NOTE 2 – Summary of Significant Accounting Policies

Basis 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, 2026 and 2025 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 financial statements be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended  February 28, 2026. The results of operations for the period ended  August 31, 2026 are not necessarily indicative of the operating results for the full year.

Reclassification

Certain prior year amounts have been reclassified to conform to the current period presentation. These reclassifications had no impact on the net earnings (loss) or financial position.

Fair Value of Financial Instruments - The Company applies ASC 820, “Fair Value Measurements.” This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:

The carrying amounts reported in the balance sheets for the cash and cash equivalents, receivables, accounts payable, and accrued expenses each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest.

Derivative Instruments and Warrants

The Company does not use derivative instruments for hedging of market risk or for trading or speculative purposes. The Company evaluates financial instruments issued, and features embedded in those instruments, to determine whether they meet the definition of a derivative in ASC 815-10 and, for instruments indexed to the Company’s own stock, whether they meet the conditions for equity classification in ASC 815-40. Instruments and embedded features that require liability classification are recorded at fair value at issuance and remeasured at each reporting date, with changes in fair value recognized in the consolidated statements of operations. Equity-classified instruments are recorded in additional paid-in capital at issuance and are not subsequently remeasured. The classification of each instrument is reassessed at each reporting date.

The restricted common shares issued by the Company pursuant to the acquisition of TA Pipeline LLC (“TA”) contained an option (the “Put Option”), which the Company accounted for as a derivative liability. As described in Note 8, on February 24, 2026 the former TA Members delivered notice purporting to exercise the Put Option with respect to all of the TA Closing Shares, and during the three months ended August 31, 2026 the Company derecognized the remaining derivative liability upon reclassifying the TA Closing Shares as a liability. No derivative liability in respect of the Put Option was outstanding at August 31, 2026.

The Common Stock Purchase Warrant issued to Lind Global Fund III LP on July 21, 2026 is classified as a liability and measured at fair value on a recurring basis, as described in Note 14. The Company allocates proceeds from an instrument issued together with a liability-classified warrant first to the warrant at its fair value, with the residual allocated to the host instrument, and allocates issuance costs between the instruments on the same basis. Issuance costs allocated to a liability-classified warrant are expensed as incurred.

 Debt Discount and Issuance Costs

Original issue discount, amounts allocated to freestanding instruments issued with debt, and debt issuance costs allocated to debt are presented as a direct deduction from the carrying amount of the related debt and are accreted to interest expense over the term of the debt using the effective interest method. Where debt is repayable in installments, the unamortized discount is allocated between the current and non-current portions of the debt on a pro rata basis consistent with the allocation of principal.

Investments in Equity Method Investees

The Company holds investments in certain entities that are accounted for under the equity method of accounting, as well as equity securities without readily determinable fair values that are measured under the measurement alternative in ASC 321, “Investments - Equity Securities.” Under the equity method, investments in entities in which the Company has significant influence, but not control, are initially recognized at cost and adjusted thereafter to recognize the Company’s share of the investees’ earnings or losses and other comprehensive income.

The Company determines the existence of significant influence based on various factors, including representation on the investees’ board of directors, participation in policy-making processes, and material intercompany transactions.

The Company’s equity method investments are evaluated periodically for impairment by assessing whether events or changes in circumstances indicate that the carrying value of the investment may not be recoverable. When such indicators exist, the Company performs an impairment test and recognizes an impairment loss to the extent that the carrying amount of the investment exceeds its fair value.

Distributions received from equity method investees that exceed cumulative earnings recognized by the Company are considered a return of investment and are recorded as a reduction in the carrying amount of the investment.

Adjustments resulting from changes in the Company’s ownership interest in equity method investees that do not result in a loss of significant influence are accounted for prospectively.

Basis Difference

In accordance with ASC 323, “Investments - Equity Method and Joint Ventures,” the Company records a basis difference when the carrying value of its equity method investment differs from its share of the investee’s fair value of net assets at the acquisition date. This basis difference is allocated to the investee’s identifiable assets and liabilities based on their fair values. The amortization of any basis difference related to depreciable assets, such as property, plant, and equipment, is recognized in the Company’s share of the investee’s earnings or losses. Any basis difference related to non-depreciable assets, including goodwill, is generally not amortized, but is subject to impairment testing as necessary.

The Company assesses the impact of any basis differences on its earnings and the carrying value of its equity method investments. If a basis difference is determined to exist, the appropriate adjustments are made to reflect the amortization of such differences in the condensed consolidated financial statements.

Investments in Equity Securities without Readily Determinable Fair Value

In accordance with ASC 321-10-35-2, the Company holds certain investments in equity securities in which the Company does not have significant influence or control, and for which fair value is not readily determinable. These investments are measured at cost, less any impairment, adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer. The carrying amount is evaluated for impairment each reporting period through a qualitative assessment of impairment indicators, and if an impairment indicator exists, an impairment loss is recognized in the statement of operations for the amount by which the carrying amount exceeds fair value.

Equity in Earnings of Equity Method Investees

The Company’s share of earnings or losses from equity method investees is recognized in the consolidated statement of operations within “Share of net loss of equity method investee,” net of any related income taxes.

Loss Per Share – The computation of loss per share is based on the weighted average number of shares outstanding during the period in accordance with ASC Topic No. 260, “Earnings Per Share.” Shares underlying the Company’s outstanding warrants, options, preferred stock and convertible note were excluded due to the anti-dilutive effect they would have on the computation. At  August 31, 2026 and 2025, the Company had the following common shares underlying these instruments:

The 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 three and six months ended August 31, 2026 and 2025:

Dilutive loss per share was not presented, as the Company’s outstanding common and preferred warrants, stock options and preferred stock common equivalent shares and shares issuable upon conversion of the convertible note for the periods presented would have had an anti-dilutive effect. At  August 31, 2026, the Company had outstanding warrants to purchase 6,047,861 shares of common stock; stock options exercisable for 939,825 shares of common stock; 150,000 shares of Series A preferred stock (“Series A Preferred”), which could be converted into 150,000 shares of common stock, 3,612 shares of Series B Preferred Stock (“Series B Preferred”) which could be converted into 930,927 shares of common stock, and 316 shares of Series E Preferred Stock (“Series E Preferred”), which could be converted into 3,673 shares of common stock, and a convertible note convertible into 1,185,567 shares of common stock at the $3.88 conversion price, resulting in a potential total additional 9,257,853 shares of common stock outstanding in the future.

In addition, the Company may elect to settle monthly installments of principal under the convertible note in shares of common stock at 90% of the average of the five lowest daily volume weighted average prices during the twenty trading days preceding the payment date. The number of shares issuable in settlement of an installment is therefore not determinable until the applicable payment date and increases as the market price of the common stock declines. Any such shares would be in addition to the 1,185,567 shares issuable at the stated conversion price.

Accounting Estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimated by management. Significant accounting estimates that may materially change in the near future are revenue recognition, including principal versus agent determinations; impairment of goodwill, intangible assets and other long-lived assets; the carrying value of equity investments; the fair value of the warrant liability; values of stock compensation awards and stock equivalents granted as offering costs; and the allowance for credit losses.

Revenue Recognition – The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers. The core principle of ASC 606 is the recognition of revenue upon the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. In general, we determine revenue recognition by: (1) identifying the contract, or contracts, with our customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to performance obligations in the contract; and (5) recognizing revenue when, or as, we satisfy performance obligations by transferring the promised goods or services. The Company’s revenue is derived primarily from its Travel segment, through the sale of travel packages and other travel products and commissions and fees earned on travel bookings, and from its Media segment, through advertising and sponsorships.

The Company recognizes revenue from travel packages when the customer has purchased the product and the performance obligation is satisfied, which occurs at the earlier of the date of travel or the date on which the customer’s cancellation period has expired. 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). 

The Company generates revenues from sales directly to customers as well as through other distribution channels of tours and activities at destinations throughout the world.

For travel packages sold directly by the Company, the Company controls the specified travel product before it is transferred to the customer and is therefore a principal, based on, among other factors, the following: 

Payments for tours or activities received in advance of services being rendered are recorded as deferred revenue and recognized as revenue at the earlier of the date of travel or the last date of cancellation (i.e., the customer’s refund privileges lapse).

For certain travel products, primarily luxury hotel bookings made through Five Star Alliance, the supplier or wholesaler controls pricing and provides the travel service, and the Company’s performance obligation is to arrange for the travel product to be provided by the supplier. In these arrangements, the Company acts as an agent and recognizes revenue on a net basis, equal to the commission or fee it retains, upon the date of travel. Media segment revenue, consisting primarily of advertising and sponsorship revenue from JOURNY TV and Travel Magazine, is recognized as advertisements are delivered and impressions are served and is recorded net of amounts retained by distribution partners.

Segment Reporting - In response to recent acquisitions and expanded business activities, during the third quarter of fiscal year 2026, our CODM, who is our Chief Executive Officer, requested changes in the information that he regularly reviews for purposes of allocating resources and assessing performance. As a result, we have updated our reporting and beginning in the third quarter of fiscal year 2026, we reported our financial performance based on our new segments, “Travel” and “Media”. A detailed description of our operating segments as of  August 31, 2026 can be found in Note 19 to the Financial Statements and in the Business Overview section of Item 2 of this Quarterly Report, entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. Prior periods have been recast to conform to these newly identified segments.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments require enhanced disclosures about significant segment expenses regularly provided to the chief operating decision maker (“CODM”) and included in the measure of segment profit or loss, an amount and description of other segment items, the title and position of the CODM, and application of the segment disclosure requirements to interim periods. The Company adopted ASU 2023-07 for its fiscal year beginning March 1, 2025. The Company began reporting under its Travel and Media reportable segments, and reflecting the interim disclosure provisions of ASU 2023-07, in the third quarter of fiscal year 2026 (the quarterly period ended November 30, 2025); prior periods have been recast to conform to the current segment presentation. Adoption affected disclosures only and did not affect the Company’s consolidated financial position, results of operations, or cash flows.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The Company adopted ASU 2023-09 on a prospective basis effective for its fiscal year beginning March 1, 2025 (fiscal year ended February 28, 2026). The amendments affect annual income tax disclosures only and do not establish new interim disclosure requirements; adoption did not affect the Company’s consolidated financial position, results of operations, or cash flows, or its interim income tax disclosures.

In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments. The amendments clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The Company adopted ASU 2024-04 on a prospective basis effective for its fiscal year beginning March 1, 2026. Adoption did not have a material effect on the Company’s consolidated financial position, results of operations, or cash flows. 

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments provide a practical expedient that permits an entity to assume that current conditions as of the balance sheet date do not change for the remaining life of current accounts receivable and current contract assets arising from transactions accounted for under Topic 606 when estimating expected credit losses. The Company adopted ASU 2025-05 on a prospective basis effective for its fiscal year beginning March 1, 2026. Adoption did not have a material effect on the Company’s consolidated financial position, results of operations, or cash flows.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires additional disclosure in the notes to the financial statements of specified categories of expenses (including employee compensation, depreciation, and intangible asset amortization) included in relevant expense captions presented on the face of the income statement. In January 2025, the FASB issued ASU 2025-01, which clarified that ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods within annual periods beginning after December 15, 2027. The Company will be required to adopt ASU 2024-03 for its annual period beginning March 1, 2027 and for interim periods beginning March 1, 2028. Early adoption is permitted. The Company is evaluating the effect of ASU 2024-03 on its disclosures, including its segment expense disclosures.

In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. The amendments require an entity to consider the factors in ASC 805-10-55-12 through 55-15 when determining the accounting acquirer in a transaction effected primarily by exchanging equity interests in which the legal acquiree is a variable interest entity that meets the definition of a business. The ASU is effective for the Company for annual periods beginning March 1, 2027, including interim periods within those annual periods, and is applied prospectively to acquisition transactions occurring after the initial application date. Early adoption is permitted. The Company does not expect adoption to affect previously reported business combinations; the effect on future transactions will depend on their facts and circumstances.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract. The amendments expand the scope exception in Topic 815 for certain contracts with underlyings based on operations or activities specific to one of the parties to the contract and clarify the accounting for share-based noncash consideration received from a customer. The ASU is effective for the Company for annual periods beginning March 1, 2027, including interim periods within those annual periods, with early adoption permitted. The Company is evaluating the effect of ASU 2025-07 on its condensed consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments remove references to prescriptive software development stages and require capitalization of eligible software costs to begin when management has authorized and committed to funding the project and it is probable that the project will be completed and the software will perform its intended function. The ASU is effective for the Company for annual periods beginning March 1, 2028, including interim periods within those annual periods, with early adoption permitted at the beginning of an annual period. The Company is evaluating the effect of ASU 2025-06 on its accounting for capitalized software development costs.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the interim disclosure requirements and the applicability of Topic 270. The ASU is effective for the Company for interim periods within annual periods beginning March 1, 2028, with early adoption permitted. The Company is evaluating the effect of ASU 2025-11 on its interim disclosures.

The Company has evaluated other recently issued accounting pronouncements and does not believe that any of them will have a material effect on its condensed consolidated financial statements.