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Item 1. Financial Statements

2024-10-15 compared with 2024-09-16 · 427 added, 320 removed, 418 unchanged (64% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

August 31, 2024

February 29, 2024

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Deferred revenue

Notes payable

Notes payable - related parties

3 unchanged sentences

Stockholder’s Equity

Preferred Stock, $ 0.001 par value;

10,000,000 shares authorized;

Preferred Stock, $ 0.001 par value, 10,000,000 shares authorized;

93,295 and 472,996 shares issued and outstanding, respectively

Common Stock, par value $ 0.001 , 250,000,000

and 1,200,000 shares authorized, respectively;

shares issued and outstanding, respectively

Common Stock, $ 0.001 par value, 250,000,000 and 1,200,000 shares authorized, respectively;

1,388,641 and 936,430 shares issued and outstanding, respectively

Additional Paid in Capital

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(FORMERLY SIGMA ADDITIVE SOLUTIONS, INC.)

CONDENSED CONSOLIDATED

STATEMENTS OF OPERATIONS

Three Months Ended May 31,

CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

Six Months Ended

Cost of revenue (exclusive of depreciation and amortization, shown separately below)

Gross profit (loss)

Operating Expenses:

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( 1,087,001 )

( 3,421,693 )

( 2,116,983 )

Other Income (Expenses)

4 unchanged sentences

( 1,160,763 )

( 3,521,145 )

( 2,256,134 )

Provision for income taxes

2 unchanged sentences

$ ( 1,160,763 )

Net gain from discontinued operations, net of taxes

$ ( 3,521,145 )

$ ( 2,256,134 )

Net gain (loss) from discontinued operations, net of taxes

$ ( 1,534,650 )

$ ( 1,160,763 )

$ ( 3,513,367 )

$ ( 2,256,134 )

Preferred dividends

2 unchanged sentences

$ ( 1,160,763 )

$ ( 3,534,743 )

$ ( 2,256,134 )

Basic and diluted loss per common share from continuing operations (*)

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Basic and diluted weighted average number of common shares (*)

* On December 29,

2023, Sigma Additive Solutions, Inc.

December 29, 2023, Sigma Additive Solutions, Inc.

acquired NextTrip in a reverse acquisition.

NextTrip Group, LLC was issued 83,371 shares of Sigma

Additive Solutions, Inc.

common stock in exchange for 100 % of the issued and outstanding capital stock of NextTrip at the time of the

reverse acquisition.

The Company has reflected this transaction retroactively in these financial statements .

NextTrip Group, LLC was issued 83,371

shares of Sigma Additive

Solutions, Inc.

common stock in exchange for 100 %

of the issued and outstanding capital stock of NextTrip at the time of the reverse acquisition.

The Company has reflected this transaction

retroactively in these financial statements.

accompanying notes to condensed financial statements.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

the Three Months Ended May 31, 2024, and May 31, 2023

Shares Outstanding

Accumulated Deficit

the Three Months and Six Months Ended August 31, 2024, and August 31, 2023

the Three Months Ended August 31, 2024, and August 31, 2023

Preferred Stock

Shares Outstanding

Accumulated Deficit

Balances, May 31, 2024

$ ( 26,140,544 )

( 1,534,650 )

Preferred Stock Dividends

Issuance of Convertible Preferred Shares

Common Shares Issued for Third party Services

Stock Options Issued to Employees

Balances, August 31, 2024

$ ( 27,685,882 )

$ ( 134,103 )

Preferred Stock

Balances, May 31, 2023(*)

$ ( 17,907,234 )

$ ( 611,261 )

( 1,160,763 )

Balances, August 31, 2023(*)

$ ( 19,067,997 )

$ ( 1,772,024 )

December 29, 2023, Sigma Additive Solutions, Inc.

acquired NextTrip in a reverse acquisition.

NextTrip Group, LLC was issued 83,371

shares of Sigma Additive

Solutions, Inc.

common stock in exchange for 100 %

of the issued and outstanding capital stock of NextTrip at the time of the reverse acquisition.

The Company has reflected this transaction

retroactively in these financial statements.

the Six Months Ended August 31, 2024, and August 31, 2023

Preferred Stock

Balances, February 29, 2024

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Preferred Stock Dividends

Issuance of Convertible Preferred Shares

Common Shares Issued for Conversion of Preferred Stock

Issuance of Common Shares for Third Party Services

Stock Options Issued to Employees

Balances, May 31, 2024

Balances, August 31, 2024

$ ( 27,685,882 )

Shares Outstanding

Accumulated Deficit

$ ( 134,103 )

Preferred Stock

Shares Outstanding

Accumulated Deficit

Balances, February 28, 2023(*)

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( 2,256,134 )

Balances, May 31, 2023( * )

Balances, August 31, 2023(*)

$ ( 19,067,997 )

$ ( 1,772,024 )

$ ( 19,067,997 )

$ ( 1,772,024 )

December 29, 2023, Sigma Additive Solutions, Inc.

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NextTrip Group, LLC was issued 83,371

shares of Sigma Additive Solutions, Inc.

common stock in exchange for 100 % of the issued and outstanding capital stock of NextTrip

at the time of the reverse acquisition.

The Company has reflected this transaction retroactively in these financial statements .

shares of Sigma Additive

Solutions, Inc.

common stock in exchange for 100 %

of the issued and outstanding capital stock of NextTrip at the time of the reverse acquisition.

The Company has reflected this transaction

retroactively in these financial statements.

accompanying notes to condensed financial statements.

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

August 31, 2024

August 31, 2023

OPERATING ACTIVITIES

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Prepaid expenses

Promissory note receivable

Accounts payable and accrued expenses

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( 1,960,326 )

( 1,393,118 )

NET CASH PROVIDED IN OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS

1 unchanged sentence

( 1,952,548 )

( 1,393,118 )

INVESTING ACTIVITIES

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FINANCING ACTIVITIES

Proceeds from issuance of convertible securities

Proceeds from issuance of convertible notes

Proceeds from issuance of convertible preferred shares

Notes payable

Advances from related parties

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Noncash Investing and Financing Activities Disclosure:

Issuance of common shares for services

Preferred stock dividends

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Additive Solutions, Inc.

