What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-09-16 compared with 2023-11-13 · 483 added, 383 removed, 42 unchanged (95% of the section changed)

1 unchanged sentence

Forward-looking

This Quarterly Report contains “Forward-Looking Statements.”

All statements other than statements of historical fact are “Forward-Looking Statements” including but not limited to, statements

regarding the pending strategic transactions or the possible dissolution and liquidation or bankruptcy of the Company.

Quarterly Report contains “Forward-Looking Statements.” All statements other than statements of historical fact are “Forward-Looking

Statements” including but not limited to, statements regarding our expectations about development and commercialization of our

technology, any projections of revenues or statements regarding our anticipated revenues or other financial items, any statements of

the plans and objectives of management for future operations, any statements concerning proposed new products or services, any statements

regarding future economic conditions or performance, and any statements of assumptions underlying any of the foregoing.

All Forward-Looking

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In some cases, Forward-Looking Statements can be identified by the use

of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “intends,”

“believes,” “estimates,” “potential,” or “continue,” or the negative thereof or other

comparable terminology.

Although we believe that the expectations reflected in the Forward-Looking Statements contained herein are reasonable,

there can be no assurance that such expectations or any of the Forward-Looking Statements will prove to be correct, and actual results

could differ materially from those projected or assumed in the Forward-Looking Statements.

Future financial condition and results of operations,

as well as any Forward-Looking Statements are subject to inherent risks and uncertainties, including factors referred to in our press

releases and reports filed with the Securities and Exchange Commission (“SEC”).

All subsequent Forward-Looking Statements

attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements.

of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,”

“intends,” “believes,” “estimates,” “potential,” or “continue,” or the negative

thereof or other comparable terminology.

Although we believe that the expectations reflected in the Forward-Looking Statements contained

herein are reasonable, there can be no assurance that such expectations or any of the Forward-Looking Statements will prove to be correct,

and actual results could differ materially from those projected or assumed in the Forward-Looking Statements.

Future financial condition

and results of operations, as well as any Forward-Looking Statements are subject to inherent risks and uncertainties, including factors

referred to in our press releases and reports filed with the Securities and Exchange Commission (“SEC”).

All subsequent Forward-Looking

Statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary

Additional factors that may have a direct bearing on our operating results are described under the caption “Risk Factors”

in our Annual Report on Form 10-K for the year ended December 31, 2022 and elsewhere in this Quarterly Report.

were incorporated as Messidor Limited in Nevada on December 23, 1985, and changed our name to Framewaves Inc.

On September 27,

2010, we changed our name to Sigma Labs, Inc.

We commenced our current business operations in 2010.

On May 17, 2022, we began doing business

as Sigma Additive Solutions, and on August 9, 2022, changed our name to Sigma Additive Solutions, Inc.

in our Annual Report on Form 10-K for the year ended February 29, 2024 and elsewhere in this Quarterly Report.

Additive Solutions, Inc.

(“Sigma”), the legal acquiror of NextTrip, was initially incorporated as Messidor Limited in Nevada

on December 23, 1985, and changed its name to Framewaves Inc.

On September 27, 2010, the name was changed to Sigma Labs, Inc.

On May 17, 2022, Sigma Labs, Inc.

began doing business as Sigma Additive Solutions, and on August 9, 2022, changed its name to Sigma

Additive Solutions, Inc.

March 11, 2024, Sigma filed a Certificate of Amendment to its Amended and Restated Articles of Incorporation, as amended to date, with

the Secretary of State of the State of Nevada, pursuant to which, effective as of 12:01 a.m.

Pacific time on March 13, 2024, among other

things, Sigma’s corporate name was changed from Sigma Additive Solutions, Inc.

to “NextTrip, Inc.”

principal executive offices are located at 3900 Paseo del Sol, Santa Fe, New Mexico 87507, and our telephone number is (954) 526-9688.

Our website address is www.sigmaadditive.com .

The Company’s annual reports, quarterly reports, current reports on Form 8-K

and amendments to such reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange

Our website address is www.nexttrip.com .

The Company’s annual reports, quarterly reports, current reports on Form 8-K and

amendments to such reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange

Act”), and other information related to the Company, are available, free of charge, on our website.

1 unchanged sentence

and the information contained therein, or connected thereto, are not and are not intended to be incorporated into this Quarterly Report.

to the Exchange Agreement, as described below, NextTrip Holdings, Inc.

(“NextTrip”) was a wholly owned subsidiary

of NextTrip Group, LLC (“Group”), which in turn, was a wholly owned subsidiary of NextPlay Technologies, Inc.

(“NextPlay”).

All of the business operations of Group were conducted through its subsidiaries.

On January 25, 2023, NextPlay and Group entered into

an Amended and Restated Separation Agreement (“Separation Agreement”), Amended and Restated Operating Agreement (“Operating

Agreement”), and Exchange Agreement (“Exchange Agreement”, and together the “Agreements”), whereby

NextPlay transferred their interest in the travel business to Group.

Pursuant to the Exchange Agreement, NextPlay exchanged 1,000,000

Membership Units of Group for 400,000 Preferred Units of Group, with a value of $10 per unit.

Prior to the exchange for Preferred Units,

Group had a payable due to NextPlay of $17,295,873, representing cash advances and payment of expenses by NextPlay on behalf of Group,

while NextPlay had obligations to provide ongoing support to NextTrip.

Such liability was settled by the issuance of the Preferred Units

and the waiver of all of NextPlay’s ongoing support obligations except for a $1.5 million advance remaining under a promissory

note, and as such NextTrip recorded the payable as contributed capital.

Company provides travel technology solutions with sales originating in the United States, with a primary emphasis on hotels, air, and

all-inclusive travel packages.

Our proprietary booking engine, branded as NextTrip 2.0, provides travel distributors access to a sizeable

Company owns 50% of Next Innovation LLC (Joint Venture) and this entity is in the process of a first structure plan.

No activities

nor operations occurred in 2023 or 2024 for this entity and NextTrip, Inc.

does not have control of the company and therefore no

minority interest was recorded.

October 12, 2023, Sigma entered into a Share Exchange Agreement (as amended, the “Exchange Agreement”) with NextTrip, Group,

and William Kerby (the “NextTrip Representative”).

Under the terms of the Exchange Agreement, the parties agreed that Group

would sell and transfer to Sigma all of the issued and outstanding shares of NextTrip in exchange for 156,007 restricted shares of Sigma

common stock (the “Closing Shares”), issuable at closing, and the right to receive up to an additional 5,843,993 restricted

shares of Sigma common stock upon satisfaction of certain milestones set forth in the Exchange Agreement (the “Contingent Shares,”

and together with the Closing Shares, the “Restricted Shares”), which Restricted Shares are issuable to the members of Group,

on a pro rata basis, under the terms of the Exchange Agreement, subject to certain closing conditions (the “Acquisition”).

Upon the closing of the Acquisition on December 29, 2023, NextTrip became a wholly owned subsidiary of Sigma.

Contingent Shares, together with the Closing Shares, will not exceed 6,000,000 shares of Sigma common stock, or approximately 90.2% of

the issued and outstanding shares of Sigma common stock immediately prior to the closing.

The Acquisition will likely result in a change

of control, with the members of Group receiving an aggregate number of shares that exceeds the number of shares that held by the legacy

shareholders of Sigma.

As a result, the Acquisition is accounted for as a reverse acquisition of NextTrip by Sigma, whereby Sigma is

treated as the legal acquirer and NextTrip is treated as the accounting acquirer.

