Company: IPSI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044146
Chunk: 139

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 139
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 shares of Common Stock exercisable for such warrants by 969,111,567 to
a total number of shares of Common Stock exercisable for such warrants to 982,029,937 and a reduction in the exercise price
to $0.001105 per share from $0.084 per share, In addition to this, certain warrants exercisable for 457,897 shares of common
stock have exercise price protection which reduced the exercise price of these warrants to $0.001105 per share from $0.084 per share,
resulting in a decrease in potential proceeds receivable from the exercise price of such warrants by $37,990. This resulted in a fair
value adjustment charge of $1,968,909 of which $1,618,545 was recorded as a charge to the statement of comprehensive loss as
it related to warrants subject to derivative liability treatment and $350,364 was recorded as a deemed dividend expense, as it related
to a down round adjustment to the price of a warrant 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:

    Three months

ended
 March 31, 
2025   
  
    Exercise price 
    $ 0.001105 to 0.084   
  
    Risk free interest rate 
     3.94 to 4.46%
  
    Expected life 
       5 months to 5 years