Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Aug. 31, 2018 | Oct. 08, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CLS HOLDINGS USA, INC. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --05-31 | |
Entity Common Stock, Shares Outstanding | 90,132,170 | |
Amendment Flag | false | |
Entity Central Index Key | 1,522,222 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Aug. 31, 2018 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Aug. 31, 2018 | May 31, 2018 | |
Current assets | |||
Cash and cash equivalents | $ 5,953,925 | $ 52,964 | |
Accounts Receivable | 59,981 | 0 | |
Inventory | 499,399 | 0 | |
Prepaid expenses | 258,308 | 1,410 | |
Total current assets | 6,771,613 | 54,374 | |
Investment | 0 | 2,050,000 | |
Property, plant and equipment, net of accumulated depreciation of $27,509 and $2,674 | 905,633 | 0 | |
Intangible assets, net of accumulated amortization of $22,757 and $828 | 1,619,325 | 898 | |
Goodwill | 25,742,899 | 0 | |
Other assets | 158,500 | 0 | |
Total assets | 35,197,970 | [1] | 2,105,272 |
Current liabilities | |||
Accounts payable and accrued liabilities | 1,199,525 | 826,621 | |
Accrued compensation, related party | 54,993 | 120,417 | |
Due to related party | 17,930 | 17,930 | |
Accrued interest | 22,830 | 24,748 | |
Accrued interest, related party | 7,393 | 5,143 | |
Notes payable | 3,834,242 | 310,000 | |
Notes payable, related parties | 5,716 | 75,137 | |
Convertible notes payable, net of discount of $0 and $561,599 | 0 | 43,401 | |
Deferred rent obligation | 136,707 | 0 | |
Contingent liability | 678,111 | 0 | |
Derivative liability | 0 | 1,265,751 | |
Total current liabilities | 5,957,447 | 2,689,148 | |
Noncurrent liabilities | |||
Accrued interest, long-term | 44,155 | 0 | |
Convertible notes payable - Long Term, net of discount of $982,098 and $733,928 | 292,902 | 41,072 | |
Convertible notes payable, related parties, net of discount of $57,322 and $65,918 | 17,678 | 2,832 | |
Total Liabilities | 6,312,182 | 2,733,052 | |
Commitments and contingencies | |||
Stockholder's equity | |||
Preferred stock, $0.001 par value; 20,000,000 shares authorized; no shares issued | 0 | 0 | |
Common stock, $0.0001 par value; 250,000,000 shares authorized; 90,087,236 and 50,128,972 shares issued and outstanding at August 31, 2018 and May 31, 2018, respectively | 9,009 | 5,013 | |
Additional paid-in capital | 63,939,091 | 17,628,717 | |
Common stock subscribed | 163,722 | 307,584 | |
Accumulated deficit | (35,226,034) | (18,569,094) | |
Total stockholder's equity (deficit) | 28,885,788 | (627,780) | |
Total liabilities and stockholders' equity (deficit) | $ 35,197,970 | $ 2,105,272 | |
[1] | Total assets are the owned or allocated assets used by each business. Corporate assets consist of cash and cash equivalents, unallocated fixed assets of support divisions and common facilities, and certain other assets. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Property, plant and equipment, accumulated depreciation | $ 27,509 | $ 2,674 |
Intangible assets, accumulated amortization | 22,757 | 828 |
Convertible notes payable - Long Term, discount | 982,098 | 733,928 |
Convertible notes payable discount | $ 165,758 | $ 0 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 90,087,236 | 50,128,972 |
Common stock, outstanding | 90,087,236 | 50,128,972 |
Convertible Debt [Member] | Non-Related Party Debt [Member] | ||
Convertible notes payable discount | $ 0 | $ 561,599 |
Convertible Debt [Member] | Related Party Notes [Member] | ||
Convertible notes payable discount | $ 57,322 | $ 65,918 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Revenue | $ 1,179,353 | $ 0 |
Cost of goods sold | 759,944 | 0 |
Gross margin | 419,409 | 0 |
Selling, general and administrative expenses | 15,392,130 | 359,204 |
Total operating expenses | 15,392,130 | 359,204 |
Operating loss | (14,972,721) | (359,204) |
Other (income) expense: | ||
Interest expense | 1,684,219 | 74,866 |
Gain on settlement of debt | 0 | (3,480) |
Loss on modification of debt | 0 | 29,145 |
Change in fair value of derivative | 0 | 105,950 |
Total other expense | 1,684,219 | 206,481 |
Income (Loss) before income taxes | (16,656,940) | (565,685) |
Income tax expense | 0 | 0 |
Net income (loss) | $ (16,656,940) | $ (565,685) |
Net income (loss) per share - basic (in Dollars per share) | $ (0.23) | $ (0.02) |
Weighted average shares outstanding - basic (in Shares) | 71,296,485 | 32,865,727 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ (16,656,940) | $ (565,685) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Imputed interest | 271 | 271 |
Change in fair value of derivative | 0 | 105,950 |
Warrants issued to placement agent | 2,908,673 | 0 |
Warrants and Special Warrants issued to penalty | 8,084,522 | 0 |
Non-cash offering costs of equity financing | 403,588 | 0 |
Stock-based compensation | 120,138 | 0 |
Fair value of shares issued to consultants | 490,000 | 0 |
Gain / loss on modification of debt | 0 | 29,145 |
(Gain) loss on note exchange | 0 | (3,480) |
Expense from derivative triggering event | 12,659 | 0 |
Amortization of debt discounts | 1,598,501 | 42,060 |
Depreciation and amortization expense | 48,461 | 331 |
Changes in assets and liabilities: | ||
Accounts receivable | (24,544) | 0 |
Inventory | (93,446) | 0 |
Prepaid expenses | (151,709) | 0 |
Other assets | 0 | 50,000 |
Accounts payable and accrued expenses | (548,738) | 112,068 |
Accrued compensation | (15,424) | 62,500 |
Due to related parties | (50,000) | 0 |
Accrued interest, related party | 3,497 | 24,198 |
Deferred rent | 667 | (49,565) |
Accrued interest | 59,437 | 8,229 |
Net cash used in operating activities | (3,810,387) | (183,978) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Payment for investment in Alternative Solutions, net of cash received of $14,612 | (5,982,710) | 0 |
Net cash used in investing activities | (5,982,710) | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from related party convertible notes payable | 0 | 117,767 |
Proceeds from related party notes payable | 81,961 | 0 |
Proceeds from convertible note payable | 500,000 | 0 |
Principal payments on notes payable | (310,000) | 0 |
Principal payments on related party notes payable | (76,381) | 0 |
Repayments of convertible notes payable | (37,500) | 0 |
Proceeds from sale of equity | 15,535,978 | 0 |
Net cash provided by financing activities | 15,694,058 | 117,767 |
Net increase in cash and cash equivalents | 5,900,961 | (66,211) |
Cash and cash equivalents at beginning of period | 52,964 | 78,310 |
Cash and cash equivalents at end of period | 5,953,925 | 12,099 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Interest paid | 8,964 | 0 |
Income taxes paid | 0 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Convertible note issued for unpaid accrued salary | 0 | 62,500 |
Related party notes payable reclassified as related party convertible notes payable | 75,000 | 816,975 |
Beneficial conversion feature on convertible notes | 1,229,831 | 351,790 |
Note payable exchanged for common stock | 654,697 | 0 |
Shares issued for settlement of accounts payable | 0 | 6,000 |
Charge to paid-in capital for par value of shares issued in cashless exercise of warrants | 13 | 0 |
Reclassify derivative liability to paid-in capital upon adoption of ASU 2017-11 | $ 1,265,751 | $ 0 |
Note 1 - Nature of Business and
Note 1 - Nature of Business and Significant Accounting Policies | 3 Months Ended |
Aug. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | Note 1 – Nature of Business and Significant Accounting Policies Basis of Presentation These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in US dollars. Principals of Consolidation The accompanying consolidated financial statements include the accounts of CLS Holdings USA, Inc., and its wholly owned operating subsidiaries, CLS Nevada, Inc., (“CLS Nevada”), CLS Labs, Inc. (“CLS Labs”), CLS Labs Colorado, Inc. (“CLS Colorado”), and Alternative Solutions, LLC (“Alternative Solutions”). Alternative Solutions is sole owner of the following three entities (collectively, the “Oasis LLCs”): Serenity Wellness Center, LLC (“Serenity Wellness Center”); Serenity Wellness Products, LLC (“Serenity Wellness Products”); and Serenity Wellness Growers, LLC (“Serenity Wellness Growers”). All material intercompany transactions have been eliminated upon consolidation of these entities. Nature of Business CLS Holdings USA, Inc. (the “Company”) was originally incorporated as Adelt Design, Inc. (“Adelt”) on March 31, 2011 to manufacture and market carpet binding art. Production and marketing of carpet binding art never commenced. On November 12, 2014, CLS Labs, Inc. (“CLS Labs”) acquired 10,000,000 shares, or 55.6%, of the outstanding shares of common stock of Adelt from its founder, Larry Adelt. On that date, Jeffrey Binder, the Chairman, President and Chief Executive Officer of CLS Labs, was appointed Chairman, President and Chief Executive Officer of the Company. On November 20, 2014, Adelt adopted amended and restated articles of incorporation, thereby changing its name to CLS Holdings USA, Inc. Effective December 10, 2014, the Company effected a reverse stock split of its issued and outstanding common stock at a ratio of 1-for-0.625 (the “Reverse Split”), wherein 0.625 shares of the Company’s common stock were issued in exchange for each share of common stock issued and outstanding. As a result, 6,250,000 shares of the Company’s common stock were issued to CLS Labs in exchange for the 10,000,000 shares that it owned by virtue of the above-referenced purchase from Larry Adelt. On April 29, 2015, the Company, CLS Labs and CLS Merger Inc., a Nevada corporation and wholly owned subsidiary of CLS Holdings (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) and completed a merger, whereby CLS Merger Inc. merged with and into CLS Labs, with CLS Labs remaining as the surviving entity (the “Merger”). Upon the consummation of the Merger, the shares of the common stock of CLS Holdings owned by CLS Labs were extinguished and the former stockholders of CLS Labs were issued an aggregate of 15,000,000 (post Reverse Split) shares of common stock in CLS Holdings in exchange for their shares of common stock in CLS Labs. As a result of the Merger, the Company acquired the business of CLS Labs and abandoned its previous business. The Company has been issued a U.S. patent with respect to its proprietary method of extracting cannabinoids from cannabis plants and converting the resulting cannabinoid extracts into concentrates such as oils, waxes, edibles and shatter. These concentrates may be ingested in a number of ways, including through vaporization via electronic cigarettes (“e-cigarettes”), and used for a variety of pharmaceutical and other purposes. Internal testing of this extraction method and conversion process has revealed that it produces a cleaner, higher quality product and a significantly higher yield than the cannabinoid extraction processes currently existing in the marketplace. The Company has not commercialized its proprietary process or otherwise earned any revenues. The Company plans to generate revenues through licensing, fee-for-service and joint venture arrangements related to its proprietary method of extracting cannabinoids from cannabis plants and converting the resulting cannabinoid extracts into saleable concentrates. On December 4, 2017, the Company and Alternative Solutions, LLC (“Alternative Solutions”) entered into a Membership Interest Purchase Agreement (the “Acquisition Agreement”) for the Company to acquire the outstanding equity interests in three subsidiaries (collectively, the “Oasis LLCs”), Serenity Wellness Center LLC d/b/a/ Oasis Medical Cannabis, Serenity Wellness Growers LLC, and Serenity Wellness Products LLS, from Alternative Solutions. Pursuant to the Acquisition Agreement, the Company initially contemplated acquiring all of the membership interests in the Oasis LLCs from Alternative Solutions. Just prior to closing, the parties agreed that the Company would instead acquire all of the membership interests in Alternative Solutions, the parent of the Oasis LLCs, from its members, and the membership interests in the Oasis LLCs owned by members other than Alternative Solutions. Pursuant to the Acquisition Agreement, the Company paid a non-refundable deposit of $250,000 upon signing, which was followed by an additional payment of $1,800,000 paid in February 2018, for an initial 10% of each of the Oasis LLCs. At that time, the Company applied for regulatory approval to own an interest in the Oasis LLCs, which approval was received. On June 27, 2018, the Company made the payments to indirectly acquire the remaining 90% of the Oasis LLCs, which were equal to cash in the amount of $5,995,543, a $4.0 million promissory note due in December 2019 (the “Oasis Note”), and 22,058,823 shares of its common stock (the “Purchase Price Shares”) collectively, the “Closing Consideration”). The cash payment of $5,995,543 was less than the $6,200,000 payment originally contemplated because the Company assumed an additional $204,457 of liabilities. The Company used the proceeds of its recent Canadian private securities offering to fund the cash portion of the Closing Consideration. The Company then applied for regulatory approval to own the additional 90% in membership interests in the Oasis LLCs, which it expects to receive in due course. The change of ownership in the Oasis LLCs to the Company will be recorded upon receipt of such regulatory approvals. The Company has adopted a fiscal year end of May 31st. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents. The Company had cash and cash equivalents of $5,953,925 and $52,964 as of August 31, 2018 and May 31, 2018, respectively. Allowance for Doubtful Accounts The Company generates the majority of its revenues and corresponding accounts receivable from the sale of cannabis, and cannabis related products. The Company evaluates the collectability of its accounts receivable considering a combination of factors. In circumstances where it is aware of a specific customer’s inability to meet its financial obligations to it, the Company records a specific reserve for bad debts against amounts due in order to reduce the net recognized receivable to the amount it reasonably believe will be collected. For all other customers, the Company recognizes reserves for bad debts based on past write-off experience and the length of time the receivables are past due. The Company had no bad debts expense during the three months ended August 31, 2018 and 2017. Segment Reporting Under FASB ASC 280-10-50, the Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. Inventory Inventories are stated at the lower of cost or market. Cost is determined on a standard cost basis that approximates the first-in, first-out (FIFO) method. Market is determined based on net realizable value. Appropriate consideration is given to obsolescence, excessive levels, deterioration, and other factors in evaluating net realizable values. Our cannabis products consists of prepackaged purchased goods ready for resale, and cannabis flower grown in-house under our cultivation license, along with produced edibles and extracts developed under our production license. Property, Plant and Equipment Property and equipment is recorded at the lower of cost or estimated net recoverable amount, and is depreciated using the straight-line method over the estimated useful lives. Computer equipment is being depreciated over a three-year period. Concentrations of Credit Risk The Company maintains its cash in bank deposit accounts and other accounts, the balances of which at times may be uninsured or exceed federally insured limits. From time to time, some of the Company’s funds are also held by escrow agents; these funds may not be federally insured. The Company continually monitors its banking relationships and consequently has not experienced any losses in such accounts. Advertising and Marketing Costs All costs associated with advertising and promoting products are expensed as incurred with the exception of the amortization of the cost of two major video productions. A music video and reality/lifestyle video were both produced in 2017. The remaining amount that hasn’t been expensed is listed on the schedule in Note 6. Total recognized advertising and promotion expenses were $127,392 and $0 for the three months ended August 31, 2018 and 2017, respectively. Research and Development Research and development expenses are charged to operations as incurred. The Company incurred no research and development costs for the three months ended August 31, 2018 and 2017, respectively. Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the establishment of deferred tax assets and liabilities for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities at enacted tax rates expected to be in effect when such amounts are realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to the extent deferred tax assets may not be recoverable after consideration of the future reversal of deferred tax liabilities, tax planning strategies, and projected future taxable income. Fair Value of Financial Instruments Pursuant to Accounting Standards Codification (“ASC”) No. 825 - Financial Instruments, the Company is required to estimate the fair value of all financial instruments included on its balance sheets. The carrying amount of the Company’s cash and cash equivalents, note receivable, notes payable, accounts payable and accrued expenses, none of which is held for trading, approximates their estimated fair values due to the short-term maturities of those financial instruments. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly. Level 3 - Significant unobservable inputs that cannot be corroborated by market data. Derivative Financial Instruments Derivatives are recorded on the condensed consolidated balance sheet at fair value. The conversion features of the convertible notes are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model the Company uses for determining the fair value of its derivatives is the Lattice Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (see note 14). On June 1, 2018, the Company adopted ASU 2017-11 and accordingly reclassified the fair value of the reset provisions embedded in convertible notes payable and certain warrants with embedded anti-dilutive provisions from liability to equity in the aggregate amount of $1,265,751. Revenue Recognition Revenue is primarily generated through our subsidiary, Serenity Wellness LLC, DBA/ Oasis Cannabis. Oasis operates a 24-hour cannabis dispensary that recognizes revenue from the sale of cannabis products within the State of Nevada. Revenue from the sale of our cannabis products is recognized by our subsidiary at the point of sale, at which time payment is received. Management estimates an allowance for sales returns. The Company also recognizes revenue from Serenity Wellness Products LLC and Serenity Wellness Growers LLC, DBA/ City Trees. City Trees recognizes revenue from the sale of the following cannabis products and services to licensed dispensaries within the State of Nevada: ● Premium organic medical cannabis sold wholesale to licensed retailers ● Recreational marijuana cannabis products sold wholesale to distributors and retailers ● Extraction products such as oils and waxes derived from in-house cannabis production ● Processing and extraction services for licensed medical cannabis cultivators in Nevada ● High quality cannabis strains in the form of vegetative cuttings for sale to licensed medical cannabis cultivators in Nevada Effective January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606. The Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605. Revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting Topic 606 for the three months ended August 31, 2018. Basic and Diluted Loss Per Share Basic net earnings per share is based on the weighted average number of shares outstanding during the period, while fully-diluted net earnings per share is based on the weighted average number of shares of common stock and potentially dilutive securities assumed to be outstanding during the period using the treasury stock method. Potentially dilutive securities consist of options and warrants to purchase common stock, and convertible debt. Basic and diluted net loss per share is computed based on the weighted average number of shares of common stock outstanding during the period. The Company uses the treasury stock method to calculate the impact of outstanding stock options and warrants. Stock options and warrants for which the exercise price exceeds the average market price over the period have an anti-dilutive effect on earnings per common share and, accordingly, are excluded from the calculation. A net loss causes all outstanding stock options and warrants to be antidilutive. As a result, the basic and dilutive losses per common share are the same for the three months ended August 31, 2018 and 2017. Commitments and Contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims brought to such legal counsel’s attention as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. Recent Accounting Pronouncements Accounting standards promulgated by the Financial Accounting Standards Board (“FASB”) are subject to change. Changes in such standards may have an impact on the Company’s future financial statements. The following is a summary of recent accounting developments. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230). In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation - Scope of Modification Accounting Effective June 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting Topic 606. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying unaudited condensed consolidated financial statements. Adoption of Accounting Standards In July 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). The amendments in Part I of this update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260). The amendments in Part II of this update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect. For public business entities, the amendments in Part I of this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. On June 1, 2018, the Company adopted ASU 2017-11 and accordingly reclassified the fair value of the reset provisions embedded in convertible notes payable and certain warrants with embedded anti-dilutive provisions from liability to equity in the aggregate amount of $1,265,751. |