As a result, the historical financial information presented

is that of NextTrip.

accordance with ASC 805 - 40 - 45 - 1, the consolidated financial statements prepared following a reverse acquisition

are issued under the name of the legal parent (NextTrip, Inc., f/k/a Sigma Additive Solutions, Inc.) but described in the notes to the

financial statements as a continuation of the financial statements of the legal subsidiary (NextTrip), with one adjustment, which

is to retroactively adjust the accounting acquirer’s legal capital to reflect the legal capital of the accounting acquiree.

adjustment is required to reflect the capital of the legal parent.

Comparative information presented in the consolidated financial statements

also is retroactively adjusted to reflect the legal capital of the legal parent.

ASC 805 - 40 - 45 - 2, the consolidated financial statements represent the continuation of the legal subsidiary

except for the capital structure, as follows:

assets and liabilities of the legal subsidiary recognized and measured at their pre-combination carrying amounts;

assets and liabilities of the legal parent recognized and measured in accordance with the guidance in this topic applicable to business

combinations (ASC 805);

retained earnings and other equity balances of the legal subsidiary before the business combination;

amount required to be recognized as issued equity interests in the consolidated financial statements determined by adding the issued

equity interest of the legal subsidiary outstanding immediately before the business combination to the fair value of the legal parent

determined in accordance with the guidance in ASC 805 applicable to business combinations.

However, the equity structure reflects

the equity structure of the legal parent, including the equity interests the legal parent issued to affect the combination.

the equity structure of the legal subsidiary is restated using the exchange ratio established in the acquisition agreement to reflect

the number of shares of the legal parent issued in the reverse acquisition.

assets and liabilities of Sigma Additive Solutions, Inc.

were recognized at fair value under ASC 805 as described in NOTE 4– Goodwill.

Accounting Policies and Estimates

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of our financial statements.

Recognition – The Company’s revenue is derived primarily from sales of our software and related hardware suite under

perpetual licenses and from providing engineering services under contracts.

The Company recognizes revenue in accordance with ASC Topic

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2014-09, Revenue

from Contracts with Customers .

ASU 2014-09 is a comprehensive revenue recognition standard that superseded nearly all existing revenue

recognition guidance under prior GAAP and replaced it with a principles-based approach for determining revenue recognition.

principle of the standard is the recognition of revenue upon the transfer of promised goods or services to customers in an amount that

reflects the consideration to which the company expects to be entitled in exchange for those goods or services.

In general, we determine

revenue recognition by:

(1) identifying the contract, or contracts, with our customer;

(2) identifying the performance obligations in

the contract;

(3) determining the transaction price;

(4) allocating the transaction price to performance obligations in the contract;

and (5) recognizing revenue when, or as, we satisfy performance obligations by transferring the promised goods or services.

January 2022, the Company began offering a subscription option to its customers, pursuant to which it leases its PrintRite3D platform

for terms between 12 and 36 months and provide technical support and maintenance for the term of the arrangement, as well as installation

and training.

The Company has determined these are leases because they relate to discrete pieces of equipment to which customers have

the right to substantially all the economic benefit and exclusive use during the term of the arrangement.

These leases are classified

as operating leases and the Company retains title to the underlying equipment.

leases may be renewed for successive one-year terms unless notice is given by either party of its intent not to renew at least 30 days

before the end of the lease term.

For leases with 36-month terms, the lessee may terminate the agreement after the first 18 months upon

at least 30 days written notice.

Some, but not all, of the leases permit lessees to purchase the asset at any time at an amount that

approximates fair value and are not reasonably certain to be exercised at the inception of the lease.

There are no anticipated variable

lease payments at the inception of the lease.

are two non-lease components in the arrangement that consist of technical support and maintenance, and installation and training.

Company has elected single component practical expedient accounting to combine the technical support and maintenance with the lease as

they have the same pattern of transfer.

The installation and training component does not have the same pattern of transfer;

this component is not eligible for single component practical expedient accounting.

The lease consideration is allocated on a relative

fair value basis of the underlying lease and non-lease components.

The Company has estimated the residual value of the leased equipment

based on its useful life, and the ability to refurbish and sell the equipment, as well as the Company’s ability to componentize

the hardware and utilize subassemblies in other products.

Company is depreciating assets over their useful life of 7 years, but certain subassemblies and components may have a longer economic

Receivable and Allowance for Doubtful Accounts - Trade accounts receivable are carried at original invoice amount less an estimated

allowance for doubtful accounts.

We determine the allowance for doubtful accounts by identifying potential troubled accounts and by using

historical experience and future expectations applied to an aging of accounts.

Trade accounts receivable are written off when deemed

uncollectible.

Recoveries of trade accounts receivable previously written off are recorded as income when received.

As of September 30,

2023 and September 30, 2022, the Company has established an allowance for doubtful accounts of $115,000 and $0, respectively.

Valuation - Inventories consist of raw materials used in the production of customized parts, work-in-process and finished goods components

which will be sold to customers.

Inventories are valued at the lower of cost or net realizable value, using the first-in, first-out

Charges for obsolete inventory are based on identification of specific items resulting from regular, on ongoing reviews of our

and Intangible Assets – Long-lived assets and certain identifiable definite life intangibles to be held and used by the Company

are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The Company periodically evaluates the recoverability of its long-lived assets based on estimated future cash flows and the estimated

liquidation value of such long-lived assets and provides for impairment if such undiscounted cash flows are insufficient to recover the

carrying amount of the long-lived assets.

If impairment exists, an adjustment is made to write the asset down to its fair value, and

a loss is recorded as the difference between the carrying value and fair value.

Fair values are determined based on quoted market values,

discounted cash flows or internal or external appraisals, as applicable.

Assets to be disposed of are carried at the lower of carrying

value or estimated net realizable value.

Utility patents are amortized over a 17-year period.

Patents which are pending are not amortized.

Compensation – We measure the compensation costs of stock-based compensation arrangements based on the grant-date fair value

and recognize the costs in the financial statements over the vesting period of the stock-based compensation.

Stock-based compensation

arrangements may include stock options, grants of shares of common stock with and without restrictions, performance-based awards, and

stock appreciation rights, or SARs.

Compensation cost is measured on the date of grant at its fair value.

instruments issued to non-employees are recorded on the basis of the grant date fair value of the instruments.

In general, the measurement

date is either (a) when a performance commitment, as defined, is reached or (b) the earlier of the date that (i) the non-employee performance

requirement is complete or (ii) the instruments vest.

The measured value related to the instruments is recognized over a period based

on the facts and circumstances of each particular grant.

fair value of common stock grants is based upon the closing price of our common stock as reported on The Nasdaq Capital Market on the

date of the grant.

The grant date fair value of stock options and SARs is calculated using the Black Scholes valuation model, and requires

estimates of several inputs to the model, including risk-free interest rates, dividends, and expected volatility of our stock price.

Additive Solutions, Inc.

(“Sigma,” “we,” “us,” “our” and the “Company”) was

founded by a group of scientists, engineers and businesspeople to develop and commercialize novel and unique manufacturing and materials

technologies.

The Company anticipated that its core technologies would allow its customers to combine advanced manufacturing quality

assurance and process control protocols with novel materials to achieve breakthrough product potential in many industries, including

aerospace, defense, oil and gas, bio-medical, and power generation.

Historically,

we generated revenues through sales of our PrintRite3D® technology to customers that seek to improve their manufacturing production

processes, and through ongoing annual software upgrades and maintenance fees.

In 2022, we began offering our current PrintRite3D integrated

hardware and software solution on a subscription basis, which reduced the initial upfront cost to a new user from over $100,000 to approximately

$3,000-$5,000 per month.