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

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

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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

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.

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

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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.

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,

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2 – Summary of Significant Accounting Policies

of Presentation - The accompanying financial statements have been prepared by the Company in accordance with Generally Accepted Accounting

Principles (“GAAP”) in the United States of America.

The financial statements have been prepared on a consolidated basis

with those of the Company’s wholly owned subsidiaries.

All intercompany transactions and balances have been eliminated in consolidation.

In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial

position, results of operations and cash flows at May 31, 2024 and 2023 and for the periods then ended have been made.

Certain information

and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted.

Company suggests these condensed financial statements be read in conjunction with the February 29, 2024 audited financial statements

and notes thereto included in the Company’s Annual Report on Form 10-K.

The results of operations for the period ended May 31,

2024 are not necessarily indicative of the operating results for the full year.

of Presentation - The accompanying financial statements have been prepared by the Company in accordance with Generally

Accepted Accounting Principles (“GAAP”) in the United States of America.

The financial statements have been prepared on

a consolidated basis with those of the Company’s wholly owned subsidiaries.

All intercompany transactions and balances have

been eliminated in consolidation.

In the opinion of management, all adjustments (which include only normal recurring adjustments)

necessary to present fairly the financial position, results of operations and cash flows at August 31, 2024 and 2023 and for the

periods then ended have been made.

Certain information and footnote disclosures normally included in financial statements prepared

in accordance with GAAP have been condensed or omitted.

The Company suggests these condensed financial statements be read in

conjunction with the February 29, 2024 audited financial statements and notes thereto included in the Company’s Annual Report

on Form 10-K filed with the Securities and Exchange Commission on September 4, 2024.

The results of operations for the period ended August 31, 2024 are not necessarily indicative of the operating

results for the full year.

Reclassification

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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.

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 and six months ended August

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

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

Per Share – The computation of loss per share is based on the weighted average number of shares outstanding during the period

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and preferred stock were excluded due to the anti-dilutive effect they would have on the computation.

At May 31, 2024 and 20223 the Company

had the following common shares underlying these instruments:

At August 31, 2024 and 2023 the

Company had the following common shares underlying these instruments:

Schedule of Underlying Common Shares Excluded from Computation of Loss Per Share

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following table shows the amounts used in computing loss per share and the effect on net loss and the weighted average number of shares

of dilutive potential common stock for the periods ended May 31, 2024 and 2023:

of dilutive potential common stock for the periods three and six months ended August 31, 2024, and 2023:

of Amounts Used In Computing Loss Per Share and Effect On Net Loss and Weighted Average Number Of Shares

Three Months Ended May 31,

Three Months Ended

Six Months Ended

Loss from continuing operations

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$ ( 1,160,763 )

$ ( 3,521,145 )

$ ( 2,256,134 )

Preferred dividends

2 unchanged sentences

( 1,160,763 )

Gain from discontinued operations applicable to common stockholders

( 3,542,521 )

( 2,256,134 )

Gain (loss) from discontinued operations applicable to common stockholders

Net loss applicable to common stockholders

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$ ( 1,160,763 )

$ ( 3,534,743 )

( 2,256,134 )

Weighted average number of common shares outstanding used in loss per share during the period (denominator)

loss per share was not presented, as the Company’s outstanding common and preferred warrants, stock options and preferred

stock common equivalent shares for the periods presented would have had an anti-dilutive effect.

At May 31, 2024, the Company had outstanding

warrants to purchase 484,063

shares of common stock, stock options exercisable

shares of common stock, 316

shares of Series E Preferred Stock, which could

be converted into 3,207

shares of common stock, 33,000

shares of Series H Preferred Stock, convertible

shares of common stock, and 30,178

shares of Series I Preferred Stock, convertible

shares of common stock, resulting in a potential

total additional 630,008

shares of common stock outstanding in the future.

At February 28, 2023, the Company had no

outstanding potentially dilutive securities.

loss per share was not presented, as the Company’s outstanding warrants, stock options and preferred stock

common equivalent shares for the periods presented would have had an anti-dilutive effect.

At August 31, 2024, the Company had outstanding

warrants to purchase 484,063 shares of common stock, stock options exercisable for 78,877 shares of common stock, 316 shares of Series

E Preferred Stock, which could be converted into 3,259 shares of common stock, 33,000 shares of Series H Preferred Stock, convertible

into 33,000 shares of common stock, and 59,979 shares of Series I Preferred Stock, convertible into 59,979 shares of common stock, resulting

in a potential total additional 659,178 shares of common stock outstanding in the future.

At August 31, 2023, the Company had no outstanding

potentially dilutive securities.

Estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions

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obsolescence.

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 U.S.

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

core 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;

Recognition – The Company recognizes revenue in accordance with ASC Topic No.

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 U.S.

GAAP and replaced it with

a principles-based approach for determining revenue recognition.

The core 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;

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.

and (5) recognizing revenue when, or as, we satisfy performance

obligations by transferring the promised goods or services.

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

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is reasonably assured.

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

Revenue for customer travel packages purchased directly from the Company is 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).

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3 – Intangible Assets

assets as of May 31, 2024, and February 29, 2024 consisted of the following:

assets as of August 31, 2024, and February 29, 2024 consisted of the following:

of Intangible Assets

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Intangible assets, net of amortization

expense for the three months ended May 31, 2024, and May 31, 2023 was $ 286,237 and $ 329,033 , respectively.

the three months ended May 31, 2024 and 2023, the Company recorded no impairment losses associated with the carrying value exceeding

its recoverable amount.

expense for the six months ended August 31, 2024, and 2023 was $ 383,061 and $ 657,389 , respectively.

the three and six months ended August 31, 2024, and 2023, the Company recorded no impairment losses associated with the carrying value

exceeding its recoverable amount.

estimated aggregate amortization expense for years ending February 28 is as follows:

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5 - Related Party Transactions

March 18, 2024, the Company’s wholly-owned subsidiary, NextTrip, entered into an unsecured promissory note for

a line of credit with Donald Monaco and William Kerby, the Company’s Chairman of the board of directors and Chief Executive

Officer, respectively, for the aggregate principal amount of $ 500,000

with an initial advance of $ 125,000 , provided that the aggregate principal amount of the note does not exceed $ 500,000

Under the terms of the note, advances under the line of credit may be made at the Company’s request until May 31, 2024.

note bears an annual interest rate of 7.5 %

and matures on February

28, 2025 , and may be prepaid by the Company at any time prior to maturity without penalty.