Note 2 - Going Concern
Note 2 - Going Concern | 3 Months Ended |
Aug. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Substantial Doubt about Going Concern [Text Block] | Note 2 – Going Concern As shown in the accompanying financial statements, the Company has incurred net losses from operations resulting in an accumulated deficit of $35,226,034 as of August 31, 2018. The Company’s auditors stated in their opinion on the Company’s financial statements for the year ended May 31, 2018 that there was substantial doubt about the Company’s ability to continue as a going concern, and that further losses were anticipated in the development of the Company’s business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company began generating revenue from operations with the Acquisition of Alternative Solutions, LLC on June 27, 2018 (note 3). Management intends to finance operating costs over the next twelve months with loans, the proceeds from the sale of securities, and/or revenues from operations. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty. |
Note 3 - Acquisition of Alterna
Note 3 - Acquisition of Alternative Solutions, LLC | 3 Months Ended |
Aug. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | Note 3 – Acquisition of Alternative Solutions, LLC On June 27, 2018, the Company closed on the purchase of all of the membership interests in Alternative Solutions, LLC and its three operating subsidiaries (collectively, the “Oasis LLCs”) from the members of such entities (other than Alternative Solutions). The Oasis LLCs operate a fully integrated cannabis business in Las Vegas, Nevada, including a grow; extraction, conversion and processing facility; and a retail dispensary. The closing occurred pursuant to a Membership Interest Purchase Agreement (the “Acquisition Agreement”) entered into between the Company and Alternative Solutions on December 4, 2017, as amended. Pursuant to the Acquisition Agreement, the Company initially contemplated acquiring all of the membership interests in the Oasis LLCs from Alternative Solutions. Just prior to closing, the parties agreed that the Company would instead acquire all of the membership interests in Alternative Solutions, the parent of the Oasis LLCs, from its members, and the membership interests in the Oasis LLCs owned by members other than Alternative Solutions. The revised structure of the transaction is referenced in the Oasis Note (as defined below), which modified the Acquisition Agreement. Pursuant to the Acquisition Agreement, the Company paid a non-refundable deposit of $250,000 upon signing, which was followed by an additional payment of $1,800,000 paid in February 2018, for an initial 10% of each of the Oasis LLCs. At that time, the Company applied for regulatory approval to own an interest in the Oasis LLCs, which approval was received. On June 27, 2018, the Company made the payments to indirectly acquire the remaining 90% of the Oasis LLCs, which were equal to cash in the amount of $5,995,543, a $4.0 million promissory note due in December 2019 (see note 12), (the “Oasis Note”), and 22,058,823 shares of its common stock (see note 13), (the “Purchase Price Shares”) (collectively, the “Closing Consideration”). The cash payment of $5,995,543 was less than the $6,200,000 payment originally contemplated because the Company assumed an additional $204,457 of liabilities. The Company used the proceeds of its recent Canadian private securities offering to fund the cash portion of the Closing Consideration (see note 13). The Company then applied for regulatory approval to own the additional 90% in membership interests in the Oasis LLCs, which it expects expect to receive in due course. The change of ownership in the Oasis LLCs to the Company will be recorded upon receipt of such regulatory approvals. The number of Purchase Price Shares was equal to 80% of the offering price of the Company’s common stock in its last equity offering, which price was $0.34 per share. The Oasis Note is secured by a first priority security interest over the membership interests in Alternative Solutions and the Oasis LLCs, as well as by the assets of the Oasis LLCs. The Company also delivered a confession of judgment to a representative of the sellers that will become effective, in general, if the Company defaults default under the Oasis Note. Oasis currently owes certain amounts to a consultant known as 4Front Advisors, LLC. If the Company makes any payments to this company post-closing, generally speaking, the Company will be entitled to deduct the present value of such payments from the principal amount due under the Oasis Note. The sellers are also entitled to a $1,000,000 payment from the Company on May 30, 2020 if the Oasis LLCs have maintained an average revenue of $20,000 per day during the 2019 calendar year. The fair value of this contingent consideration was $678,111 as determined by the Company’s outside valuation consultants. The acquisition date estimated fair value of the consideration transferred totaled $27,975,650, which consisted of the following: Initial purchase price $ 2,050,000 Cash paid in connection with transaction 5,995,543 Note payable 3,810,820 Contingent consideration 678,111 Common stock 15,441,176 Total purchase price $ 27,975,650 Net tangible assets $ 595,151 Intangible assets 1,637,600 Goodwill 25,742,899 Total purchase price $ 27,975,650 The above estimated fair value of the intangible assets is based on a preliminary purchase price allocation prepared by a third party valuation expert. During the preliminary purchase price allocation period, which may be up to one year from the business combination date, the Company may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill. After the preliminary purchase price allocation period, the Company may record adjustments to assets acquired or liabilities assumed subsequent to the purchase price allocation period in its operating results in the period in which the adjustments were determined. Pro forma results The following table sets forth the unaudited pro forma results of the Company as if the acquisition of the Oasis LLCs was effective on the first day of each of the three months periods presented. These combined results are not necessarily indicative of the results that may have been achieved had the companies always been combined. Three months ended August 31, 2018 2017 (unaudited (unaudited) Revenues $ 1,655,744 $ 1,383,192 Net loss $ (12,016,196 ) $ (8,742,167 ) Basic net income per share $ (0.18 ) $ (0.16 ) Diluted net income per share $ (0.18 ) $ (0.16 ) Weighted average shares - basic 67,913,333 56,199,550 Weighted average shares - diluted 67,913,333 56,199,550 |
Note 4 - Accounts Receivable
Note 4 - Accounts Receivable | 3 Months Ended |
Aug. 31, 2018 | |
Receivables [Abstract] | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | Note 4 – Accounts Receivable Accounts receivable was $59,981 and $0 at August 31, 2018 and May 31, 2018, respectively. No allowance for doubtful accounts was necessary during the three months ended August 31, 2018 and 2017. |
Note 5 - Inventory
Note 5 - Inventory | 3 Months Ended |
Aug. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | Note 5 – Inventory Inventory, consisting of material, overhead, labor, and manufacturing overhead, is stated at the lower of cost (first-in, first-out) or market, and consists of the following: August 31, May 31, 2018 2018 Raw materials $ 197,475 $ - Finished goods 301,924 - Total $ 499,399 $ - Raw materials consist of cannabis plants and the materials that are used in our production process prior to being tested and packaged for consumption. Finished goods consist of pre-packaged materials previously purchased from other licensed cultivators and our manufactured edibles and extracts. |
Note 6 - Prepaid Expenses
Note 6 - Prepaid Expenses | 3 Months Ended |
Aug. 31, 2018 | |
Disclosure Text Block Supplement [Abstract] | |
Other Assets Disclosure [Text Block] | Note 6 – Prepaid Expenses Prepaid expenses consisted of the following at August 31, 2018 and May 31, 2018: August 31, May 31, 2018 2018 Prepaid insurance $ 5,865 $ - Prepaid advertising 23,784 - Prepaid license fees 77,459 - Prepaid legal fees 1,410 1,410 Prepaid general and administrative expenses 74,790 - Prepaid consulting 75,000 Total $ 258,308 $ 1,410 |
Note 7 - Other Assets
Note 7 - Other Assets | 3 Months Ended |
Aug. 31, 2018 | |
Other Non-current Assets Disclosure [Abstract] | |
Other Non-current Assets Disclosure [Text Block] | Note 7 – Other Assets Other assets included the following as of August 31, 2018 and May 31, 2018, respectively: August 31 May 31, 2018 2018 Security deposits 158,500 - $ 158,500 $ - |
Note 8 - Note Receivable
Note 8 - Note Receivable | 3 Months Ended |
Aug. 31, 2018 | |
Disclosure Text Block Supplement [Abstract] | |
Other Current Assets [Text Block] | Note 8 – Note Receivable During the year ended May 31, 2015, the Company loaned $500,000 (the “Note”) to Picture Rock Holdings, LLC, a Colorado limited liability company (“PRH”). Pursuant to the Note, as amended by the parties effective June 30, 2015, October 31, 2015, April 11, 2016, and May 31, 2016, PRH was expected to repay the principal due under the Note in twenty (20) equal quarterly installments of Twenty Five Thousand Dollars ($25,000) commencing in the month following the month in which PRH commenced generating revenue at the grow facility, which commencement was originally anticipated to occur in the first quarter of 2017, and continuing until paid in full. Recently, we suspended our plans to proceed with the Colorado Arrangement due to regulatory delays and have not yet determined when we will pursue it again. Interest will accrue on the unpaid principal balance of the Note at the rate of twelve percent (12%) per annum and will be paid quarterly in arrears commencing after such initial payment and continuing until paid in full. All outstanding principal and any accumulated unpaid interest due under the Note is due and payable on the five-year anniversary of the initial payment thereunder. In the event of default as defined in the agreements underlying the Note, all amounts under the Note shall be due and payable at once. During the year ended May 31, 2015, the Company recorded an impairment related to the note receivable in the amount of $500,000. During the year ended May 31, 2018, the Company received a payment of $50,000 on the Note. As a result, the Company has reduced the impairment of the note by $50,000 to reflect this payment. The receivable is recorded on the balance sheet as of August 31, 2018 in the amount of $0, net of allowance in the amount of $450,000. |
Note 9 - Property, Plant and Eq
Note 9 - Property, Plant and Equipment | 3 Months Ended |
Aug. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | Note 9 – Property, Plant and Equipment Property, plant and equipment consisted of the following at August 31, 2018 and May 31, 2018. August 31, May 31, 2018 2018 Office equipment 120,276 2,674 Furniture and fixtures 13,112 - Leasehold improvements $ 799,754 $ - Less: accumulated depreciation (27,509 ) (2,674 ) Property, plant, and equipment, net $ 905,633 $ - During the three months ended August 31, 2018, the Company acquired property, plant, and equipment with an aggregate fair value of $933,142 with the acquisition of Alternative Solutions, LLC. See note 3. Depreciation expense totaled $27,509 and $223 for the three months ended August 31, 2018 and 2017 respectively. |
Note 10 - Intangible Assets
Note 10 - Intangible Assets | 3 Months Ended |
Aug. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure [Text Block] | Note 10 – Intangible Assets Intangible assets consisted of the following at August 31, 2018 and May 31, 2018. August 31, 2018 Accumulated Gross Amortization Net Intellectual Property $ 319,600 $ (5,327 ) $ 314,273 License & Customer Relations 990,000 (8,250 ) 981,750 Tradenames - Trademarks 301,000 (5,017 ) 295,983 Non-compete Agreements 27,000 (2,250 ) 24,750 Domain Names 4,482 (1,913 ) 2,569 Total $ 1,642,082 $ (22,757 ) $ 1,619,325 May 31, 2018 Accumulated Gross Amortization Net Intellectual Property $ - $ - $ - License & Customer Relations - - - Domain name 1,726 (828 ) 898 Non-compete Agreements - - - Goodwill - - - Total $ 1,726 $ (828 ) $ 898 Total amortization expense charged to operations for the three months ended August 31, 2018 and 2017 was $20,952 and $108, respectively. Amount to be amortized during the twelve months ended August 31, 2019 $ 126,973 2020 123,466 2021 111,560 2022 111,560 2023 111,560 Thereafter 1,034,206 $ 1,619,325 |
Note 11 - Accounts Payable and
Note 11 - Accounts Payable and Accrued Liabilities | 3 Months Ended |
Aug. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Liabilities Disclosure [Text Block] | Note 11 – Accounts Payable and Accrued Liabilities Accrued expenses consisted of the following at August 31, 2018 and May 31, 2018: August 31, May 31, 2018 2018 Trade accounts payable 601,714 $ 726,457 Accrued payroll and payroll taxes 38,203 44,465 Accrued liabilities 503,909 - Deferred rent liability 55,699 55,699 Total $ 1,199,525 $ 826,621 |
Note 12 - Notes Payable and Con
Note 12 - Notes Payable and Convertible Notes Payable | 3 Months Ended |
Aug. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | Note 12 – Notes Payable and Convertible Notes Payable Notes Payable August 31, May 31, 2018 2018 On February 7, 2018, the Company issued a note payable to Todd Blatt in the amount of $210,000 the “Blatt Note”). This note accrues interest at a rate of 6% per annum and is due on February 7, 2019. During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,726 on the Blatt Note. On July 20, 2018, the Company made principal and interest payments in the amount of $210,000 and $5,627, respectively, on the Blatt Note. $ - $ 210,000 On February 7, 2018, the Company issued a note payable to AJG Group in the amount of $200,000 the “AJG Note”). This note accrues interest at a rate of 6% per annum and is due on February 7, 2019. During the three months ended August 31, 2018, the Company accrued interest in the amount of $641 on the AJG Note. On July 9, 2018, the Company made principal and interest payments in the amount of $100,000 and $3,337, respectively, on the AJG Note. - 100,000 Secured note payable to Serenity Wellness Enterprises, LLC, as nominee (“Oasis Note”). dated June 27, 2018 in the principal amount of $4,000,000 and bearing interest at a rate of 6% per annum was issued pursuant to the Membership Interest Purchase Agreement with Alternative Solutions. The note is due December 4, 2019, but may be prepaid at any time without penalty. The Oasis Note is secured by all of the membership interests in Alternative Solutions and the Oasis LLCs and by the assets of the Oasis LLCs. The Company recognized an original issue discount of $189,180 on the Oasis Note. During the three months ended August 31, 2018, $23,422 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $43,333 on this note. 4,000,000 - Total – Notes Payable $ 4,000,000 $ 310,000 Less: Discount (165,758 ) - Notes Payable, Net of Discounts $ 3,834,242 $ 310,000 Current portion $ 3,834,242 $ 310,000 Long term portion $ - $ - Related Party Convertible Demand Notes Payable On May 31, 2017, the Company entered into an Omnibus Loan Amendment Agreement (the “Omnibus Loan Amendment”) with Jeffrey I. Binder, Frank Koretsky, Newcan Investment Partners LLC and CLS CO 2016, LLC (collectively, the “Insiders”). Pursuant to the Omnibus Loan Amendment, the Company agreed with the Insiders to amend certain terms of loans the Insiders made to the Company for working capital purposes, which loans were initially demand loans, and, except for loans made in 2017, were later memorialized as convertible loans (the “Insider Loans”), in exchange for the agreement of the Insiders to convert all Insider Loans where funds were advanced prior to January 1, 2017, which totaled $2,537,750, plus $166,490 of accrued interest thereon, into an aggregate of 10,816,960 shares of the Company’s common stock at $0.25 per share, and forego the issuance of warrants to purchase the Company’s common stock upon conversion. This resulted in the issuance of an additional 7,609,910 shares compared to the original number of shares issuable upon conversion of the Insider Loans prior to the Omnibus Loan Amendment. The Company valued the shares at $0.125, which was the market price of the Company’s stock at the conversion date, and charged the amount of $951,239 to loss on modification of debt during the twelve months ended May 31, 2017. The Company entered into the Omnibus Loan Amendment in order to ease the debt burden on the Company and prevent it from defaulting on the Insider Loans. Pursuant to the Omnibus Loan Amendment, the following amendments were made to the Insider Loans: (a) the Company reduced the conversion price on the Insider Loans from between $0.75 and $1.07 per share of common stock to $0.25 per share of common stock, in those cases where the conversion price was greater than $0.25, which reduced conversion price exceeded the closing price of the common stock during the three months prior to the Omnibus Loan Amendment; (b) the Company deleted the requirement to issue warrants to purchase the Company’s common stock upon conversion of the Insider Loans; (c) the Company amended one Insider Loan to permit conversion of only the portion of the Insider Loan related to services that were provided to it prior to January 1, 2017; and (d) the Company amended the terms of the Insider Loans where funds were advanced on or after January 1, 2017, which Insider Loans were not converted into the Company’s common stock, to provide for, where not already the case, a 10% interest rate per annum, a $0.25 conversion price per share of common stock, and the deletion of the requirement that the Company issue warrants to purchase its common stock upon conversion of such Insider Loans. On January 10, 2018, effective December 1, 2017, the Company entered into an Omnibus Amendment to Convertible Notes (the “Second Omnibus Loan Agreement”) with Jeffrey I. Binder, an officer and director of the Company, and Newcan Investment Partners LLC, an entity owned by Frank Koretsky, a director of the Company. The Second Omnibus Loan Agreement provides that the conversion price of all outstanding convertible promissory notes issued to either Mr. Binder or Newcan Investment Partners, LLC as of the date of the Agreement would be increased from $0.25 to $0.3125 per share of common stock. The remaining terms of such notes remain unchanged. The following tables summarize the Company’s loan balances at August 31, 2018 and May 31, 2017: August 31, May 31, 2018 2018 Notes payable to Jeffrey Binder, an officer and director of the Company, for advances to fund operations (the “Binder Funding Notes”). The Binder Funding Notes bear interest at a rate of 10% per annum, have no maturity date and are due on demand. Effective May 31, 2017, pursuant to the Omnibus Loan Agreement, a conversion feature was added to the Binder Funding Notes whereby principal and accrued interest is convertible into common stock of the Company at a rate of $0.25 per share. Effective December 1, 2017, pursuant to the Second Omnibus Loan Amendment, the conversion price was increased from $0.25 per share to $0.3125 per share and a discount in the amount of $35,023 related to the revaluation of the beneficial conversion feature of the Binder Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the twelve months ended May 31, 2018, Mr. Binder advanced a total of $440,579 to the Company under the Binder Funding Notes. During the year ended May 31, 2018, principal in the amount of $280,198 and accrued interest in the amount of $5,188 was transferred out of the Binder Funding Notes and used to fund four new convertible notes payable to Mr. Binder, which were converted or repaid as of May 31, 2018. Also during the year ended May 31, 2018 the Company made principal payments in the aggregate of $237,794 under the Binder Funding Notes. During the year ended May 31, 2018, the Company accrued interest in the amount of $7,364 on the Binder Funding Notes. During the year ended May 31, 2018, discounts in the amount of $385,637 related to the beneficial conversion feature of the Binder Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the three months ended August 31, 2018, Mr. Binder advanced as total of $81,961 to the Company under the Binder Funding Notes. During the three months ended August 31, 2018. The Company made principal payments to in the amount of $76,381 under the Binder Funding Notes. During the three months ended August 31, 2018, the Company accrued interest in the amount of $347 on the Binder Funding Notes. During the three months ended August 31, 2018, a discount in the amount of $ 81,961 related to the beneficial conversion feature of the Binder Funding Notes was charged to additional-paid in capital and amortized to interest expense. $ 5,716 $ 137 August 31, 2018 May 31, 2018 Notes payable to Newcan Investment Partners, LLC (“Newcan”), an entity owned by Frank Koretsky, a director of the Company, for advances to fund operations (the “Newcan Funding Notes”). The Newcan Funding Notes bear interest at a rate of 10% per annum, have no maturity date and are due on demand. Effective May 31, 2017, pursuant to the Omnibus Loan Agreement, a conversion feature was added to the Newcan Funding Notes whereby principal and accrued interest is convertible into common stock of the Company at a rate of $0.25 per share. Effective December 1, 2017, pursuant to the Second Omnibus Loan Amendment, the conversion price was increased from $0.25 per share to $0.3125 per share and a discount in the amount of $6,120 related to the revaluation of the beneficial conversion feature of the Newcan Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the twelve months ended May 31, 2018, Newcan advanced a total of $290,000 to the Company under the Newcan Funding Notes. During the year ended May 31, 2018, principal in the amount of $836,658 and accrued interest in the amount of $25,018 was transferred out of the Newcan Funding Notes and used to fund