NOTE 19 - Commitments and Contingencies

The Company is involved, from time to time, in litigation, other legal claims and proceedings involving matters associated with or incidental to our business, including, among other things, matters involving breach of contract claims, intellectual property, employment issues, and other related claims and vendor matters. The Company believes that the resolution of currently pending matters could, individually or in the aggregate, have a material adverse effect on our financial condition or results of operations. However, assessment of the current litigation or other legal claims could change considering the discovery of facts not presently known to the Company or by judges, juries or other finders of fact, which are not in accord with management’s evaluation of the possible liability or outcome of such litigation or claims.

TA Pipeline Put Option and Contingently Redeemable Shares

In connection with the acquisition of TA Pipeline LLC on August 6, 2025 (see Note 6), the Company issued 96,774 restricted shares of common stock (the “TA Closing Shares”) to the former TA Members, valued at $387,000 at the closing date. Under the TA MIPA, the TA Members were granted a Put Option that, upon the occurrence of certain events outside the Company’s control, could require the Company to (i) repurchase the TA Closing Shares (and any TA Milestone Shares) at the Base Price of $3.10 per share, (ii) issue additional “Top-Up Shares” sufficient to restore the original aggregate Base Price value, or (iii) pay cash equal to the difference between the Base Price and the then-current Fair Market Value of the Company’s common stock multiplied by the number of TA Acquisition Shares specified in the exercise notice. Because the redemption features are outside the Company’s control, the 96,774 TA Closing Shares are classified as mezzanine equity (carrying value $387,000) on the consolidated balance sheet rather than within permanent equity.

On February 24, 2026, the former TA Members submitted an exercise notice with respect to all of their TA Closing Shares. The Company believes the former TA Members are in breach of their obligations under the TA MIPA and has declined to honor the exercise of the Put Option. The parties are in discussions to resolve the dispute; however, the outcome of such discussions is uncertain. The Company believes it has meritorious defenses and intends to vigorously defend against any claims, as well as to assert any counterclaims relating to the TA Members’ alleged breach. The maximum aggregate cash exposure under the Put Option, if ultimately determined adverse to the Company, would be approximately $300,000 (96,774 shares at the $3.10 Base Price), exclusive of any Top-Up Shares that could be issuable. As of February 28, 2026, no adjustment to the fair value of the Put Option has been recorded because the terms of any potential settlement were not known or knowable.

For additional information regarding the TA Pipeline acquisition, the Put Option, and the TA Milestone Payment, refer to Note 2 (Summary of Significant Accounting Policies), Note 6 (Acquisition of TA Pipeline, LLC), and Note 20 (Stockholders’ Equity).

Option to Purchase NextTrip Privilege Class B Common Stock

On December 2, 2025, the Company was granted an option by NextTrip Group, LLC to acquire up to 12,500,000 shares of Class B common stock of NextTrip Privilege, Inc. at $0.01 per share, or an aggregate exercise price of $125,000, exercisable from June 1, 2026 through December 31, 2027. The Option represents a contingent purchase commitment of the Company of up to $125,000 in aggregate exercise price. As described in Note 17 (Related Party Transactions), no amount has been recognized on the Company’s balance sheet in respect of the Option, the Option is not currently exercisable, and the Company does not consider exercise of the Option to be probable.

JOURNY.tv Licensing and Royalty Payment Obligation

In connection with the JOURNY.tv Asset Acquisition (see Note 5), the Company is obligated to make license fee payments to Ovation LLC totaling $336,801 over the period from April 2025 through October 2027. These payments were initially recorded at their present value of $299,800, discounted using the Company’s estimated cost of debt of 12.03% per annum. The difference between the undiscounted payments and their present value is being recognized as interest expense using the effective interest method over the payment term. As of February 28, 2026, the carrying value of the JOURNY.tv licensing and royalty payment obligation was $144,168, of which $78,197 is classified within current liabilities and $65,971 is classified within non-current liabilities on the Company’s consolidated balance sheet.

GoUSA TV Minimum Royalty Payment Obligation

In connection with the GoUSA TV Asset Purchase (see Note 7), the Company agreed, for the three-year period beginning on the closing date of February 2, 2026, to pay Brand USA a royalty equal to 1% for every $100,000 in destination booking revenue directly attributed to the acquired content, subject to a minimum quarterly payment of $30,000. The total undiscounted minimum royalty payments over the three-year term are $360,000 (12 quarterly payments of $30,000 each). These minimum guaranteed payments were recorded at their present value of $295,000, discounted using the Company’s estimated cost of debt of 12.03% per annum. The difference between the undiscounted minimum payments and their present value is being recognized as interest expense using the effective interest method over the payment term. As of February 28, 2026, the carrying value of the GoUSA TV minimum royalty payment obligation was $297,504, of which $58,385 is classified within current liabilities and $239,119 is classified within non-current liabilities on the Company’s consolidated balance sheet.

Scheduled Maturities of Licensing and Royalty Payment Obligations

The following table presents the scheduled undiscounted payments under both obligations as of February 28, 2026, reconciled to their aggregate present value carrying amount (in dollars):

 Scheduled of Undiscounted Payments Under Maturities of Licensing and Royalty Payment Obligations