 1,730,058 shares
of Common Stock, as adjusted for any stock splits, dividends or other similar corporate events, in full satisfaction of its obligations
under the Exchange Notes (or any pro rata portion of such number of shares in partial satisfaction of such obligations). The Company is
under no legal obligation to reserve such number of shares for future issuance.

On
February 27, 2024, the maturity date of the notes was extended to April 30, 2024 with an automatic one-month extension each month until
such time as the note is declared to be in default, all other terms remain the same as the previous notes. The automatic extension of
the maturity date may not extend past November 27, 2024, thereafter all amounts due under the note are immediately due and payable. The
Company performed an analysis in terms of ASC 470 and it was determined that the extension was a debt modification, in addition, no additional
consideration was paid for the maturity date extension.

With
effect from November 27, 2024, the notes accrue interest at 18% per annum, the default interest rate per the note agreement. 

2024
Notes

Between
May 29, 2024 and November 27, 2024, the Company entered into nine Securities Purchase Agreements with four accredited investors, pursuant
to which the Company issued nine non-convertible promissory notes (the “2024 Notes”) with an aggregate principal
amount of $577,778 for gross proceeds of $433,333, after taking into account an aggregate original issuance discount of $144,445.

The
2024 Notes mature between February 28