four new convertible notes payable to Newcan, which were converted or repaid as of May 31, 2018.). During the year ended May 31, 2018, the Company accrued interest in the amount of $16,681 on the Newcan Funding Notes. During the year ended May 31, 2018, discounts in the amount of $210,120 related to the beneficial conversion feature of the Newcan Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the three months ended August 31, 2018, principal in the amount of $75,000 and accrued interest in the amount of $1,931 was transferred out of the Newcan Funding Notes and used to create a new convertible note payable to Newcan (“Newcan Convertible Note 8”). During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,377 on the Newcan Funding Notes. - 75,000 Total – Demand Convertible Notes Payable, Related Parties $ 5,716 $ 75,137 Total – Demand Convertible Notes Payable, Related Parties - Current portion $ 5,716 $ 75,137 Total – Demand Convertible Notes Payable, Related Parties - Long term portion $ - $ - Convertible Notes Payable, Related Parties August 31, 2018 May 31, 2018 Convertible promissory note payable to David Lamadrid (the “Lamadrid Note”) dated February 20, 2018 in the principal amount of $31,250 and bearing interest at a rate of 8% per annum. The Lamadrid Note is due eighteen months from the date of issue. Mr. Lamadrid may, at his option, convert all or a portion of the Lamadrid Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Lamadrid Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Lamadrid Note will be reset to such lower price. The Company recognized a discount of $31,250 on the Lamadrid Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $942 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $685 on this note. During the three months ended August 31, 2018, interest in the amount of $562 was accrued on the Lamadrid note. During the three months ended August 31, 2018, the Lamadrid Note, in the amount of $$32,497, of which $31,250 was principal and $1,247 was accrued interest, was converted into 103,989 shares of common stock. During the three months ended August 31, 2018 the remaining discount in the amount of $30,308 was charged to operations. - 31,250 Unsecured convertible note issued to Jeffery Binder, an officer and director of the Company, dated April 6, 2018 in the original principal amount of $37,500 (the “Binder Convertible Note 9”). The Binder Convertible Note 9 was funded with the conversion of $37,500 of unpaid accrued salary due to Mr. Binder. This note bears interest at the rate of 10% per annum. No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $4,688 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. This note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.3125 converted. The Company recognized a discount of $37,500 on the Binder Convertible Note 9 related to the value of the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, the Company amortized $1,890 of this discount to interest expense. During the twelve months ended May 31, 2018 and 2017, interest in the amount of $565 and $0 was accrued on Binder Convertible Note 9, respectively. During the three months ended August 31, 2018, interest in the amount of $699 was accrued on the Binder Convertible Note 9. During the three months ended August 31, 2018, the Company made a principal payment in the amount of $37,000 on the Binder Convertible Note 9. During the three months ended August 31, 2018 the remaining discount in the amount of $35,610 was charged to operations. - 37,500 Unsecured convertible note issued to Newcan, an entity owned by Frank Koretsky, a director of the Company, dated, August 6, 2018 in the original amount of $75,000 (the “Newcan Convertible Note 8”). The Newcan Convertible Note 8 was funded with the conversion of $75,000 of advances Newcan made to the Company under the Newcan Funding Notes. This note bears interest at the rate of 10% per annum. No interest payments are required until January 1, 2020, at which time all of the accrued interest becomes due and payable. Commencing on January 1, 2020, the first of eight principal payments in the amount of $9,375 will become due; subsequent principal payments will become due on the first day of each April, July, October, and January until paid in full. This note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.40 converted. The Company recognized a discount of $58,594 on the Newcan Convertible Note 8 related to the value of the beneficial conversion feature at the time of issuance. During the three months ended August 31, 2018, the Company amortized $1,272 of this discount to interest expense. During the three months ended August 31, 2018, the Company accrued interest in the amount of $514 on the Newcan Convertible Note 8. 75,000 - Total – Convertible Notes Payable, Related Parties $ 75,000 $ 68,750 Less: Discount (57,322 ) (65,918 ) Convertible Notes Payable, Related Parties, Net of Discounts $ 17,678 $ 2,832 Convertible Notes Payable, Related Parties, Net of Discounts, Current Portion $ - $ 2,832 Convertible Notes Payable, Related Parties, Net of Discounts, Long-term Portion 17,678 - Convertible Notes Payable August 31, 2018 May 31, 2018 Convertible promissory note payable to Darling Capital, LLC (the “Darling Note”) dated February 5, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $500,000 and the Darling Note has an original issue discount of $50,000. The Darling Note is due eighteen months from the date of issue. Darling may, at its option, convert all or a portion of the Darling Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Darling Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Darling Note will be reset to such lower price. The Company recognized a discount of $550,000 on the Darling Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $40,427 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $13,863 on this note. During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,447 on this note. During the three months ended August 31, 2018, the holder of the Darling Note converted $565,000, of which $550,000 was principal and $15,000 was accrued interest into 1,808,000 shares of common stock. Also, during the three months ended August 31, 2018, the remaining discount in the amount of $509,573 was charged to operations. - 550,000 Convertible promissory note payable to Efrat Investments, LLC (the “Efrat Note”) dated February 12, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $50,000 and the Efrat Note has an original issue discount of $5,000. The Efrat Note is due eighteen months from the date of issue. Efrat may, at its option, convert all or a portion of the Efrat Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Efrat Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Efrat Note will be reset to such lower price. The Company recognized a discount of $55,000 on the Efrat Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $2,974 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $1,302 on this note. During the three months ended August 31, 2018, the Company accrued interest in the amount of $898 on this note. During the three months ended August 31, 2018, the holder of the Efrat Note converted $57,200, of which $55,000 was principal and $2,200 was accrued interest into 183,040 shares of common stock. Also, during the three months ended August 31, 2018, the remaining discount in the amount of $52,026 was charged to operations. - 55,000 August 31, 2018 May 31, 2018 Convertible promissory note payable to YA II PN, Ltd. (the “YA II PN Note”) dated May 14, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $750,000, and the note is due November 14, 2019. YA II PN may, at its option, convert all or a portion of the YA II PN Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.40 per share. The YA II PN Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.40 per share of common stock, the conversion price of the YA II PN Note will be reset to such lower price. The Company recognized a discount of $750,000 related to the beneficial conversion feature at the time of issuance. Commencing on December 1, 2018, the first of eight payments in the amount of $93,750 will become due; subsequent payments will become due on the first day of each of the following months until paid in full. During the twelve months ended May 31, 2018, $23,224 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $2,795 on this note. During the three months ended August 31, 2018, the Company charged $19,112 of the discount to operations. Also, during the three months ended August 31, 2018, the Company accrued interest in the amount of $15,123 on this note. During the three months ended August 31, 2018, a reset event occurred. As a result, the conversion price of the YA II PN Note was reduced to $0.34 per share of common stock. This was considered a material modification of the note; the remaining balance of the discount to the note in the amount of $699,628 was charged to interest expense, a new discount in the amount of $750,000 was charged to additional paid-in capital, and $105,469 of the new discount was amortized to interest expense during the three months ended August 31, 2018. 750,000 750,000 Unsecured convertible note issued to Jay Lasky (the “Lasky Note”), dated May 3, 2018 in the original principal amount of $25,000. This note bears interest at the rate of 10% per annum. No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing on October 1, 2019, the first of eight principal payments in the amount of $3,125 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. The Lasky Note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.40 converted. The Company recognized a discount of $7,301 on the Lasky Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $149 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $192 on this note. During the three months ended August 31, 2018, $498 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $630 on this note. 25,000 25,000 Convertible promissory note payable to YA II PN, Ltd. (the “YA II PN Note 2”) dated July 20, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $500,000, and the note is due November 14, 2019. YA II PN may, at its option, convert all or a portion of the YA II PN Note 2 and accrued but unpaid interest into shares of common stock at a conversion price of $0.40 per share. The YA II PN Note 2 also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.40 per share of common stock, the conversion price of the YA II PN Note 2 will be reset to such lower price. The Company recognized a discount of $362,500 related to the beneficial conversion feature at the time of issuance. Commencing on December 1, 2018, the first of eight payments in the amount of 62,500 will become due; subsequent payments will become due on the first day of each of the following months until paid in full. During the three months ended August 31, 2018, $31,587 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $4,603 on this note. 500,000 - Total - Convertible Notes Payable $ 1,275,000 $ 1,380,000 Less: Discount (982,098 ) (1,295,527 ) Convertible Notes Payable, Net of Discounts $ 292,902 $ 84,473 Total - Convertible Notes Payable, Net of Discounts, Current Portion $ - $ 43,401 Total - Convertible Notes Payable, Net of Discounts, Long-term Portion $ 292,902 $ 41,072 Discounts on notes payable amortized to interest expense – 3 months ended August 31, 2018 and 2017, respectively $ 1,598,502 $ 39,489 Beneficial Conversion Features The Darling Note, Efrat Note, Lamadrid Note and YA II PN Notes contain conversion features that create derivative liabilities. The pricing model the Company uses for determining fair value of its derivatives is the Lattice Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income. The derivative components of the notes were valued at issuance, at conversion, at restructure, and at each period end. Certain of the Company’s other convertible notes payable contain beneficial conversion features that are not derivatives, but which require valuation in order to determine the discount to the related convertible note payable. The value of these conversion features is calculated using the intrinsic value method, whereby the amount of the discount is calculated as the difference between the conversion price and the market price of the underlying common stock at the date of issuance multiplied by the number of shares issuable. |
Note 13 - Stockholders' Equity
Note 13 - Stockholders' Equity | 3 Months Ended |
Aug. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | Note 13 – Stockholders’ Equity The Company’s authorized capital stock consists of 250,000,000 shares of common stock, par value $0.0001 per share and 20,000,000 shares of preferred stock, par value $0.001 per share. The Company had 90,087,236 and 50,128,972 shares of common stock issued and outstanding as of August 31, 2018 and May 31, 2018, respectively. The Company recorded imputed interest of $271 and $271 during the three months ended August 31, 2018 and 2017 on related party payables due to a director and officer of the Company. Stock Issued upon Conversion of Notes Payable During the three months ended August 31, 2018, Darling Capital, holder of a convertible promissory note, converted a total of $565,000, which consisted of $550,000 of principal and $15,000 of accrued interest, into 1,808,000 shares of common stock. During the three months ended August 31, 2018, Efrat Investments, holder of a convertible promissory note, converted a total of $57,200, which consisted of $55,000 of principal and $2,200 of accrued interest, into 183,040 shares of common stock. During the three months ended August 31, 2018, David Lamadrid, holder of a convertible promissory note, converted a total of $32,497, which consisted of $31,250 of principal and $1,247 of accrued interest, into 103,989 shares of common stock. Stock Issued for Services On July 24, 2018, the Company awarded Star Associates, LLC, a limited liability company owned by Andrew Glashow, a director of the Company, a cash payment in the amount of $250,000 and 700,000 restricted shares of the Company’s common stock in recognition of Mr. Glashow’s efforts, through Star Associates, in successfully assisting the Company in negotiating and obtaining the financing necessary to acquire Alternative Solutions, LLC. The shares were valued at $490,000 and were charged to operations during the three months ended August 31, 2018. On June 24, 2018, pursuant to the terms of a severance agreement between the Company and David Lamadrid, the Company issued 600,000 shares of common stock to Mr. Lamadrid. These shares were valued at $264,000, $213,320 of which was previously expensed and the remaining $50,680 of which was charged to operations during the three months ended August 31, 2018. Stock Issued for Acquisition On June 27, 2018, the Company issued 22,058,823 shares of its common stock pursuant to the terms of the Alternative Solutions, LLC Acquisition Agreement. These shares were valued at $15,441,176. (See note 3). Special Warrants Issued in Offering On June 20, 2018, the Company executed an Agency Agreement with Canaccord Genuity Corp. and closed on a private offering of its special warrants for aggregate gross proceeds of C$13,037,859 (USD$9,785,978). Pursuant to the offering, the Company issued 28,973,020 special warrants at a price of C$0.45 (USA$0.34) per special warrant. Each special warrant is automatically exercisable, for no additional consideration, into units of the Company on the earlier of: (i) the date that is five business days following the date on which the Company obtains a receipt from the applicable securities regulatory authorities in each of the jurisdictions in Canada in which the special warrants were sold for a final prospectus qualifying the distribution of the units, which is intended to be no later than August 31, 2018, and (ii) the date that is four months and one day after the completion of the Company's acquisition of all of the membership interests in Alternative Solutions, LLC, known as Oasis Cannabis. Upon exercise of the special warrants, each unit shall consist of one share of the Company's common stock and one warrant to purchase one share of common stock. Each warrant will be exercisable at a price of C$0.65 for three years after the Company's common stock is listed on a recognized Canadian stock exchange, subject to adjustment in certain events. Because the Company did not receive a receipt from the applicable Canadian securities authorities for the qualifying prospectus by August 20, 2018, the unexercised special warrants were adjusted to entitle the holders to receive 1.1 units instead of one unit of the Company. This resulted in the issuance of an additional 3,042,167 special warrants. This penalty was valued at $7,142,550 and was charged to operations during the three months ended August 31, 2018. In connection with the offering, the Company paid Canaccord Genuity Corp. a cash commission equal to C$1,043,028 (USD$799,053), a corporate finance fee equal to 1,448,651 special warrants, and 2,317,842 compensation broker warrants valued at $1,495,373. Each compensation broker warrant entitles the holder thereof to acquire one unit at a price of C$0.45 per unit for a period of 36 months from the date that the Company's common stock is listed on a recognized Canadian stock exchange, subject to adjustment in certain events. The 1,448,651 special units that were issued were valued at $1,413,300 and were charged to operations during the three months ended August 31, 2018. Stock Issued in Navy Capital Offering On July 31, 2018, the Company entered into a Subscription Agreement with Navy Capital Green International, Ltd, (the “Navy Capital Offering”) for 7,500,000 units at a price of $0.40 per unit, or an aggregate amount of $3,000,000. The units collectively represent (i) 7,500,000 shares of common stock, and (ii) three-year warrants to purchase an aggregate of 7,500,000 shares of common stock at an exercise price of $0.60 per share of Common Stock. In connection with the Navy Capital Offering, between August 8, 2018 and August 10, 2018, the Company entered into five subscription agreements for a total of 6,875,000 units at a price of $0.40 per unit, or an aggregate purchase price of $2,750,000. The units collectively represent (i) 6,875,000 shares of common stock, and (ii) three-year warrants to purchase an aggregate of 6,875,000 shares of common stock at an exercise price of $0.60 per share of common stock. Stock Issued to Officers On July 27, 2018, the Company granted 25,000 shares of restricted common stock to its Chief Financial Officer. These share will vest four months after issuance. The shares were valued at $17,500, and will be amortized over the vesting period. As of August 31, 2018, these shares had not been issued. As of August 31, 2018, $4,375 had been charged to operations, and is carried as Common Stock Subscribed on the Company’s balance sheet at August 31, 2018. On July 31, 2018, the Company granted the Chief Executive Officer of CLS Nevada, Inc. a one-time signing bonus of 500,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement. These shares were valued at $350,000 and will be amortized over the vesting period. As of August 31, 2018, $59,167 had been charged to operations, and is carried as Common Stock Subscribed on the Company’s balance sheet at August 31, 2018. On July 31, 2018, the Company granted the Chief Operating Officer of CLS Nevada, Inc. a one-time signing bonus of 50,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement. These shares were valued at $35,000 and will be amortized over the vesting period. As of August 31, 2018, $5,917 had been charged to operations, and is carried as Common Stock Subscribed on the Company’s balance sheet at August 31, 2018. Stock Issued upon Cashless Exercise of Warrants On August 14, 2018, the Company issued 129,412 shares of common stock for the cashless conversion of 350,000 warrants at an exercise price of $0.75 per share. Additional Paid-in Capital During the three months ended August 31, 2018, the Company recorded discounts on two convertible notes payable relating to beneficial conversion features in the aggregate amount of $362,500 on the YA II PN Note 2; and $58,594 on the Newcan Convertible Note 8. Also during the three months ended August 31, 2018, a reset event occurred with regard to the YAII PN Note. During the three months ended August 31, 2018, the Company recorded an original issue discount on the Serenity Wellness Note in the amount of $81,961. On June 1, 2018, the Company adopted ASU 2017-11 and accordingly reclassified the fair value of the reset provisions embedded in the previously issued convertible notes payable and certain warrants with embedded anti-dilutive provisions from liability to additional paid-in capital in the aggregate amount of $1,265,751. On June 20, 2018, a reset event occurred in connection with the YA II PN Note (see note 12), and the Company charged the change in fair value of the conversion feature in the amount of $35,833 to additional paid-in capital. This was considered a material modification of the note, and the Company created a new discount to this note in the amount of $750,000, which was charged to additional paid-in capital. Warrants On June 27, 2018, the Company incurred a penalty in connection with the WestPark Offering due to the late filing of the registration statement that included the resale of the securities that were sold in such offering. As a result of the penalty, the Company issued three-year common stock warrants to purchase an aggregate of 1,368,250 shares of the Company’s common stock at an exercise price of $0.50 per share. In addition, the Company reduced the exercise price of the common stock purchase warrants previously issued to the investors in the WestPark Offering from $0.75 per share to $0.50 per share. The fair value of the penalty was $941,972; this amount was charged to operations during the three months ended August 31, 2018. On June 20, 2018, in connection with the special warrant offering, the Company issued Canaccord Genuity Corp. 2,317,842 three-year broker warrants at an exercise price of C$0.45 per share as compensation. Each warrant entitles the holder to purchase one unit, which consists of one share of common stock and a warrant to purchase one share of common stock, for C$0.65 per share. These warrants were valued at $1,495,373, and this amount was charged to operations during the three months ended August 31, 2018. On July 20, 2018, in connection with the Company’s sale of a convertible debenture, the Company issued to YA II PN, Ltd. a five-year common stock purchase warrant to purchase 1,250,000 shares of the Company’s common stock at an initial exercise price of $0.60 per share. On August 6, 2018, the Company issued three-year common stock purchase warrants to purchase an aggregate of 7,500,000 shares of the Company’s common stock at an exercise price of $0.60 per share, to investors in the Navy Capital Offering. On August 8, 2018, the Company issued three-year common stock purchase warrants to purchase an aggregate of 6,875,000 shares of the Company’s common stock at an exercise price of $0.60 per share, to investors in the Navy Capital Offering. The following table summarizes the significant terms of warrants outstanding at August 31, 2018. These warrants were granted as part of financing agreements. This table does not include the special warrants; see Special Warrant section below: Weighted Weighted Weighted average average average Range of Number of remaining exercise exercise exercise warrants contractual price of Number of price of Prices Outstanding life (years) outstanding Warrants warrants Exercisable exercisable Warrants $ 0.49 2,317,842 2.81 $ 0.49 2,317,842 $ 0.49 0.50 2,736,500 3.48 0.50 2,736,500 0.50 0.60 17,500,000 3.25 0.60 17,500,000 0.60 0.75 1,107,738 2.85 0.75 1,107,738 0.75 23,662,080 3.22 $ 0.57 23,662,080 $ 0.57 Transactions involving warrants are summarized as follows. This table does not include the special warrants; see Special Warrant section below. Number of Shares Weighted Average Exercise Price Warrants outstanding at May 31, 2018 4,700,988 $ 0.75 Granted 19,311,092 $ 0.58 Exercised (350,000 ) $ 0.75 Cancelled / Expired - $ - Warrants outstanding at August 31, 2018 23,662,080 $ 0.57 Special Warrants On June 20, 2018, the Company sold 28,973,019 special warrants for net proceeds of US$9,785,978. Each Special Warrant is automatically exercisable, for no additional consideration, into units of the Company on the earlier of: (i) the date that is five business days following the date on which the Company obtains a receipt from the applicable securities regulatory authorities in each of the jurisdictions in Canada in which the special warrants were sold for a final prospectus qualifying the distribution of the units, which is intended to be no later than August 31, 2018, and (ii) the date that is four months and one day after the completion of the Company's acquisition of all of the membership interests in Alternative Solutions, LLC, known as Oasis Cannabis, which was June 28, 2018. Upon exercise, each unit shall consist of one share of the Company’s common stock and one three-year warrant to purchase one share of common stock at a price of CAN$0.65. The special warrants are not included in the tables in the Warrants section above. |