The combination of subscription pricing and the new software-only products that can be embedded into OEM and

software partner offerings was intended to make our technology more affordable to acquire and easier to bundle, distribute and support

in an effort to become the industry standard.

The shift in our business model adversely affected our revenues and near-term revenue growth

as we increased our focus on building strategic partnerships, expanding our partner ecosystem, and ensuring the success of our existing

customers as they move into production.

March 1, 2023, we announced that we had retained Lake Street Capital Markets as our financial advisor in connection with our consideration

of a range of strategic alternatives, including a possible strategic investment, acquisition, merger, business combination, or similar

our Current Report filed with the SEC on October 13, 2023, we reported that we had entered into an Asset Purchase Agreement with Divergent

Technologies, Inc., or Divergent, pursuant to which have agreed to sell to Divergent, and Divergent has agreed to purchase from us, certain

assets consisting primarily of patents, software code and other intellectual property for a purchase price of $1,626,242, including a

$37,000 earnest-money deposit previously paid to us by Divergent.

The closing under the Asset Purchase Agreement is expected to occur

subsequent to the closing or termination of our acquisition of NextTrip Holdings, Inc.

parties’ respective obligations to close are subject to the accuracy of the parties’ respective representations and warranties

and performance of their respective covenants and satisfaction or waiver of other customary conditions specified in the Asset Purchase

our additional Current Report filed with the SEC on October 13, 2023, On October 12, 2023, we reported that we had entered into a Share

Exchange Agreement with NextTrip Holdings, Inc., pursuant to which we will acquire NextTrip (the “Acquisition”) in exchange

for shares of our common stock, which we refer to as the Exchange Shares, subject to approval of our shareholders and other conditions

described below.

As a result, NextTrip will become a wholly owned subsidiary of Sigma, which is expected to change its corporate name

to “NextTrip, Inc.” following the Acquisition.

the closing of the Acquisition, the shareholders of NextTrip will be issued a number of Exchange Shares equal to 19.99% of our issued

and outstanding shares of common stock immediately prior to the closing.

Under the Share Exchange Agreement, the NextTrip shareholders

will be entitled to receive additional shares of our common stock, referred to as the Contingent Shares, subject to NextTrip’s

achievement of future business milestones specified in the Share Exchange Agreement.

Alternatively,

independent of the aforementioned milestones, for each month during the fifteen (15) month period following the closing date that in

which $1,000,000 or more in gross travel bookings are generated by the combined company, to the extent not previously issued, the Contingent

Shares will be issuable up to the maximum Contingent Shares issuable under the Share Exchange Agreement.

Contingent Shares, together with the shares of our common stock issued at the closing, will not exceed 6,000,000 shares of our

common stock, or approximately 90.2% of our issued and outstanding shares of common stock immediately following the issuance of such

Assuming all the business milestones are achieved and no other change in our outstanding shares, Sigma shareholders will retain approximately 9.8% of the Company’s

outstanding shares immediately following the issuance of such shares.

parties’ respective obligations to close the Acquisition are subject to the satisfaction or waiver of various conditions specified

in the Share Exchange Agreement.

The conditions include approval by Sigma shareholders of the issuance of the Exchange Shares as required

by applicable listing standards of Nasdaq, amendments to our amended and restated articles of incorporation

to change our name as described above and to increase our authorized common stock, the continued listing or our common stock on Nasdaq,

as well as customary other closing conditions.

Agreement contains representations and warranties and covenants of the parties customary for a transaction of this nature which will

not survive the closing of the Acquisition.

The Share Exchange Agreement also contains customary covenants regarding the conduct of the

respective businesses of Sigma and NextTrip pending the closing of the Acquisition.

The Share Exchange Agreement permits us to sell our

quality assurance software assets at or after the closing of the Acquisition as contemplated by our Asset Purchase

Agreement with Divergent Technologies, Inc.

Share Exchange Agreement may be terminated by the parties by mutual agreement or by a party in the event of a breach of the other party’s

representations, warranties or covenants, subject to certain exceptions, or if the Acquisition is not completed by December 31, 2023.

Recognition – The Company recognizes revenue in accordance with ASC 606 which involves identifying the contracts with customers,

identifying performance obligations in the contracts, determining transactions price, allocating transaction price to the performance

obligation and recognizing revenue when the performance obligation is satisfied.

Company recognizes revenue when the customer has purchased the product, the occurrence of the earlier of date of travel or the date of

cancellation has expired, as satisfaction of the performance obligation, the sales price is fixed or determinable and collectability

is reasonably assured.

Revenue for customer travel packages purchased directly from the Company are recorded gross (the amount paid to

the Company by the customer is shown as revenue and the cost of providing the respective travel package is recorded to cost of revenues).

Company generates revenues from sales directly to customers as well as through other distribution channels of tours and activities at

destinations throughout the world.

Company controls the specified travel product before it is transferred to the customer and is therefore a principal, based on but not

limited to, the following:

Company is primarily responsible for fulling the promise to provide such travel product.

Company has inventory risk before the specified travel product has been transferred to a customer or after transfer of control to

Company has discretion in establishing the price for the specified travel product.

for tours or activities received in advance of services being rendered are recorded as deferred revenue and recognized as revenue at

the earlier of the date of travel or the last date of cancellation (i.e., the customer’s refund privileges lapse).

Note Receivable

is in default under the terms of its promissory note to NextTrip, and as a result, an allowance for doubtful accounts of $1,567,665 was

established as of February 29, 2024 as collectability of the entire receivable is uncertain.

During the three months ended May 31, 2024

and 2023, there was no bad debt expense recorded related to the allowance account, and the allowance is unchanged as of May 31, 2024.

As of May 31, 2023, no allowance for doubtful accounts was established.

(the “Company,” “NextTrip,” “we,” “us” and “our”) is an innovative technology

company that is building next generation solutions to power the travel industry.

NextTrip, through its subsidiaries, provides travel

technology solutions with sales originating in the United States, leisure travel, business travel, groups travel, media and tech.

connect people to new places and discoveries by utilizing digital media engagement, seasoned planning expertise, and unique inventory

to curate custom vacations and business travel across the globe.

Our proprietary booking engine, branded as NXT2.0, provides travel distributors

access to a sizeable inventory.

vision is to drive the evolution of the travel industry by merging advanced digital solutions with personalized travel services.

core technology – a fully integrated travel booking platform – focuses on untapped and underserved sectors of the travel

industry, intending to capture new markets.

We expect that our future growth will be accelerated by interactive technology, immersive

media and unparalleled travel industry expertise.

believe NextTrip will revolutionize the travel industry by combining advanced digital technologies with personalized travel services.

Our mission is to become the premier travel, media, and lifestyle brand, inspiring and empowering individuals to explore the world.

our brands, including NextTrip Vacations, Travel Magazine, and Compass.TV, we aim to create a unique ecosystem that reduces dependency

on traditional marketing methods, where major travel companies spend billions to attract customers.

strategy focuses on both the Media and Travel divisions working together to draw users into our ecosystem by offering the following benefits:

to a wealth of highly relevant travel videos and articles for research.

ability to plan and save future travel destinations and activities on personalized profiles.

to share travel ideas and communicate with others.

from our concierge help desk and AI-powered solutions.

convenience of booking travel online or through a call center.

to customer support before, during, and after travel.

opportunity to earn rewards that encourage repeat bookings.

ecosystem is built on four key pillars:

A comprehensive travel booking platform that offers curated, personalized, and seamless travel experiences for every budget and

Powered by the NXT2.0 booking platform, NextTrip serves as our direct-to-consumer transactional hub, providing users with

detailed scheduling, pricing, and availability information for airlines, hotels, rental cars, and other travel products.

offer dynamically assembled travel packages and provide valuable content, including destination information, maps, and travel

details, all supported by our customer call center.

