Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 1269

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 6
Chunk 1269
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MENT
SOLUTIONS, INC.

NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS

13CONVERTIBLE NOTES PAYABLE
(continued)

Cavalry
and Mercer December 2022 Note Amendment Transaction (continued)

    (2) The Original Warrants issued on February 16, 2021 were irrevocably exchanged for 12-month non-convertible promissory notes in the amount of $482,000 (the “Exchange Notes”). This exchange caused the cancellation of the Original Warrants for all purposes. The Exchange Notes have a maturity date of December 30, 2023 and carry an interest rate of ten percent (10%). The Company shall have the right, but not the obligation, in lieu of a cash payment upon maturity of the Exchange Notes, to issue a total 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; 

    (3)
    Each of Cavalry and Mercer agreed (i) not to convert all or any portion of the Cavalry/Mercer Notes until after March 30, 2023 and (ii) waive any events of default under the Cavalry/Mercer Notes and the Cavalry/Mercer SPAs;

    (4) Certain other warrants held by Cavalry and Mercer which contain a mandatory exercise provision allowing us to force exercise of such warrants if the price of the Common Stock is $1.80 per share or above were amended effective December 30, 2022 to reduce such forced exercise price to $1.20 per share; and 

    (5)
    The Company was obligated to register the shares of Common Stock underlying the Cavalry/Mercer Notes and the shares underlying all warrants held by Cavalry and Mercer for resale with the Securities and Exchange Commission and the Company filed the registration statement to satisfy such registration obligation.

As
a result of the reduction in the conversion price of the Cavalry/Mercer Notes, certain other warrants held by third parties have their
exercise price of such warrants reduced to $0.345 per share. All of the shares of our Common Stock underlying the Cavalry/Mercer
Notes as amended and all warrants held by Cavalry and Mercer as