NextTrip, Inc. Goodwill & Intangibles Disclosure

NOTE 12 – Goodwill

 

Reverse Acquisition of Sigma Additive Solutions, Inc.

 

As discussed in Note 1 – Business Description and Going Concern, the legal acquisition of NTH by the Company was determined to be a reverse acquisition, with NTH as the accounting acquirer, using the acquisition method of accounting in accordance with ASC 805, Business Combinations. Under this method of accounting, the purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of consummation of the transaction.

 

The following table presents the allocation of the $2,368,418 consideration for the acquisition and summarizes the estimated fair values of the Sigma (the accounting acquiree) assets acquired and liabilities assumed for NTH (the accounting acquirer). The estimated consideration of approximately $2,368,418 is based on Sigma’s closing share price of $3.0229, as reported on Nasdaq on December 29, 2023 multiplied by the 780,423 shares outstanding as of that date and the fair value of Series E Preferred Stock (on an as converted basis) into 3,069 common shares.

 

 Schedule of Fair Value of Assets Acquired

Fair Value of Net Assets Acquired:
Cash		$	417,121
Accounts Receivable, net			4,900
Inventory			257,873
Prepaid expenses and other current assets			50,802
Property and equipment			52,357
Intangible assets			1,277,919
Accounts payable			(837,450	)
Accrued expenses			(61,001	)
Deferred revenue			(14,218	)
Total identifiable net assets acquired			1,148,303
Goodwill			1,220,115
Total Fair Value of Net Assets Acquired		$	2,368,418
Total Purchase Consideration		$	2,368,418

 

Pursuant to ASC 350-20, the Company assigned its goodwill to reporting units and is required to test each reporting unit’s goodwill for impairment at least on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The goodwill resulting from the reverse acquisition is primarily attributable to NTH’s objective to obtain access to public markets to provide funding wherewithal to fund business growth. NTH’s benefit in paying for these synergies in the reverse acquisition transaction are to avoid the time and expense of organizing and executing an Initial Public Offering transaction. In the reverse acquisition, $52,310 of goodwill was allocated to the Sigma Reporting Unit (as defined below) and $1,167,805 of goodwill was allocated to the NTH Reporting Unit (as defined below) under the acquisition method of accounting.

 

The combined Company consists of two reporting units, Sigma (the “Sigma Reporting Unit”) and NTH (the “NTH Reporting Unit”). As the accounting acquirer in the reverse acquisition, NTH is considered to be an existing reporting unit and Sigma is considered to be a new reporting unit in that it is not in the same business as NTH. Accordingly, the reverse acquisition creates a new reporting unit which holds the Sigma business, constituting an asset held for sale as a result of the agreement for the sale of certain legacy Sigma assets to Divergent for a sales price of $1,626,242. As such, the fair value of the Sigma Reporting Unit is determined to be $1,626,242, with the difference of $742,176 from the purchase consideration being allocated to the NTH Reporting Unit. The assets sold to Divergent and the liabilities relieved from the Divergent transaction are assigned to the Sigma Reporting unit with the difference between the net fair value of those assets and liabilities and the Sigma Reporting Unit being assigned to goodwill. The goodwill being assigned to the NTH Reporting Unit is determined by the difference between the purchase consideration assigned to the NTH Reporting Unit and the net acquired Sigma assets and liabilities assumed that are assigned to the NTH Reporting Unit. A gain of $37,592 was recognized in the disposition transaction.

 

Acquisition of FSA Travel, LLC

 

As of February 28, 2026, goodwill of $1,669,058 arising from the FSA acquisition has been reported within the Company’s reporting segment, Travel Products and Services. See Note 4, Acquisition of FSA Travel, LLC for a description of goodwill recognized in connection with the acquisition.

 

Acquisition of TA Pipeline LLC

 

As of February 28, 2026, goodwill of $286,824 arising from the TA Pipeline acquisition has been reported within the Company’s reporting segment, Travel Products and Services. See Note 6, Acquisition of TA Pipeline, LLC for a description of goodwill recognized in connection with the acquisition.