A trusted source of captivating travel inspiration, offering authentic stories, practical advice, and diverse perspectives

to fuel wanderlust and create lasting vacation memories.

Travel Magazine will soon launch MyBucketList, a platform designed for travelers

to build and share their travel bucket lists with personalized suggestions, booking support, and local insights.

Our Free Ad-supported Streaming TV (“FAST”) channel, slated for launch in fall 2024.

Compass.TV will offer over 1,000 hours of travel

shows and long-form travel content at launch.

To draw users into the NextTrip ecosystem, the launch will be supported by travel

influencers, promoted to our multi-million strong email list, and marketed to major streaming platforms like Roku and YouTube.

Compass.TV plans to use artificial intelligence to personalize content, convert blogs and articles to video, and enable users to

create custom videos.

This platform will allow users to create fully customized FAST channels featuring vacation opportunities that

can be explored and booked directly through the NextTrip booking engine.

PrometheanTV :

A unique influencer-led platform that drives advertising revenue and content-to-commerce.

We recently secured a perpetual license

with Promethean TV, Inc., the developer of the Ignite TV interactive video platform.

This technology will power Compass.TV and video

content on Travel Magazine/MyBucketList, allowing for targeted advertising via video overlays, enabling viewers to purchase travel

directly from their screens.

This integration is designed to enhance customer engagement, drive ad-supported revenue, and increase

travel transactions.

integrating the NextTrip booking platform across all our media platforms, we will enable users to research and book travel seamlessly

from any of our offerings.

Our ecosystem will encompass leisure travel, wellness travel, business travel, alternative lodging, and innovative

technology and media solutions.

We will engage with consumers throughout the entire travel planning journey, from initial research to

post-travel, offering robust product options and preferred rates in top global destinations.

We believe that NextTrip stands apart from

other travel companies, providing users with the tools to create personalized vacation packages and travel solutions, resulting in a

more rewarding experience than traditional pre-packaged offerings.

This ensures a thriving and growing ecosystem that drives both travel

transactions and targeted advertising revenue while supporting consumers on their travel journeys—truly a next-generation travel

Organizational

Monaker Group Business

travel business was the principal business of NextPlay (then, Monaker Group, Inc.

(“Monaker”)) until June 30, 2020, when

Monaker entered into a share exchange transaction with HotPlay Enterprise Limited (“HotPlay”), resulting in HotPlay becoming

a wholly owned subsidiary of Monaker and HotPlay’s business becoming the principal business of Monaker.

Prior to this share exchange,

the primary focus of Monaker had been its travel business, which included the sale of vacation rentals, and in particular, ALRs, to consumers

through its proprietary booking engine.

To support its travel offerings, Monaker introduced travelmagazine.com, featuring travel and

lifestyle content to appeal to travelers researching destinations and planning future vacations.

In January 2023, NextPlay spun the NextTrip

business out to its founders to separate it from NextPlay’s primary business.

Transition and Technology Development

spread of the COVID-19 virus globally beginning in January 2020 severely impacted our business.

Beginning in March 2020, many U.S.

and foreign countries began issuing “stay-at-home” orders and closed their borders to interstate and international travel.

Such restrictions on travel, together with other measures implemented by governments around the world, severely restricted the level

of economic activity around the world and had an unprecedented effect on the global travel industry.

The public’s ability to travel

was severely curtailed through border closures, mandated travel restrictions and limited operations of hotels, airlines, and additional

voluntary or mandated closures of travel-related businesses from December 2019 through the beginning of 2022 (and beyond in some jurisdictions).

Measures implemented during the COVID-19 pandemic led to unprecedented levels of temporary and permanent business closures, cancellations

and limited new travel bookings, having a severe negative impact on our business, financial condition and results of operations.

to the significant decrease in demand for the travel related services provided by us during the peak of the COVID-19 pandemic, we shifted

our focus to developing and enhancing our program offerings.

For example, we began to develop our online media platform -TravelMagazine.com

allowing consumers to research future travel options as well as enhancing the functionality of our booking engines, including developing

a booking engine platform that allows customers to book packaged vacations and wellness programs along with the development of a platform

to arrange and manage business travel.

of Bookit.com Asset

NextTrip’s separation from NextPlay, our team focused on the continued technological development of its booking platform.

of this development, we acquired a travel platform in June 2022 to help power our proprietary NXT2.0 booking technology.

this technology powered the Bookit.com business, a well-established online leisure travel agent generating over $400 million in annual

sales as recently as 2019 (pre-pandemic).

As part of the acquisition of the assets of Bookit.com, we were not only able to acquire a

proven technology platform that could be integrated with our core travel sectors, but we were also able to secure the Bookit.com database

with millions of past travelers and opt-in consumers.

2022, and the acquisition of the Bookit.com business, we have been focused on the holistic development and integration of the NXT2.0

technology platform, which serves as a base for current and future technology projects as well as proprietary system enhancements.

integration includes re-engaging with and re-negotiating more than 250 contracts with hotel, airline, and cruise suppliers, and securing

unique product inventory of more than 3 million lodging, air and tour product suppliers at exceptional rates to over 2,100 destinations

in 200+ countries worldwide.

this strategic offering, we will focus on key areas of opportunity in the travel sector and drive enhanced booking conversion rates.

Our proprietary technology, when combined with media, product offerings and customer service, provides a unique lane to serve mid- to

luxury travelers.

December 2023, we completed the Acquisition, which resulted in NextTrip becoming a wholly-owned subsidiary of a public company

and the principal business of the Company moving forward.

To align the new business with NextTrip’s travel-focused business model,

the Company recently changed its name to “NextTrip, Inc.”

of Promethean FAST TV Exclusive License

recently entered into a perpetual license agreement with Promethean TV, Inc.

(“Promethean”), the owner and developer of the

Ignite TV interactive video platform used for driving engagement and commerce.

This license will form the basis for our FAST channel – Compasss.TV allowing for targeted advertising via video overlays, allowing the viewer to purchase

travel from their screen.

This integrated technology is intended to boost engagement with customers driving ad-supported revenue and

travel transactions.

Fully Integrated Travel Booking Platform

have established a direct-to-consumer presence though a number of websites, powered by the NXT2.0 booking platform.

Today, the primary

leisure platform is hosted on nexttrip.com and the media platform is hosted on travelmagazine.com.

sells travel services to leisure and corporate customers across these websites.

Our primary focus is our current offerings of scheduling,

pricing and availability information for booking reservations for airlines, hotels, rental cars, as well as other travel products such

as transfers, sightseeing tours, shows and event tickets.

NextTrip sells these travel services both individually and as components of

dynamically assembled packaged travel vacations and trips.

In addition, we provide content that presents travelers with information about

travel destinations, maps and other travel details.

online travel publication, travelmagazine.com, provides travelers around the world with inspiration for future vacation destinations

The publication offers written articles, videos, and podcasts.

The website is expected to be supported by advertising and

allow for research and booking of vacation products.

Products and Services

are building an ecosystem with technology and product offerings that will include leisure travel, wellness travel, business travel, alternative

lodging, technology and media solutions.

We engage with consumers and distributors throughout the travel planning journey from planning

through post-travel.

Through direct relationships, we have established robust product offerings and preferred rates across the top destinations

Our primary product offerings are as follows:

Leisure brings travel solutions and a proprietary booking engine that allows customers to book customized travel, including vacation

packages, airline tickets, hotel reservations, tours and activities, curated journeys, cruises, wellness and group travel.

