NextTrip Inc. Executes Debt-for-Equity Exchange; Issues Series B Preferred

What Happened
NextTrip, Inc. (NTRP) filed an 8-K reporting that it entered into an Exchange Agreement with Monaco Investment Partners II, LP (the Lender), converting outstanding advances under an amended Line of Credit into newly created Series B convertible preferred stock. The Line of Credit advances totaled $3,000,000 and were increased by $500,000 (total principal $3,500,000); the Exchange Agreement is effective August 25, 2026 and closed upon filing of the Series B Certificate of Designation on August 27, 2026. The conversion exchanges the Outstanding Debt (advances plus accrued interest through the Effective Date) for Series B preferred shares at a stated value of $1,000 per share.

Key Details

• Lender: Monaco Investment Partners II, LP, which is owned/operated by NextTrip’s chairman, Donald P. Monaco (related‑party).
• Amounts: $3,000,000 initial advances + $500,000 credit increase = $3,500,000 principal converted, plus accrued interest.
• Conversion mechanics: Outstanding Debt divided by $1,000 equals the number of Series B convertible preferred shares issued.
• Governance: The related‑party transaction was reviewed and approved by disinterested directors and the audit committee under Nevada law, Nasdaq rules, and the company’s Related Party Transactions Policy.

Why It Matters
This transaction cancels a material portion of NextTrip’s debt to a related‑party lender and replaces it with Series B convertible preferred equity, changing the company’s capital structure. Investors should note (1) the dollar amount converted ($3.5M plus interest), (2) the issuance of a new class of convertible preferred stock with a $1,000 stated value per share, and (3) that the deal involved a related party but received approval from disinterested directors and the audit committee. Full terms and rights of the Series B preferred and the Exchange Agreement are included in the company’s 8‑K filing.