As of May 31, 2024, the full

principal amount of the note had been advanced to the Company.

April 23, 2024, the Company’s board of directors approved the Company’s wholly-owned subsidiary, NextTrip, to enter into a series of unsecured promissory notes with

certain related parties, including investors, directors, officers and employees, who may individually provide funds for the aggregate

principal amount of $ 1,000,000 .

The notes bear an annual interest rate of 7.5 % and shall mature one year from the date of each note’s

execution, and may be prepaid by the Company at any time prior to maturity without penalty.

As of May 31, 2024, $ 424,592 had been advanced to the Company.

March 18, 2024, the Company’s wholly-owned subsidiary, NextTrip, entered into an unsecured promissory note for a line of credit

with Donald Monaco and William Kerby, the Company’s Chairman of the board of directors and Chief Executive Officer, respectively,

for the aggregate principal amount of $ 500,000 with an initial advance of $ 125,000 , provided that the aggregate principal amount of the

note does not exceed $ 500,000 at any time.

Under the terms of the note, advances under the line of credit may be made at the Company’s

request until August 31, 2024.

The note bears an annual interest rate of 7.5 % and matures on February 28, 2025 , and may be prepaid by

the Company at any time prior to maturity without penalty.

As of August 31, 2024, the full principal amount of the note had been advanced

to the Company.

April 23, 2024, the Company’s board of directors approved the Company’s wholly-owned subsidiary, NextTrip, to enter into

a series of unsecured promissory notes with certain related parties, including investors, directors, officers and employees, who may

individually provide funds for the aggregate principal amount of $ 1,000,000 .

The notes bear an annual interest rate of 7.5 % and shall

mature one year from the date of each note’s execution, and may be prepaid by the Company at any time prior to maturity without

On August 14, 2024, at a joint meeting of the Audit Committee and the board of directors, the directors unanimously approved

an increase in the principal amount of the related party line of credit to $ 2,000,000 on the same terms and conditions as previously

As of August 31, 2024, $ 1,411,414 had been advanced to the Company.

May 21, 2024, NextTrip issued an unsecured promissory note, in the principal amount of $ 455,000 (the “Promissory Note”),

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Directors, including the independent members thereof.

total amounts due to related parties at May 31, 2024 and February 29, 2024 totaled $ 1,752,868

and $ 828,277 ,

respectively.

NOTE 6 – Note Payable

On May 24, 2024, the Company issued an unsecured promissory

note for $ 100,000 to an investor upon receipt of proceeds.

The note bears an annual interest rate of 7.5 % and will mature and be due and

payable on the earlier date of the completion of a public financing or October 31, 2024, unless extended by the written consent of the

total amounts due to related parties at August 31, 2024 and February 29, 2024 totaled $ 2,718,594 and $ 828,277 , respectively.

6 – Notes Payable

May 24, 2024, the Company issued an unsecured promissory note for $ 100,000 to an investor upon receipt of proceeds.

The note bears an

annual interest rate of 7.5 % and will mature and be due and payable on the earlier date of the completion of a public financing or October 31, 2024, unless extended by the written consent of the investor.

The note can be prepaid at any time by the Company without penalty.

July 11, 2024, the Company issued an unsecured promissory note for $ 40,000 to an investor upon receipt of proceeds.

The note bears an

annual interest rate of 7.5 % and will mature and be due and payable on June 25, 2025, unless extended by the written consent of the investor.

The note can be prepaid at any time by the Company without penalty.

January 25, 2023, as part of the separation agreement with NextPlay Technologies Inc., the Company assumed control of a lease arrangement

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leases arrangements greater than twelve (12) months.

determined that the arrangement was an operating lease at inception and included it in operating lease ROU assets, operating lease

liabilities - current, and operating lease liabilities - noncurrent on the balance sheet as of February 28, 2023.

facility was occupied by NextTrip employees through March 16, 2023, when the landlord informed NextTrip that it would not recognize

NextTrip as the tenant.

The Company continued to negotiate the assumption of the lease with the landlord, but was ultimately

unsuccessful, and as a result derecognized the lease in the financial statements as of February 29, 2024.

No restatement was made

for fiscal year 2023 as the Company had use of the offices at that time and was in negotiations to assume the lease from NextPlay

Technologies, Inc.

No payments have been made on the lease and no expense has been recognized for the three months ended May 31,

Rent expense for the three months ended May 31, 2023 totaled $ 37,025 .

determined that the arrangement was an operating lease at inception and included it in operating lease ROU assets, operating lease liabilities

- current, and operating lease liabilities - noncurrent on the balance sheet as of February 28, 2023.

The office facility was occupied

by NextTrip employees through March 16, 2023, when the landlord informed NextTrip that it would not recognize NextTrip as the tenant.

The Company continued to negotiate the assumption of the lease with the landlord, but was ultimately unsuccessful, and as a result derecognized

the lease in the financial statements as of February 29, 2024.

No restatement was made for fiscal year 2023 as the Company had use of

the offices at that time and was in negotiations to assume the lease from NextPlay Technologies, Inc.

No payments have been made on the

lease and no expense has been recognized for the three and six months ended August 31, 2024.

Rent expense for the three and six months

ended August 31, 2023 totaled $ 37,822 and $ 74,847 , respectively.

Company leases approximately 350 square feet of space for its principal executive offices at 3900 Paseo del Sol, Santa Fe, New Mexico

The lease has a 6-month term which ends on December 31, 2024.