Solutions offers technology solutions for product and inventory management as well as white label offerings including NextTrip products

under their brand, and technology solutions.

We are also developing a travel agent portal to drive bookings and travel agent brand

Media includes Travel Magazine and the Compass.TV experience, which is currently in development.

These digital solutions engage consumers

at the initial phases of travel planning, offering relevant content, destination information and immersive online experiences as

well as solutions for travel suppliers.

This ecosystem, once fully developed, is expected to allow users to create their own fully

customized FAST channel featuring vacation journey opportunities that customers can explore prior to booking the actual vacation.

and Services for Travelers

Tools and Ability to Compare .

Our online marketplace nexttrip.com provides travelers with the tools to search for and filter several

travel products including air, car, accommodations (including ALRs) and activities based on various criteria, such as destination, travel

dates, type of property, number of bedrooms, amenities, price, or keywords.

Travelers are able to create accounts on our website(s) that give them access to their booking activity through the website.

Members will also have access to special rates and discounts on the NextTrip product.

Travel guides, videos and pictures as well as travel articles can be accessed through travelmagazine.com.

We use a combination of technology and human review to evaluate the content of listings and to screen for inaccuracies or fraud with

the goal of providing only accurate and trustworthy information to travelers.

NextTrip is Payment Card Industry compliant to ensure the

safety and security of its customer credit card data.

Communication.

Travelers who create an account on our websites will receive regular communications, including notices about places of interest,

special offers, new listings, and an email newsletter.

The newsletter will be available to any traveler who agrees to receive it and

offers introductions to new destinations and properties, as well as tips and useful information when traveling.

the COVID-19 pandemic arose, we have primarily focused on developing our booking engine and establishing relationships with suppliers

to increase the size of our instantly bookable inventory.

The booking engine has produced little revenue to date because of, among other

reasons, the efforts that have been taken to integrate the NextTrip travel platforms with the Bookit.com technology since its acquisition

in the summer of 2022.

The new platform was launched in beta in May 2023 with a limited number of hotel properties in Mexico and the

We have expanded our distribution since launch to include over one million hotel properties worldwide and have completed a

full launch of the leisure travel website in May 2024.

Revenue Drivers

fully integrated travel booking platform serves as the foundation of our revenue-generating business.

The platform contains a robust

booking engine with merchandising capabilities that drive increased conversions and higher per revenue transactions.

We plan to leverage

the bookit.com foundational travel database consisting of several million customers to further drive revenues.

Those revenues consist primarily

of commissions and bookings but are expanding to include affiliate commerce, advertising and sponsored content (via Compass.TV and Travel

addition, as the booking platform expands, it establishes an opportunity for product expansion and revenue from technology licensing,

including white-labeling key technology.

A monthly software-as-a-service (“SaaS”) model is being established around key technology developments

and innovative platforms, including turn-key booking solutions, product management and targeted audience offerings.

Future Research & Development Driving Growth

we expand the reach of our booking platforms, including to different underserved areas of the travel industry, we plan to focus on future

technologies to drive growth by investing in research and development.

As FAST gains momentum globally, we are in the process of developing Compass.TV, with a targeted launch

in the fall of 2024.

Our innovative travel channel is being developed in conjunction with our perpetual license with Promethean discussed

With over 1,000 hours of relevant travel content secured, Compass.TV intends to utilize artificial intelligence (“AI”) to personalize

content, convert blogs and articles to video, and empower users to create custom travel channels.

Integration with the NextTrip Concierge

desk will enable seamless booking and assistance.

recognizes the pivotal role of video in promoting travel sales and engagement, hence our focus on incorporating video across platforms.

To maximize effectiveness, NextTrip has entered into the license with Promethean enabling targeted advertising and transactional capabilities

without interrupting content.

are transforming our Travel Magazine website into a social media platform catering to all things travel.

The site was re-launched mid-2024,

and features enhanced media capabilities and targeted advertising using the Promethean solution.

A private consumer section called “MyBucketList,”

is targeted for release in the fall of 2024 and will feature connectivity to booking engines, AI travel planner assist and AI-driven

content creation.

My Bucket List, NextTrip is building a technology solution catered to travelers to build and share their own travel bucket list with

personalized suggestions, booking support and local insights.

of Operations

Months Ended September 30, 2023 and September 30, 2022

the three months ended September 30, 2023, we recognized revenue of $141,988, as compared to $ 188,245 in the same period in 2022, a

decrease of $46,257, or 25%.

The decrease was due to decreased PrintRite3D sales of $41,595, and decreased annual maintenance contract

revenue of $13,560, as compared to the third quarter of 2022.

Partially offsetting the decreases were increases in PrintRite3D lease

revenue of $5,669, and on-site development and support revenue of $3,229.

cost of revenue for the three months ended September 30, 2023 was $176,116, as compared to $79,713 for the same period in 2022, an increase

of $96,403, or 121%.

The increase was primarily attributable to the cost of a new quad laser intended for a lease that was sold at a

discounted price in the third quarter of 2023 as compared to the third quarter of 2022.

total operating expenses for the three months ended September 30, 2023 were $866,199, as compared to $2,392,956 for the same period

in 2022, a decrease of $1,526,757, or 64%.

The decrease was primarily attributable to a decrease in salaries and benefits of

$938,911, a decrease in stock-based compensation of $191,340, a decrease in operations and R&D costs of $152,000, a decrease in

organization costs of $92,942, and a decrease in office expense of $119,531 primarily attributable to reduced headcount and travel

as further described below.

and benefits costs were $288,894 for the three months ended September 30, 2023, as compared to $1,227,805 for the same period in 2022,

a decrease of $938,911, or 77%.

The decrease was attributable to:

(a) decreased salaries of $705,631 attributable to furloughed and terminated

(b) a decrease in commission and bonus expense of $37,405;

(d) decreased severance

expense of $30,301;

and (e) a decrease in stock appreciation rights of $48,549.

compensation was $84,078 for the three months ended September 30, 2023, as compared to $275,418 for the same period in 2022, a decrease

Months Ended May 31, 2024 and May 31, 2023

the three months ended May 31, 2024, we recognized revenue of $188,793, as compared to $19,562 in the same period in 2023, an increase

of $169,231, or 865%.

This decrease was primarily a result of forfeitures of unvested options by former employees.

incurred operations and research and development costs of $245 during the three months ended September 30, 2023, as compared to

$152,245 in the same period in 2022, a decrease of $152,000.

The decrease was due to decreasing operations and R&D work as we

have shifted our focus to closing our two corporate transactions and supporting existing customers.

incurred investor, public relations, and marketing costs of $15,797 during the three months ended September 30, 2023, as compared to

$46,832 during the same period in 2022.

The decrease of $31,035, or 66%, was due to a decrease in investor relations consulting costs

of $22,609 as a result of renegotiated lower monthly fees and a decrease in marketing costs of $8,426.

incurred organization costs of $47,580 during the three months ended September 30, 2023, as compared to $140,522 during the same

period in 2022.

The decrease of $92,942, or 66%, was primarily attributable to a decrease in non-employee director compensation of

$21,359 primarily due to fewer stock options granted in 2023 and a decrease in shareholder services costs of $72,785 due to a change

in timing of our annual shareholders’ meeting from the third quarter of 2022 to the fourth quarter of 2023.

offsetting these decreases was an increase in regulatory compliance fees of $1,202.

and professional fees incurred in the three months ended September 30, 2023 were $251,265, as compared to $252,886 during the

same period in 2022, a decrease of $1,621.

This decrease was primarily a result of decreased recruiting fees of $74,250, and a decrease

in consulting expenses of $47,754 for an advisor to the board of directors and a marketing consultant.

