NOTE 14 - Stockholders’ Equity

Mezzanine Equity

TA Pipeline LLC Acquisition

In connection with the acquisition of TA Pipeline LLC on August 6, 2025, the Company issued 96,774 TA Closing Shares. Although the shares are legally common stock, they are classified as mezzanine (temporary) equity on the consolidated balance sheet due to contingent redemption rights resulting from derivative liability provisions that could require cash or share settlement outside the Company’s control.

Accordingly, these shares are presented outside of permanent stockholders’ equity and below total liabilities. The Company will continue to classify the shares as mezzanine equity until such time as the redemption provisions lapse or are removed, or until settlement occurs.

The carrying amount of instruments recorded within mezzanine equity are not adjusted below initial measurement. The TA Acquisition Shares were initially recorded at $4.00 per share, which was the closing prices of our stock on the acquisition date. The Put Option has an exercise price of $3.10 per share. As such, the TA Acquisition Shares will not be subsequently remeasured in future reporting periods

For further information regarding the TA Closing Shares and TA Acquisition shares, refer to Notes 2 and 6.

Helena Global Investment Opportunities 1 Ltd. Private Placement

On May 6, 2026, the Company entered into a Securities Purchase Agreement with Helena Global Investment Opportunities 1 Ltd. (“Helena”) pursuant to which the Company issued 408,421 shares of Series B Convertible Preferred Stock (“Series B Preferred Stock”), consisting of 368,421 shares issued in exchange for cash proceeds of $1,015,000 and 40,000 “Issuance Fee Shares” issued to the Investor for no additional consideration.

Classification of Series B Convertible Preferred Stock

The Company classifies its Series B Convertible Preferred Stock as mezzanine equity because the redemption obligation, while at a fixed date, is not unconditional from the Company’s perspective. Helena retains the right to convert the Series B Preferred Stock into Common Stock at any time prior to the mandatory redemption date and the right to elect a one-time extension of the mandatory redemption date. As a result, whether redemption occurs (in cash) or is settled through conversion (in shares), and the timing of any such redemption, is outside the Company’s sole control. As such, the Series B Convertible Preferred Stock is presented between liabilities and stockholders’ equity on the balance sheet.

Initial Measurement

Proceeds from the issuance of the Series B Convertible Preferred Stock and detachable Investor Warrant are allocated to the two freestanding instruments using the relative fair value method pursuant to ASC 470-20-25-2. The portion of proceeds allocated to the Investor Warrant is credited to additional paid-in capital. The portion of proceeds allocated to the Series B Convertible Preferred Stock, net of debt issuance costs and original issue discount associated with issuance fee shares issued for no consideration, represents the initial carrying value of the mezzanine preferred.

Subsequent Measurement

The mezzanine carrying value of the Series B Convertible Preferred Stock is accreted to its redemption value over the period from issuance to the mandatory redemption date using the effective interest method. Accretion and stated dividends accrued on the Series B Convertible Preferred Stock are recognized as charges to retained earnings (deemed dividends to the holder) and reduce net income available to common shareholders for purposes of earnings per share calculations pursuant to ASC 260-10-S99. Accreted amounts and dividends are not recognized as interest expense in the income statement.

Common Stock

The Company has 250,000,000 shares of common stock authorized for issuance pursuant to its amended and restated articles of incorporation, as amended (“Charter”). At May 31, 2026 and February 28, 2026, there were 14,396,694 (excluding 96,774 mezzanine shares classified outside of permanent equity) and 13,978,171 shares of common stock, par value $0.001 per share, issued and outstanding, respectively. All shares of common stock have equal voting rights, are fully-paid and non-assessable, and are entitled to one vote per share.

During the first quarter of 2025, the Company issued 105,000 shares of common stock in connection with various investor relations consulting contracts, 45,642 shares of common stock to the holders of shares of the Company’s Series L and Series M Preferred stock as dividends, 20,000 shares of common stock to Ovation as partial consideration pursuant to the April 1, 2025 JOURNY.tv Asset Purchase Agreement; 5,000 shares of common stock to ITA as a finder’s fee related to the FSA acquisition; 15,000 shares of common stock pursuant to a consulting contract related to the development and launch of a dedicated beauty and wellness FAST channel; and 5,843,993 shares of common stock to the members of NTG pursuant to the Exchange Agreement, constituting Contingent Shares issuable to the members of NTG upon the achievement of all business milestones.

During the first quarter of 2026, the Company issued 60,000 shares of common stock in connection with various investor relations consulting contracts, 77,500 shares of common stock in connection with strategic marketing and business development contracts, 200,000 shares of common stock as consideration pursuant to third party contractor services, 8,000 shares of common stock to a vendor as settlement for outstanding invoices, 13,801 shares of common stock issued as stock-based compensation to an employee, 4,640 shares issued as commission payments to travel agents, and 54,582 shares issued to investors in private placements.

Preferred Stock

Under our Charter, 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.

Our board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of the common stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in our control and may adversely affect the market price of the common stock and the voting and other rights of the holders of common stock.

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

An aggregate of 150,316 (excluding 408,421 mezzanine shares of Series B Preferred classified outside of permanent equity) and 100,316 shares of preferred stock were issued and outstanding at May 31, 2026 and February 28, 2026, respectively, as further discussed below.

Series A Convertible Preferred Stock

On February 9, 2026, the Company filed a Certificate of Designation of Series A Convertible Preferred Stock (the “Series A Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 1,000,000 shares of the Company’s preferred stock as Series A Preferred Stock, par value $0.001 per share (the “Series A Preferred”).

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

Ranking. The Series A Preferred rank pari passu to the Company’s common stock.

Dividends. Holders of Series A Preferred will be entitled to dividends, on an as-converted basis, equal to dividends actually paid, if any, on shares of Company common stock.

Voting. Except as provided by the Company’s Charter or as otherwise required by the Nevada Revised Statutes, holders of Series A 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 A 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 A Preferred, (i) alter or change adversely the powers, preferences or rights given to the Series A Preferred or alter or amend the Series A Certificate of Designation, (ii) amend its Charter or other charter documents in any manner that adversely affects any rights of the holders of the Series A Preferred, or (iii) enter into any agreement with respect to the foregoing.

Conversion. On the third business day after the date that the Company’s stockholders approve the conversion of Series A Preferred into shares of Common Stock in accordance with the listing rules of Nasdaq, each outstanding share of Series A Preferred shall automatically be converted into one share of Company common stock (subject to adjustment under certain limited circumstances) (the “Series A Conversion Ratio”), subject to beneficial ownership limitations.

Liquidation. In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, holders of Series A Preferred will be entitled to participate, on an as-converted-to-common stock basis calculated based on the Series A Conversion Ratio, with holders of Company common stock in any distribution of assets of the Company to holders of the Company’s common stock.

At May 31, 2026, 150,000 shares of the issued Series A Preferred were outstanding, which if converted as of May 31, 2026, would have resulted in the issuance of 150,000 shares of common stock.

Series B Convertible Preferred Stock

On May 6, 2026 the Company filed a Certificate of Designation of Series B Convertible Preferred Stock (the “Series B Certificate of Designation”) with the Secretary of State of the State of Nevada, designating 450,000 shares of the Company’s preferred stock as Series B Preferred Stock, par value $0.001 per share (the “Series B Preferred”).

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

Ranking. The Series B Preferred Shares rank pari passu to the Company’s existing preferred shares and prior to the holders of the Company’s Common Stock and any other series of capital stock ranking junior to the Preferred Shares.

Dividends. Holders of Series B Preferred Shares will be entitled to dividends equal to 12% per annum (or 18% per annum upon an Event of Default (as defined in the Series B Certificate of Designation)) which will accrue and be payable in cash upon redemption or added to the Stated Value ($2.755) upon conversion.

Voting. Except as otherwise provided herein or as required by the Nevada Revised Statutes, the Series B Preferred Stock shall have no voting rights. However, without the affirmative vote of the holders of a majority of the then outstanding Series B Preferred Shares, the Company may not (i) alter or change adversely the powers, preferences or rights given to Series B Preferred Shares or alter or amend the Certificate of Designation in any manner that adversely affects any rights of the holders of the Series B Preferred Shares, (ii) issue further Series B Preferred Shares or increase or decrease the number of authorized shares of Series B Preferred Shares, or (iii) enter into any agreement with respect to the foregoing.

Conversion. At the option of the Holder, each outstanding share of Series B Preferred Shares may be converted at an initial conversion price of $2.755 per share (subject to adjustment under certain limited circumstances) (the “Series B Conversion Price”), subject to beneficial ownership limitations.

Liquidation. In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, holders of Series B Preferred Shares will be entitled to receive in preference to the holders of Common Stock and any class of capital stock junior to the Series B Preferred Shares an amount per share equal to the greater of (i) 115% of the Stated Value plus all accrued and unpaid dividends, or (ii) the amount that such holder would receive if such holder converted all of its shares of Series B Preferred Stock into Common Stock immediately prior to such liquidation, dissolution or winding up, and on parity with all existing preferred shares of the Company.

Redemption. The Company has the right to redeem all or any portion of the Series B Preferred Shares at a price per share equal to the Stated Value plus all accrued and unpaid dividends (the “Redemption Price”). On August 30, 2026, the Company is obligated to redeem all outstanding Series B Preferred Shares at the Redemption Price. The Holder may elect to extend the redemption period to December 31, 2026 by providing written notice at least five (5) Trading Days prior to August 30, 2026. Upon the occurrence of an Event of Default, the Company shall mandatorily redeem all outstanding Series B Preferred Shares at the Mandatory Default Amount, which equals 130% of the Stated Value plus all accrued and unpaid dividends calculated at the default rate plus any other amounts then due.

Events of Default under the Series B Certificate of Designation include, among others: (a) failure to pay the Mandatory Default Amount with 5 business days of when due; (b) breach of representations, warranties or covenants; (c) bankruptcy or insolvency proceedings; (d) delisting or suspension from the Principal Market or receipt of deficiency notices from Nasdaq or failing to meet Nasdaq listing standards; (e) entry of unsatisfied judgments in excess of $100,000; (f) material adverse change; (g) a Change of Control; (h) failure to deliver Conversion Shares; (i) failure to timely file periodic reports with the SEC; (j) loss of DTC eligibility; and (k) certain other events specified in the Certificate of Designation.

On May 6, 2026, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with Helena Global Investment Opportunities 1 Ltd. (the “Purchaser”), pursuant to which the Company issued and sold (a) an aggregate of 368,421 restricted shares of newly designated Series B Convertible Preferred Stock, par value $0.001, of the Company (the “Series B Preferred Shares”) plus 40,000 additional Series B Preferred Shares as an issuance fee; and (b) a five-year warrant (the “Warrant”) to purchase 100,000 shares of the Common Stock, par value $0.001 per share, of the Company (“Common Stock”) (the “Series B Offering”) at a purchase price of $2.7550 per share representing the Nasdaq Minimum Price plus $0.125 as of the date of the Purchase Agreement. The Warrant has an exercise price of $2.7550 per share. If a registration statement is not effective at the time of exercise, the holder may exercise the Warrant using a cashless exercise feature. If there is an Event of Default as defined in the Series B Certificate of Designation, the Warrant may be exercised without payment of cash.

The obligations of the Company under the transaction documents are secured by a pledge of 1,365,314 shares of Common Stock (the “Pledged Shares”) owned by the Company’s Chief Executive Officer, William Kerby, pursuant to a Guarantee and Pledge Agreement (the “Pledge Agreement”). The Pledge Agreement provides a limited recourse guarantee, with recourse solely to the Pleated Shares and not to any other assets of Mr. Kerby.

Pursuant to the Purchase Agreement, the Company has granted the Purchaser a right of participation of up to 20% of any future securities offering by the Company, other than exempt issuances. The Purchaser also has an exchange right to exchange Preferred Shares for offered securities at 100% of stated value. The Company has also agreed to file a registration statement with the Securities and Exchange Commission (the “SEC”) covering the resale of the shares of Common Stock issuable pursuant to exercise of the Warrant and conversion of the Series B Preferred Shares within fifteen (15) days (the “Filing Deadline”) of the closing date of the Series B Offering (the “Closing Date”). The Company shall use its best efforts to cause the registration statement to become effective within thirty (30) days after the Closing Date (or sixty (60) days if the SEC reviews the registration statement).

Also, in connection with any “at the market” offerings conducted by the Company during the 180-day period following the Closing Date, the Purchaser has the right to require the Company to apply an amount equal to 25% of the net proceeds to redeem the Series B Preferred Shares at the Redemption Price.

At May 31, 2026, 408,421 shares of the issued Series B Preferred were outstanding and classified as mezzanine shares outside of permanent equity, which if converted as of May 31, 2026, would have resulted in the issuance of 411,689 shares of common stock.

Series E Convertible Preferred Stock

Under the Certificate of Designations of the Series E Preferred Stock, shares of the Company’s Series E Preferred have an initial stated value of $1,500 per share (the “Series E 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 Series E Stated Value of the Series E Preferred by said amount. The holders of shares of the Series E Preferred have the right at any time to convert all or a portion of the Series E Preferred (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 Series E Value of the shares of Series E Preferred then being converted plus any other unpaid amounts payable with respect to the Series E Preferred 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.

At May 31, 2026, 316 shares of Series E Preferred were outstanding, which if converted as of May 31, 2026, including the make-whole dividends, would have resulted in the issuance of 3,623 shares of common stock.

Stock Options

On 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 May 31, 2026, 5,466,374 shares are available for future issuance.

The 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, 2026.

On March 26, 2025, under the terms of the 2013 Equity Incentive Plan, all outstanding options terminated upon the change in control effected by the issuance of Contingent Shares pursuant to the Exchange Agreement entered into in connection with the NextTrip Acquisition.

During the three months ended May 31, 2026 and 2025, the Company granted and issued stock options to purchase an aggregate of 200,000 and 556,250 shares of common stock, respectively, under the 2023 Plan.

The Company generally grants stock options to employees, consultants, and directors at exercise prices equal to the fair market value of the Company’s common stock on the grant date, but not less than 100% of the fair market value. Stock options are typically granted throughout the year and generally vest over a period from one to three years of service and expire five years from the grant date, unless otherwise specified. The Company recognizes compensation expense for the fair value of the stock options over the vesting period for each stock option award.

Total stock-based compensation expense included in the statements of operations for the three months ended May 31, 2026 and 2025 was $(13,660) related to a common share issuance and $138,325 related to stock options, respectively.

The fair value of stock-based awards was estimated using the Black-Scholes model with the following weighted average assumptions for the three months ended May 31, 2026 and May 31, 2025.

Schedule of Share Based Payments Award Stock Options Valuation Assumptions

Option activity for the three months ended May 31, 2026 and the year ended February 28, 2026 was as follows:

 Schedule of Stock Option Activity

The 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, 2026, no options had an exercise price below the $2.18 closing price of our common stock as reported on The Nasdaq Capital Market.

At May 31, 2026, there was $358,973 unrecognized stock-based compensation expense related to unvested stock options.

Stock Appreciation Rights

The purposes of the 2020 Stock Appreciation Rights Plan (the “2020 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; and (iii) promote the success of the Company’s business. The 2020 SAR Plan provides for incentive awards that are only in the form of stock appreciation rights payable in cash (“SARs”). No shares of common stock are reserved or will be issued pursuant to the 2020 SAR Plan.

SARs 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 (a “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 on the date of grant of the SAR. The administrator of the 2020 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.

On March 26, 2025, under the terms of the 2020 SAR Plan, all outstanding unvested SARs became immediately vested and exercisable upon the change in control effected by the issuance of Contingent Shares pursuant to the Exchange Agreement entered into in connection with the NextTrip Acquisition.

The Company did not grant any SARs during the three months ended May 31, 2026 or May 31, 2025.

The Company recognizes compensation expense and a corresponding liability for the fair value of the SARs over the vesting period for each SAR award. The SARs are revalued at each reporting date in accordance with ASC 718 “Compensation-Stock Compensation,” and any changes in fair value are reflected in the Statement of Operations as of the applicable reporting date.

SARs activity for the three months ended May 31, 2026 and the year ended February 28, 2026 was as follows:

 Schedule of Stock Option Activity

The 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, 2026, no SARs had an exercise price below the $2.18 closing price of our common stock as reported on The Nasdaq Capital Market.

At May 31, 2026, there was no unrecognized stock-based compensation expense related to unvested SARs.

Warrants

The fair value of warrants issued during the three months ended May 31, 2026 was estimated using the Black-Scholes model with the following assumptions.

Assumptions:

 Schedule of Share Based Payments Award Stock Options Valuation Assumptions

Warrant activity for the three months ended May 31, 2026 and the year ended February 28, 2026 was as follows:

 Schedule of Warranty Activity