The landlord can terminate the lease upon 30 days written notice

and NextTrip can terminate the lease upon 45 days written notice.

Therefore, the Company has elected the short-term lease recognition

exemption, whereby leases are not recorded on the Company’s balance sheet and lease payments are recognized as lease expense on

a straight-line basis over the lease term.

Rent expense related to this lease for the three and six months ended August 31, 2024 was

$ 1,650 and $ 3,300 , respectively, and $ 0 for the same periods in 2023.

8 - Stockholders’ Equity

On March 8, 2024, at a special meeting

of stockholders, the Company received approval to increase its authorized shares of common stock from 1,200,000

to 250,000,000

(the “Increase in Authorized”).

On March 11, 2024, the Company filed a Certificate of Amendment to its amended

and restated articles of incorporation, as amended, with the Secretary of State of the State of Nevada, pursuant to which, effective

as of 12:01 a.m.

March 8, 2024, at a special meeting of stockholders, the Company received approval to increase its authorized shares of common stock

from 1,200,000 to 250,000,000 (the “Increase in Authorized”).

On March 11, 2024, the Company filed a Certificate of Amendment

to its amended and restated articles of incorporation, as amended, 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, the Increase in Authorized was implemented.

the first quarter of 2024, the Company issued 100,000

shares of common stock upon conversion of 100,000

shares of Series G Convertible Preferred Stock,

shares of common stock upon conversion

shares of Series H Convertible Preferred Stock,

shares of common stock upon conversion

shares of Series I Convertible Preferred Stock.

our articles of incorporation, our board of directors has the authority, without further action by stockholders, to designate one or

more series of preferred stock and to fix the voting powers, designations, preferences, limitations, restrictions and relative rights

granted to or imposed upon the preferred stock, including dividend rights, conversion rights, voting rights, rights and terms of redemption,

liquidation preference and sinking fund terms, any or all of which may be preferential to or greater than the rights of the common stock.

the first quarter of 2024, the Company issued 100,000 shares of common stock upon conversion of 100,000 shares of Series G Convertible

Preferred Stock, 117,000 shares of common stock upon conversion of 117,000 shares of Series H Convertible Preferred Stock, and 192,502

shares of common stock upon conversion of 192,502 shares of Series I Convertible Preferred Stock.

the second quarter of 2024, the Company issued 42,709

shares of common stock to a service provider as partial compensation for development work related to Compass.tv, the

Company’s Free-Ad Supported TV (“FAST”) channel.

our amended and restated articles of incorporation, as amended (“Articles”), our board of directors has the authority, without further action by

stockholders, to designate one or more series of preferred stock and to fix the voting powers, designations, preferences,

limitations, restrictions and relative rights granted to or imposed upon the preferred stock, including dividend rights, conversion

rights, voting rights, rights and terms of redemption, liquidation preference and sinking fund terms, any or all of which may be

preferential to or greater than the rights of the common stock.

board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting

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of common stock.

Company is authorized to issue 10,000,000

shares of preferred stock, $ 0.001

An aggregate of 63,494

shares of preferred stock were issued and outstanding at May 31, 2024 and February 29, 2024.

respectively.

Company is authorized to issue 10,000,000 shares of preferred stock, $ 0.001 par value.

An aggregate of 93,295 and 472,996 shares of preferred

stock were issued and outstanding at August 31, 2024 and February 29, 2024, respectively.

E Convertible Preferred Stock

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per share (the “Stated Value”).

Dividends at the initial rate of 9 % per annum will accrue and, on a monthly basis, shall

be payable in kind by the increase of the Stated Value of the Series E Preferred Stock by said amount.

The holders of the Series E Preferred

Shares have the right at any time to convert all or a portion of the Preferred Shares (including, without limitation, accrued and unpaid

dividends and make-whole dividends through the third anniversary of the closing date) into shares of the Company’s Common Stock

at an initial conversion rate determined by dividing the Conversion Amount by the Conversion Price ($ 0.13 above the consolidated closing

bid price for the trading day prior to the execution of the relates stock purchase agreement).

The Conversion Amount is the sum of the

Stated Value of the Series E Preferred Shares then being converted plus any other unpaid amounts payable with respect to the Series E

Preferred Shares being converted plus the “Make Whole Amount” (the amount of any dividends that, but for the conversion,

would have accrued at the dividend rate for the period through the third anniversary of the initial issuance date).

The Conversion Rate

is also subject to adjustment for stock splits, dividends recapitalizations and similar events.

May 31, 2024, 316 shares of the issued Series E Convertible Preferred Stock were outstanding, which if converted as of May 31, 2024,

Dividends at the initial rate of 9 %

per annum will accrue and, on a monthly basis, shall be payable in kind by the increase of the Stated Value of the Series E

Preferred Stock by said amount.

The holders of the Series E Preferred Shares have the right at any time to convert all or a portion

of the Series E Preferred Shares (including, without limitation, accrued and unpaid dividends and make-whole dividends through the

third anniversary of the closing date) into shares of the Company’s common stock at an initial conversion rate determined by

dividing the Conversion Amount by the Conversion Price ($ 0.13

above the consolidated closing bid price for the trading day prior to the execution of the relates stock purchase agreement).

Conversion Amount is the sum of the Stated Value of the Series E Preferred Shares then being converted plus any other unpaid amounts

payable with respect to the Series E Preferred Shares being converted, plus the “Make Whole Amount” (the amount of any

dividends that, but for the conversion, would have accrued at the dividend rate for the period through the third anniversary of the

initial issuance date).

The Conversion Rate is also subject to adjustment for stock splits, dividends recapitalizations and similar

August 31, 2024, 316 shares of the issued Series E Convertible Preferred Stock were outstanding, which if converted as of August 31,

2024, including the make-whole dividends, would have resulted in the issuance of 3,259 shares of common stock.