Partially offsetting these decreases

was an increase in legal expenses fees of $116,426 due to employment related matters and legal and financial advisors engaged to assist

in Sigma’s evaluation of corporate transactions, and an increase in accounting expenses of $3,337.

expenses for the three months ended September 30, 2023, were $61,077 as compared to $183,608 for the same period in 2022, a decrease

The increase was primarily due to the implementation of the BookIt asset as well as the integration of Expedia

into our booking engine, NXT 2.0.

Expedia significantly increased our product offering from 12-15 hotel chains to over 250,000 properties

worldwide, including hotels, resorts, and alternative accommodations.

cost of revenue for the three months ended May 31, 2024 was $173,581, as compared to $17,718 for the same period in 2023, an increase

of $155,863, or 880%.

The decrease resulted from:

(a) decreased travel and entertainment expenses of $71,746;

(b) decreased office supply

expenses of $4,374;

(d) decreased payroll services expense of $10,538;

(e) decreased

rent and utilities of $10,588;

and (f) decreased training and education expense of $848.

These decreases were the result of a reduction

in the number of employees.

and amortization expense for the three months ended September 30, 2023 was $24,554, as compared to $26,857 for the same period in 2022,

a decrease of $2,303, or 9%.

The decrease was primarily the result of returned and sold property and equipment.

operating expenses were $92,709 for the three months ended September 30, 2023, as compared to $86,783 for the same period in 2022.

$5,926 increase was primarily related to a FINRA filing fee.

the three months ended September 30, 2023, we realized net other income of $28,666, as compared to net other expense of $7,884 in the

same period in 2022.

The increase in other income of $36,550 was primarily due to the net gain on the sale of our 3DPrinter.

dividends for the three months ended September 30, 2023 were $10,687, as compared to $14,220 for the same period in 2022.

was due to fewer outstanding shares of preferred stock as a result of conversions to common shares.

net loss applicable to common stockholders for the three months ended September 30, 2023 was $882,348 as compared to $2,306,528 for

the same period in 2022, a decrease of $1,424,180, or 62%.

The decrease was due to the decrease in the loss from operations

of $1,384,097, a decrease in preferred dividends of $3,533, and an increase in other income of $36,550.

Months Ended September 30, 2023 and September 30, 2022

the nine months ended September 30, 2023, we recognized revenue of $369,188, as compared to $476,749 in the same period in 2022, a decrease

The increase was primarily attributable to the increase in sales from the launch of NXT 2.0 in the first quarter

of 2024 as compared to the first quarter of 2023.

total operating expenses for the three months ended May 31, 2024 were $1,967,613, as compared to $1,031,825 for the same period in 2023,

an increase of $935,788, or 90.7%.

The increase was primarily attributable to the relaunch of the NXT 2.0 booking engine in March of 2024,

as well as the integration of Sigma Additive Solutions, and the transition to public company status.

and benefits costs were $626,752 for the three months ended May 31, 2024, as compared to $407,609 for the same period in 2023, an increase

of $219,143, or 54%.

The decrease primarily resulted from fewer PrintRite3D sales of $91,297, decreased annual maintenance and support

of $19,389, and decreased on-site development and support of $52,815 as compared to the third quarter of 2022.

The increase was comprised of:

(a) an increase in salaries and benefits of 212,371 due to the conversion of booking

engine contractors to employees and new accounting staff, and (b) an increase in taxes and benefits of $29,153.

Partially offsetting the

decreases were an increase in PrintRite3D lease revenue of $19,840, an increase in PrintRite3D consulting services of $25,500, and an

increase in Rapid Test and Evaluation, or RTE revenue of $10,600.

cost of revenue for the nine months ended September 30, 2023 was $276,270, as compared to $312,879 for the same period in 2022, a decrease

of $36,609, or 12%.

The decrease was primarily attributable to fewer unit sales and installations in the third quarter of 2023 as compared

to the third quarter of 2022.

total operating expenses for the nine months ended September 30, 2023 were $4,078,912, as compared to $6,968,079 for the same period

increase was a decrease in SAR expense of $22,381 due to revaluation in March of 2024.

compensation was $16,394 for the three months ended May 31, 2024, as compared to $0 for the same period in 2023, an increase of $16,394.

This increase was primarily a result of two employees that moved from Sigma Additive Solutions to NextTrip in 2024.

incurred general and administrative costs of $27,555 during the three months ended May 31, 2024, as compared to $69,103 in the same period

in 2023, a decrease of $41,548, or 60%.

The decrease was primarily attributable to a decrease in salaries and benefits of $1,929,975,

a decrease in stock-based compensation of 166,416, a decrease in operations and R&D of 210,332, a decrease in investor, public relations,

and marketing expense of $164,893, a decrease in organization costs of 123,071 and a decrease in office expense of $382,875 primarily

attributable to reduced headcount and travel as further described below.

and benefits costs were $1,774,658 for the nine months ended September 30, 2023, as compared to $3,704,633 for the same period in

2022, a decrease of $1,929,975, or 52%.

The decrease was comprised of:

(a) decreased salaries of $1,517,791 attributable to

furloughed and terminated employees;

(b) a decrease in commission and bonus expense of $113,363 due to the reversal of 2022 year-end

bonuses and fewer commissions on sales;

and (d) decreased stock appreciation rights

expense of $70,800 due to the quarterly revaluation at September 30, 2023.

Partially offsetting these decreases was an increase in

severance expense of $15,408.

compensation was $447,417 for the nine months ended September 30, 2023, as compared to $613,833 for the same period in 2022, a decrease

of $166,416, or 27%.

This decrease was primarily a result of the forfeiture of unvested options by former employees.

incurred operations and research and development costs of $232,216 during the nine months ended September 30, 2023, as compared to $442,548

in the same period in 2022, a decrease of $210,332, or 48%.

The decrease was due to a decrease in operations costs of $141,346 and a

decrease in R&D costs of $68,986.

The decrease in operations costs related to fewer parts and material purchases in the third quarter

The decrease in R&D costs was primarily due to suspending consulting work with a third-party software vendor

in connection with the development of our software-only product suite.

incurred investor, public relations, and marketing costs of $128,565 during the nine months ended September 30, 2023, as compared to

$293,458 during the same period in 2022.

The decrease of $164,893, or 56%, was primarily due to a decrease in investor relations consulting

costs of $92,822 related to renegotiated lower fees, a decrease in attendance at tradeshows and conferences of $46,535 due to fewer employees,

and a decrease in marketing costs of $25,536.

incurred organization costs of $137,017 during the nine months ended September 30, 2023, as compared to $260,088 during the same period

The decrease of $123,071, or 47% was attributable to a decrease in non-employee director compensation of $51,278 primarily due

to fewer stock options granted in 2023 and a decrease in shareholder services of $71,914 as a result of a change in the timing of our

annual shareholders meeting from the third quarter of 2022 to the fourth quarter of 2023.

and professional fees incurred in the nine months ended September 30, 2023 were $587,541, as compared to $608,830 incurred during the

same period in 2022, a decrease of $21,289, or 3.5%.

This decrease was a result of a decrease in consulting expenses from 2022 of $222,187

which were related to a manufacturing consultant, technical accounting support, HR consultant, and an advisor to the Board of Directors,

a decrease in recruiting fees of $74,250, and a decrease in IT service fees of $6,539 related to new employee setup fees in 2022.

offsetting these decreases were an increase in legal fees of $272,302 due to employment related matters and legal and financial advisors

engaged to assist in Sigma’s evaluation of strategic corporate transactions, and an increase in accounting fees of $9,385.

expenses for the nine months ended September 30, 2023, were $309,765 as compared to $692,640 for the same period in 2022, a decrease

of $382,875, or 55%.