Note 14 - Fair Value of Financi
Note 14 - Fair Value of Financial Instruments | 3 Months Ended |
Aug. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | Note 14 – Fair Value of Financial Instruments The Company has issued convertible notes containing beneficial conversion features to Darling, Efrat, David Lamadrid and YA II PN Notes. One of the features is a ratchet reset provision which, in general, reduces the conversion price should the Company issue equity with an effective price per share that is lower than the stated conversion price in the note. The Company accounts for the fair value of the conversion feature in accordance with ASC 815- Accounting for Derivatives and Hedging and Emerging Issues Task Force (“EITF”) 07-05- Determining Whether an Instrument (or Embedded Feature) Is Indexed to an Entity’s Own Stock (“EITF 07-05”). The Company carries the embedded derivative on its balance sheet at fair value and accounts for any unrealized change in fair value as a component of its results of operations. The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at August 31, 2018 and May 31, 2018: August 31, 2018 Level 1 Level 2 Level 3 Total Liabilities Contingent liabilities $ - $ - $ 678,111 $ 678,111 May 31, 2018 Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities $ - $ - $ 1,265,751 $ 1,265,751 The estimated fair values of the Company’s derivative liabilities are as follows: Derivative Liability Liabilities Measured at Fair Value Balance as of May 31, 2018 $ 1,265,751 Transfers out due to the adoption of ASU 2017-11 effective June 1, 2018 (1,265,751 ) Balance as of August 31, 2018 $ - |
Note 15 - Operating Segments
Note 15 - Operating Segments | 3 Months Ended |
Aug. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | Note 15 – Operating Segments The Company has three principal operating segments, which are the retail sales of cannabis and cannabis products through its (1) cannabis dispensary, (2) cannabis production, and (3) cannabis cultivation. These operating segments were determined based on the nature of the products offered and customers. Operating segments Administrative functions such as finance, accounting and information systems are centralized. However, where applicable, portions of the administrative function expenses are allocated between the operating segments. The cannabis dispensary operating segment does not share distribution facilities, however, the production and cultivation segments share manufacturing and distribution facilities. The costs of operating the manufacturing and distribution facilities are captured discretely within each segment. The Company’s property, plant and equipment, inventory, and accounts receivable are captured and reported discretely within each operating segment as well. The Company has determined that there are currently two reportable segments: (1) cannabis dispensary segment, and (2) cannabis production segment. The cannabis cultivation segment was not separately reported as it does not yet meet any of the quantitative thresholds under applicable accounting literature. The Company evaluates performance based on several factors, of which the primary financial measure is business segment income before taxes. The accounting policies of the business segments are the same as those described in “Note 1: Summary of Significant Accounting Policies.” Intersegment sales are accounted for at fair value as if sales were to third parties. The following table shows the operations of the Company’s reportable segments for the three months ended August 31, 2018: Cannabis Cannabis Corporate Dispensary Production and Segment Segment Eliminations Consolidated Sales to unaffiliated customers $ 776,707 $ 402,646 $ - $ 1,179,353 Intersegment sales - 58,814 (58,814 ) - Net sales $ 776,707 $ 461,460 $ (58,814 ) $ 1,179,353 Net income (loss) $ (204,044 ) $ 4,022 $ (16,456,918 ) $ (16,656,940 ) Total assets (1) $ 1,084,414 $ 361,845 $ 33,751,711 $ 35,197,970 Total liabilities $ 698,867 $ 265,620 $ 5,347,695 $ 6,312,182 Property additions $ 3,553 $ - $ - $ 3,553 Depreciation and amortization (2) $ 22,043 $ 1,007 $ 25,411 $ 48,461 (1) Total assets Corporate assets (2) |
Note 16 - Commitments and Conti
Note 16 - Commitments and Contingencies | 3 Months Ended |
Aug. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Note 16 – Commitments and Contingencies In connection with the Colorado Arrangement, on April 17, 2015, pursuant to an Industrial Lease Agreement (the “Lease”), CLS Labs Colorado leased 14,392 square feet of warehouse and office space (the “Leased Real Property”) in a building in Denver, Colorado where certain intended activities, including growing, extraction, conversion, assembly and packaging of cannabis and other plant materials, are permitted by and in compliance with state, city and local laws, rules, ordinances and regulations. The Lease had an initial term of seventy-two (72) months and provided CLS Labs Colorado with two options to extend the term of the lease by up to an aggregate of ten (10) additional years. In August 2017, as a result of the Company’s decision to suspend its proposed operations in Colorado, CLS Labs Colorado asked its landlord to be relieved from its obligations under the Lease, but the parties have not yet reached an agreement on how to proceed. In August 2017, the Company’s Colorado subsidiary received a demand letter from its Colorado landlord requesting the forfeiture of the $50,000 security deposit, $10,000 in expenses, $15,699 in remaining rent due under the lease agreement and $30,000 to buy out the remaining amounts due under the lease. These expenses, which are a liability of the Company’s Colorado subsidiary, have been accrued on the balance sheet as of August 31, 2018. Employment Agreements CLS Labs and Jeffrey Binder entered into a five-year employment agreement effective October 1, 2014. Under the agreement, Mr. Binder serves as CLS Labs’ Chairman and Chief Executive Officer and is entitled to receive an annual salary of $150,000. Under the agreement, Mr. Binder is also entitled to receive a performance bonus equal to 2% of CLS Labs’ annual EBITDA, up to a maximum annual cash compensation of $1 million (including his base salary), and annual stock options, exercisable at the fair market value of CLS Labs’ common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million. On April 28, 2015, CLS Labs and the Company entered into an addendum to Mr. Binder’s employment agreement whereby Mr. Binder agreed that following the merger of CLS Labs and a subsidiary of the Company, in addition to his obligations to CLS Labs, he would serve the Company and its subsidiaries in such roles as the Company may request. In exchange, the Company agreed to assume the obligations of CLS Labs to grant Mr. Binder annual stock options, as referenced above. Mr. Binder continues to receive an annual salary of $150,000 from CLS Labs for serving as its Chairman, President and Chief Executive Officer. On July 20, 2016, March 31, 2017, August 23, 2017, October 9, 2017, January 5, 2018 and April 6, 2018, the Company issued Mr. Binder convertible notes in exchange for $250,000, $112,500, $62,500, $39,521, $37,500 and $37,500 respectively, in deferred salary, among other amounts owed to Mr. Binder by the Company. As of August 31, 2018 and May 31, 2018, the Company had accrued compensation due to Mr. Binder in the amount of $0 and $37,500. Effective August 1, 2015, the Company and Alan Bonsett entered into a five-year employment agreement. Pursuant to the agreement, Mr. Bonsett commenced serving as the Company’s Chief Operating Officer on August 15, 2015. Under the agreement, Mr. Bonsett is entitled to receive an annual salary of $150,000. Further, he was entitled to receive a performance bonus equal to 2% of the Company’s annual EBITDA, up to a maximum annual cash compensation of $1 million (including his base salary), and annual stock options, exercisable at the fair market value of the Company’s common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million. Additionally, Mr. Bonsett received a one-time signing bonus of 250,000 (post Reverse-Split) shares of restricted common stock of the Company, valued at $327,500, which became fully vested one year from the effective date of the agreement. Mr. Bonsett, as an owner of Picture Rock Holdings, LLC (“PRH”), was expected to indirectly receive the benefits of the Colorado Arrangement discussed in Note 12. The business to be operated by PRH pursuant to the Colorado Arrangement has not yet produced revenues. Mr. Bonsett agreed to defer his salary effective July 1, 2017; at August 31, 2018, the Company had accrued compensation due to Mr. Bonsett in the amount of $37,500. On October 1, 2017, the Company and Mr. Bonsett, the Company’s Chief Operating Officer, mutually agreed to end his employment with the Company. Mr. Bonsett may provide consulting services to the Company in the future on an as needed basis. Effective November 30, 2017, the Company and Mr. Lamadrid entered into a one-year employment agreement. Pursuant to the agreement, Mr. Lamadrid commenced serving as the Company’s President and Chief Financial Officer on December 1, 2017. Under the agreement, Mr. Lamadrid was entitled to receive an annual salary of $175,000. Further, he was entitled to receive a performance bonus equal to 2% of the Company’s annual EBITDA, and annual restricted stock awards of the Company’s common stock in an amount equal to 3% of its annual EBITDA. Additionally, Mr. Lamadrid was entitled to a one-time signing bonus of 500,000 shares of restricted common stock of the Company, which were to become fully vested one year from the effective date of the agreement. On July 24, 2018, the Company and Mr. Lamadrid mutually agreed to terminate the employment agreement. Mr. Lamadrid resigned as President and Chief Financial Officer effective as of July 13, 2018. In connection with a severance agreement between the Company and Mr. Lamadrid, the Company paid certain amounts and issued 600,000 shares of common stock to Mr. Lamadrid, and the parties further agreed that neither party would have any further obligations under the Employment Agreement after such date. On July 31, 2018, the Company and Mr. Sillitoe entered into a one-year employment agreement. Pursuant to the agreement, Mr. Sillitoe commenced serving as the Chief Executive Officer of CLS Nevada, Inc. effective July 1, 2018. Under the agreement, Mr. Sillitoe is entitled to receive an annual salary of $150,000. Further, he is entitled to receive a performance bonus equal to 2% of the annual EBITDA of CLS Nevada, Inc., and annual restricted stock awards of the Company’s common stock in an amount equal to 3% of the annual EBITDA of CLS Nevada, Inc. Additionally, Mr. Sillitoe is entitled to a one-time signing bonus of 500,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement assuming Mr. Sillitoe remains employed by the Company on such date. As of August 31, 2018 and May 31, 2018, the Company had accrued compensation due to Mr. Sillitoe in the amount of $25,000 and $0. The Company and Mr. Decatur entered into a one-year employment agreement on July 31, 2018. Pursuant to the agreement, Mr. Decatur commenced serving as the Chief Operating Officer of CLS Nevada, Inc. on July 1, 2018. Under the agreement, Mr. Decatur is entitled to receive an annual salary of $150,000. Further, he is entitled to receive a performance bonus equal to 2% of the annual EBITDA of CLS Nevada, Inc., and annual restricted stock awards of the Company’ common stock in an amount equal to 3% of the annual EBITDA of CLS Nevada, Inc. Additionally, Mr. Decatur is entitled to a one-time signing bonus of 50,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement assuming Mr. Decatur remains employed by the Company on such date. At August 31, 2018 and May 31, 2018, the Company had accrued salary due to Michael Abrams, a former officer of the Company, prior to his September 1, 2015 termination, in the amount of $16,250. |
Note 17 - Related Party Transac
Note 17 - Related Party Transactions | 3 Months Ended |
Aug. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | Note 17 – Related Party Transactions As of August 31, 2018 and May 31, 2018, the Company owed the amount of $0 and $37,500, respectively, to Jeffrey Binder, its Chief Executive Officer, for accrued salary. As of August 31, 2018 and May 31, 2018, the Company had accrued salary due to Alan Bonsett, a former officer of the Company prior to his October 1, 2017 separation, in the amount of $37,500 and $37,500, respectively. As of August 31, 2018 and May 31, 2018, the Company had accrued salary due to Michael Abrams, a former officer of the Company prior to his September 1, 2015 termination, in the amount of $16,250. As of August 31, 2018 and May 31, 2018, the Company had related party payables in the amount of $17,930 due to officers and directors related to expenses paid on behalf of the Company. The Company imputed interest at the rate of 6% per annum on these liabilities, and recorded imputed interest expense on these liabilities in the amounts of $271 and $271 during the three months ended August 31, 2018 and 2017, respectively. These interest accruals were charged to additional paid-in capital. On July 27, 2018, the Company granted 25,000 shares of restricted common stock to its Chief Financial Officer. These share will vest four months after issuance. The shares were valued at $17,500, and will be amortized over the vesting period. As of August 31, 2018, these shares have not been issued. As of August 31, 2018, $4,375 had been charged to operations. On July 31, 2018, the Company granted the Chief Executive Officer of CLS Nevada, Inc. a one-time signing bonus of 500,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement. These shares were valued at $355,000 and will be amortized over the vesting period. As of August 31, 2018, $59,167 had been charged to operations. On July 31, 2018, the Company granted the Chief Operating Officer of CLS Nevada, Inc. a one-time signing bonus of 50,000 shares of restricted common stock, which shall become fully vested one year from the effective date of his employment agreement. These shares were valued at $35,000 and will be amortized over the vesting period. As of August 31, 2018, $5,917 had been charged to operations. On July 24, 2018, the Company awarded Star Associates, LLC, a limited liability company owned by Andrew Glashow, a director of the Company, a cash payment in the amount of $250,000 and 700,000 shares of restricted common stock in recognition of Mr. Glashow’s efforts, through Star Associates, in successfully assisting the Company in negotiating and obtaining the financing necessary to acquire Alternative Solutions, LLC. The shares were valued at $490,000 and were charged to operations during the three months ended August 31, 2018. Related Party Notes Payable The Company has convertible notes payable outstanding to Jeffrey Binder, an officer and director, and to Newcan Investment Partners, LLC, an entity that is wholly owned by Frank Koretsky, a director (see note 12). |
Note 18 - Subsequent Events
Note 18 - Subsequent Events | 3 Months Ended |
Aug. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Note 18 – Subsequent Events On September 6, 2018, the Company issued 13,684 shares of common stock upon the cashless exercise of 40,000 warrants at an exercise price of $0.75 per share. On September 11, 2018, the Company issued 31,250 shares of common stock in exchange for legal services previously rendered to the Company. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Aug. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in US dollars. |
Consolidation, Policy [Policy Text Block] | Principals of Consolidation The accompanying consolidated financial statements include the accounts of CLS Holdings USA, Inc., and its wholly owned operating subsidiaries, CLS Nevada, Inc., (“CLS Nevada”), CLS Labs, Inc. (“CLS Labs”), CLS Labs Colorado, Inc. (“CLS Colorado”), and Alternative Solutions, LLC (“Alternative Solutions”). Alternative Solutions is sole owner of the following three entities (collectively, the “Oasis LLCs”): Serenity Wellness Center, LLC (“Serenity Wellness Center”); Serenity Wellness Products, LLC (“Serenity Wellness Products”); and Serenity Wellness Growers, LLC (“Serenity Wellness Growers”). All material intercompany transactions have been eliminated upon consolidation of these entities. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents. The Company had cash and cash equivalents of $5,953,925 and $52,964 as of August 31, 2018 and May 31, 2018, respectively. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Allowance for Doubtful Accounts The Company generates the majority of its revenues and corresponding accounts receivable from the sale of cannabis, and cannabis related products. The Company evaluates the collectability of its accounts receivable considering a combination of factors. In circumstances where it is aware of a specific customer’s inability to meet its financial obligations to it, the Company records a specific reserve for bad debts against amounts due in order to reduce the net recognized receivable to the amount it reasonably believe will be collected. For all other customers, the Company recognizes reserves for bad debts based on past write-off experience and the length of time the receivables are past due. The Company had no bad debts expense during the three months ended August 31, 2018 and 2017. |
Segment Reporting, Policy [Policy Text Block] | Segment Reporting Under FASB ASC 280-10-50, the Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. |
Inventory, Policy [Policy Text Block] | Inventory Inventories are stated at the lower of cost or market. Cost is determined on a standard cost basis that approximates the first-in, first-out (FIFO) method. Market is determined based on net realizable value. Appropriate consideration is given to obsolescence, excessive levels, deterioration, and other factors in evaluating net realizable values. Our cannabis products consists of prepackaged purchased goods ready for resale, and cannabis flower grown in-house under our cultivation license, along with produced edibles and extracts developed under our production license. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property, Plant and Equipment Property and equipment is recorded at the lower of cost or estimated net recoverable amount, and is depreciated using the straight-line method over the estimated useful lives. Computer equipment is being depreciated over a three-year period. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations of Credit Risk The Company maintains its cash in bank deposit accounts and other accounts, the balances of which at times may be uninsured or exceed federally insured limits. From time to time, some of the Company’s funds are also held by escrow agents; these funds may not be federally insured. The Company continually monitors its banking relationships and consequently has not experienced any losses in such accounts. |