F Convertible Preferred Stock

January 4, 2024, the Company filed a Certificate of Designation of Series F Convertible Preferred Stock (the “Series F

Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 5,843,993

shares of the Company’s preferred stock as Series F Convertible Preferred Stock, par value $ 0.001

per share (the “Series F Preferred”).

The Series F Preferred was designated by the Company in connection with its recent

acquisition of NextTrip, and, in the event that the Company does not have sufficient shares

of common stock available to fulfill its obligations pursuant to the Share Exchange Agreement governing the terms of the

acquisition, shares of Series F Preferred shall be issued to the previous equity holders of NextTrip in lieu of shares of Company

January 4, 2024, the Company filed a Certificate of Designation of Series F Convertible Preferred Stock (the “Series F Certificate

of Designation”) with the Secretary of State of the State of Nevada, designating 5,843,993 shares of the Company’s preferred

stock as Series F Convertible Preferred Stock, par value $ 0.001 per share (the “Series F Preferred”).

The Series F Preferred

was designated by the Company in connection with its acquisition of NextTrip, and, in the event that the Company does not have

sufficient shares of common stock available to fulfill its obligations pursuant to the Share Exchange Agreement governing the terms of

the acquisition, shares of Series F Preferred shall be issued to the previous equity holders of NextTrip in lieu of shares of Company

common stock.

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on shares of Company common stock.

Except as provided by the Company’s amended and restated articles of incorporation, as amended (“Articles”), or as

otherwise required by the Nevada Revised Statutes, holders of Series F Preferred are entitled to vote with the holders of

outstanding shares of Company common stock, voting together as a single class, with respect to all matters presented to the

Company’s stockholders for their action or consideration.

In any such vote, each holder is entitled to a number of votes equal

to the number of shares of common stock into which the Series F Preferred held by such holder is convertible.

The Company may not,

without the consent of holders of a majority of the outstanding shares of Series F Preferred, (i) alter or change adversely the

powers, preferences or rights given to the Series F Preferred or alter or amend the Series F Certificate of Designation, (ii) amend

its Articles or other charter documents in any manner that adversely effects any rights of the holders of the Series F Preferred, or

Except as provided by the Articles, or as

otherwise required by the Nevada Revised Statutes, holders of Series F Preferred are entitled to vote with the holders of outstanding

shares of Company common stock, voting together as a single class, with respect to all matters presented to the Company’s stockholders

for their action or consideration.

In any such vote, each holder is entitled to a number of votes equal to the number of shares of common

stock into which the Series F Preferred held by such holder is convertible.

The Company may not, without the consent of holders of a

majority of the outstanding shares of Series F Preferred, (i) alter or change adversely the powers, preferences or rights given to the

Series F Preferred or alter or amend the Series F Certificate of Designation, (ii) amend its Articles or other charter documents in any

manner that adversely effects any rights of the holders of the Series F Preferred, or (iii) enter into any agreement with respect to

the foregoing.

On such date that the Company amends its Articles to increase the number of shares of common stock authorized for issuance thereunder,

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Ratio, with holders of Company common stock in any distribution of assets of the Company to holders of the Company’s common stock.

May 31, 2024, no shares of the Series F Convertible Preferred Stock were outstanding.

August 31, 2024, no shares of the Series F Convertible Preferred Stock were outstanding.

G Convertible Preferred Stock

January 26, 2024, the Company filed a Certificate of Designation of Series G Convertible Preferred Stock (the “Series G Certificate

of Designation”) with the Secretary of State of the State of Nevada, designating 100,000 shares of the Company’s preferred

stock as Series G Preferred Stock, par value $ 0.001 per share.

January 26, 2024, the Company filed a Certificate of Designation of Series G Convertible Preferred Stock (the “Series G

Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 100,000

shares of the Company’s preferred stock as Series G Preferred Stock, par value $ 0.001

per share (the “Series G Preferred”).

terms and conditions set forth in the Series G Certificate of Designation are summarized below:

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(ii) amend its Articles or other charter documents in any manner that adversely effects any rights of the holders of the Series G Preferred,

or (c) enter into any agreement with respect to the foregoing.

or (iii) enter into any agreement with respect to the foregoing.

On such date that the Company amends its Articles to increase the number of shares of common stock authorized for issuance thereunder,

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of Company common stock in any distribution of assets of the Company to holders of the Company’s common stock.

Company shall have the right to redeem up to 50% of the Series G Preferred Stock for an aggregate price of $1.00 in accordance with

the terms of the Perpetual License Agreement .

May 31, 2024, no shares of the issued Series G Convertible Preferred Stock were outstanding.

The Company shall have the right to redeem up to 50% of the Series G Preferred Stock for an aggregate price of $1.00 in accordance

with the terms of the Perpetual License Agreement .

August 31, 2024, no shares of the issued Series G Convertible Preferred Stock were outstanding.

H Convertible Preferred Stock

January 26, 2024, the Company filed a Certificate of Designation of Series H Convertible Preferred Stock (the “Series H Certificate

of Designation”) with the Secretary of State of the State of Nevada, designating 150,000 shares of the Company’s preferred

stock as Series H Preferred Stock, par value $ 0.001 per share.

January 26, 2024, the Company filed a Certificate of Designation of Series H Convertible Preferred Stock (the “Series H

Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 150,000

shares of the Company’s preferred stock as Series H Preferred Stock, par value $ 0.001

per share (the “Series H Preferred”).

terms and conditions set forth in the Series H Certificate of Designation are summarized below:

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(ii) amend its Articles or other charter documents in any manner that adversely effects any rights of the holders of the Series H Preferred,

or (c) enter into any agreement with respect to the foregoing.

or (iii) enter into any agreement with respect to the foregoing.

On such date that the Company amends its Articles to increase the number of shares of common stock authorized for issuance thereunder,

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of Company common stock in any distribution of assets of the Company to holders of the Company’s common stock.

May 31, 2024, 33,000 shares of the issued Series H Convertible Preferred Stock were outstanding, which if converted as of May 31, 2024,

August 31, 2024, 33,000 shares of the issued Series H Convertible Preferred Stock were outstanding, which if converted as of August 31,

2024, would have resulted in the issuance of 33,000 shares of common stock.