The decrease resulted primarily from:(a) decreased travel and entertainment expenses of $247,989;

(b) decreased

office supply expenses of $24,531;

(d) decreased payroll services expense of $14,640;

(e) decreased rent and utilities of $24,196;

and (f) decreased training and education expense of $33,559.

These decreases were all the

result of a reduction in the number of employees and no company-wide conference being held in 2023.

and amortization expense for the nine months ended September 30, 2023 was $74,151, as compared to $88,302 for the same period in 2022,

a decrease of $14,151, or 16%.

The decrease was primarily the result of the increased life expectancy of our leased and consigned PrintRite3D

systems, as well as returned and sold property and equipment.

operating expenses were $387,582 for the nine months ended September 30, 2023, as compared to $263,747 for the same period in 2022.

$123,835 increase was primarily due to an allowance for doubtful account of $115,600 related to a customer receivable for which collectability is uncertain.

the nine months ended September 30, 2023, we realized net other income of $54,539, as compared to $57,336 in the

same period in 2022.

The decrease of $2,797 was primarily due to the New Mexico High Wage Tax credit of $76,628 received in 2022,

partially offset by a net gain on the sale of our 3DPrinter and a write-off of accounts payable due to an unclaimed customer deposit

in the third quarter of 2023.

dividends for the nine months ended September 30, 2023 were $33,122, as compared to $42,660 for the same period in 2022.

was due to fewer outstanding shares of preferred stock as a result of conversions to common shares.

net loss applicable to common stockholders for the nine months ended September 30, 2023, was $3,964,577 as compared to $6,789,533 for

the same period in 2022, a decrease of $2,824,956, or 41.6%.

The decrease was primarily due to the decrease in the loss from operations

of $2,818,215 and a decrease in preferred dividends of $9,538, partially offset by a decrease in total other income of $2,797.

The decrease was primarily the result of an amortized lease expense in 2023 for $37,026 and

$5,485 in penalties associated with the lease liability.

Partially offsetting the decrease was an increase in filing fees of $1,796.

incurred marketing costs of $156,188 during the three months ended May 31, 2024, as compared to $40,781 during the same period in 2023.

The increase of $115,407, or 283%, was primarily due to the relaunch of NXT 2.0 booking engine in March of 2024 and ongoing maintenance

with Travel Magazine.

Marketing and advertising expenses increased by $50,525, contracted marketing services increased by $49,115, and

Travel Magazine costs increased by $15,767.

During the same period in 2023, the priority was the development of the booking engine, and

the product was not ready to market.

incurred technology costs of $184,669 during the three months ended May 31, 2024, as compared to $35,893 during the same period in 2023.

The increase of $148,776, or 414.5% was primarily attributable to an increase in dues and subscription services of $99,649 for external

travel services used in connection with our booking engine, and an increase cloud database and software expenses of $49,127 to host the

booking engine.

service fees incurred in the three months ended May 31, 2024 were $523,873, as compared to $134,370 incurred during the same period in

2023, an increase of $389,503, or 290%.

This increase was a result of:

(a) an increase in investor relations of $31,875;

increase in legal expense of $173,911 due to the reverse acquisition and associated transactions;

of $25,062 for audit and related financial services;

(d) an increase in consulting fees of $89,613 due to a contract in connection

with an independent financial advisory firm;

(e) an increase in consultants contracted for services of $69,042 related to the FastTV

channel, and maintenance and bug fixes with the booking engine.

Organizational

costs for the three months ended May 31, 2024, were $28,737 as compared to $0 for the same period in 2023, an increase of $28,737.

The increase resulted primarily from shareholder services expenses in connection with the Acquisition, transfer agent fees, and

filing services.

and amortization expense for the three months ended May 31, 2024 was $287,586, as compared to $336,339 for the same period in 2023, a

decrease of $48,753, or 14.5%.

The decrease was primarily due to no new equipment purchases and an increase in fully amortized intangible

assets as of May 31, 2024.

operating expenses were $115,859 for the three months ended May 31, 2024, as compared to $ 7,730 for the same period in 2023.

increase was primarily due to the additional cost of directors and officers insurance of $88,158 and an increase in merchant processing fees

the three months ended May 31, 2024, we realized net other expense of $35,225, as compared to net other expense of $65,390 in the same

period in 2023.

The decrease in net other income of $30,165 was primarily due to a decrease in interest expense associated with convertible

loans due to their conversion in connection with the Acquisition.

dividends for the three months ended May 31, 2024 were $10,668, as compared to $0 for the same period in 2023.

The increase was due to

dividends associated with outstanding shares of Series E convertible preferred stock assumed in the Acquisition.

the three months ended May 31, 2024, the net loss from continuing operations totaled $1,987,626 as compared to a net loss from continuing

operations of $1,095,371 for the same period in 2023.

The operating loss component increased by $922,420 in 2024, partially offset by

a decrease in the other loss component of $30,165.

net gain from discontinued operations of $8,909 for the three months ended May 31, 2024 consisted primarily of revenue of $11,731 from

legacy Sigma customers, and a gain of $5,961 from the settlement of a trade accounts payable at a discount, partially offset by expenses

of $8,783 consisting of legal expenses and Sigma’s legacy investor relations website.

net loss applicable to common stockholders for the three months ended May 31, 2024, was $1,989,405, as compared to $1,095,371 for the

same period in 2023, an increase of $894,034, or 81.6%.

The increase was primarily attributable to an increase in operating loss from continued

operations of $922,420 and an increase in preferred dividends of $10,688, partially offset by a gain from discontinued operations of

$8,909, and a decrease in other expense of $30,165.

and Capital Resources

1 unchanged sentence

our ability to continue as a going concern for 12 months from the date of the filing of this Quarterly Report,

of September 30, 2023, we had $556,087 in cash and working capital of $564,386I, as compared with $2,845,931 in cash and working capital

of $3,644,522 as of December 31, 2022.

On October 13, 2023, we raised $772,468 in net proceeds

by selling 128,887 common shares pursuant to our ATM Agreement.

With these additional proceeds, the Company estimates that it has sufficient

cash and working capital to fund its scaled-back operations as described below through the earlier of the closing of our asset sale to

Divergent and acquisition of NextTrip, or March 2024.

The Company reduced its employee headcount, and discontinued product development

activities for the time being to ensure lowered expenses.

The Company is continuing to operate and support its existing customers who

have maintenance agreements and leases in place, supporting new installations in the field, and actively seeking potential sales of the

PrintRite3D systems and software to customers who have lease agreements in place, systems on consignment, or otherwise express interest

in Sigma’s products available for sale.

The Company completed two such sales in the quarter ended September 30, 2023, and believes

additional sales are achievable going forward as we progress towards closing the pending transactions.

There is no assurance, however,

that we will be able to close either transaction.

If we fail to complete the acquisition of NextTrip Holdings, Inc., we intend to proceed

with the sale of assets to Divergent Technologies, Inc.

and may seek to undertake another strategic transaction, if possible, or the dissolution

and liquidation or the bankruptcy of the Company.

For these reasons, there is substantial doubt about our ability to continue as a going

of May 31, 2024, we had $36,679 in cash and a working capital deficit of $2,109,148, as compared with $323,805 in cash and a working

capital deficit of $262,005 as of February 29, 2024.

Additionally, at May 31, 2024, the amount due under our notes payable to related

parties totaled $1,752,868.

Between June 1, 2024 and September 13, 2024, additional

net related party advances totaled $978,822, and the aggregate outstanding principal balance of related party advances as of September

13 2024 was $2,731,690.