Advertising Costs, Policy [Policy Text Block] | Advertising and Marketing Costs All costs associated with advertising and promoting products are expensed as incurred with the exception of the amortization of the cost of two major video productions. A music video and reality/lifestyle video were both produced in 2017. The remaining amount that hasn’t been expensed is listed on the schedule in Note 6. Total recognized advertising and promotion expenses were $127,392 and $0 for the three months ended August 31, 2018 and 2017, respectively. |
Research, Development, and Computer Software, Policy [Policy Text Block] | Research and Development Research and development expenses are charged to operations as incurred. The Company incurred no research and development costs for the three months ended August 31, 2018 and 2017, respectively. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company accounts for income taxes using the asset and liability method, which requires the establishment of deferred tax assets and liabilities for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities at enacted tax rates expected to be in effect when such amounts are realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to the extent deferred tax assets may not be recoverable after consideration of the future reversal of deferred tax liabilities, tax planning strategies, and projected future taxable income. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments Pursuant to Accounting Standards Codification (“ASC”) No. 825 - Financial Instruments, the Company is required to estimate the fair value of all financial instruments included on its balance sheets. The carrying amount of the Company’s cash and cash equivalents, note receivable, notes payable, accounts payable and accrued expenses, none of which is held for trading, approximates their estimated fair values due to the short-term maturities of those financial instruments. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly. Level 3 - Significant unobservable inputs that cannot be corroborated by market data. |
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments Derivatives are recorded on the condensed consolidated balance sheet at fair value. The conversion features of the convertible notes are embedded derivatives and are separately valued and accounted for on the consolidated balance sheet with changes in fair value recognized during the period of change as a separate component of other income/expense. Fair values for exchange-traded securities and derivatives are based on quoted market prices. The pricing model the Company uses for determining the fair value of its derivatives is the Lattice Model. Valuations derived from this model are subject to ongoing internal and external verification and review. The model uses market-sourced inputs such as interest rates and stock price volatilities. Selection of these inputs involves management’s judgment and may impact net income (see note 14). On June 1, 2018, the Company adopted ASU 2017-11 and accordingly reclassified the fair value of the reset provisions embedded in convertible notes payable and certain warrants with embedded anti-dilutive provisions from liability to equity in the aggregate amount of $1,265,751. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue is primarily generated through our subsidiary, Serenity Wellness LLC, DBA/ Oasis Cannabis. Oasis operates a 24-hour cannabis dispensary that recognizes revenue from the sale of cannabis products within the State of Nevada. Revenue from the sale of our cannabis products is recognized by our subsidiary at the point of sale, at which time payment is received. Management estimates an allowance for sales returns. The Company also recognizes revenue from Serenity Wellness Products LLC and Serenity Wellness Growers LLC, DBA/ City Trees. City Trees recognizes revenue from the sale of the following cannabis products and services to licensed dispensaries within the State of Nevada: ● Premium organic medical cannabis sold wholesale to licensed retailers ● Recreational marijuana cannabis products sold wholesale to distributors and retailers ● Extraction products such as oils and waxes derived from in-house cannabis production ● Processing and extraction services for licensed medical cannabis cultivators in Nevada ● High quality cannabis strains in the form of vegetative cuttings for sale to licensed medical cannabis cultivators in Nevada Effective January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606. The Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605. Revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting Topic 606 for the three months ended August 31, 2018. |
Earnings Per Share, Policy [Policy Text Block] | Basic and Diluted Loss Per Share Basic net earnings per share is based on the weighted average number of shares outstanding during the period, while fully-diluted net earnings per share is based on the weighted average number of shares of common stock and potentially dilutive securities assumed to be outstanding during the period using the treasury stock method. Potentially dilutive securities consist of options and warrants to purchase common stock, and convertible debt. Basic and diluted net loss per share is computed based on the weighted average number of shares of common stock outstanding during the period. The Company uses the treasury stock method to calculate the impact of outstanding stock options and warrants. Stock options and warrants for which the exercise price exceeds the average market price over the period have an anti-dilutive effect on earnings per common share and, accordingly, are excluded from the calculation. A net loss causes all outstanding stock options and warrants to be antidilutive. As a result, the basic and dilutive losses per common share are the same for the three months ended August 31, 2018 and 2017. |
Commitments and Contingencies, Policy [Policy Text Block] | Commitments and Contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims brought to such legal counsel’s attention as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements Accounting standards promulgated by the Financial Accounting Standards Board (“FASB”) are subject to change. Changes in such standards may have an impact on the Company’s future financial statements. The following is a summary of recent accounting developments. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230). In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation - Scope of Modification Accounting Effective June 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting Topic 606. Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying unaudited condensed consolidated financial statements. Adoption of Accounting Standards In July 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815). The amendments in Part I of this update change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. As a result, a freestanding equity-linked financial instrument (or embedded conversion option) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. For freestanding equity classified financial instruments, the amendments require entities that present earnings per share (EPS) in accordance with Topic 260 to recognize the effect of the down round feature when it is triggered. That effect is treated as a dividend and as a reduction of income available to common shareholders in basic EPS. Convertible instruments with embedded conversion options that have down round features are now subject to the specialized guidance for contingent beneficial conversion features (in Subtopic 470-20, Debt—Debt with Conversion and Other Options), including related EPS guidance (in Topic 260). The amendments in Part II of this update recharacterize the indefinite deferral of certain provisions of Topic 480 that now are presented as pending content in the Codification, to a scope exception. Those amendments do not have an accounting effect. For public business entities, the amendments in Part I of this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted for all entities, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. On June 1, 2018, the Company adopted ASU 2017-11 and accordingly reclassified the fair value of the reset provisions embedded in convertible notes payable and certain warrants with embedded anti-dilutive provisions from liability to equity in the aggregate amount of $1,265,751. |
Note 3 - Acquisition of Alter_2
Note 3 - Acquisition of Alternative Solutions, LLC (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | The acquisition date estimated fair value of the consideration transferred totaled $27,975,650, which consisted of the following: Initial purchase price $ 2,050,000 Cash paid in connection with transaction 5,995,543 Note payable 3,810,820 Contingent consideration 678,111 Common stock 15,441,176 Total purchase price $ 27,975,650 Net tangible assets $ 595,151 Intangible assets 1,637,600 Goodwill 25,742,899 Total purchase price $ 27,975,650 |
Business Acquisition, Pro Forma Information [Table Text Block] | The following table sets forth the unaudited pro forma results of the Company as if the acquisition of the Oasis LLCs was effective on the first day of each of the three months periods presented. These combined results are not necessarily indicative of the results that may have been achieved had the companies always been combined. Three months ended August 31, 2018 2017 (unaudited (unaudited) Revenues $ 1,655,744 $ 1,383,192 Net loss $ (12,016,196 ) $ (8,742,167 ) Basic net income per share $ (0.18 ) $ (0.16 ) Diluted net income per share $ (0.18 ) $ (0.16 ) Weighted average shares - basic 67,913,333 56,199,550 Weighted average shares - diluted 67,913,333 56,199,550 |
Note 5 - Inventory (Tables)
Note 5 - Inventory (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | Inventory, consisting of material, overhead, labor, and manufacturing overhead, is stated at the lower of cost (first-in, first-out) or market, and consists of the following: August 31, May 31, 2018 2018 Raw materials $ 197,475 $ - Finished goods 301,924 - Total $ 499,399 $ - |
Note 6 - Prepaid Expenses (Tabl
Note 6 - Prepaid Expenses (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Disclosure Text Block Supplement [Abstract] | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Table Text Block] | Prepaid expenses consisted of the following at August 31, 2018 and May 31, 2018: August 31, May 31, 2018 2018 Prepaid insurance $ 5,865 $ - Prepaid advertising 23,784 - Prepaid license fees 77,459 - Prepaid legal fees 1,410 1,410 Prepaid general and administrative expenses 74,790 - Prepaid consulting 75,000 Total $ 258,308 $ 1,410 |
Note 7 - Other Assets (Tables)
Note 7 - Other Assets (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Other Non-current Assets Disclosure [Abstract] | |
Schedule of Other Assets [Table Text Block] | Other assets included the following as of August 31, 2018 and May 31, 2018, respectively: August 31 May 31, 2018 2018 Security deposits 158,500 - $ 158,500 $ - |
Note 9 - Property, Plant and _2
Note 9 - Property, Plant and Equipment (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property, plant and equipment consisted of the following at August 31, 2018 and May 31, 2018. August 31, May 31, 2018 2018 Office equipment 120,276 2,674 Furniture and fixtures 13,112 - Leasehold improvements $ 799,754 $ - Less: accumulated depreciation (27,509 ) (2,674 ) Property, plant, and equipment, net $ 905,633 $ - |
Note 10 - Intangible Assets (Ta
Note 10 - Intangible Assets (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Intangible assets consisted of the following at August 31, 2018 and May 31, 2018. August 31, 2018 Accumulated Gross Amortization Net Intellectual Property $ 319,600 $ (5,327 ) $ 314,273 License & Customer Relations 990,000 (8,250 ) 981,750 Tradenames - Trademarks 301,000 (5,017 ) 295,983 Non-compete Agreements 27,000 (2,250 ) 24,750 Domain Names 4,482 (1,913 ) 2,569 Total $ 1,642,082 $ (22,757 ) $ 1,619,325 May 31, 2018 Accumulated Gross Amortization Net Intellectual Property $ - $ - $ - License & Customer Relations - - - Domain name 1,726 (828 ) 898 Non-compete Agreements - - - Goodwill - - - Total $ 1,726 $ (828 ) $ 898 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Amount to be amortized during the twelve months ended August 31, 2019 $ 126,973 2020 123,466 2021 111,560 2022 111,560 2023 111,560 Thereafter 1,034,206 $ 1,619,325 |
Note 11 - Accounts Payable an_2
Note 11 - Accounts Payable and Accrued Liabilities (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block] | Accrued expenses consisted of the following at August 31, 2018 and May 31, 2018: August 31, May 31, 2018 2018 Trade accounts payable 601,714 $ 726,457 Accrued payroll and payroll taxes 38,203 44,465 Accrued liabilities 503,909 - Deferred rent liability 55,699 55,699 Total $ 1,199,525 $ 826,621 |
Note 12 - Notes Payable and C_2
Note 12 - Notes Payable and Convertible Notes Payable (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | August 31, May 31, 2018 2018 On February 7, 2018, the Company issued a note payable to Todd Blatt in the amount of $210,000 the “Blatt Note”). This note accrues interest at a rate of 6% per annum and is due on February 7, 2019. During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,726 on the Blatt Note. On July 20, 2018, the Company made principal and interest payments in the amount of $210,000 and $5,627, respectively, on the Blatt Note. $ - $ 210,000 On February 7, 2018, the Company issued a note payable to AJG Group in the amount of $200,000 the “AJG Note”). This note accrues interest at a rate of 6% per annum and is due on February 7, 2019. During the three months ended August 31, 2018, the Company accrued interest in the amount of $641 on the AJG Note. On July 9, 2018, the Company made principal and interest payments in the amount of $100,000 and $3,337, respectively, on the AJG Note. - 100,000 Secured note payable to Serenity Wellness Enterprises, LLC, as nominee (“Oasis Note”). dated June 27, 2018 in the principal amount of $4,000,000 and bearing interest at a rate of 6% per annum was issued pursuant to the Membership Interest Purchase Agreement with Alternative Solutions. The note is due December 4, 2019, but may be prepaid at any time without penalty. The Oasis Note is secured by all of the membership interests in Alternative Solutions and the Oasis LLCs and by the assets of the Oasis LLCs. The Company recognized an original issue discount of $189,180 on the Oasis Note. During the three months ended August 31, 2018, $23,422 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $43,333 on this note. 4,000,000 - Total – Notes Payable $ 4,000,000 $ 310,000 Less: Discount (165,758 ) - Notes Payable, Net of Discounts $ 3,834,242 $ 310,000 Current portion $ 3,834,242 $ 310,000 Long term portion $ - $ - |
Short-term Debt [Text Block] | The following tables summarize the Company’s loan balances at August 31, 2018 and May 31, 2017: August 31, May 31, 2018 2018 Notes payable to Jeffrey Binder, an officer and director of the Company, for advances to fund operations (the “Binder Funding Notes”). The Binder Funding Notes bear interest at a rate of 10% per annum, have no maturity date and are due on demand. Effective May 31, 2017, pursuant to the Omnibus Loan Agreement, a conversion feature was added to the Binder Funding Notes whereby principal and accrued interest is convertible into common stock of the Company at a rate of $0.25 per share. Effective December 1, 2017, pursuant to the Second Omnibus Loan Amendment, the conversion price was increased from $0.25 per share to $0.3125 per share and a discount in the amount of $35,023 related to the revaluation of the beneficial conversion feature of the Binder Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the twelve months ended May 31, 2018, Mr. Binder advanced a total of $440,579 to the Company under the Binder Funding Notes. During the year ended May 31, 2018, principal in the amount of $280,198 and accrued interest in the amount of $5,188 was transferred out of the Binder Funding Notes and used to fund four new convertible notes payable to Mr. Binder, which were converted or repaid as of May 31, 2018. Also during the year ended May 31, 2018 the Company made principal payments in the aggregate of $237,794 under the Binder Funding Notes. During the year ended May 31, 2018, the Company accrued interest in the amount of $7,364 on the Binder Funding Notes. During the year ended May 31, 2018, discounts in the amount of $385,637 related to the beneficial conversion feature of the Binder Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the three months ended August 31, 2018, Mr. Binder advanced as total of $81,961 to the Company under the Binder Funding Notes. During the three months ended August 31, 2018. The Company made principal payments to in the amount of $76,381 under the Binder Funding Notes. During the three months ended August 31, 2018, the Company accrued interest in the amount of $347 on the Binder Funding Notes. During the three months ended August 31, 2018, a discount in the amount of $ 81,961 related to the beneficial conversion feature of the Binder Funding Notes was charged to additional-paid in capital and amortized to interest expense. $ 5,716 $ 137 August 31, 2018 May 31, 2018 Notes payable to Newcan Investment Partners, LLC (“Newcan”), an entity owned by Frank Koretsky, a director of the Company, for advances to fund operations (the “Newcan Funding Notes”). The Newcan Funding Notes bear interest at a rate of 10% per annum, have no maturity date and are due on demand. Effective May 31, 2017, pursuant to the Omnibus Loan Agreement, a conversion feature was added to the Newcan Funding Notes whereby principal and accrued interest is convertible into common stock of the Company at a rate of $0.25 per share. Effective December 1, 2017, pursuant to the Second Omnibus Loan Amendment, the conversion price was increased from $0.25 per share to $0.3125 per share and a discount in the amount of $6,120 related to the revaluation of the beneficial conversion feature of the Newcan Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the twelve months ended May 31, 2018, Newcan advanced a total of $290,000 to the Company under the Newcan Funding Notes. During the year ended May 31, 2018, principal in the amount of $836,658 and accrued interest in the amount of $25,018 was transferred out of the Newcan Funding Notes and used to fund four new convertible notes payable to Newcan, which were converted or repaid as of May 31, 2018.). During the year ended May 31, 2018, the Company accrued interest in the amount of $16,681 on the Newcan Funding Notes. During the year ended May 31, 2018, discounts in the amount of $210,120 related to the beneficial conversion feature of the Newcan Funding Notes was charged to additional paid-in capital and amortized to interest expense. During the three months ended August 31, 2018, principal in the amount of $75,000 and accrued interest in the amount of $1,931 was transferred out of the Newcan Funding Notes and used to create a new convertible note payable to Newcan (“Newcan Convertible Note 8”). During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,377 on the Newcan Funding Notes. - 75,000 Total – Demand Convertible Notes Payable, Related Parties $ 5,716 $ 75,137 Total – Demand Convertible Notes Payable, Related Parties - Current portion $ 5,716 $ 75,137 Total – Demand Convertible Notes Payable, Related Parties - Long term portion $ - $ - |
Convertible Debt [Table Text Block] | August 31, 2018 May 31, 2018 Convertible promissory note payable to David Lamadrid (the “Lamadrid Note”) dated February 20, 2018 in the principal amount of $31,250 and bearing interest at a rate of 8% per annum. The Lamadrid Note is due eighteen months from the date of issue. Mr. Lamadrid may, at his option, convert all or a portion of the Lamadrid Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Lamadrid Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Lamadrid Note will be reset to such lower price. The Company recognized a discount of $31,250 on the Lamadrid Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $942 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $685 on this note. During the three months ended August 31, 2018, interest in the amount of $562 was accrued on the Lamadrid note. During the three months ended August 31, 2018, the Lamadrid Note, in the amount of $$32,497, of which $31,250 was principal and $1,247 was accrued interest, was converted into 103,989 shares of common stock. During the three months ended August 31, 2018 the remaining discount in the amount of $30,308 was charged to operations. - 31,250 Unsecured convertible note issued to Jeffery Binder, an officer and director of the Company, dated April 6, 2018 in the original principal amount of $37,500 (the “Binder Convertible Note 9”). The Binder Convertible Note 9 was funded with the conversion of $37,500 of unpaid accrued salary due to Mr. Binder. This note bears interest at the rate of 10% per annum. No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $4,688 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. This note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.3125 converted. The Company recognized a discount of $37,500 on the Binder Convertible Note 9 related to the value of the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, the Company amortized $1,890 of this discount to interest expense. During the twelve months ended May 31, 2018 and 2017, interest in the amount of $565 and $0 was accrued on Binder Convertible Note 9, respectively. During the three months ended August 31, 2018, interest in the amount of $699 was accrued on the Binder Convertible Note 9. During the three months ended August 31, 2018, the Company made a principal payment in the amount of $37,000 on the Binder Convertible Note 9. During the three months ended August 31, 2018 the remaining discount in the amount of $35,610 was charged to operations. - 37,500 Unsecured convertible note issued to Newcan, an entity owned by Frank Koretsky, a director of the Company, dated, August 6, 2018 in the original amount of $75,000 (the “Newcan Convertible Note 8”). The Newcan Convertible Note 8 was funded with the conversion of $75,000 of advances Newcan made to the Company under the Newcan Funding Notes. This note bears interest at the rate of 10% per annum. No interest payments are required until January 1, 2020, at which time all of the accrued interest becomes due and payable. Commencing on January 1, 2020, the first of eight principal payments in the amount of $9,375 will become due; subsequent principal payments will become due on the first day of each April, July, October, and January until paid in full. This note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.40 converted. The Company recognized a discount of $58,594 on the Newcan Convertible Note 8 related to the value of the beneficial conversion feature at the time of issuance. During the three months ended August 31, 2018, the Company amortized $1,272 of this discount to interest expense. During the three months ended August 31, 2018, the Company accrued interest in the amount of $514 on the Newcan Convertible Note 8. 75,000 - Total – Convertible Notes Payable, Related Parties $ 75,000 $ 68,750 Less: Discount (57,322 ) (65,918 ) Convertible Notes Payable, Related Parties, Net of Discounts $ 17,678 $ 2,832 Convertible Notes Payable, Related Parties, Net of Discounts, Current Portion $ - $ 2,832 Convertible Notes Payable, Related Parties, Net of Discounts, Long-term Portion 17,678 - August 31, 2018 May 31, 2018 Convertible promissory note payable to Darling Capital, LLC (the “Darling Note”) dated February 5, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $500,000 and the Darling Note has an original issue discount of $50,000. The Darling Note is due eighteen months from the date of issue. Darling may, at its option, convert all or a portion of the Darling Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Darling Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Darling Note will be reset to such lower price. The Company recognized a discount of $550,000 on the Darling Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $40,427 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $13,863 on this note. During the three months ended August 31, 2018, the Company accrued interest in the amount of $1,447 on this note. During the three months ended August 31, 2018, the holder of the Darling Note converted $565,000, of which $550,000 was principal and $15,000 was accrued interest into 1,808,000 shares of common stock. Also, during the three months ended August 31, 2018, the remaining discount in the amount of $509,573 was charged to operations. - 550,000 Convertible promissory note payable to Efrat Investments, LLC (the “Efrat Note”) dated February 12, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $50,000 and the Efrat Note has an original issue discount of $5,000. The Efrat Note is due eighteen months from the date of issue. Efrat may, at its option, convert all or a portion of the Efrat Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.3125 per share. The Efrat Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.3125 per share of common stock, the conversion price of the Efrat Note will be reset to such lower price. The Company recognized a discount of $55,000 on the Efrat Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $2,974 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $1,302 on this note. During the three months ended August 31, 2018, the Company accrued interest in the amount of $898 on this note. During the three months ended August 31, 2018, the holder of the Efrat Note converted $57,200, of which $55,000 was principal and $2,200 was accrued interest into 183,040 shares of common stock. Also, during the three months ended August 31, 2018, the remaining discount in the amount of $52,026 was charged to operations. - 55,000 August 31, 2018 May 31, 2018 Convertible promissory note payable to YA II PN, Ltd. (the “YA II PN Note”) dated May 14, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $750,000, and the note is due November 14, 2019. YA II PN may, at its option, convert all or a portion of the YA II PN Note and accrued but unpaid interest into shares of common stock at a conversion price of $0.40 per share. The YA II PN Note also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.40 per share of common stock, the conversion price of the YA II PN Note will be reset to such lower price. The Company recognized a discount of $750,000 related to the beneficial conversion feature at the time of issuance. Commencing on December 1, 2018, the first of eight payments in the amount of $93,750 will become due; subsequent payments will become due on the first day of each of the following months until paid in full. During the twelve months ended May 31, 2018, $23,224 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $2,795 on this note. During the three months ended August 31, 2018, the Company charged $19,112 of the discount to operations. Also, during the three months ended August 31, 2018, the Company accrued interest in the amount of $15,123 on this note. During the three months ended August 31, 2018, a reset event occurred. As a result, the conversion price of the YA II PN Note was reduced to $0.34 per share of common stock. This was considered a material modification of the note; the remaining balance of the discount to the note in the amount of $699,628 was charged to interest expense, a new discount in the amount of $750,000 was charged to additional paid-in capital, and $105,469 of the new discount was amortized to interest expense during the three months ended August 31, 2018. 750,000 750,000 Unsecured convertible note issued to Jay Lasky (the “Lasky Note”), dated May 3, 2018 in the original principal amount of $25,000. This note bears interest at the rate of 10% per annum. No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing on October 1, 2019, the first of eight principal payments in the amount of $3,125 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. The Lasky Note and accrued interest under the note may be converted, in whole or in part, into one share of common stock for each $0.40 converted. The Company recognized a discount of $7,301 on the Lasky Note related to the beneficial conversion feature at the time of issuance. During the twelve months ended May 31, 2018, $149 of this discount was charged to operations. During the twelve months ended May 31, 2018, the Company accrued interest in the amount of $192 on this note. During the three months ended August 31, 2018, $498 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $630 on this note. 25,000 25,000 Convertible promissory note payable to YA II PN, Ltd. (the “YA II PN Note 2”) dated July 20, 2018 and bearing interest at a rate of 8% per annum. The lender loaned the Company $500,000, and the note is due November 14, 2019. YA II PN may, at its option, convert all or a portion of the YA II PN Note 2 and accrued but unpaid interest into shares of common stock at a conversion price of $0.40 per share. The YA II PN Note 2 also contains a reset feature, whereby, absent certain exceptions, if the Company issues equity securities at an effective price less than $0.40 per share of common stock, the conversion price of the YA II PN Note 2 will be reset to such lower price. The Company recognized a discount of $362,500 related to the beneficial conversion feature at the time of issuance. Commencing on December 1, 2018, the first of eight payments in the amount of 62,500 will become due; subsequent payments will become due on the first day of each of the following months until paid in full. During the three months ended August 31, 2018, $31,587 of this discount was charged to operations. During the three months ended August 31, 2018, the Company accrued interest in the amount of $4,603 on this note. 500,000 - Total - Convertible Notes Payable $ 1,275,000 $ 1,380,000 Less: Discount (982,098 ) (1,295,527 ) Convertible Notes Payable, Net of Discounts $ 292,902 $ 84,473 Total - Convertible Notes Payable, Net of Discounts, Current Portion $ - $ 43,401 Total - Convertible Notes Payable, Net of Discounts, Long-term Portion $ 292,902 $ 41,072 |
Schedule of Amortization of Debt Discount [Table Text Block] | Discounts on notes payable amortized to interest expense – 3 months ended August 31, 2018 and 2017, respectively $ 1,598,502 $ 39,489 |
Note 13 - Stockholders' Equity
Note 13 - Stockholders' Equity (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] | The following table summarizes the significant terms of warrants outstanding at August 31, 2018. These warrants were granted as part of financing agreements. This table does not include the special warrants; see Special Warrant section below: Weighted Weighted Weighted average average average Range of Number of remaining exercise exercise exercise warrants contractual price of Number of price of Prices Outstanding life (years) outstanding Warrants warrants Exercisable exercisable Warrants $ 0.49 2,317,842 2.81 $ 0.49 2,317,842 $ 0.49 0.50 2,736,500 3.48 0.50 2,736,500 0.50 0.60 17,500,000 3.25 0.60 17,500,000 0.60 0.75 1,107,738 2.85 0.75 1,107,738 0.75 23,662,080 3.22 $ 0.57 23,662,080 $ 0.57 |
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block] | Transactions involving warrants are summarized as follows. This table does not include the special warrants; see Special Warrant section below. Number of Shares Weighted Average Exercise Price Warrants outstanding at May 31, 2018 4,700,988 $ 0.75 Granted 19,311,092 $ 0.58 Exercised (350,000 ) $ 0.75 Cancelled / Expired - $ - Warrants outstanding at August 31, 2018 23,662,080 $ 0.57 |
Note 14 - Fair Value of Finan_2
Note 14 - Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following summarizes the Company’s derivative financial liabilities that are recorded at fair value on a recurring basis at August 31, 2018 and May 31, 2018: August 31, 2018 Level 1 Level 2 Level 3 Total Liabilities Contingent liabilities $ - $ - $ 678,111 $ 678,111 May 31, 2018 Level 1 Level 2 Level 3 Total Liabilities Derivative liabilities $ - $ - $ 1,265,751 $ 1,265,751 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The estimated fair values of the Company’s derivative liabilities are as follows: Derivative Liability Liabilities Measured at Fair Value Balance as of May 31, 2018 $ 1,265,751 Transfers out due to the adoption of ASU 2017-11 effective June 1, 2018 (1,265,751 ) Balance as of August 31, 2018 $ - |
Note 15 - Operating Segments (T
Note 15 - Operating Segments (Tables) | 3 Months Ended |
Aug. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | The following table shows the operations of the Company’s reportable segments for the three months ended August 31, 2018: Cannabis Cannabis Corporate Dispensary Production and Segment Segment Eliminations Consolidated Sales to unaffiliated customers $ 776,707 $ 402,646 $ - $ 1,179,353 Intersegment sales - 58,814 (58,814 ) - Net sales $ 776,707 $ 461,460 $ (58,814 ) $ 1,179,353 Net income (loss) $ (204,044 ) $ 4,022 $ (16,456,918 ) $ (16,656,940 ) Total assets (1) $ 1,084,414 $ 361,845 $ 33,751,711 $ 35,197,970 Total liabilities $ 698,867 $ 265,620 $ 5,347,695 $ 6,312,182 Property additions $ 3,553 $ - $ - $ 3,553 Depreciation and amortization (2) $ 22,043 $ 1,007 $ 25,411 $ 48,461 (1) Total assets Corporate assets (2) |
Note 1 - Nature of Business a_2
Note 1 - Nature of Business and Significant Accounting Policies (Details) | Jun. 27, 2018USD ($)shares | Feb. 28, 2018USD ($) | Dec. 04, 2017USD ($) | Apr. 29, 2015shares | Dec. 10, 2014shares | Nov. 12, 2014shares | Aug. 31, 2018USD ($) | Aug. 31, 2017USD ($) | May 31, 2018USD ($) | May 31, 2017USD ($) |
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 0.625 | |||||||||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 10.00% | |||||||||
Cash and Cash Equivalents, at Carrying Value | $ 5,953,925 | $ 12,099 | $ 52,964 | $ 78,310 | ||||||
Advertising Expense | 127,392 | $ 0 | ||||||||
Reverse Merger with CLS Labs [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Stock Issued During Period, Shares, New Issues (in Shares) | shares | 15,000,000 | |||||||||
Oasis Acquisition [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Number of Subsidiaries | 3 | |||||||||
Payments to Acquire Businesses, Gross | $ 5,995,543 | 2,050,000 | ||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 90.00% | |||||||||
Debt Instrument, Face Amount | $ 4,000,000 | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 22,058,823 | |||||||||
Liabilities Assumed | $ 204,457 | |||||||||
Deposit [Member] | Oasis Acquisition [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Payments to Acquire Businesses, Gross | $ 250,000 | |||||||||
Additional Payments [Member] | Oasis Acquisition [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Payments to Acquire Businesses, Gross | $ 1,800,000 | |||||||||
Original Contemplated Transaction Payment [Member] | Oasis Acquisition [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Payments to Acquire Businesses, Gross | $ 6,200,000 | |||||||||
Accounting Standards Update 2017-11 [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 1,265,751 | |||||||||
Shares of CLS Holdings USA, Inc. [Member] | CLS Labs, Inc. [Member] | ||||||||||
Note 1 - Nature of Business and Significant Accounting Policies (Details) [Line Items] | ||||||||||
Subsidiary or Equity Method Investee, Cumulative Number of Shares Issued for All Transactions (in Shares) | shares | 6,250,000 | 10,000,000 |
Note 2 - Going Concern (Details
Note 2 - Going Concern (Details) - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Retained Earnings (Accumulated Deficit) | $ (35,226,034) | $ (18,569,094) |
Note 3 - Acquisition of Alter_3
Note 3 - Acquisition of Alternative Solutions, LLC (Details) | Jun. 27, 2018USD ($)shares | Feb. 28, 2018USD ($) | Dec. 04, 2017USD ($) | Aug. 31, 2018USD ($) |
Note 3 - Acquisition of Alternative Solutions, LLC (Details) [Line Items] | ||||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 10.00% | |||
Oasis Acquisition [Member] | ||||
Note 3 - Acquisition of Alternative Solutions, LLC (Details) [Line Items] | ||||
Number of Subsidiaries | 3 | |||
Payments to Acquire Businesses, Gross | $ 5,995,543 | $ 2,050,000 | ||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 90.00% | |||
Debt Instrument, Face Amount | $ 4,000,000 | |||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares) | shares | 22,058,823 | |||
Liabilities Assumed | $ 204,457 | |||
Business Acquisition, Equity Interest Issued or Issuable, Description | The number of Purchase Price Shares was equal to 80% of the offering price of the Company’s common stock in its last equity offering, which price was $0.34 per share. | |||
Business Combination, Contingent Consideration Arrangements, Change in Range of Outcomes, Contingent Consideration, Liability, Value, High | $ 1,000,000 | |||
Average Revenue, Maintained | 20,000 | |||
Business Combination, Contingent Consideration, Liability | 678,111 | |||
Business Combination, Consideration Transferred | 27,975,650 | $ 27,975,650 | ||
Deposit [Member] | Oasis Acquisition [Member] | ||||
Note 3 - Acquisition of Alternative Solutions, LLC (Details) [Line Items] | ||||
Payments to Acquire Businesses, Gross | $ 250,000 | |||
Additional Payments [Member] | Oasis Acquisition [Member] | ||||
Note 3 - Acquisition of Alternative Solutions, LLC (Details) [Line Items] | ||||
Payments to Acquire Businesses, Gross | $ 1,800,000 | |||
Original Contemplated Transaction Payment [Member] | Oasis Acquisition [Member] | ||||
Note 3 - Acquisition of Alternative Solutions, LLC (Details) [Line Items] | ||||
Payments to Acquire Businesses, Gross | $ 6,200,000 |
Note 3 - Acquisition of Alter_4
Note 3 - Acquisition of Alternative Solutions, LLC (Details) - Schedule of Business Acquisitions, by Acquisition - USD ($) | Jun. 27, 2018 | Aug. 31, 2018 | May 31, 2018 |
Business Acquisition [Line Items] | |||
Goodwill | $ 25,742,899 | $ 0 | |
Oasis Acquisition [Member] | |||
Business Acquisition [Line Items] | |||
Initial purchase price | $ 5,995,543 | 2,050,000 | |
Cash paid in connection with transaction | 5,995,543 | ||
Note payable | 3,810,820 | ||
Contingent consideration | 678,111 | ||
Common stock | 15,441,176 | ||
Total purchase price | $ 27,975,650 | 27,975,650 | |
Net tangible assets | 595,151 | ||
Intangible assets | 1,637,600 | ||
Goodwill | 25,742,899 | ||
Total purchase price | $ 27,975,650 |
Note 3 - Acquisition of Alter_5
Note 3 - Acquisition of Alternative Solutions, LLC (Details) - Business Acquisition, Pro Forma Information - Oasis Acquisition [Member] - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Note 3 - Acquisition of Alternative Solutions, LLC (Details) - Business Acquisition, Pro Forma Information [Line Items] | ||
Revenues | $ 1,655,744 | $ 1,383,192 |
Net loss | $ (12,016,196) | $ (8,742,167) |
Basic net income per share | $ (0.18) | $ (0.16) |
Diluted net income per share | $ (0.18) | $ (0.16) |
Weighted average shares - basic | 67,913,333 | 56,199,550 |
Weighted average shares - diluted | 67,913,333 | 56,199,550 |
Note 4 - Accounts Receivable (D
Note 4 - Accounts Receivable (Details) - USD ($) | Aug. 31, 2018 | May 31, 2018 | Aug. 31, 2017 |
Receivables [Abstract] | |||
Accounts Receivable, Net, Current | $ 59,981 | $ 0 | |
Allowance for Doubtful Accounts Receivable, Current | $ 0 | $ 0 |
Note 5 - Inventory (Details) -
Note 5 - Inventory (Details) - Schedule of Inventory, Current - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Schedule of Inventory, Current [Abstract] | ||
Raw materials | $ 197,475 | $ 0 |
Finished goods | 301,924 | 0 |
Total | $ 499,399 | $ 0 |
Note 6 - Prepaid Expenses (Deta
Note 6 - Prepaid Expenses (Details) - Deferred Costs, Capitalized, Prepaid, and Other Assets - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets [Abstract] | ||
Prepaid insurance | $ 5,865 | $ 0 |
Prepaid advertising | 23,784 | 0 |
Prepaid license fees | 77,459 | 0 |
Prepaid legal fees | 1,410 | 1,410 |
Prepaid general and administrative expenses | 74,790 | 0 |
Prepaid consulting | 75,000 | 0 |
Total | $ 258,308 | $ 1,410 |
Note 7 - Other Assets (Details)
Note 7 - Other Assets (Details) - Schedule of Other Assets - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Schedule of Other Assets [Abstract] | ||
Security deposits | $ 158,500 | $ 0 |
Total Other Assets | $ 158,500 | $ 0 |
Note 8 - Note Receivable (Detai
Note 8 - Note Receivable (Details) - USD ($) | 12 Months Ended | |||
May 31, 2018 | May 31, 2015 | Aug. 31, 2018 | Aug. 31, 2017 | |
Note 8 - Note Receivable (Details) [Line Items] | ||||
Allowance for Doubtful Accounts Receivable, Current | $ 0 | $ 0 | ||
Notes Receivable [Member] | Affiliated Entity [Member] | ||||
Note 8 - Note Receivable (Details) [Line Items] | ||||
Financing Receivable, Gross | $ 500,000 | |||
Loans and Leases Receivable, Description | Pursuant to the Note, as amended by the parties effective June 30, 2015, October 31, 2015, April 11, 2016, and May 31, 2016, PRH was expected to repay the principal due under the Note in twenty (20) equal quarterly installments of Twenty Five Thousand Dollars ($25,000) commencing in the month following the month in which PRH commenced generating revenue at the grow facility, which commencement was originally anticipated to occur in the first quarter of 2017, and continuing until paid in full.  Recently, we suspended our plans to proceed with the Colorado Arrangement due to regulatory delays and have not yet determined when we will pursue it again.  Interest will accrue on the unpaid principal balance of the Note at the rate of twelve percent (12%) per annum and will be paid quarterly in arrears commencing after such initial payment and continuing until paid in full.  All outstanding principal and any accumulated unpaid interest due under the Note is due and payable on the five-year anniversary of the initial payment thereunder. | |||
Note Receivable, Interest Rate, Stated Percentage | 12.00% | |||
Asset Impairment Charges | $ 500,000 | |||
Proceeds from Collection of Notes Receivable | $ 50,000 | |||
Financing Receivable, Net | 0 | |||
Allowance for Doubtful Accounts Receivable, Current | $ 450,000 |
Note 9 - Property, Plant and _3
Note 9 - Property, Plant and Equipment (Details) - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Note 9 - Property, Plant and Equipment (Details) [Line Items] | ||
Depreciation | $ 27,509 | $ 223 |
Alternative Solutions, LLC [Member] | ||
Note 9 - Property, Plant and Equipment (Details) [Line Items] | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 933,142 |
Note 9 - Property, Plant and _4
Note 9 - Property, Plant and Equipment (Details) - Property, Plant and Equipment - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation | $ (27,509) | $ (2,674) |
Property, plant, and equipment, net | 905,633 | 0 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 120,276 | 2,674 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | 13,112 | 0 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment, gross | $ 799,754 | $ 0 |
Note 10 - Intangible Assets (De
Note 10 - Intangible Assets (Details) - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of Intangible Assets | $ 20,952 | $ 108 |
Note 10 - Intangible Assets (_2
Note 10 - Intangible Assets (Details) - Schedule of Finite-Lived Intangible Assets - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | $ 1,642,082 | $ 1,726 |
Intangible Assets, Accumulated Amortization | (22,757) | (828) |
Intangible Assets, Net | 1,619,325 | 898 |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 319,600 | 0 |
Intangible Assets, Accumulated Amortization | (5,327) | 0 |
Intangible Assets, Net | 314,273 | 0 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 990,000 | |
Intangible Assets, Accumulated Amortization | (8,250) | |
Intangible Assets, Net | 981,750 | |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 301,000 | |
Intangible Assets, Accumulated Amortization | (5,017) | |
Intangible Assets, Net | 295,983 | |
Noncompete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 27,000 | 0 |
Intangible Assets, Accumulated Amortization | (2,250) | 0 |
Intangible Assets, Net | 24,750 | 0 |
Internet Domain Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 4,482 | 1,726 |
Intangible Assets, Accumulated Amortization | (1,913) | (828) |
Intangible Assets, Net | $ 2,569 | 898 |
Customer-Related Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 0 | |
Intangible Assets, Accumulated Amortization | 0 | |
Intangible Assets, Net | 0 | |
Goodwill [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible Assets, Gross | 0 | |
Intangible Assets, Accumulated Amortization | 0 | |
Intangible Assets, Net | $ 0 |
Note 10 - Intangible Assets (_3
Note 10 - Intangible Assets (Details) - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Aug. 31, 2018USD ($) |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Abstract] | |
2,019 | $ 126,973 |
2,020 | 123,466 |
2,021 | 111,560 |
2,022 | 111,560 |
2,023 | 111,560 |
Thereafter | 1,034,206 |
$ 1,619,325 |
Note 11 - Accounts Payable an_3
Note 11 - Accounts Payable and Accrued Liabilities (Details) - Schedule of Accounts Payable and Accrued Liabilities - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Schedule of Accounts Payable and Accrued Liabilities [Abstract] | ||
Trade accounts payable | $ 601,714 | $ 726,457 |
Accrued payroll and payroll taxes | 38,203 | 44,465 |
Accrued liabilities | 503,909 | 0 |
Deferred rent liability | 55,699 | 55,699 |
Total | $ 1,199,525 | $ 826,621 |
Note 12 - Notes Payable and C_3
Note 12 - Notes Payable and Convertible Notes Payable (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2017 | May 31, 2018 | Jan. 10, 2018 | |
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Conversion, Original Debt, Amount (in Dollars) | $ 0 | $ 62,500 | |||
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | 10,816,960 | ||||
Debt Instrument, Convertible, Conversion Price | $ 0.25 | ||||
Stock Issued During Period, Shares, Other (in Shares) | 7,609,910 | ||||
Shares Issued, Price Per Share | $ 0.125 | ||||
Other Nonoperating Gains (Losses) (in Dollars) | $ (951,239) | ||||
Omnibus Loan Agreement [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Instrument, Convertible, Conversion Price | $ 0.10 | ||||
Debt Instrument, Interest Rate, Stated Percentage | 0.25% | ||||
Second Omnibus Loan Agreement [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Instrument, Convertible, Conversion Price | $ 0.3125 | ||||
Principal [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Conversion, Original Debt, Amount (in Dollars) | 2,537,750 | ||||
Accrued Interest [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Conversion, Original Debt, Amount (in Dollars) | $ 166,490 | ||||
Minimum [Member] | Omnibus Loan Agreement [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Instrument, Convertible, Conversion Price | $ 0.75 | ||||
Maximum [Member] | Omnibus Loan Agreement [Member] | |||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) [Line Items] | |||||
Debt Instrument, Convertible, Conversion Price | $ 1.07 |
Note 12 - Notes Payable and Co
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt [Line Items] | ||
Notes payable | $ 4,000,000 | $ 310,000 |
Less: Discount | (165,758) | 0 |
Notes Payable, Net of Discounts | 3,834,242 | 310,000 |
Current portion | 3,834,242 | 310,000 |
Long term portion | 0 | 0 |
Loans Payable [Member] | Blatt Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt [Line Items] | ||
Notes payable | 0 | 210,000 |
Loans Payable [Member] | AJG Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt [Line Items] | ||
Notes payable | 0 | 100,000 |
Loans Payable [Member] | Oasis Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt [Line Items] | ||
Notes payable | $ 4,000,000 | $ 0 |
Note 12 - Notes Payable and _2
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt (Parentheticals) - USD ($) | 3 Months Ended | 12 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2018 | |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt (Parentheticals) [Line Items] | |||
Principal payments | $ 310,000 | $ 0 | |
Interest payments | 8,964 | 0 | |
Original Issue Discount | 81,961 | ||
Discount charged to operations | 1,598,502 | $ 39,489 | |
Loans Payable [Member] | Blatt Note [Member] | |||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt (Parentheticals) [Line Items] | |||
Note amount | $ 210,000 | $ 210,000 | |
Note interest rate | 6.00% | 6.00% | |
Note due | Feb. 7, 2019 | Feb. 7, 2019 | |
Interest Accrued | $ 1,726 | ||
Principal payments | 210,000 | ||
Interest payments | 5,627 | ||
Loans Payable [Member] | AJG Note [Member] | |||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt (Parentheticals) [Line Items] | |||
Note amount | $ 200,000 | $ 200,000 | |
Note interest rate | 6.00% | 6.00% | |
Note due | Feb. 7, 2019 | Feb. 7, 2019 | |
Interest Accrued | $ 641 | ||
Principal payments | 100,000 | ||
Interest payments | 3,337 | ||
Loans Payable [Member] | Oasis Note [Member] | |||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Debt (Parentheticals) [Line Items] | |||
Note amount | $ 4,000,000 | ||
Note interest rate | 6.00% | ||
Note due | Dec. 4, 2019 | ||
Interest Accrued | $ 43,333 | ||
Secured | secured by all of the membership interests in Alternative Solutions and the Oasis LLCs and by the assets of the Oasis LLCs | ||
Original Issue Discount | $ 189,180 | ||
Discount charged to operations | $ 23,422 |
Note 12 - Notes Payable and _3
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt [Line Items] | ||
Note payable | $ 5,716 | $ 75,137 |
Current portion | 5,716 | 75,137 |
Long term portion | 0 | 0 |
Newcan Funding Notes [Member] | Director [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt [Line Items] | ||
Note payable | 0 | 75,000 |
Binder Funding Notes [Member] | Chief Executive Officer [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt [Line Items] | ||
Note payable | $ 5,716 | $ 137 |
Note 12 - Notes Payable and _4
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2018 | May 31, 2017 | |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
New Notes Payable | $ 81,961 | $ 0 | ||
Transferred | 0 | 62,500 | ||
Accrued interest | 44,155 | $ 0 | ||
Beneficial conversion feature | 1,229,831 | $ 351,790 | ||
Conversion Rate (in Dollars per share) | $ 0.25 | |||
Newcan Funding Notes [Member] | Director [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
New Notes Payable | $ 0 | $ 290,000 | ||
Interest Rate | 10.00% | 10.00% | ||
Transferred | $ 75,000 | $ 836,658 | ||
Accrued interest | $ 1,377 | $ 16,681 | ||
Conversion Rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Binder Funding Notes [Member] | Chief Executive Officer [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
New Notes Payable | $ 81,961 | $ 440,579 | ||
Interest Rate | 10.00% | 10.00% | ||
Accrued interest | $ 347 | $ 7,364 | ||
Beneficial conversion feature | 81,961 | 385,637 | ||
Principal payments | $ 76,381 | $ 237,794 | ||
Conversion Rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Binder Funding Notes [Member] | Accrued Interest [Member] | Chief Executive Officer [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
Transferred | $ 5,188 | |||
Binder Funding Notes [Member] | Principal [Member] | Chief Executive Officer [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
Transferred | 280,198 | |||
Accrued Interest [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
Transferred | $ 166,490 | |||
Accrued Interest [Member] | Newcan Funding Notes [Member] | Accrued Interest [Member] | Director [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Short-term Debt (Parentheticals) [Line Items] | ||||
Transferred | $ 1,931 | $ 25,018 |
Note 12 - Notes Payable and _5
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | $ 1,275,000 | $ 1,380,000 |
Less: Discount | (982,098) | (1,295,527) |
Convertible Notes Payable, Net of Discounts | 292,902 | 84,473 |
Total - Convertible Notes Payable, Net of Discounts, Current Portion | 0 | 43,401 |
Total - Convertible Notes Payable, Net of Discounts, Long-term Portion | 292,902 | 41,072 |
Related Party Notes [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 75,000 | 68,750 |
Less: Discount | (57,322) | (65,918) |
Convertible Notes Payable, Net of Discounts | 17,678 | 2,832 |
Total - Convertible Notes Payable, Net of Discounts, Current Portion | 0 | 2,832 |
Total - Convertible Notes Payable, Net of Discounts, Long-term Portion | 17,678 | 0 |
Convertible Debt [Member] | Lamadrid Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 0 | 31,250 |
Convertible Debt [Member] | Binder Convertible Note 9 [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 0 | 37,500 |
Convertible Debt [Member] | Newcan Convertible Note 8 [Member] | Director [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 75,000 | 0 |
Convertible Debt [Member] | Darling Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 0 | 550,000 |
Convertible Debt [Member] | Efrat Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 0 | 55,000 |
Convertible Debt [Member] | YA II PN Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 750,000 | 750,000 |
Convertible Debt [Member] | Lasky Note [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | 25,000 | 25,000 |
Convertible Debt [Member] | YA II PN Note #2 [Member] | ||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt [Line Items] | ||
Convertible Notes Payable, Gross | $ 500,000 | $ 0 |
Note 12 - Notes Payable and _6
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2018 | May 31, 2017 | |
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Conversion rate (in Dollars per share) | $ 0.25 | |||
Discount recognized | $ 1,229,831 | $ 351,790 | ||
Discount | 1,598,501 | 42,060 | ||
Accrued interest | 44,155 | $ 0 | ||
Converted | 0 | 62,500 | ||
Converted, shares (in Shares) | 10,816,960 | |||
Payment | 37,500 | $ 0 | ||
Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 32,497 | |||
Converted, shares (in Shares) | 103,989 | |||
Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 565,000 | |||
Converted, shares (in Shares) | 1,808,000 | |||
Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 57,200 | |||
Converted, shares (in Shares) | 183,040 | |||
Convertible Debt [Member] | Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 31,250 | $ 31,250 | ||
Interest rate | 8.00% | 8.00% | ||
Note due | eighteen months | eighteen months | ||
Conversion rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Discount recognized | $ 31,250 | |||
Discount | $ 30,308 | 685 | ||
Accrued interest | 562 | |||
Converted | $ 32,497 | |||
Converted, shares (in Shares) | 103,989 | |||
Convertible Debt [Member] | Binder Convertible Note 9 [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 37,500 | $ 37,500 | ||
Interest rate | 10.00% | 10.00% | ||
Conversion rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Discount | $ 37,500 | |||
Accrued interest | $ 699 | $ 565 | ||
Payments | No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $4,688 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. | No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $4,688 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. | ||
Convertible Debt [Member] | Binder Convertible Note 9 [Member] | Accrued Interest [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Payment | $ 37,500 | |||
Convertible Debt [Member] | Newcan Convertible Note 8 [Member] | Director [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 75,000 | |||
Interest rate | 10.00% | |||
Conversion rate (in Dollars per share) | $ 0.40 | |||
Discount recognized | $ 58,594 | |||
Discount | 1,272 | |||
Accrued interest | $ 514 | |||
Payments | No interest payments are required until January 1, 2020, at which time all of the accrued interest becomes due and payable. Commencing on January 1, 2020, the first of eight principal payments in the amount of $9,375 will become due; subsequent principal payments will become due on the first day of each April, July, October, and January until paid in full. | |||
Dated | Aug. 6, 2018 | |||
Convertible Debt [Member] | Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 500,000 | $ 500,000 | ||
Conversion rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Discount recognized | $ 550,000 | |||
Discount | $ 509,573 | 40,427 | ||
Accrued interest | 1,447 | $ 13,863 | ||
Converted | $ 565,000 | |||
Converted, shares (in Shares) | 1,808,000 | |||
Dated | Feb. 5, 2018 | Feb. 5, 2018 | ||
Original issue discount | $ 50,000 | $ 50,000 | ||
Convertible Debt [Member] | Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 50,000 | $ 50,000 | ||
Interest rate | 8.00% | 8.00% | ||
Conversion rate (in Dollars per share) | $ 0.3125 | $ 0.3125 | ||
Discount recognized | $ 55,000 | |||
Discount | $ 52,026 | 2,974 | ||
Accrued interest | 898 | $ 1,302 | ||
Converted | $ 57,200 | |||
Converted, shares (in Shares) | 183,040 | |||
Dated | Feb. 12, 2018 | Feb. 12, 2018 | ||
Original issue discount | $ 5,000 | $ 5,000 | ||
Convertible Debt [Member] | YA II PN Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 750,000 | $ 750,000 | ||
Interest rate | 8.00% | 8.00% | ||
Note due | November 14, 2019 | November 14, 2019 | ||
Conversion rate (in Dollars per share) | $ 0.34 | $ 0.40 | ||
Discount recognized | $ 19,112 | $ 23,224 | ||
Discount | 750,000 | |||
Accrued interest | $ 15,123 | $ 2,795 | ||
Dated | May 14, 2018 | May 14, 2018 | ||
Convertible Debt [Member] | Lasky Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 25,000 | $ 25,000 | ||
Interest rate | 10.00% | 10.00% | ||
Conversion rate (in Dollars per share) | $ 0.40 | $ 0.40 | ||
Discount recognized | $ 498 | $ 149 | ||
Discount | 7,301 | |||
Accrued interest | $ 630 | $ 192 | ||
Payments | No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $3,125 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. | No interest payments are required until July 1, 2019, at which time all accrued interest becomes due and payable. Commencing October 1, 2019, the first of eight principal payments in the amount of $3,125 will become due; subsequent payments will become due on the first day of each January, April, July and October until paid in full. | ||
Dated | May 3, 2018 | May 3, 2018 | ||
Convertible Debt [Member] | YA II PN Note #2 [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Amount | $ 500,000 | |||
Interest rate | 8.00% | |||
Note due | November 14, 2019 | |||
Conversion rate (in Dollars per share) | $ 0.40 | |||
Discount recognized | $ 362,500 | |||
Discount | 31,587 | |||
Accrued interest | $ 4,603 | |||
Payments | Commencing on December 1, 2018, the first of eight payments in the amount of 62,500 will become due; subsequent payments will become due on the first day of each of the following months until paid in full. | |||
Dated | Jul. 20, 2018 | |||
Principal [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 2,537,750 | |||
Principal [Member] | Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 31,250 | |||
Principal [Member] | Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 550,000 | |||
Principal [Member] | Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 55,000 | |||
Principal [Member] | Convertible Debt [Member] | Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 31,250 | |||
Principal [Member] | Convertible Debt [Member] | Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 550,000 | |||
Principal [Member] | Convertible Debt [Member] | Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 55,000 | |||
Accrued Interest [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 166,490 | |||
Accrued Interest [Member] | Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 1,247 | |||
Accrued Interest [Member] | Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 15,000 | |||
Accrued Interest [Member] | Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 2,200 | |||
Accrued Interest [Member] | Convertible Debt [Member] | Lamadrid Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 1,247 | |||
Accrued Interest [Member] | Convertible Debt [Member] | Darling Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | 15,000 | |||
Accrued Interest [Member] | Convertible Debt [Member] | Efrat Note [Member] | ||||
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Convertible Debt (Parentheticals) [Line Items] | ||||
Converted | $ 2,200 |
Note 12 - Notes Payable and _7
Note 12 - Notes Payable and Convertible Notes Payable (Details) - Schedule of Amortization of Debt Discount - USD ($) | 3 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Schedule of Amortization of Debt Discount [Abstract] | ||
Discounts on notes payable amortized to interest expense – 3 months ended August 31, 2018 and 2017, respectively | $ 1,598,502 | $ 39,489 |
Note 13 - Stockholders' Equit_2
Note 13 - Stockholders' Equity (Details) | Aug. 20, 2018USD ($)shares | Aug. 14, 2018$ / sharesshares | Aug. 10, 2018USD ($)$ / sharesshares | Aug. 06, 2018$ / sharesshares | Jul. 31, 2018USD ($)$ / sharesshares | Jul. 27, 2018USD ($)shares | Jul. 24, 2018USD ($)shares | Jul. 20, 2018$ / sharesshares | Jul. 01, 2018shares | Jun. 27, 2018USD ($)$ / sharesshares | Jun. 24, 2018USD ($)shares | Jun. 20, 2018USD ($)$ / sharesshares | Jun. 20, 2018CAD ($)shares | Jun. 01, 2018USD ($) | Mar. 29, 2018$ / shares | Aug. 01, 2015USD ($)shares | Aug. 31, 2018USD ($)$ / sharesshares | Nov. 30, 2017USD ($)shares | Nov. 30, 2017CAD ($)$ / sharesshares | Aug. 31, 2017USD ($) | May 31, 2018USD ($)$ / sharesshares | May 31, 2017USD ($)shares | Aug. 08, 2018$ / sharesshares | Jun. 26, 2018$ / shares | Jun. 20, 2018$ / shares |
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Common Stock, Shares Authorized (in Shares) | shares | 250,000,000 | 250,000,000 | |||||||||||||||||||||||
Common Stock, Par or Stated Value Per Share (in Dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||||||||||||||||||||
Preferred Stock, Shares Authorized (in Shares) | shares | 20,000,000 | 20,000,000 | |||||||||||||||||||||||
Preferred Stock, Par or Stated Value Per Share (in Dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |||||||||||||||||||||||
Common Stock, Shares, Outstanding (in Shares) | shares | 90,087,236 | 50,128,972 | |||||||||||||||||||||||
Common Stock, Shares, Issued (in Shares) | shares | 90,087,236 | 50,128,972 | |||||||||||||||||||||||
Imputed Interest, Debt | $ 271 | $ 271 | |||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 0 | 62,500 | |||||||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | shares | 10,816,960 | ||||||||||||||||||||||||
Share-based Compensation | 490,000 | 0 | |||||||||||||||||||||||
Proceeds from Issuance or Sale of Equity | 15,535,978 | 0 | |||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.50 | ||||||||||||||||||||||||
Other Noncash Expense | 8,084,522 | 0 | |||||||||||||||||||||||
Number of Units to be Issued (in Shares) | shares | 6,875,000 | 7,500,000 | |||||||||||||||||||||||
Unit, Price Per Unit (in Dollars per share) | $ / shares | $ 0.40 | $ 0.40 | |||||||||||||||||||||||
Units, Value, Subscriptions | $ 2,750,000 | $ 3,000,000 | |||||||||||||||||||||||
Unit, Description | The units collectively represent (i) 6,875,000 shares of common stock, and (ii) three-year warrants to purchase an aggregate of 6,875,000 shares of common stock at an exercise price of $0.60 per share of common stock | The units collectively represent (i) 7,500,000 shares of common stock, and (ii) three-year warrants to purchase an aggregate of 7,500,000 shares of common stock at an exercise price of $0.60 per share of Common Stock | |||||||||||||||||||||||
Number of Subscription Agreements | 5 | ||||||||||||||||||||||||
Allocated Share-based Compensation Expense | $ 4,375 | $ 120,138 | $ 0 | ||||||||||||||||||||||
Class of Warrant or Rights, Exercised (in Shares) | shares | 350,000 | ||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Convertible Debt with Conversion Feature | $ 750,000 | ||||||||||||||||||||||||
81,961 | |||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Other | 35,833 | ||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares) | shares | 1,368,250 | ||||||||||||||||||||||||
Alternative Solutions, LLC [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Stock Issued During Period, Shares, Acquisitions (in Shares) | shares | 22,058,823 | ||||||||||||||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 15,441,176 | ||||||||||||||||||||||||
Affiliated Entity [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Payments for Commissions | $ 250,000 | ||||||||||||||||||||||||
Stock Issued During Period, Shares, Issued for Services (in Shares) | shares | 700,000 | ||||||||||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 490,000 | ||||||||||||||||||||||||
Chief Financial Officer [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Stock Issued During Period, Shares, Share-based Compensation, Gross (in Shares) | shares | 25,000 | ||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 months | ||||||||||||||||||||||||
Stock Issued During Period, Value, Share-based Compensation, Gross | $ 17,500 | ||||||||||||||||||||||||
Allocated Share-based Compensation Expense | 4,375 | ||||||||||||||||||||||||
Termination of Employment Agreement [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Stock Issued During Period, Shares, Issued for Services (in Shares) | shares | 600,000 | ||||||||||||||||||||||||
Stock Issued During Period, Value, Issued for Services | $ 264,000 | ||||||||||||||||||||||||
Stock Issued, Previously Subscribed | $ 213,320 | ||||||||||||||||||||||||
Share-based Compensation | 50,680 | ||||||||||||||||||||||||
Special Warrants [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Payments for Commissions | $ 799,053 | $ 1,043,028 | |||||||||||||||||||||||
Proceeds from Issuance or Sale of Equity | $ 9,785,978 | $ 13,037,859 | |||||||||||||||||||||||
Class of Warrant or Rights, Granted (in Shares) | shares | 3,042,167 | 28,973,020 | 28,973,020 | ||||||||||||||||||||||
Warrants Issued, Price Per Warrant | (per share) | $ 0.34 | $ 0.45 | |||||||||||||||||||||||
Warrant Description | the Company did not receive a receipt from the applicable Canadian securities authorities for the qualifying prospectus by August 20, 2018, the unexercised special warrants were adjusted to entitle the holders to receive 1.1 units instead of one unit of the Company. | Each special warrant is automatically exercisable, for no additional consideration, into units of the Company on the earlier of: (i) the date that is five business days following the date on which the Company obtains a receipt from the applicable securities regulatory authorities in each of the jurisdictions in Canada in which the special warrants were sold for a final prospectus qualifying the distribution of the units, which is intended to be no later than August 31, 2018, and (ii) the date that is four months and one day after the completion of the Company's acquisition of all of the membership interests in Alternative Solutions, LLC, known as Oasis Cannabis.Upon exercise of the special warrants, each unit shall consist of one share of the Company's common stock and one warrant to purchase one share of common stock.  Each warrant will be exercisable at a price of C$0.65 for three years after the Company's common stock is listed on a recognized Canadian stock exchange, subject to adjustment in certain events | Each special warrant is automatically exercisable, for no additional consideration, into units of the Company on the earlier of: (i) the date that is five business days following the date on which the Company obtains a receipt from the applicable securities regulatory authorities in each of the jurisdictions in Canada in which the special warrants were sold for a final prospectus qualifying the distribution of the units, which is intended to be no later than August 31, 2018, and (ii) the date that is four months and one day after the completion of the Company's acquisition of all of the membership interests in Alternative Solutions, LLC, known as Oasis Cannabis.Upon exercise of the special warrants, each unit shall consist of one share of the Company's common stock and one warrant to purchase one share of common stock.  Each warrant will be exercisable at a price of C$0.65 for three years after the Company's common stock is listed on a recognized Canadian stock exchange, subject to adjustment in certain events | ||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.65 | ||||||||||||||||||||||||
Warrant, Term of Warrants | 3 years | 3 years | |||||||||||||||||||||||
Other Noncash Expense | $ 7,142,550 | ||||||||||||||||||||||||
Cashless Exercise of Warrants [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.75 | ||||||||||||||||||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities (in Shares) | shares | 129,412 | ||||||||||||||||||||||||
Class of Warrant or Rights, Exercised (in Shares) | shares | 350,000 | ||||||||||||||||||||||||
Private Placement, Westpark Offering [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.75 | ||||||||||||||||||||||||
Navy Green Capital Offering [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.60 | ||||||||||||||||||||||||
Warrant, Term of Warrants | 3 years | ||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares) | shares | 7,500,000 | ||||||||||||||||||||||||
Navy Green Capital and Ionic Venture Offering [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.60 | ||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares) | shares | 6,875,000 | ||||||||||||||||||||||||
YA II PN, Ltd [Member] | In Connection with Sale of Convertible Debt [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.60 | ||||||||||||||||||||||||
Warrant, Term of Warrants | 5 years | ||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares) | shares | 1,250,000 | ||||||||||||||||||||||||
Finance Fee [Member] | Special Warrants [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Rights, Granted (in Shares) | shares | 1,448,651 | 1,448,651 | |||||||||||||||||||||||
Class of Warrants or Rights, Value | $ 1,413,300 | ||||||||||||||||||||||||
Compensation Warrants [Member] | Special Warrants [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Class of Warrant or Rights, Granted (in Shares) | shares | 2,317,842 | 2,317,842 | |||||||||||||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 0.45 | ||||||||||||||||||||||||
Warrant, Term of Warrants | 36 months | ||||||||||||||||||||||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in Shares) | shares | 1 | ||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 1,495,373 | ||||||||||||||||||||||||
One Time Signing Bonus [Member] | Chief Executive Officer [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | |||||||||||||||||||||||
Allocated Share-based Compensation Expense | $ 59,167 | $ 59,167 | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | shares | 500,000 | 500,000 | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share) | $ / shares | $ 355,000 | $ 350,000 | |||||||||||||||||||||||
One Time Signing Bonus [Member] | Chief Operating Officer [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | |||||||||||||||||||||||
Allocated Share-based Compensation Expense | $ 5,917 | $ 327,500 | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | shares | 50,000 | 250,000 | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share) | $ / shares | $ 35,000 | ||||||||||||||||||||||||
Darling Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 565,000 | ||||||||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | shares | 1,808,000 | ||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 941,972 | ||||||||||||||||||||||||
Efrat Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 57,200 | ||||||||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | shares | 183,040 | ||||||||||||||||||||||||
Lamadrid Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 32,497 | ||||||||||||||||||||||||
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | shares | 103,989 | ||||||||||||||||||||||||
YA II PN, Ltd [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Convertible Debt with Conversion Feature | $ 362,500 | ||||||||||||||||||||||||
Newcan Convertible Note 8 [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Convertible Debt with Conversion Feature | 58,594 | ||||||||||||||||||||||||
Principal [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 2,537,750 | ||||||||||||||||||||||||
Principal [Member] | Darling Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 550,000 | ||||||||||||||||||||||||
Principal [Member] | Efrat Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 55,000 | ||||||||||||||||||||||||
Principal [Member] | Lamadrid Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 31,250 | ||||||||||||||||||||||||
Accrued Interest [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 166,490 | ||||||||||||||||||||||||
Accrued Interest [Member] | Darling Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 15,000 | ||||||||||||||||||||||||
Accrued Interest [Member] | Efrat Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | 2,200 | ||||||||||||||||||||||||
Accrued Interest [Member] | Lamadrid Note [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 1,247 | ||||||||||||||||||||||||
Accounting Standards Update 2017-11 [Member] | Reset Provisions Embedded in Convertible Notes [Member] | |||||||||||||||||||||||||
Note 13 - Stockholders' Equity (Details) [Line Items] | |||||||||||||||||||||||||
Adjustments to Additional Paid in Capital, Convertible Debt with Conversion Feature | $ 1,265,751 |
Note 13 - Stockholders' Equit_3
Note 13 - Stockholders' Equity (Details) - Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range - $ / shares | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2018 | May 31, 2018 | Jun. 27, 2018 | May 31, 2017 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 0.50 | |||
Number of warrants outstanding (in Shares) | 23,662,080 | 4,700,988 | ||
Weighted average remaining contractual life | 3 years 80 days | |||
Weighted average exercise price of outstanding warrants | $ 0.57 | $ 0.75 | ||
Number of warrants exercisable (in Shares) | 23,662,080 | |||
Weighted average exercise price of exercisable warrants | $ 0.57 | |||
Warrants Exercisable at $0.49 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 0.49 | |||
Number of warrants outstanding (in Shares) | 2,317,842 | |||
Weighted average remaining contractual life | 2 years 295 days | |||
Weighted average exercise price of outstanding warrants | $ 0.49 | |||
Number of warrants exercisable (in Shares) | 2,317,842 | |||
Weighted average exercise price of exercisable warrants | $ 0.49 | |||
Warrants Exercisable at $0.50 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 0.50 | |||
Number of warrants outstanding (in Shares) | 2,736,500 | |||
Weighted average remaining contractual life | 3 years 175 days | |||
Weighted average exercise price of outstanding warrants | $ 0.50 | |||
Number of warrants exercisable (in Shares) | 2,736,500 | |||
Weighted average exercise price of exercisable warrants | $ 0.50 | |||
Warrant Exercisable at $0.60 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 0.60 | |||
Number of warrants outstanding (in Shares) | 17,500,000 | |||
Weighted average remaining contractual life | 3 years 3 months | |||
Weighted average exercise price of outstanding warrants | $ 0.60 | |||
Number of warrants exercisable (in Shares) | 17,500,000 | |||
Weighted average exercise price of exercisable warrants | $ 0.60 | |||
Warrant Exercisable at $0.75 [Member] | ||||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||||
Exercise Price | $ 0.75 | |||
Number of warrants outstanding (in Shares) | 1,107,738 | |||
Weighted average remaining contractual life | 2 years 310 days | |||
Weighted average exercise price of outstanding warrants | $ 0.75 | |||
Number of warrants exercisable (in Shares) | 1,107,738 | |||
Weighted average exercise price of exercisable warrants | $ 0.75 |
Note 13 - Stockholders' Equit_4
Note 13 - Stockholders' Equity (Details) - Schedule of Stockholders' Equity Note, Warrants or Rights - $ / shares | 3 Months Ended | 12 Months Ended |
Aug. 31, 2018 | May 31, 2018 | |
Schedule of Stockholders' Equity Note, Warrants or Rights [Abstract] | ||
Warrants outstanding, Number of Shares | 4,700,988 | |
Warrants outstanding, Weighted Average Exercise Price | $ 0.57 | $ 0.75 |
Granted, Number of Shares | 19,311,092 | |
Granted, Weighted Average Exercise Price | $ 0.58 | |
Exercised, Number of Shares | (350,000) | |
Exercised, Weighted Average Exercise Price | $ 0.75 | |
Cancelled / Expired, Number of Shares | 0 | |
Cancelled / Expired, Weighted Average Exercise Price | $ 0 | |
Warrants outstanding, Number of Shares | 23,662,080 |
Note 14 - Fair Value of Finan_3
Note 14 - Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis - USD ($) | Aug. 31, 2018 | May 31, 2018 |
Note 14 - Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Derivative liabilities | $ 678,111 | $ 1,265,751 |
Fair Value, Inputs, Level 1 [Member] | ||
Note 14 - Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Derivative liabilities | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Note 14 - Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Derivative liabilities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Note 14 - Fair Value of Financial Instruments (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Derivative liabilities | $ 678,111 | $ 1,265,751 |
Note 14 - Fair Value of Finan_4
Note 14 - Fair Value of Financial Instruments (Details) - Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation | 3 Months Ended |
Aug. 31, 2018USD ($) | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract] | |
Balance | $ 1,265,751 |
Transfers out due to the adoption of ASU 2017-11 effective June 1, 2018 | (1,265,751) |
Balance | $ 0 |
Note 15 - Operating Segments (D
Note 15 - Operating Segments (Details) | 3 Months Ended |
Aug. 31, 2018 | |
Segment Reporting [Abstract] | |
Number of Operating Segments | 3 |
Number of Reportable Segments | 2 |
Note 15 - Operating Segments _2
Note 15 - Operating Segments (Details) - Schedule of Segment Reporting Information, by Segment - USD ($) | 3 Months Ended | ||||
Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2018 | |||
Segment Reporting Information [Line Items] | |||||
Sales | $ 1,179,353 | ||||
Net sales | 1,179,353 | $ 0 | |||
Net income (loss) | (16,656,940) | $ (565,685) | |||
Total assets | 35,197,970 | [1] | $ 2,105,272 | ||
Total liabilities | 6,312,182 | $ 2,733,052 | |||
Property additions | 3,553 | ||||
Depreciation and amortization | [2] | 48,461 | |||
Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 0 | ||||
Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 0 | ||||
Net sales | (58,814) | ||||
Net income (loss) | (16,456,918) | ||||
Total assets | [1] | 33,751,711 | |||
Total liabilities | 5,347,695 | ||||
Property additions | 0 | ||||
Depreciation and amortization | [2] | 25,411 | |||
Intersegment Eliminations [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | (58,814) | ||||
Cannabis Dispensary Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 776,707 | ||||
Net sales | 776,707 | ||||
Net income (loss) | (204,044) | ||||
Total assets | [1] | 1,084,414 | |||
Total liabilities | 698,867 | ||||
Property additions | 3,553 | ||||
Depreciation and amortization | [2] | 22,043 | |||
Cannabis Dispensary Segment [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 0 | ||||
Cannabis Production Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 402,646 | ||||
Net sales | 461,460 | ||||
Net income (loss) | 4,022 | ||||
Total assets | [1] | 361,845 | |||
Total liabilities | 265,620 | ||||
Property additions | 0 | ||||
Depreciation and amortization | [2] | 1,007 | |||
Cannabis Production Segment [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Sales | $ 58,814 | ||||
[1] | Total assets are the owned or allocated assets used by each business. Corporate assets consist of cash and cash equivalents, unallocated fixed assets of support divisions and common facilities, and certain other assets. | ||||
[2] | Corporate property additions and depreciation and amortization expense include items attributable to the unallocated fixed assets of support divisions and common facilities. |
Note 16 - Commitments and Con_2
Note 16 - Commitments and Contingencies (Details) | Jul. 31, 2018USD ($)shares | Jul. 27, 2018USD ($) | Jul. 01, 2018USD ($)shares | Apr. 06, 2018USD ($) | Jan. 05, 2018USD ($) | Nov. 30, 2017USD ($)shares | Oct. 09, 2017USD ($) | Aug. 23, 2017USD ($) | Jul. 20, 2016USD ($) | Mar. 31, 2016USD ($) | Aug. 01, 2015USD ($)shares | Oct. 01, 2014USD ($) | Aug. 31, 2018USD ($)shares | Aug. 31, 2017USD ($) | May 31, 2018USD ($) | Apr. 17, 2017ft² |
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Loss Contingency Accrual, Provision | $ 10,000 | |||||||||||||||
Debt Conversion, Original Debt, Amount | $ 0 | $ 62,500 | ||||||||||||||
Employee-related Liabilities, Current | 38,203 | 44,465 | ||||||||||||||
Allocated Share-based Compensation Expense | $ 4,375 | 120,138 | $ 0 | |||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Employment Agreement, Term | 5 years | |||||||||||||||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | $ 150,000 | $ 150,000 | ||||||||||||||
Deferred Compensation Arrangement with Individual, Description | performance bonus equal to 2% of the annual EBITDA of CLS Nevada, Inc., and annual restricted stock awards of the Company’s common stock in an amount equal to 3% of the annual EBITDA of CLS Nevada, Inc | performance bonus equal to 2% of CLS Labs’ annual EBITDA, up to a maximum annual cash compensation of $1 million (including his base salary), and annual stock options, exercisable at the fair market value of CLS Labs’ common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | annual stock options, exercisable at the fair market value of CLS Labs’ common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million | |||||||||||||||
Employee-related Liabilities, Current | 0 | 37,500 | ||||||||||||||
Accrued Salaries | $ 25,000 | 0 | ||||||||||||||
Chief Operating Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Employment Agreement, Term | 5 years | |||||||||||||||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | $ 150,000 | $ 150,000 | ||||||||||||||
Deferred Compensation Arrangement with Individual, Description | performance bonus equal to 2% of the annual EBITDA of CLS Nevada, Inc., and annual restricted stock awards of the Company’ common stock in an amount equal to 3% of the annual EBITDA | performance bonus equal to 2% of the Company’s annual EBITDA, up to a maximum annual cash compensation of $1 million (including his base salary), and annual stock options, exercisable at the fair market value of the Company’s common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | annual stock options, exercisable at the fair market value of the Company’s common stock on the date of grant, in an amount equal to 2% of its annual EBITDA up to $42.5 million and 4% of its annual EBITDA in excess of $42.5 million | |||||||||||||||
Employee-related Liabilities, Current | $ 37,500 | |||||||||||||||
President and Chief Financial Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Salary and Wage, Officer, Excluding Cost of Good and Service Sold | $ 175,000 | |||||||||||||||
Deferred Compensation Arrangement with Individual, Description | performance bonus equal to 2% of the Company’s annual EBITDA, and annual restricted stock awards of the Company’s common stock in an amount equal to 3% of its annual EBITDA | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | annual restricted stock awards of the Company’s common stock in an amount equal to 3% of its annual EBITDA | |||||||||||||||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures (in Shares) | shares | 600,000 | |||||||||||||||
Former Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Employee-related Liabilities, Current | $ 16,250 | 16,250 | ||||||||||||||
Building [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Area of Real Estate Property (in Square Feet) | ft² | 14,392 | |||||||||||||||
Lessee, Operating Lease, Term of Contract | 72 months | |||||||||||||||
Lessee, Operating Lease, Renewal Term | 10 years | |||||||||||||||
Deposit [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Loss Contingency Accrual, Provision | 50,000 | |||||||||||||||
Rent Expense [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Loss Contingency Accrual, Provision | 15,699 | |||||||||||||||
Remaining Amounts Due Under Lease [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Loss Contingency Accrual, Provision | 30,000 | |||||||||||||||
One Time Signing Bonus [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | shares | 500,000 | 500,000 | ||||||||||||||
Allocated Share-based Compensation Expense | $ 59,167 | $ 59,167 | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | ||||||||||||||
One Time Signing Bonus [Member] | Chief Operating Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | shares | 50,000 | 250,000 | ||||||||||||||
Allocated Share-based Compensation Expense | $ 5,917 | $ 327,500 | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | ||||||||||||||
One Time Signing Bonus [Member] | President and Chief Financial Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | shares | 500,000 | |||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | |||||||||||||||
Unpaid Accrued Salary Converted to Convertible Note [Member] | Convertible Debt [Member] | Chief Executive Officer [Member] | ||||||||||||||||
Note 16 - Commitments and Contingencies (Details) [Line Items] | ||||||||||||||||
Debt Conversion, Original Debt, Amount | $ 37,500 | $ 37,500 | $ 39,521 | $ 62,500 | $ 250,000 | $ 112,500 |
Note 17 - Related Party Trans_2
Note 17 - Related Party Transactions (Details) - USD ($) | Jul. 31, 2018 | Jul. 27, 2018 | Jul. 24, 2018 | Jul. 01, 2018 | Mar. 29, 2018 | Aug. 01, 2015 | Aug. 31, 2018 | Aug. 31, 2017 | May 31, 2018 | Nov. 30, 2017 |
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Employee-related Liabilities, Current | $ 38,203 | $ 44,465 | ||||||||
Due to Related Parties, Current | 17,930 | 17,930 | ||||||||
Imputed Interest, Debt | 271 | $ 271 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights | four months after issuance | |||||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 17,500 | |||||||||
Allocated Share-based Compensation Expense | $ 4,375 | 120,138 | $ 0 | |||||||
Chief Executive Officer [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Employee-related Liabilities, Current | 0 | 37,500 | ||||||||
Former Officer Prior to his October 1, 2017 Seperation [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Employee-related Liabilities, Current | 37,500 | 37,500 | ||||||||
Former Officer Prior to his September 1, 2015 Seperation [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Employee-related Liabilities, Current | 16,250 | 16,250 | ||||||||
Officers and Directors [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Due to Related Parties, Current | $ 17,930 | $ 17,930 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | |||||||||
Affiliated Entity [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Payments for Commissions | $ 250,000 | |||||||||
Affiliated Entity [Member] | For Introducing Us to Alternative Solutions [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross (in Shares) | 700,000 | |||||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 490,000,000,000 | |||||||||
Payments for Commissions | $ 250,000 | |||||||||
Chief Operating Officer [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Employee-related Liabilities, Current | $ 37,500 | |||||||||
One Time Signing Bonus [Member] | Chief Executive Officer [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Allocated Share-based Compensation Expense | $ 59,167 | $ 59,167 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | 500,000 | 500,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share) | $ 355,000 | $ 350,000 | ||||||||
One Time Signing Bonus [Member] | Chief Operating Officer [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Allocated Share-based Compensation Expense | $ 5,917 | $ 327,500 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares) | 50,000 | 250,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | 1 year | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share) | $ 35,000 | |||||||||
Notes Receivable [Member] | Affiliated Entity [Member] | ||||||||||
Note 17 - Related Party Transactions (Details) [Line Items] | ||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross (in Shares) | 25,000 |
Note 18 - Subsequent Events (De
Note 18 - Subsequent Events (Details) - $ / shares | Sep. 11, 2018 | Sep. 06, 2018 | Aug. 31, 2018 | Jun. 27, 2018 |
Note 18 - Subsequent Events (Details) [Line Items] | ||||
Class of Warrant or Rights, Exercised | 350,000 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share) | $ 0.50 | |||
Subsequent Event [Member] | ||||
Note 18 - Subsequent Events (Details) [Line Items] | ||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 13,684 | |||
Class of Warrant or Rights, Exercised | 40,000 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share) | $ 0.75 | |||
Stock Issued During Period, Shares, Issued for Services | 31,250 |