I Convertible Preferred Stock

February 22, 2024, the Company filed a Certificate of Designation of Series I Convertible Preferred Stock (the “Series I Certificate

of Designation”) with the Secretary of State of the State of Nevada, designating 331,124 shares of the Company’s preferred

stock as Series I Convertible Preferred Stock, par value $ 0.001 per share.

February 22, 2024, the Company filed a Certificate of Designation of Series I Convertible Preferred Stock (the “Series I

Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 331,124

shares of the Company’s preferred stock as Series I Convertible Preferred Stock, par value $ 0.001

per share (the “Series I Preferred”).

terms and conditions set forth in the Series I Certificate of Designation are summarized below:

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the powers, preferences or rights given to the Series I Preferred or alter or amend the Series I Certificate of Designation, (ii) amend

its Articles or other charter documents in any manner that adversely effects any rights of the holders of the Series I Preferred, or (c)

enter into any agreement with respect to the foregoing.

its Articles or other charter documents in any manner that adversely effects any rights of the holders of the Series I Preferred, or

(iii) enter into any agreement with respect to the foregoing.

On such date that the Company amends its Articles to increase the number of shares of common stock authorized for issuance thereunder,

6 unchanged sentences

of Company common stock in any distribution of assets of the Company to holders of the Company’s common stock.

May 31, 2024, 30,178 shares of the issued Series I Convertible Preferred Stock were outstanding, which if converted as of May 31, 2024,

would have resulted in the issuance of 30,178 shares of common stock.

December 28, 2023, at the Annual Meeting of Stockholders of the Company, the Company’s stockholders approved the adoption of

the NextTrip 2023 Equity Incentive Plan (the “2023 Plan”).

shares of common stock have been reserved for issuance under the 2023 Plan., and as of May 31, 2024, all of such shares are

available for issuance.

August 15, 2024, the Company entered into a securities purchase agreement with an investor for the sale of 4,967

shares of Series I Convertible Preferred Stock, at $ 3.02

per share, resulting in gross proceeds to the Company of $ 15,000 .

August 31, 2024, the Company entered into a securities purchase agreement with an investor for the sale of 24,834

shares of Series I Convertible Preferred Stock at $ 3.02

per share, resulting in gross proceeds to the Company of $ 75,000 .

August 31, 2024, 59,979

shares of the issued Series I Convertible Preferred Stock were outstanding, which if converted as of August 31, 2024, would have

resulted in the issuance of 59,979

shares of common stock.

December 28, 2023, at the Annual Meeting of Stockholders of the Company, the Company’s stockholders approved the adoption of the

NextTrip 2023 Equity Incentive Plan (the “2023 Plan”).

7,000,000 shares of common stock have been reserved for issuance under

the 2023 Plan., and as of August 31, 2024, all of such shares are available for issuance.

Company’s 2013 Equity Incentive Plan expired on March 15, 2023.

As such, there were no shares of common stock reserved for future

issuance thereunder as of May 31, 2024.

were no issuances of options for the three months ended May 31, 2024 or May 31, 2023.

As such, no new grants may be made under the 2013 Plan.

August 31, 2024, there were 78,877

shares of common stock reserved for issuance upon exercise of outstanding stock options issued under the 2013 Plan prior to its

issuances of stock options for the six months ended August 31, 2024 or August 31, 2023.

Company generally grants stock options to employees and directors at exercise prices equal to the fair market value of the Company’s

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The Company recognizes compensation expense for the fair value of the stock options over the vesting period for each stock option award.

stock-based compensation expense included in the statements of operations for the three months ended May 31, 2024 and 2023 was $ 16,394

and $ 0 respectively, all of which is related to stock options.

activity for the three months ended May 31, 2024 and the year ended February 29, 2024 was as follows:

stock-based compensation expense included in the statements of operations for the three and six months ended August 31, 2024 was $ 13,841

and $ 30,235 , respectively, all of which was related to stock options.

There was no stock-based compensation included in the statements

of operations for the three or six months ended August 31, 2023.

activity for the six months ended August 31, 2024 and the year ended February 29, 2024 was as follows:

Schedule of Stock Option Activity

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Forfeited or cancelled

Options outstanding May 31, 2024

Options expected to vest in the future as of May 31, 2024

Options exercisable at May 31, 2024

Options vested, exercisable, and options expected to vest at May 31, 2024

Options outstanding August 31, 2024

Options expected to vest in the future as of August 31, 2024

Options exercisable at August 31, 2024

Options vested, exercisable, and options expected to vest at August 31, 2024

aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the market price of

our common stock for those awards that have an exercise price below the market price of our common stock.

At May 31, 2024, no option

At August 31, 2024, no option

had an exercise price below the $ 2.59 closing price of our common stock as reported on the Nasdaq Capital Market.

May 31, 2024, there was $ 29,980 of unrecognized stock-based compensation expense related to unvested stock options with a weighted average

remaining recognition period of 0.77 years.

August 31, 2024, there was $ 16,139 of unrecognized stock-based compensation expense related to unvested stock options with a weighted

average remaining recognition period of 0.74 years.

Appreciation Rights

purposes of the 2020 Stock Appreciation Rights Plan (the “SAR Plan”) are to:

(i) enable the Company to attract and

retain the types of employees, consultants, and directors (collectively, “Service Providers”) who will contribute to the

Company’s long-range success;

(ii) provide incentives that align the interests of Service Providers with those of the

stockholders of the Company;

(i) enable the Company to attract and retain

the types of employees, consultants, and directors (collectively, “Service Providers”) who will contribute to the Company’s

long-range success;

(ii) provide incentives that align the interests of Service Providers with those of the stockholders of the Company;

and (iii) promote the success of the Company’s business.

The SAR Plan provides for incentive

awards only in the form of stock appreciation rights payable in cash (“SARs”) and no shares of common stock are reserved

or will be issued pursuant to the SAR Plan.