On September 13, 2024, the Company’s board of

directors approved the conversion of up to 100% of the outstanding principal balance of the promissory notes held by Messrs.

Monaco into shares of a series of non-redeemable convertible preferred stock preferred stock yet to be designated.

Kerby and Monaco

have agreed to initially convert $1,500,000, or 56.3% of their total outstanding principal balance of $2,666,790 into the new series of

convertible preferred stock, and, at their discretion, may convert up to the remaining principal balance, or any portion thereof, into

additional shares of such convertible preferred stock at a future date.

The conversion remains subject to completion of final documentation

for the transaction, including the filing of the certificate of designation for the new series of convertible preferred stock with the

Nevada Secretary of State.

major sources of funding have been proceeds from private offerings of our securities, advances from related parties, and issuance of

convertible and non-convertible debt.

We will need to raise additional amounts to fund our operations, maintain compliance with the

Nasdaq continued listing requirements and implement our business plan.

We currently have no arrangement to obtain any additional

financing, and there is no assurance as to the amount and availability of any required future financing or the terms thereof.

such financing, if in the form of equity, may be highly dilutive to our existing stockholders and may otherwise include onerous

If in the form of debt, such financing may include covenants and repayment obligations which may be difficult to meet and

that could adversely affect our business and operations.

To the extent that funds are not available to us, we may be required to

delay, limit, or terminate our business and operations and/or lose our Nasdaq listing.

existing cash on hand and anticipated revenues are not sufficient to fund our anticipated operating costs.

We estimate that we will need

to raise a minimum of $5.5 million in net proceeds to continue operation for the next twelve months.

We have based this estimate on assumptions

that may prove to be wrong, and we could exhaust our capital resources sooner than we expect, or extend such resources longer than we

of the numerous risks and uncertainties associated with the research, development, and commercialization of our products, however, we

are unable to estimate the exact amount of our working capital requirements.

Our future capital requirements will depend on many factors,

cost of developing and maintaining our proprietary software and NXT2.0 booking engine;

effect of competing technological and market developments;

revenue from the sales of our existing and future products;

cost of operating as a public company.

effects of a U.S.

or global recession, while difficult to predict, could result in some customers delaying or cancelling planned travel.

Cash Used in Operating Activities

cash used in operating activities during the nine months ended September 30, 2023 was $2,586,884 as compared to $6,386,415 during the

same period in 2022, a decrease of $3,799,531, or 59.5%.

the nine months ended September 30, 2023, the net cash used in operating activities was the result of a net loss of $3,931,455 before

preferred dividends, partially offset by changes in working capital of $832,808 and non-cash expenses of $511,763 related to depreciation

and amortization of $74,151 and stock-based compensation of $466,244, partially offset by a gain on the sale of property and equipment of $28,632.

Changes in working capital were driven by a decrease in accounts

receivable of $312,620, a decrease in inventory of $175,877, a decrease in prepaid expenses of $67,393 an increase in accounts payable

and accrued expenses of $285,909, partially offset by a decrease in deferred revenue of $8,991.

The decrease in accounts receivable was

a result of cash collections from 2022 sales and the establishment of an allowance for doubtful accounts of $115,000, and the decrease

in inventory was due to the cessation of manufacturing activity.

The increase in accounts payable and accrued expenses was due to extending

payment times to vendors to conserve cash in advance of obtaining additional financing.

the nine months ended September 30, 2022, the net cash used in operating activities was the result of a net loss of $6,746,873 before

preferred dividends and the use of cash for working capital of $436,734, partially offset non-cash expenses of $797,192 related to depreciation

and amortization of $88,302 and stock-based compensation of $708,890.

Changes in working capital were driven by an increase in inventory

of $257,352, an increase in prepaid expenses of $63,446, a decrease in deferred revenue of $19,166, and a decrease in accounts payable

and accrued expenses of $141,192 partially offset by a decrease in accounts receivable of $44.422.

The decrease in accrued expenses was

largely driven by the payment of incentive bonuses, and the decrease in accounts receivable was a result of cash collections from 2021

Increases in inventory and prepaid expenses resulted from the stocking of long lead-time parts for planned production and payment

of our annual Nasdaq listing fee, respectively.

cash used in operating activities from continuing operations totaled $1,151,220 as compared to $591,391 during the same period in 2023,

an increase of $559,829, or 94.71%.

the three months ended May 31, 2024, the net cash used in operating activities was the result of a net loss of $1,987,626 before preferred

dividends, partially offset by changes in working capital of $532,426, and non-cash expenses of $303,980 related to depreciation and

amortization of $287,586 and stock-based compensation of $16,394.

Changes in working capital were driven by a decrease in accounts receivable

of $6,322, an increase in deferred revenue of $14,280, and an increase in accounts payable and accrued expenses of $534,493, partially

offset by an increase in prepaid expenses of $19,669.

the three months ended May 31, 2023, the net cash used in operating activities was the result of a net loss of $1,095,371, partially offset by changes inworking capital of $130,615, and non-cash expenses of $373,365 related to depreciation and amortization.

Changes in working capital were driven by an increase in accounts payable and accrued expenses of $147,231, partially offset by a decrease

in accounts receivable of $5,000 and a decrease in deferred revenue of $11,616.

Cash Used in Investing Activities

cash used in investing activities during the nine months ended September 30, 2023 was $67,515, which compares to $259,952 of cash used

in investing activities during the same period of 2022, a decrease of $192,437, or 74.0%.

The decrease resulted from a decrease in patent

costs of $30,589, proceeds from the sale of our 3D printer of $78,000, and no purchases

of property, plant and equipment during the first nine months of 2023.

cash used in investing activities during the three months ended May 31, 2024 was $169,406, which compares to $165,975 of cash used in

investing activities during the same period of 2023, an increase of $3,431, or 2.1%.

The decrease resulted from a slight decrease in

capitalized software development costs during the first three months of 2024.

Cash Provided by Financing Activities

Company raised $364,555 in net proceeds through our ATM Agreement during the third quarter of 2023, and an additional $772,468 in net

proceeds in October, 2023.

There were no warrant exercises during the nine months ended September 30, 2023 or

September 30, 2022.

cash provided by financing activities for the three months ended May 31, 2024 was $1,024,591, as compared to $555,745 for the same period

The increase of $468,846, or 84.4% was due to an increase in advances from related parties of $909,091 and the issuance of a promissory note for $100,000 to an investor, partially offset by

a decrease in the issuance of convertible notes of $540,245.

ability to continue to fund our working capital needs will be dependent upon the success of our efforts to generate revenues from our

operations, and by obtaining additional capital from the sale of securities or by borrowing funds from lenders to fulfill our business

If we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities

may have rights, preferences or privileges senior to those of existing holders of our common stock.

There is no assurance that we will

be successful in obtaining additional funding.

The Company is unable to predict the effect a global recession or geopolitical events,

including the on-going conflict in Ukraine, may have on its access to the financing markets.

If we fail to obtain sufficient funding

when needed, we may be forced to delay, scale back or eliminate all or a portion of our commercialization efforts and operations.

than the related party promissory notes as described in NOTE 5 – Related Party Transactions to the financial statements included

elsewhere in this Quarterly Report, we have no lines of credit or other financing arrangements.

changing prices and rising interest rates have had no material effect on our continuing operations over our two most recent fiscal years.

However, continued unfavorable trends may affect the prices we pay for materials and other goods and services necessary to our business,

thus increasing our use of cash.

have no off-balance sheet arrangements as defined in Item 303(a) of Regulation S-K.

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What changed 10-Q

Item 2. Management’s Discussion and Analysis