The SAR Plan provides for incentive awards only in the form of stock appreciation

rights payable in cash (“SARs”) and no shares of common stock are reserved or will be issued pursuant to the SAR Plan.

may be granted to any Service Provider.

A SAR is the right to receive an amount equal to the Spread with respect to a share of the

Company’s common stock (“Share”) upon the exercise of the SAR.

The “Spread” is the difference between

the exercise price per share specified in a SAR agreement on the date of grant and the fair market value per share on the date of

exercise of the SAR.

The exercise price per share will not be less than 100% of the fair market value of a share of common stock on

the date of grant of the SAR.

The administrator of the SAR Plan will have the authority to, among other things, prescribe the terms

and conditions of each SAR, including, without limitation, the exercise price and vesting provisions, and to specify the provisions

of the SAR Agreement relating to such grant.

Company did not grant any SAR’s during the three months ended May 31, 2024 or May 31, 2023.

A SAR is the right to receive an amount equal to the Spread with respect to a share of the Company’s

common stock (“Share”) upon the exercise of the SAR.

The “Spread” is the difference between the exercise price

per share specified in a SAR agreement on the date of grant and the fair market value per share on the date of exercise of the SAR.

exercise price per share will not be less than 100% of the fair market value of a share of common stock on the date of grant of the SAR.

The administrator of the SAR Plan will have the authority to, among other things, prescribe the terms and conditions of each SAR, including,

without limitation, the exercise price and vesting provisions, and to specify the provisions of the SAR Agreement relating to such grant.

Company did not grant any SAR’s during the six months ended August 31, 2024 or August 31, 2023.

Company recognizes compensation expense and a corresponding liability for the fair value of the SARs over the vesting period for each

1 unchanged sentence

any changes in fair value are reflected in the Statement of Operations as of the applicable reporting date.

activity for the three months ended May 31, 2024 and the year ended February 29, 2024 was as follows:

Schedule of Stock Option Activity

activity for the six months ended August 31, 2024 and the year ended February 29, 2024 was as follows:

Schedule of Stock

Appreciation Rights Activity

Contractual Life (Yrs.)

4 unchanged sentences

Forfeited or cancelled

SARs outstanding May 31, 2024

SARs expected to vest in the future as of May 31, 2024

SARs exercisable at May 31, 2024

SARs vested, exercisable, and SARs expected to vest at May 31, 2024

SARs outstanding August 31, 2024

SARs expected to vest in the future as of August 31, 2024

SARs exercisable at August 31, 2024

SARs vested, exercisable, and SARs expected to vest at August 31, 2024

aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the market price of

our common stock for those awards that have an exercise price below the market price of our common stock.

At May 31, 2024, no SAR had

an exercise price below the $ 2.37 closing price of our common stock as reported on The Nasdaq Capital Market.

May 31, 2024, there was $ 1,122 of unrecognized stock-based compensation expense related to unvested SARs with a weighted average remaining

At August 31, 2024, no SAR

had an exercise price below the $ 2.59 closing price of our common stock as reported on the Nasdaq Capital Market.

August 31, 2024, there was $ 943 of unrecognized stock-based compensation expense related to unvested SARs with a weighted average remaining

recognition period of 0.64 years.

activity for the three months ended May 31, 2024 and the year ended February 29, 2024 was as follows:

activity for the six months ended August 31, 2024 and the year ended February 29, 2024 was as follows:

Schedule of Warranty Activity

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Forfeited or cancelled

Warrants outstanding at May 31, 2024

Warrants outstanding at August 31, 2024

9 - Subsequent Events

June 17, 2024, the Company received a notification letter (the “Initial Notice”) from the Listing Qualifications Department

of The Nasdaq Stock Market LLC (“Nasdaq”) advising the Company that it was not in compliance with Nasdaq’s continued

listing requirements under Nasdaq Listing Rule 5250(c)(1) (the “Rule”) as a result of its failure to timely file its Annual

Report on Form 10-K for the fiscal year ended February 29, 2024 (the “Form 10-K”).

July 17, 2024, the Company received an additional notification letter (the “Additional Notice,” and together with the Initial

Notice, the “Notices”) from Nasdaq stating that, because the Company has not filed its Quarterly Report on Form 10-Q for

the quarter ended May 31, 2024 (the “Form 10-Q”), and because the Company remains delinquent in filing the Form 10-K, the

Company remains noncompliant with the Rule.

of the Notices have an immediate effect on the listing of the Company’s common stock on the Nasdaq Capital Market, and, therefore,

the Company’s listing remains fully effective.

Notices require the Company to either file the delinquent Form 10-K and Form 10-Q with the Commission or submit a plan to regain compliance

with the Rule by August 16, 2024.

If Nasdaq accepts the Company’s plan, then Nasdaq may grant an exception of up to 180 calendar

days from the Form 10-K’s due date, or until December 10, 2024, to regain compliance.

If Nasdaq does not accept the Company’s

plan, then the Company will have the opportunity to appeal that decision to a Nasdaq Hearings Panel under Nasdaq Listing Rule 5815.

August 16, 2024, the Company submitted a plan to Nasdaq to regain compliance with the Rule, including the steps the Company will

take to promptly file the Form 10-K and Form 10-Q and regain compliance.

The Company has requested an extension until September 30, 2024.

There can be no assurance that the Company will regain compliance with the Rule, secure an exception until September 30, 2024 to regain

compliance, or maintain compliance with other Nasdaq listing requirements.

On September 4, 2024, the Company filed its Annual Report

on Form-10-K with the Securities and Exchange Commission.

August 14, 2024, at a joint meeting of the Audit Committee and the board of directors, the directors unanimously approved an increase

in the principal amount of the related party line of credit to $ 2,000,000 on the same terms and conditions as previously approved.

of September 13, 2024, the total principal amount advanced under the line of credit was $ 1,441,414 .

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 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.

Kerby and 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

Related Party Advances

September 1, 2024 and October 11, 2024, additional net related party advances totaled $ 84,060 , and the aggregate outstanding principal

balance of related party advances was $ 2,802,654 .

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.

Kerby and 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.

Nasdaq Listing Requirement Deficiency Notice

September 18, 2024, the Company received a notification letter (the “Notice”) from the Nasdaq Listing Qualifications Staff

(the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that its amount of stockholders’

equity has fallen below the $ 2,500,000 required minimum for continued listing set forth in Nasdaq Listing Rule 5550(b)(1).

also noted that the Company does not meet the alternatives of market value of listed securities or net income from continuing operations,

and therefore, the Company no longer complies with Nasdaq’s Listing Rules.

Nasdaq Listing Rules, the Company has until November 4, 2024 to provide Nasdaq with a specific plan to achieve and sustain compliance.

If Nasdaq accepts the Company’s plan to regain compliance, Nasdaq may grant an extension of up to 180 calendar days from the date

of the Notice to evidence compliance.

If Nasdaq does not accept the Company’s plan to regain compliance, the Company will have

the opportunity to appeal the decision to a Nasdaq Hearings Panel.

A hearing request will stay the suspension and delisting of the Company’s

securities pending the Nasdaq Hearings Panel’s decision.

Notice has no immediate effect on the listing of the Company’s common stock on the Nasdaq Capital Market, and, therefore, the Company’s

listing remains fully effective.

Company is evaluating various courses of action to achieve compliance with Nasdaq Listing Rule 5550(b)(1).

There can be no assurance

that the Company will regain compliance with Nasdaq Listing Rule 5550(b)(1) or that the Company will be able meet the continued listing

requirements during any compliance period that may be granted by Nasdaq.

September 18, 2024, the Company also received a letter from the Staff of Nasdaq indicating that the Staff has determined that the Company

has regained compliance with the periodic filing requirements set forth in Nasdaq Listing Rule 5250(c)(1) because the Company filed its

Annual Report on Form 10-K for the fiscal year ended February 29, 2024 and the Quarterly Report on Form 10-Q for the quarter ended May

the Company has regained full compliance with the periodic filing requirement deficiency, which the Company disclosed in those Current

Reports on Form 8-K filed with the Securities and Exchange Commission on June 21, 2024 and July 19, 2024, and Nasdaq has informed the

Company in writing that the matter is now closed.

September 2024 Alumni Capital Transactions

September 19, 2024 the Company entered into a securities purchase agreement (the “Note & Warrant SPA”) with Alumni

Capital LP (Alumni Capital”) for the sale of a short-term promissory note (the “Alumni Note”) and warrants (the

“Warrants”) to Alumni Capital for total consideration of $ 250,000 .

After deducting commissions, net proceeds to the Company were $ 230,000 .

Alumni Note is in the principal amount of $ 300,000

with an original issue discount of $ 50,000

and guaranteed interest on the principal amount of ten percent ( 10 %)

per annum which shall be due and payable on December

In the event of a failure to re-pay the Alumni Note on or before December 19, 2024, the interest rate will increase

to the lesser of twenty-two percent ( 22 %)

per annum or the maximum amount permitted under law from the due date thereof until the same is paid.

The Alumni Note is convertible

into common stock of the Company only upon an event of default.

such an event of default, Alumni shall have the right to convert all or any part of the outstanding and unpaid principal, interest, penalties,

and all other amounts under the Alumni Note into fully paid and non-assessable shares of the Company’s common stock at a conversion

price of eighty percent (80%) of the lowest traded price of the common stock during the twenty (20) business days prior to Alumni’s

delivery of a notice of conversion (the “Conversion Price’), subject to adjustment in the event the Company is no longer

DWAC eligible, is subject to a DTC “chill” and/or the Company ceases to be a reporting issuer.

Notwithstanding the foregoing,

conversions will be subject to limitation whereby such conversion would result in beneficial ownership by Alumni and its affiliates of

more than 9.99% of the outstanding shares of Company’s common stock (the “Beneficial Ownership Limitation”) or would

exceed 19.99% of the Company’s outstanding common stock as of September 19, 2024 (the “Exchange Cap”).

conjunction with the issuance of the Alumni Note to Alumni, the Company also issued Warrants to purchase 96,774 shares of common stock

at a price per share of $ 3.10 , which represents 100% warrant coverage on the principal amount of the Alumni Note.

The Warrants are exercisable

on or prior to the five ( 5 ) year anniversary of the date of issuance.

September 19, 2024, the Company also entered into a Common Stock Securities Purchase Agreement (the “Common Stock SPA”) with

Alumni Capital.

Pursuant to the Common Stock SPA, the Company has the right, but not the obligation to cause Alumni Capital to purchase

up to $ 10 million shares of common stock (the “Commitment Amount”) at the Purchase Price (defined below) during the period

beginning on the execution date of the Common Stock SPA and ending on the earlier of (i) the date on which Alumni Capital has purchased

$ 10 million shares of common stock pursuant to the Common Stock SPA or (ii) December 31, 2025.

to the Common Stock SPA, the “Purchase Price” means the lowest traded price of Company common stock during the five (5) business

days prior a closing date multiplied by eighty nine percent (89%).

No Purchase Notice will be made without an effective registration

statement and no Purchase Notice will be in an amount greater than $500,000.

consideration for Alumni Capital’s execution and delivery of, and performance under, the Common Stock SPA, the Company (i) issued

and delivered 32,786 shares of Company common stock to Alumni Capital on September 19, 2024, and (ii) within one (1) business day from

the date off effectiveness of the S-1 Registration Statement registering shares issuable pursuant to the Common Stock SPA, the Company

shall cause its transfer agent to issue and deliver as DWAC or DRS shares to Alumni Capital that number of shares of common stock equal

to two percent ( 2.00 %) of the Commitment Amount divided by the VWAP for the Company’s common stock for the business day prior to

the notice of effectiveness.

2024 Preferred Stock Sale

October 1, 2024, the Company entered into a securities purchase agreement with an investor for the sale of 66,225 shares of Series I

Convertible Preferred Stock at $ 3.02 per share, for total consideration of $ 200,000 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements