Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Feb. 28, 2022 | Jun. 13, 2022 | Aug. 31, 2021 | |
Document Information Line Items | |||
Entity Registrant Name | AURA SYSTEMS INC | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --02-28 | ||
Entity Common Stock, Shares Outstanding | 84,272,770 | ||
Entity Public Float | $ 29,061,265 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0000826253 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Document Period End Date | Feb. 28, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 0-17249 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 95-4106894 | ||
Entity Address, Address Line One | 20431 North Sea | ||
Entity Address, City or Town | Lake Forest | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92630 | ||
City Area Code | (310) | ||
Local Phone Number | 643-5300 | ||
Entity Interactive Data Current | No | ||
Auditor Firm ID | 572 | ||
Auditor Name | Weinberg & Company, P.A. | ||
Auditor Location | Los Angeles, California |
Balance Sheets
Balance Sheets - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Current assets | ||
Cash and cash equivalents | $ 150,217 | $ 390,702 |
Inventories | 144,257 | 94,166 |
Prepaid and other current assets | 255,453 | 115,203 |
Total current assets | 549,927 | 600,071 |
Property and equipment, net | 484,526 | 14,870 |
Operating lease right-of-use asset | 1,000,467 | 1,168,053 |
Security deposit | 159,595 | 159,595 |
Total assets | 2,194,515 | 1,942,589 |
Current liabilities | ||
Accounts payable (including $208,507 and $590,501 due to related party, respectively) | 1,581,724 | 1,880,172 |
Accrued expenses (including $187,411 and $178,536 due to related party, respectively) | 1,692,173 | 1,291,775 |
Customer advances | 440,331 | 440,331 |
Notes payable, current portion | 97,958 | 198,331 |
Convertible notes payable, current portion | 1,402,971 | |
Convertible note payable-related party, current portion | 3,000,000 | |
Notes payable-related parties, –in default | 12,996,069 | 12,165,015 |
Operating lease liability, current portion | 179,450 | 110,587 |
Derivative warrant liability | 828,232 | 1,366,375 |
Total current liabilities | 22,218,908 | 17,452,586 |
Notes payable | 327,658 | 156,255 |
Operating lease liability | 867,484 | 1,046,902 |
Convertible notes payable | 1,402,971 | |
Convertible note payable-related party | 3,000,000 | |
Total liabilities | 23,414,050 | 23,058,714 |
Commitments and contingencies | ||
Shareholders’ deficit | ||
Common stock: $0.0001 par value; 150,000,000 shares authorized; 83,119,104 and 71,103,009 issued and outstanding at February 28, 2022 and February 28, 2021, respectively. | 8,312 | 7,109 |
Additional paid-in capital | 450,136,522 | 446,249,272 |
Accumulated deficit | (471,364,369) | (467,372,506) |
Total shareholders’ deficit | (21,219,535) | (21,116,125) |
Total liabilities and shareholders’ deficit | $ 2,194,515 | $ 1,942,589 |
Balance Sheets (Parentheticals)
Balance Sheets (Parentheticals) - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Statement of Financial Position [Abstract] | ||
Accounts payable due to related party (in Dollars) | $ 208,507 | $ 590,501 |
Accrued expenses due to related party (in Dollars) | $ 187,411 | $ 178,536 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 83,119,104 | 71,103,009 |
Common stock, shares outstanding | 83,119,104 | 71,103,009 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Income Statement [Abstract] | ||
Net revenue | $ 100,406 | $ 114,923 |
Cost of goods sold | 124,360 | 81,449 |
Gross profit (loss) | (23,954) | 33,474 |
Operating expenses: | ||
Engineering, research and development | 610,728 | 237,450 |
Selling, general and administration (including $137,500 and $131,300 to related party, respectively) | 2,795,133 | 1,577,238 |
Total operating expenses | 3,405,861 | 1,814,688 |
Loss from operations | (3,429,816) | (1,781,214) |
Other income (expense): | ||
Interest expense, net | (1,271,586) | (1,279,949) |
Gain on extinguishment of debt | 3,447,039 | |
Gain on extinguishment of PPP loans | 167,104 | |
Gain on extinguishment of derivative warrant liability, net | 61,540 | 13,611 |
Gain on debt settlement | 4,292 | 71,775 |
Change in fair value of derivative warrant liability | 476,602 | (432,714) |
Other income | 7,000 | |
Income (loss) before tax provision | (3,991,863) | 45,548 |
Income tax provision | 800 | |
Net income (loss) | $ (3,991,863) | $ 44,748 |
Basic income (loss) per share (in Dollars per share) | $ (0.05) | $ 0 |
Diluted income (loss) per share (in Dollars per share) | $ (0.05) | $ 0 |
Basic weighted-average shares outstanding (in Shares) | 76,805,616 | 61,768,215 |
Diluted weighted-average shares outstanding (in Shares) | 76,805,616 | 65,203,634 |
Statements of Operations (Paren
Statements of Operations (Parentheticals) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Income Statement [Abstract] | ||
Selling, general and administration related party | $ 137,500 | $ 131,300 |
Statements of Shareholders_ Def
Statements of Shareholders’ Deficit - USD ($) | Common Stock Amount | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at Feb. 29, 2020 | $ 5,658 | $ 443,548,428 | $ (467,417,254) | $ (23,863,168) |
Balance (in Shares) at Feb. 29, 2020 | 56,589,046 | |||
Common shares issued for cash | $ 1,410 | 2,144,590 | 2,146,000 | |
Common shares issued for cash (in Shares) | 14,098,327 | |||
Common shares issued for settlement of debt-related party | $ 41 | 103,868 | 103,909 | |
Common shares issued for settlement of debt-related party (in Shares) | 415,636 | |||
Share-based compensation | 452,386 | 452,386 | ||
Net income(loss) | 44,748 | 44,748 | ||
Balance at Feb. 28, 2021 | $ 7,109 | 446,249,272 | (467,372,506) | (21,116,125) |
Balance (in Shares) at Feb. 28, 2021 | 71,103,009 | |||
Common shares issued for cash | $ 1,021 | 2,651,839 | 2,652,860 | |
Common shares issued for cash (in Shares) | 10,199,665 | |||
Common shares issued for settlement of debt-related parties | $ 157 | 549,843 | 550,000 | |
Common shares issued for settlement of debt-related parties (in Shares) | 1,571,429 | |||
Common shares issued for settlement of debt-related party | $ 25 | 73,475 | 73,500 | |
Common shares issued for settlement of debt-related party (in Shares) | 245,001 | |||
Share-based compensation | 612,093 | 612,093 | ||
Net income(loss) | (3,991,863) | (3,991,863) | ||
Balance at Feb. 28, 2022 | $ 8,312 | $ 450,136,522 | $ (471,364,369) | $ (21,219,535) |
Balance (in Shares) at Feb. 28, 2022 | 83,119,104 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Statement of Cash Flows [Abstract] | ||
Net income (loss) | $ (3,991,863) | $ 44,748 |
Adjustments to reconcile net loss to cash used in operating activities | ||
Depreciation | 14,765 | 743 |
Inventory write-down | 36,000 | |
Gain on extinguishment of debt | (3,447,039) | |
Gain on extinguishment of PPP loans | (167,104) | |
Gain on extinguishment of derivative warrant liability, net | (61,540) | (13,611) |
Change in fair value of derivative warrant liability | (476,602) | 432,714 |
Gain on debt settlement | (4,292) | (71,775) |
Common stock issued for services | 73,500 | |
Share-based compensation | 612,093 | 452,386 |
Changes in operating assets and liabilities: | ||
Inventory | (86,091) | (4,129) |
Prepaid and other current assets | (90,251) | (113,716) |
Deposit | (159,595) | |
Operating lease right-of-use asset | 167,586 | 7,220 |
Accounts payable and accrued expenses | 387,695 | (85,468) |
Accrued interest on notes payable | 1,055,885 | 1,086,510 |
Operating lease liability | (110,555) | (17,784) |
Cash used in operating activities | (2,640,774) | (1,888,796) |
Cash used in investing activities: | ||
Purchase of property and equipment | (196,421) | (15,614) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | 2,652,860 | 2,146,000 |
Principal payments of notes payable | (147,385) | (95,000) |
Proceeds from government assistance loans – PPP and EID loans | 91,235 | 224,305 |
Cash provided by financing activities | 2,596,710 | 2,275,305 |
Net increase (decrease) in cash and cash equivalents | (240,485) | 370,895 |
Cash and cash equivalents-beginning of year | 390,702 | 19,807 |
Cash and cash equivalents-end of year | 150,217 | 390,702 |
Cash paid for: | ||
Interest | 85,295 | 4,428 |
Income taxes | ||
Supplemental schedule of non-cash transactions: | ||
Recognition of operating lease right of use asset and operating lease liability | 1,175,273 | |
Accounts payable converted into shares of common stock | 450,000 | 103,909 |
Accrued expenses converted into shares of common stock | 100,000 | |
Acquisition of property and equipment with notes payable | $ 288,000 |
Organization and Operations
Organization and Operations | 12 Months Ended |
Feb. 28, 2022 | |
Accounting Policies [Abstract] | |
ORGANIZATION AND OPERATIONS | NOTE 1 – ORGANIZATION AND OPERATIONS Aura Systems, Inc., (“Aura”, “We” or the “Company”) a Delaware corporation, was founded to engage in the development, commercialization, and sale of products, systems, and components, using its patented and proprietary electromagnetic technology. Aura develops and sells AuraGen ® Going Concern The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. During the fiscal year ended February 28, 2022, the Company incurred a net loss of approximately $4.0 million and had negative cash flows from operating activities of approximately $2.6 million and at February 28, 2022, had a stockholders deficit of approximately $21.2 million and a working capital deficit of approximately $21.7 million. Also, at February 28, 2022, the Company is in default on notes payable in the aggregate amount of approximately $13.0 million. These factors raise substantial doubts about the Company’s ability to continue as a going concern within one year of the date that these financial statements are issued. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. At February 28, 2022, the Company had cash on hand in the amount of $150,000. Subsequent to February 28, 2022, the Company issued 1,153,666 shares of common stock in exchange for cash proceeds of $346,100. In addition, subsequent to February 28, 2022, the Company reached an agreement with a related party note holder to resolve all litigation between them related to notes payable and accrued interest of $12.1 million (see Note 19). Management estimates that the current funds on hand will be sufficient to continue operations through the next four months. The Company’s ability to continue as a going concern is dependent upon its ability to continue to implement its business plan. During the next twelve months we intend to continue to attempt to increase the Company’s sale of our AuraGen ® COVID-19 As of the date of this filing, there continues to be widespread concern regarding the ongoing impacts and disruptions caused by the COVID-19 pandemic in the regions in which the Company operates. Although the impacts of the COVID-19 pandemic have not been material to date, a prolonged downturn in economic conditions could have a material adverse effect on our customers and demand for our services. The Company has not observed any impairments of its assets or a significant change in the fair value of its assets due to the COVID-19 pandemic. At this time, it is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations, financial condition, or liquidity. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 28, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. Significant estimates include assumptions made for inventory reserve, impairment testing of long-lived assets, the valuation allowance for deferred tax assets, assumptions used in valuing derivative liabilities, assumptions used in valuing share-based compensation, and accruals for potential liabilities. Amounts could materially change in the future. Revenue Recognition The Company recognizes revenue in accordance with Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. To determine revenue recognition under ASC 606, an entity performs the following five-steps (i) identifies the contract(s) with a customer; (ii) identifies the performance obligations in the contract; (iii) determines the transaction price; (iv) allocates the transaction price to the performance obligations in the contract; and (v) recognizes revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-steps to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Our primary source of revenue is the manufacture and delivery of generator sets used primarily in mobile power applications, which represented nearly 100% of our revenues of approximately $100,000 and $115,000 for the fiscal years ended February 28, 2022 and February 28, 2021, respectively. Our principal sales channel is sales to a domestic distributor. In accordance with ASC 606, we recognize revenue, net of discounts, for our generator sets at time of product delivery to the domestic distributor (i.e. point-in-time), which also corresponds to the passage of legal title to the customer and the satisfaction of our performance obligations to the customer. Our payment terms are cash payment due upon delivery and typically includes a 2% price discount off the selling price in accordance with this policy. Our commercial terms and conditions do not include a right of return for reasons other than a defect in performance or quality. We offer a 24 month assurance-type warranty covering material and manufacturing defects, which we account for under the guidance of ASC 460, Guarantees. Cost of Goods Sold Cost of goods sold primarily consists of the salaries of certain employees and contractors, purchase price of consumer products, packaging supplies, inventory reserve and customer shipping and handling expenses. Shipping costs to receive products from our suppliers are included in our inventory and recognized as cost of revenue upon sale of products to our customers. Cash and Cash Equivalents Cash and equivalents include cash on hand and cash in time deposits, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less. Inventories Inventories are valued at the lower of cost (first-in, first-out) or net realizable value, on an average cost basis. We review the components of inventory on a regular basis for excess or obsolete inventory based on estimated future usage and sales. When evidence exists that the net realizable value of inventory is lower than its cost, the difference is recognized as a loss in the period in which it occurs. Once inventory has been written down, it creates a new cost basis for inventory that may not be subsequently written up. During the year ended February 28, 2022, the Company wrote-down inventories of $36,000. During the year ended February 28, 2021, there were no inventory write downs recorded. Property and Equipment Property and equipment are recorded at historical cost and depreciated on a straight-line basis over their estimated useful lives of approximately three years up to ten years once the individual assets are placed in service. Leasehold improvements are amortized over the shorter of the useful life or the remaining period of the applicable lease term. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows e xpected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value at that time. At February 28, 2022 and 2021, management determined there were no impairments of the Company’s property and equipment. Impairment of Long-lived Assets The Company reviews its property and equipment, right-of-use asset, and other long-lived assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended February 28, 2022 and 2021, the Company had no impairment of long-lived assets. Leases The Company determines whether a contract is, or contains, a lease at inception. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at lease commencement in determining the present value of unpaid lease payments. Customer Advances Customer advances represent consideration received from customers under revenue contracts for which the Company has not yet delivered to the customer. Concentration of Credit and Other Risks Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and accounts receivable. Cash is deposited with a limited number of financial institutions. The balances held at any one financial institution at times may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits of up to $250,000. We have not experienced any losses in such accounts and believe we are not exposed to any significant risk on cash and cash equivalents. During the year ended February 28, 2022, one customer accounted for 18% of revenues. During the year ended February 28, 2021, one customers accounted for 83% of revenues. As of February 28, 2022, three vendors accounted for 44%, 13% and 15% of accounts payable. As of February 28, 2021, three vendors accounted for 34%, 31% and 13% of accounts payable. Research and Development The Company engages in research and development to stay current with changes in vehicle manufacture and design and to maintain an advantage over potential competition. Research and development expenses relate primarily to the development, design, testing of preproduction prototypes and models and are expensed as incurred. Research and development costs for Fiscal 2022 and 2021 was approximately $600,000 and $200,000, respectively. Share-Based Compensation The Company periodically issues stock options and warrants, and shares of common stock to employees and non-employees in non-capital raising transactions for services and for financing costs. Share-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. Recognition of compensation expense for non-employees is in the same period and manner as if the Company had paid cash for services. Income Taxes The Company uses an asset and liability approach for accounting and reporting for income taxes that allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. Derivative Warrant Liability The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. The Company uses Level 2 inputs for its valuation methodology for the derivative liabilities as their fair values were determined by using a Binomial pricing model. The Company’s derivative liabilities are adjusted to reflect fair value at each reporting date, with any increase or decrease in the fair value being recorded in the statement of operations. Fair Value of Financial Instruments The Company determines the fair values of its financial instruments based on a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. Under ASC 820, Fair Value Measurement and Disclosures ● Level 1 – Quoted prices (unadjusted) for identical assets and liabilities in active markets; ● Level 2 – Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly; and ● Level 3 – Unobservable inputs. The recorded amounts of inventory, other current assets, accounts payable, and accrued expenses approximate their fair value due to their short-term nature. The carrying amounts of notes payable and convertible notes payable approximate their respective fair values because of their current interest rates payable in relation to current market conditions. The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities at fair value as of February 28, 2022 and 2021: February 28, 2022 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 828,232 $ - $ 828,232 Total liabilities $ - $ 828,232 $ - $ 828,232 February 28, 2021 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 1,366,375 $ - $ 1,366,375 Total liabilities $ - $ 1,366,375 $ - $ 1,366,375 The Company estimated the fair value of the derivative warrant liability using the Binomial Model (see Note 14). E arnings (loss) per share The Company’s earnings (loss) per share amounts have been computed based on the weighted-average number of shares of common stock outstanding for the period. Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of shares of common stock assuming all potential shares had been issued, and the additional shares of common stock were dilutive. Diluted earnings (loss) per share reflects the potential dilution, using the as-if-converted method for convertible debt, and the treasury stock method for options and warrants, which could occur if all potentially dilutive securities were exercised The following information sets forth the computation of basic and diluted net increase in the Company's net assets per share resulting from operations for the years ended February 28, 2022 and 2021: Year Ended February 28, 2022 2021 Numerator Net income (loss) $ (3,991,863 ) $ 44,748 Adjustment for interest expense on convertible notes - 220,179 Adjusted net income (loss) $ (3,991,863 ) $ 264,927 Denominator Denominator for basic weighted average share 76,805,616 61,768,215 Adjustment for dilutive effect of convertible notes - 3,435,419 Denominator for diluted weighted average share 76,805,616 65,203,634 Earnings (loss) per share Basic earnings (loss) per share: $ (0.05 ) $ 0.00 Diluted earnings (loss) per share $ (0.05 ) $ 0.00 For the years ended February 28, 2022, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: February 28, February 28, Warrants 4,800,834 5,662,272 Options 5,059,769 3,040,002 Convertible notes 3,749,961 - Total 13,610,564 8,702,274 Reclassifications Certain prior period amounts have been reclassified to conform to the current year presentation. These reclassifications have no effect on the previously reported financial position, results of operations and cash flows (see Note 3). Segments The Company operates in one segment for the manufacture and delivery of generator sets. In accordance with the “ Segment Reporting Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Credit Losses – Measurement of Credit Losses on Financial Instruments (“ASC 326”). The standard significantly changes how entities will measure credit losses for most financial assets, including accounts and notes receivables. The standard will replace today’s “incurred loss” approach with an “expected loss” model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. As a small business filer, the standard will be effective for the Company for interim and annual reporting periods beginning after March 1, 2023. Management is currently assessing the impact of adopting this standard on the Company’s financial statements and related disclosures. In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (the “SEC”) did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Restatement of Previously Issue
Restatement of Previously Issued Financial Statements | 12 Months Ended |
Feb. 28, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | NOTE 3 – RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS The financial statements for the year ended February 28, 2021 and certain balances as of February 29, 2020 have been restated. On May 31, 2022, our management determined the following: ● that the Company erroneously did not recognize a derivative warrant liability associated with warrants issued in prior years that included a fundamental transaction provision that could give rise to an obligation to pay cash to the warrant holder. As such, the Company determined that the warrants fundamental transaction provision created a derivative liability pursuant to current accounting guidelines. ● that the Company had issued common stock in exchange for a settlement of debt to a former employee during fiscal 2018 and had erroneously not accounted for it until fiscal 2021. ● that the Company had granted stock options during fiscal 2021 which were erroneously not recorded. The effects on the previously issued financial statements are as follows: (A) In fiscal 2022, the Company recognized that previously issued warrants had characteristics of derivative liabilities. The Company determined the fair value of the warrant derivative liability as of February 29, 2020, was $947,271, and recorded the liability and its associated expense as a prior period adjustment to Accumulated Deficit in the amount of $947,271. Additionally, the warrant derivative liability was revalued at February 28, 2021 and the net increase in fair value of $419,103 was recorded as additional liability. The associated other net expense of $432,714 for the increase in fair value, partially offset by the gain on expiring warrants of $13,611, was recorded to the statement of operations. (B) In fiscal 2022, the Company recognized that during fiscal 2021, the Company recorded the effect of issuing common stock for debt to a former employee when the issuance had occurred in fiscal 2018. To correct the timing of recording the transaction, the Company calculated the gain on the extinguishment of debt as of the February 28, 2018, issuance date in the amount of $256,044 and recorded the gain as a prior period adjustment to Accumulated Deficit. Additionally, the interest expense associated with the debt of $13,460 and gain on its extinguishment of $133,500 recorded in fiscal 2021 were reversed out of the statement of operations. € In fiscal 2022, the Company recognized that certain stock options granted during fiscal 2021 should have been fully or partially vested in the year of grant but had no share-based compensation expense recorded in fiscal 2021. To correct the timing of the expense recognition, the Company computed the amount of expense associated with the vesting as of February 28, 2021, and recorded an additional $258,636 of stock-based compensation expense to the statement of operations and is included in selling, general and administrative expenses. Reclassifications (1) In fiscal 2021, the Company presented interest accrued of $3,668 on its Economic Injury Disaster Loan as additional note payable principle. In the accompanying fiscal 2022 financial statements, the Company has reclassified the accrued interest of $3,668 recorded in fiscal 2021 from notes payable to accrued interest. (2) In fiscal 2021, the Company presented $2,713,652 of extinguishment of accrued wages and accounts payable as Other Income. In the accompanying fiscal 2022 financial statements, the $2,713,652 has been reclassified to gain on extinguishment of debt. The following table presents the effect of the restatements and reclassifications on the Company’s previously issued balance sheet: As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Accrued expenses (including accrued interest) $ 1,288,107 $ - $ 3,668 $ 1,291,775 [1] Note payable 159,922 - (3,668 ) 156,255 [1] Derivative warrant liability - 1,366,375 - 1,366,375 [A] Additional paid-in capital 446,126,640 (136,004 ) - 446,249,272 [B] 258,636 - [C] Accumulated deficit $ (465,883,499 ) $ (1,366,375 ) $ - $ (467,372,506 ) [A] 136,004 - [B] (258,636 ) - [C] The following table presents the effect of the restatements and reclassifications on the Company’s previously issued statement of operations: As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Selling, general and administrative expense $ 1,318,602 $ 258,636 $ - $ 1,577,238 [C] Interest expense 1,293,409 (13,460 ) - 1,279,949 [B] Gain on extinguishment of debt 866,887 (133,500 ) 2,713,652 3,447,039 [2] Gain on extinguishment of derivative warrant liability - 13,611 - 13,611 [A] Change in fair value of derivative warrant liability - (432,714 ) - (432,714 ) [A] Other income 2,720,652 - (2,713,652 ) 7,000 [2] Net income $ 842,528 $ (797,780 ) $ - $ 44,748 Net income per share, basic and diluted $ 0.01 $ 0.00 The following table presents the effect of the restatements on the Company’s previously issued statement of shareholder deficit: Common Stock Common Additional Accumulated Total Balance, February 29, 2020, as previously reported 56,400,874 $ 5,639 $ 443,417,452 $ (466,726,027 ) $ (23,302,937 ) Prior period revisions 192,641 19 130,977 (691,227 ) (560,231 ) Corrections of errors (4,469 ) - Balance, February 29, 2020, as restated 56,589,046 $ 5,658 $ 443,548,428 $ (467,417,254 ) $ (23,863,168 ) Balance, February 28, 2021, as previously reported 71,107,442 $ 7,109 $ 446,126,640 $ (465,883,499 ) $ (19,749,750 ) Prior period revisions - - 122,632 (1,489,007 ) (1,366,375 ) Corrections of errors (4,433 ) - Balance, February 28, 2021, as restated 71,103,009 $ 7,109 $ 446,249,272 $ (467,372,506 ) $ (21,116,125 ) The following table presents the effect of the restatements and reclassifications on the Company’s previously issued statement of cash flows: As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Cash flows from operating activities: Net income $ 842,528 $ (797,780 ) $ - $ 44,748 [A] [B] [C] Gain on extinguishment of liabilities (3,585,639 ) 133,500 5,100 (3,447,039 ) [B] Gain on debt settlement (71,775 ) (71,775 ) Gain on extinguishment of derivative warrant liability - (13,611 ) - (13,611 ) [A] Change in fair value of derivative warrant liability - 432,714 - 432,714 [A] Share-based compensation expense 193,750 258,636 - 452,386 [C] Changes in working capital assets and liabilities: Operating lease right-to-use asset - - 7,220 7,220 Accounts payable and accrued expenses 99,839 - (185,308 ) (85,469 ) [1] Accrued interest on notes payable 847,987 (13,460 ) 251,983 1,086,510 [B] [1] Operating lease liability (10,564 ) - (7,220 ) (17,784 ) Supplemental schedule of non-cash transactions: Notes payable converted into shares of common stock $ 267,000 $ (267,000 ) $ - $ - [B] |
Inventories
Inventories | 12 Months Ended |
Feb. 28, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4 – INVENTORIES Inventories consisted of the following: February 28, February 28, Raw materials $ 129,836 $ 91,739 Work-in-process 14,421 - Finished goods - 2,427 Total inventory $ 144,257 $ 94,166 |
Prepaid and Other Current Asset
Prepaid and Other Current Assets | 12 Months Ended |
Feb. 28, 2022 | |
Other Current Assets [Abstract] | |
PREPAID AND OTHER CURRENT ASSETS | NOTE 5 – PREPAID AND OTHER CURRENT ASSETS Prepaid and other current assets consisted of the following: February 28, February 28, Prepaid annual software licenses $ 94,907 $ - Prepaid commissions 73,390 63,500 Vendor advances 35,500 37,400 Other prepaid expenses 51,656 14,303 Total other current assets $ 255,453 $ 115,203 Equity method investment (written off in fiscal 2020) In March 2017, the Company entered into a joint venture (“Jiangsu Shengf”ng") with a Chinese company to build and distribute AuraGen® products in China. The Chinese partner owns 51% of Jiangsu Shengfeng and contributed facilities and equipment of approximately $9.75 million, and approximately $500,000 of working capital. The Company owns 49% of Jiangsu Shengfeng and contributed $250,000 of working capital as well as a limited license. In September, 2018, Jiangsu Shengfeng placed a $1,000,000 order with the Company which included an advance payment of $700,000. The Company failed to deliver products in accordance with the order received. In November 2019, the Company issued a note payable for the $700,000 due to Jiangsu Shengfeng (see Note 10) as part of an agreement for the repayment of the advance subject to Jiangsu Shengf’ng's continuance of operations. However, starting in January 2020, Jiangsu Shengfeng’s operations were shut down by governmental authorities due to the COVID-19 virus, and as of the date of this filing, its operations have not restarted. As of February 28, 2020, the Company wrote off its equity interest in Jiangsu Shengfeng. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Feb. 28, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE–6 - PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following: February 28, 2022 2021 Leasehold improvements $ 56,530 $ - Machinery and equipment 276,762 15,613 Vehicle 96,334 - Computer equipment 59,816 - Furniture and fixtures 10,592 - 500,034 15,613 Less accumulated depreciation and amortization (15,508 ) (743 ) $ 484,526 $ 14,870 Depreciation expense for the years ended February 28, 2022 and 2021 was $14,765 and $743, respectively: |
Convertible Notes Payable
Convertible Notes Payable | 12 Months Ended |
Feb. 28, 2022 | |
Convertible Notes Payable [Abstract] | |
CONVERTIBLE NOTES PAYABLE | NOTE 7 – CONVERTIBLE NOTES PAYABLE Convertible notes payable consisted of the following: February 28, 2022 February 28, 2021 Convertible notes payable $ 1,402,971 $ 1,402,971 Non-current - (1,402,971 ) Current $ 1,402,971 $ - In Fiscal 2013 and 2014, the Company issued six convertible notes payable in the aggregate of $4,000,000. As of February 28, 2022 and 2021, the outstanding balance of the convertible notes payable amounted to $1,402,971. The notes are unsecured, bear interest at 5% per annum and are convertible to shares of common stock at a conversion price of $1.40 per share, as adjusted. The notes were originally due in 2014 to 2017, and were all amended in 2018 and the maturity date for all the notes was changed to January 11, 2023. At February 28, 2022 and 2021, accrued interest on convertible notes payable totaled $284,063 and $213,884, respectively, and is included in accrued expenses (See Note 11). |
Convertible Note Payable-Relate
Convertible Note Payable-Related Party | 12 Months Ended |
Feb. 28, 2022 | |
Convertible Note Payable Related Party [Abstract] | |
CONVERTIBLE NOTE PAYABLE-RELATED PARTY | NOTE 8 – CONVERTIBLE NOTE PAYABLE-RELATED PARTY Convertible note payable – related party consisted of the following: February 28, 2022 February 28, 2021 Convertible note payable $ 3,000,000 $ 3,000,000 Non-current - (3,000,000 ) Current $ 3,000,000 $ - On January 24, 2017, the Company entered into a debt refinancing agreement with a former director and current shareholder of the Company. As part of the agreement, the Company issued a $3,000,000 convertible note. The convertible note is unsecured, bears interest at 5% per annum, is due February 2, 2023, and is convertible into shares of common stock at a conversion price of $1.40 per share, as adjusted. At February 28, 2022 and 2021, accrued interest on convertible notes payable-related party totaled $562,911 and $412,911, respectively, and is included in accrued expenses (See Note 11). |
Notes Payable
Notes Payable | 12 Months Ended |
Feb. 28, 2022 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | NOTE 9 – NOTES PAYABLE Notes payable consisted of the following: February 28, 2022 February 28, 2021 Secured notes payable (a) Note payable-EID loan $ 150,000 $ 150,000 (b) Notes payable-vehicles and equipment 265,616 - Unsecured notes payable (c) Notes payable-PPP loans - 74,405 (d) Note payable-Abdou - 120,181 (e) Note payable-other-in default 10,000 10,000 Total $ 425,616 $ 354,586 Non-current 327,658 156,255 (a) Economic Injury Disaster (EID) Loan Entities negatively impacted by the COVID-19 pandemic were eligible to apply for loans sponsored by the United States Small Business Administration (“SBA”) Economic Injury Disaster Loan (“EID Loan”) program. On July 1, 2020, the Company received a $150,000 loan under this program. The proceeds can be used to fund payroll, healthcare benefits, rent and other qualifying expenses, and the loan is not subject to a loan forgiveness provision. The loan is due July 1, 2050, interest accrues at 3.75% per annum, and is secured by the assets of the Company (b) Notes payable-vehicle and equipment During fiscal 2022, the Company purchased two pieces of equipment and a vehicle for $329,297 as a part of its efforts to expand its operations and research and development capacities. The Company made down payments aggregating $41,300 with the balance financed by two notes payable aggregating $287,997. The notes are secured by the equipment and vehicle purchased. One note is due in 36 equal monthly payments of approximately $6,100 each, including interest at 2.9% per annum. The second note is due in 72 equal monthly payments of approximately $1,500 each, including interest at 10.9% interest per annum. As of February 28, 2022, the balance of the notes was $265,616. (c) Paycheck Protection Plan (PPP) Loans On April 23, 2020, the Company was granted a Paycheck Protection Program (“PPP”) loan in the amount of $74,405 pursuant to the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The PPP matures on April 23, 2022, bears interest at a rate of 1% per annum, with the first six months of interest deferred, and is unsecured and guaranteed by the SBA. The Company applied ASC 470, Debt, to account for the PPP loan. Funds from the PPP loan may only be used for qualifying expenses, including qualifying payroll costs, qualifying group health care benefits, qualifying rent and debt obligations, and qualifying utilities. The Company used the loan amount for qualifying expenses. Under the terms of the PPP, certain amounts of the loan may be forgiven if they are used for qualifying expenses. The Company applied for the forgiveness of the PPP Loan, and in April 2021 the Company was notified that the PPP loan, including accrued interest, was being forgiven under the terms of the PPP program. As a result, the Company recorded other income of approximately $75,100, representing the forgiven principal and interest. In March 2021, the Company applied for and received a second PPP loan (“PPP-2”) in the amount of approximately $91,200 pursuant to CARES Act, as amended to allow a second loan. The terms of the PPP-2 loan were essentially the same as under the original PPP loan. The Company applied for the forgiveness of the PPP-2 loan, and in January 2022 we were notified that the PPP-2 loan, including accrued interest, was being forgiven under the terms of the PPP program. As a result, the Company recorded other income of approximately $92,000, representing the forgiven principal and interest. Total gain on extinguishment of debt recorded for the PPP and PPP-2 loans is $167,104 (d) Abdou On June 20, 2013, the Company issued convertible notes payable to two individuals in the aggregate of $125,000. The notes were due June 20, 2014. The loans were not paid when due, and in September 2019, the note holders and the Company reached a settlement for past due principal, accrued interest, and fees of approximately $325,000. As of February 28, 2020, the outstanding balance of the settlement note was $215,181. During the year ended February 28, 2021, the Company paid $95,000 of the note, and as of February 28, 2021, the outstanding balance was $120,181. During the year ended February 28, 2022, the Company paid the remaining balance of $120,181. (e) Other notes payable Demand promissory notes as of February 28, 2022 and February 28, 2021 are for one individual issued in September 2015 that is payable on demand with an interest rate of 10% per annum. During the year ended February 28, 2021, an aggregate of $743,386, consisting of $491,537 of demand notes principal and $251,849 of accrued interest, was extinguished as the related statute of limitations were determined to have expired (see Note 12). At February 28, 2022 and 2021, accrued interest on notes payable totaled $36,541 and $28,822, respectively, and is included in accrued expenses (See Note 11). |
Notes Payable-Related Parties-I
Notes Payable-Related Parties-In Default | 12 Months Ended |
Feb. 28, 2022 | |
Notes Payable Related Parties [Abstract] | |
NOTES PAYABLE-RELATED PARTIES-IN DEFAULT | NOTE 10 – NOTES PAYABLE-RELATED PARTIES-IN DEFAULT Notes payable-related parties consisted of the following: February 28, February 28, Unsecured notes payable (a) Notes payable-Koppel-in default $ 5,607,323 $ 5,607,323 Accrued interest-Koppel-in default 6,533,318 5,710,464 Subtotal-Koppel-in default 12,140,641 11,317,787 (b) Note payable- Gagerman-in default 82,000 82,000 Accrued interest-Gagerman-in default 73,428 65,228 Subtotal-Gagerman-in default 155,428 147,228 (c) Note payable-Jiangsu Shengfeng-in default 700,000 700,000 Total $ 12,996,069 $ 12,165,015 Non-current - - Current $ 12,996,069 $ 12,165,015 (a) Kopple Notes In fiscals 2013 through 2018, the Company issued notes payable to Robert Kopple and associated entities (collectively “Kopple”) in the aggregate of $6,107,323. Robert Kopple was the former Vice-Chairman of the Company’s Board of Directors and is a current shareholder in the Company. The notes are unsecured, bear interest at rates ranging from 5% and 15% per annum, and were due in fiscal 2014 through fiscal 2018. At February 28, 2022 and 2021, the accrued interest due to Kopple totaled $6,533,318 and $5,710,464, respectively. Due to its significance, the balance of accrued interest is added to the note payable principal for presentation on the accompanying balance sheets. As of February 28, 2022 and 2021, the outstanding balance of the Kopple notes payable and accrued interest amounted to $12,140,641 and $11,317,787, respectively. Kopple brought suit against the Company beginning in 2017 for repayment of the notes. On March 14, 2022, the Company reached an agreement with Kopple to resolve all remaining litigation between them. Under the terms of the settlement, the Company agreed to pay Kopple an aggregate amount of $10,000,000, and granted Koppel warrants exercisable into 3,331,664 shares of the Company’s common stock. The fair value of the warrants is estimated to be $1,000,000, resulting in total consideration to Kopple of approximately $11,000,00 (see Note 19). (b) Note payable-Gagerman In April 2014, the Company issued a note payable to Gagerman, former CEO and CFO of the Company, for $82,000. The note is unsecured, bears interest at a rate of 10% per annum and matured in March 2019. At February 28, 2022 and 2021, accrued interest on notes payable-Gagerman totaled $73,428 and $65,228, respectively, and is added to the note principal for presentation on the accompanying balance sheets. As of February 28, 2022 and 2021, the outstanding balance of the Gagerman notes payable and accrued interest amounted to $155,428 and $147,228, respectively. (c) Jiangsu Shengfeng Note On November 20, 2019, the Company reached an agreement with its joint venture partner Jiangsu Shengfeng (see Note 5) regarding the return of $700,000 that had been advanced to the Company, and the Company issued a non-interest-bearing promissory note for $700,000 to be paid over a 11-month period beginning March 15, 2020, through February 15, 2021. As of February 28, 2022 and February 28, 2021, the principal due was $700,000, respectively. As of February 28, 2022, the note is past due and deemed in default. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Feb. 28, 2022 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 11 – ACCRUED EXPENSES Accrued expenses consisted of the following: February 28, February 28, (As Restated) Accrued payroll and related expenses $ 431,597 $ 547,412 Accrued interest-convertible notes payable 284,063 213,884 Accrued interest-convertible notes payable related party 562,911 412,911 Accrued interest-notes payable 36,541 28,822 Other accrued expenses 377,061 88,746 $ 1,692,173 $ 1,291,775 |
Gain on Extinguishment of Debt
Gain on Extinguishment of Debt | 12 Months Ended |
Feb. 28, 2022 | |
Gain On Extinguishment Of Debt [Abstract] | |
GAIN ON EXTINGUISHMENT OF DEBT | NOTE 12 – GAIN ON EXTINGUISHMENT OF DEBT During fiscal 2021, the Company recorded a gain on extinguishment of debt primarily related to the cancellation of liabilities following the expiration of the statute of limitations on such debt. The Company obtained a legal opinion with conclusions that support the Company’s position that the statute of limitations for all potential claims owed by the Company on approximately $2,704,000 of accrued wages and vendor payables, and notes payable and accrued interest of approximately $743,000, had expired pursuant to various precedents. Accordingly, the Company recorded a gain on extinguishment of debt of $3,447,039 in the accompanying statement of operations for the year ended February 28, 2021. |
Leases
Leases | 12 Months Ended |
Feb. 28, 2022 | |
Disclosure Text Block [Abstract] | |
LEASES | NOTE 13 – LEASES During fiscal 2021, our facilities consisted primarily of an approximate 20,000 square feet facility in Stanton, California and an additional storage facility in Santa Clarita, California. Effective February 28, 2021, we vacated the Stanton facility and consolidated our administrative, production operations including warehousing within an approximately 18,000 square foot facility in Lake Forest, California. The Lake Forest lease is for 66-months effective February 2021 through August 31, 2026. The initial monthly base rental rate was approximately $22,000 per month and escalates 3% each year to approximately $26,000 per month in 2026. The lease liability was determined by discounting the future lease payments under the lease terms using a 10% per annum discount rate to arrive at the current lease liability. Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The operating lease ROU asset includes any lease payments made and excludes lease incentives. The components of lease expense and supplemental cash flow information related to leases for the period are as follows: Year ended Year ended Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 279,000 $ 170,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the years ended February 28, 2022 $ 222,000 $ - Weighted average remaining lease term – operating leases (in years) 4.5 5.5 Average discount rate – operating leases 10.0 % 10.0 % The supplemental balance sheet information related to leases for the period is as follows: At Operating leases Long-term right-of-use assets $ 1,000,467 Short-term operating lease liabilities $ 179,450 Long-term operating lease liabilities 867,484 Total operating lease liabilities $ 1,046,934 Maturities of the Company’s lease liability is as follows: Year Ending February 28: Operating 2023 $ 275,000 2024 283,000 2025 292,000 2026 300,000 2027 128,000 Total lease payments 1,278,000 Less: Imputed interest/present value discount (231,066 ) Present value of lease liabilities $ 1,046,934 |
Derivative Warrant Liabilities
Derivative Warrant Liabilities | 12 Months Ended |
Feb. 28, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE WARRANT LIABILITIES | NOTE 14 – DERIVATIVE WARRANT LIABILITY The Company issued warrants in prior years that include a fundamental transaction provision that could give rise to an obligation to pay cash to the warrant holder. The Company determined that the warrants do not satisfy the criteria for classification as equity instruments due to the existence of the cash settlement feature that is not within the sole control of the Company, and the warrants are accounted for as liabilities in accordance with ASC 815. The fair value of the warrants is remeasured at each reporting period, and the change in the fair value is recognized in earnings in the accompanying statements of operations. The warrant liability will ultimately be converted into the Company’s equity when the warrants are exercised, or will be extinguished on the expiration of the outstanding warrants. The following tables summarize the derivative warrant liability: February 28, February 28, Stock price $ 0.41 $ 0.35 Risk free interest rate 1.0 % 1.8 % Expected volatility 170 % 232 % Expected life in years 0.98 2.0 Expected dividend yield 0 % 0 % Number of warrants 4,800,834 5,662,272 Fair value of derivative warrant liability $ 828,232 $ 1,366,375 Number of Fair Value of Derivative Warrant Liability February 29, 2020 (As Restated) 5,816,939 $ 947,272 Change in fair value of derivative warrant liability - 432,714 Gain on extinguishment on expiration of warrants (154,667 ) (13,611 ) February 28, 2021 (As Restated) 5,662,272 $ 1,366,375 Change in fair value of derivative warrant liability - (476,603 ) Gain on extinguishment on expiration of warrants (861,438 ) (61,540 ) February 28, 2022 4,800,834 $ 828,232 |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Feb. 28, 2022 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS’ DEFICIT | NOTE 15 – STOCKHOLDERS’ DEFICIT Common Stock On February 28, 2022 and February 28, 2021, the Company had 150,000,000 shares of $0.0001 par value common stock authorized for issuance. During the year ended February 28, 2022, the Company issued an aggregate of 12,016,095 shares of its common stock as follows: ● The Company sold 10,199,665 shares of common stock for net proceeds of $2,652,860 in a private placement. ● The Company issued 1,571,429 shares of common stock with a fair value of $550,000 for settlement of debt. ● The Company issued 245,001 shares of common stock for services with a fair value of $73,500. The common shares were valued based on the closing price of the Company’s shares of common stock on the respective dates of issuances. During the year ended February 28, 2021, the Company issued an aggregate of 14,513,963 shares of its common stock as follows: ● The Company sold 14,098,327 shares of common stock for net proceeds of $2,146,000 in a private placement. ● The Company issued 415,636 shares of common stock with a fair value of $103,909 for settlement of debt. Stock Options A summary of the Company’s stock option activity is as follows: Number of Shares Exercise Weighted Average Intrinsic Value Total options, February 29, 2020 (As Restated) 1,040,001 $ 1.40 $ - Granted 4,250,000 0.38 225,000 Exercised - - - Cancelled - - - Total options, February 28, 2021 (As Restated) 5,290,001 $ 0.77 $ 225,000 Granted - - - Exercised - - - Cancelled (230,232 ) 1.40 - Total options, February 28, 2022 5,059,769 $ 0.55 $ 360,000 Exercisable, February 28, 2022 5,059,769 $ 0.55 $ 360,000 The exercise prices and information related to options under the 2011 Plan outstanding on February 28, 2022 is as follows: Range of Exercise Price Stock Outstanding Stock Exercisable Weighted Average Remaining Contractual Life Weighted Average Exercise Outstanding Weighted Average Exercise Price of Options Exercisable $0.25 to $1.40 5,059,769 5,059,769 3.25 $ 0.55 $ 0.55 During the year ended February 28, 2021, the Board of Directors granted options to purchase an aggregate of 2,750,000 shares of the Company’s common stock to the Company’s President and members of the Board of Directors. Options exercisable into 2,250,000 shares have an exercise price of $0.25 per share, and options exercisable into 500,000 shares have an exercise price of $0.50 per share. Options exercisable into 2,000,000 shares vested immediately, and options exercisable into 750,000 shares vest over 12 months. The 2,750,000 options expire in five years. The aggregate fair value of the options was determined to be $576,879 using a Black-Scholes option pricing model based on the following assumptions: (i) volatility rate of 222% to 226%, (ii) discount rate of 0.16% to 0.57%, iii) zero expected dividend yield, and (iv) expected life of 2.5 years to 3 years. In February 2021, the Company’s Board of Directors authorized the grant of 1,500,000 stock options at an exercise price of $0.50 per share as compensation for advisors to the Board. As of February 28, 2022 and 2021, these options have not been issued as the proposal to renew the employee stock option plan needs to be approved by the shareholders at an annual meeting. Upon approval, the 1,500,000 stock options will be issued. The options vest over 12 months, and expire in five years. Although the options have not been issued, the commitment to issue existed when granted by the Board. As a result, the fair value of the authorized grant was determined to be $487,600 using a Black-Scholes option pricing model based on the following assumptions: (i) volatility rate of 226%, (ii) discount rate of 0.34%, iii) zero expected dividend yield, and (iv) expected life of 3 years. The risk-free interest rate was based on rates established by the Federal Reserve Bank. The Company uses the historical volatility of its common stock to estimate the future volatility for its common stock. The expected life of the stock options granted is estimated using the “simplified” method, whereby the expected term equals the average of the vesting term and the original contractual term of the stock option. The expected dividend yield was based on the fact that the Company has not paid dividends to its common stockholders in the past and does not expect to pay dividends to its common stockholders in the future. During the years ended February 28, 2022 and 2021, the Company recognized stock-based compensation of $612,093 and $452,386 related to the fair value of vested stock options. Employee Stock Option Plans In September 2009, the Company’s shareholders approved the 2006 Employee Stock Option Plan (as amended, the “2006 Plan”). Under the 2006 Plan, the Company may grant options for up to 10,000,000 or 15% of the number of shares of Common Stock of Aura outstanding from time to time. As of February 28, 2022 and 2021, no options remain outstanding under the 2006 Plan as the last remaining options expired during fiscal 2020, and no options are available for grant under the 2006 Plan as the authorized term of the plan has expired. In October 2011, the Company’s shareholders approved the 2011 Director and Executive Officers Stock Option Plan (the “2011 Plan”). Under the 2011 Plan, the Company may grant options, or warrants, for up to 15% of the number of shares of Common Stock of the Company outstanding from time to time. Pursuant to this plan, the Board or a committee of the Board may grant an option to any person who is elected or appointed a director or executive officer of the Company. The exercise price of each option shall be at least equal to the fair market value of such shares on the date of grant, and the term of the options may not be greater than five years. During the year ended February 28, 2022, there were no options granted under the 2011 Plan. During the year ended February 28, 2021, the Company issued 2,750,000 stock options under the 2011 Plan. Warrants Number of Exercise Outstanding, February 29, 2020 5,816,939 $ 1.40 Granted - - Exercised - - Cancelled (154,667 ) 1.40 Outstanding, February 28, 2021 5,662,272 $ 1.40 Granted - - Exercised - - Cancelled (861,438 ) 1.40 Outstanding, February 28, 2022 4,800,834 $ 1.40 There was no intrinsic value as of February 28, 2022, as the exercise prices of these warrants were greater than the market price of the Company’s stock. The exercise prices and information related to the warrants under the 2011 Plan outstanding on February 28, 2022 is as follows: Range of Exercise Price Stock Stock Weighted Weighted Weighted $ 1.40 4,800,834 4,800,834 0.98 $ 1.40 $ 1.40 |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 28, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 16 – INCOME TAXES For the year ended February 28, 2022, the Company had no income tax expense. For the year ended February 28, 2021, the Company recorded an income tax expense of $800 for state franchise taxes. FY2022 FY2021 Current: Federal $ - $ - State - 800 Total current $ - $ 800 Deferred: Federal $ - $ - State - - Total deferred $ - $ - Total Provision $ - $ 800 The following is a reconciliation of the statutory federal income tax rate to the Company’s effective tax rate: FY2022 FY2021 Federal tax benefit at statutory rate 21 % 21 % State tax benefit, net of federal benefit 7 % 7 % Change in valuation allowance (28 )% (28) % Total 0 % 0 % The following table summarizes our deferred tax asset at February 28, 2022, and February 28, 2021: FY2022 FY2021 Deferred tax asset Net operating loss carryforwards $ 42,141,000 $ 46,999,000 Gross deferred tax assets 42,141,000 46,999,000 Valuation allowance (42,141,000 ) (46,999,000 ) Net deferred tax asset (liability) $ - $ - The provisions of ASC Topic 740, Accounting for Income Taxes, require an assessment of both positive and negative evidence when determining whether it is more likely than not that deferred tax assets are recoverable. For the years ended February 28, 2022 and 2021, based on all available objective evidence, including the existence of cumulative losses, the Company determined that it was more likely than not that the net deferred tax assets were not fully realizable. Accordingly, the Company established a full valuation allowance against its net deferred tax assets. The Company intends to maintain a full valuation allowance on net deferred tax assets until sufficient positive evidence exists to support reversal of the valuation allowance. During the years ended February 28, 2022 and 2021, the valuation allowance decreased by $4.8 million and $5.8 million, respectively. At February 28, 2022, the Company had available Federal and state net operating loss carryforwards (“NOL”s) to reduce future taxable income. For Federal purposes the amounts available were approximately $168.4 million and for state purposes the amounts available were approximately $96.8 million. The Federal carryforwards expire on various dates through 2042 and the state carryforwards expire through 2039. Due to restrictions imposed by Internal Revenue Code Section 382 regarding substantial changes in ownership of companies with loss carryforwards, the utilization of the Company’s NOL may be limited as a result of changes in stock ownership. The Company’s operations are based in California and it is subject to Federal and California state income tax. Tax years after 2017 are open to examination by United States and state tax authorities. The Company adopted the provisions of ASC 740, which requires companies to determine whether it is “more likely than not” that a tax position will be sustained upon examination by the appropriate taxing authorities before any tax benefit can be recorded in the financial statements. ASC 740 also provides guidance on the recognition, measurement, classification and interest and penalties related to uncertain tax positions. As of February 28, 2022 and 2021, no liability for unrecognized tax benefits was required to be recorded or disclosed. Our continuing practice is to recognize interest and/or penalties related to income tax matters in income tax expense. As of February 28, 2022, and February 28, 2021, we have no accrued interest and penalties related to uncertain tax positions. We are subject to taxation in the U.S. and California. Our tax years for 2014 and forward are subject to examination by our tax authorities. We are not currently under examination by any tax authority. The Company has failed to file its California tax returns for the years ended February 28, 2015 thru February 28, 2022 due to its inability to pay the minimum annual franchise tax payment of $800. The balance of accrued income taxes related to unpaid California franchise tax of $4,800 represents six years of minimum taxes due. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Feb. 28, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 17 – RELATED PARTY TRANSACTIONS As of February 28, 2022 and 2021, Bettersea LLC (“Bettersea”) was an 11.0% and 10.4%, respectively, shareholder in the Company. For the years ended February 28, 2022 and 2021, the Company incurred total fees to Bettersea of $137,500 and $131,300, respectively, for consulting services. As of February 28, 2022 and 2021, a total of $218,507 and $602,501, respectively, was due to Bettersea and included in accounts payable and accrued expenses.. During fiscal 2022, the Company issued 1,285,714 shares of common stock with a fair value of $450,000 for the settlement of accounts payable of $450,000 due to Bettersea. Also during fiscal 2022, the Company issued 285,715 shares of common stock with a fair value of $100,000 for the settlement of accounts payable of $100,000 due to the Company’s President. During fiscal 2021, the Company issued 415,636 common shares with a fair value of $103,909 for the settlement of accounts payable of $103,909 due to a 50% owner of Bettersea. There were no gains or losses recognized on these transactions. |
Contingencies
Contingencies | 12 Months Ended |
Feb. 28, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | NOTE 18 – CONTINGENCIES The Company is subject to legal proceedings and claims that have arisen in the ordinary course of business. Our management evaluates our exposure to these claims and proceedings individually and in the aggregate and evaluates potential losses on such litigation if the amount of the loss is estimable and the loss is probable. However, the outcome of legal proceedings and claims brought against the Company is subject to significant uncertainty. Although management considers the likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the Company for amounts in excess of management’s expectations, the Company’s financial statements for that reporting period could be materially adversely affected. In 2017, the Company’s former COO was awarded approximately $238,000 in accrued salary and related charges by the California labor board. In August 2021, the Company reached a settlement by which the Company agreed to pay approximately $330,000, representing the principal award plus accrued interest. As of the time of this filing, the Company has paid approximately $108,400 toward the settlement amount. The remaining balance of approximately $221,600 is to be paid no later than September 1, 2022, and accrues interest of 10% per annum until paid. Since July 2017 the Company has been engaged in litigation with a former director, Robert Kopple, relating to more than $13 million and the current equivalent of the approximately 23 million warrants, exercisable for seven years at a price of $0.10 per share, which Mr. Kopple and his affiliated entities (collectively the “Kopple Parties”) claimed should have been originally issued to them pursuant to various agreements with the Company entered to between 2013-2016. In March 2022, the Company reached a settlement with the Kopple Parties that resolves all claims asserted against the Company without any admission, concession or finding of any fault, liability or wrongdoing on the part of the Company. Under the terms of the settlement, we have agreed to pay an aggregate amount of $10 million over a period of seven years; $3 million of which is to be paid on or before June 8, 2022, after which, interest will accrue on the unpaid balance at a rate of 6%, compounded annually. All amounts, including all accrued interest, are to be paid no later than eight years from the date of the initial payment. The Kopple Parties have also received seven-year warrants to purchase up to an aggregate of approximately 3.3 million shares of our common stock at a price of $0.85 per share. The settlement also provides for standard mutual general release provisions and includes customary representations, warranties, and covenants, including certain increases in the amount payable to the Kopple Parties and the right of such parties to enter judgment against the Company if the Company remains in uncured default in its payment obligations under the settlement. As of June 8, 2022 and the date of this report, the Company has not yet paid the $3,000,000 installment due to Kopple. Pursuant to the agreement, the Company has 60 days to cure the nonpayment of the $3,000,000 default. (See Note 19) On March 26, 2019, various stockholders of the Company controlling a combined total of more than 27.5 million shares delivered a signed written consent to the Company removing Ronald Buschur as a member of the Company’s Board and electing Cipora Lavut as a director of the Company. On March 27, 2019, those same stockholders delivered a further signed written consent to the Company removing William Anderson and Si Ryong Yu as members of the Company’s Board and electing Robert Lempert and David Mann as directors of the Company. These written consents represented a majority of the outstanding shares of the Company’s common stock as of March 26, 2019 and March 27, 2019, respectively. Because of Aura’s refusal to recognize the legal effectiveness of the consents, on April 8, 2019 the stockholders filed suit in the Court of Chancery of the State of Delaware pursuant to Section 225 of the Delaware General Corporations Law, seeking an order confirming the validity of the consents and declaring that Aura’s Board consists of Ms. Lavut, Mr. Mann, Dr. Lempert, Mr. Douglas and Mr. Diaz-Versón, Jr. On July 8, 2019 the Court of Chancery entered final judgment in favor of the stockholder plaintiffs, confirming that (a) Ronald Buschur, Si Ryong Yu and William Anderson had been validly removed by the holders of a majority of the Company’s outstanding stock acting by written consent (b) Ms. Lavut, Mr. Mann and Dr. Lempert had been validly elected by the holders of a majority of the Company’s outstanding stock acting by written consent, and (c) the Company’s Board of Directors validly consists of Cipora Lavut, David Mann, Robert Lempert, Gary Douglas and Salvador Diaz-Versón, Jr. As a result of prior management’s unsuccessful opposition to this stockholders’ action filed in the Court of Chancery, such stockholders may be potentially entitled to recoup their litigation costs from the Company under Delaware’s corporate benefit doctrine and/or other legal provisions. To date, no final determination has been made as to the amount of recoupment, if any, to which such stockholders may be entitled. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Feb. 28, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 19 – SUBSEQUENT EVENTS In fiscals 2013 through 2018, the Company issued notes payable to Robert Kopple and associated entities (collectively “Kopple”) in the aggregate of $5,607,323 (see Note 10). The notes were due in fiscal 2014 through fiscal 2018. As of February 28, 2022 and 2021, the outstanding balance of the Kopple notes payable and accrued interest amounted to $12,140,641 and $11,317,787, respectively. Kopple brought suit against the Company beginning in 2017 for repayment of the notes. On March 14, 2022, the Company reached an agreement with Kopple to resolve all remaining litigation between them. Under the terms of the settlement, the Company agreed to pay Kopple an aggregate amount of $10,000,000, including $3,000,000 to be paid by June 8, 2022, and granted Koppel warrants exercisable into 3,331,664 shares of the Company’s common stock at a price of $0.85 per share. The fair value of the warrants is estimated to be $1,000,000, resulting in total consideration to Kopple of approximately $11,000,00. Pursuant to current accounting guidelines, the Company will only recognize any gain on the settlement of the Kopple notes and accrued interest of $12,140,161 upon completion of all settlement payments. As of June 8, 2022 and the date of this report, the Company has not yet paid the $3,000,000 installment due to Kopple. Pursuant to the agreement, the Company has 60 days to cure the nonpayment of the $3,000,000 default. The settlement provides for certain increases in the amount payable to Kopple and the right of such parties to enter judgment against the Company if the Company remains in uncured default in its payment obligations. Subsequent to February 28, 2022, the Company issued 1,153,666 shares of common stock in exchange for cash proceeds of $346,100. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Feb. 28, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reported periods. Significant estimates include assumptions made for inventory reserve, impairment testing of long-lived assets, the valuation allowance for deferred tax assets, assumptions used in valuing derivative liabilities, assumptions used in valuing share-based compensation, and accruals for potential liabilities. Amounts could materially change in the future. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. To determine revenue recognition under ASC 606, an entity performs the following five-steps (i) identifies the contract(s) with a customer; (ii) identifies the performance obligations in the contract; (iii) determines the transaction price; (iv) allocates the transaction price to the performance obligations in the contract; and (v) recognizes revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-steps to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Our primary source of revenue is the manufacture and delivery of generator sets used primarily in mobile power applications, which represented nearly 100% of our revenues of approximately $100,000 and $115,000 for the fiscal years ended February 28, 2022 and February 28, 2021, respectively. Our principal sales channel is sales to a domestic distributor. In accordance with ASC 606, we recognize revenue, net of discounts, for our generator sets at time of product delivery to the domestic distributor (i.e. point-in-time), which also corresponds to the passage of legal title to the customer and the satisfaction of our performance obligations to the customer. Our payment terms are cash payment due upon delivery and typically includes a 2% price discount off the selling price in accordance with this policy. Our commercial terms and conditions do not include a right of return for reasons other than a defect in performance or quality. We offer a 24 month assurance-type warranty covering material and manufacturing defects, which we account for under the guidance of ASC 460, Guarantees. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold primarily consists of the salaries of certain employees and contractors, purchase price of consumer products, packaging supplies, inventory reserve and customer shipping and handling expenses. Shipping costs to receive products from our suppliers are included in our inventory and recognized as cost of revenue upon sale of products to our customers. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and equivalents include cash on hand and cash in time deposits, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less. |
Inventories | Inventories Inventories are valued at the lower of cost (first-in, first-out) or net realizable value, on an average cost basis. We review the components of inventory on a regular basis for excess or obsolete inventory based on estimated future usage and sales. When evidence exists that the net realizable value of inventory is lower than its cost, the difference is recognized as a loss in the period in which it occurs. Once inventory has been written down, it creates a new cost basis for inventory that may not be subsequently written up. During the year ended February 28, 2022, the Company wrote-down inventories of $36,000. During the year ended February 28, 2021, there were no inventory write downs recorded. |
Property and Equipment | Property and Equipment Property and equipment are recorded at historical cost and depreciated on a straight-line basis over their estimated useful lives of approximately three years up to ten years once the individual assets are placed in service. Leasehold improvements are amortized over the shorter of the useful life or the remaining period of the applicable lease term. Management assesses the carrying value of property and equipment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows e xpected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value at that time. At February 28, 2022 and 2021, management determined there were no impairments of the Company’s property and equipment. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company reviews its property and equipment, right-of-use asset, and other long-lived assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. For the years ended February 28, 2022 and 2021, the Company had no impairment of long-lived assets. |
Leases | Leases The Company determines whether a contract is, or contains, a lease at inception. Right-of-use assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at lease commencement in determining the present value of unpaid lease payments. |
Customer Advances | Customer Advances Customer advances represent consideration received from customers under revenue contracts for which the Company has not yet delivered to the customer. |
Concentration of Credit and Other Risks | Concentration of Credit and Other Risks Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and accounts receivable. Cash is deposited with a limited number of financial institutions. The balances held at any one financial institution at times may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits of up to $250,000. We have not experienced any losses in such accounts and believe we are not exposed to any significant risk on cash and cash equivalents. During the year ended February 28, 2022, one customer accounted for 18% of revenues. During the year ended February 28, 2021, one customers accounted for 83% of revenues. As of February 28, 2022, three vendors accounted for 44%, 13% and 15% of accounts payable. As of February 28, 2021, three vendors accounted for 34%, 31% and 13% of accounts payable. |
Research and Development | Research and Development The Company engages in research and development to stay current with changes in vehicle manufacture and design and to maintain an advantage over potential competition. Research and development expenses relate primarily to the development, design, testing of preproduction prototypes and models and are expensed as incurred. Research and development costs for Fiscal 2022 and 2021 was approximately $600,000 and $200,000, respectively. |
Share-Based Compensation | Share-Based Compensation The Company periodically issues stock options and warrants, and shares of common stock to employees and non-employees in non-capital raising transactions for services and for financing costs. Share-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service period. Recognition of compensation expense for non-employees is in the same period and manner as if the Company had paid cash for services. |
Income Taxes | Income Taxes The Company uses an asset and liability approach for accounting and reporting for income taxes that allows recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. |
Derivative Warrant Liability | Derivative Warrant Liability The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. The Company uses Level 2 inputs for its valuation methodology for the derivative liabilities as their fair values were determined by using a Binomial pricing model. The Company’s derivative liabilities are adjusted to reflect fair value at each reporting date, with any increase or decrease in the fair value being recorded in the statement of operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company determines the fair values of its financial instruments based on a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The classification of a financial asset or liability within the hierarchy is based upon the lowest level input that is significant to the fair value measurement. Under ASC 820, Fair Value Measurement and Disclosures ● Level 1 – Quoted prices (unadjusted) for identical assets and liabilities in active markets; ● Level 2 – Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly; and ● Level 3 – Unobservable inputs. The recorded amounts of inventory, other current assets, accounts payable, and accrued expenses approximate their fair value due to their short-term nature. The carrying amounts of notes payable and convertible notes payable approximate their respective fair values because of their current interest rates payable in relation to current market conditions. The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities at fair value as of February 28, 2022 and 2021: February 28, 2022 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 828,232 $ - $ 828,232 Total liabilities $ - $ 828,232 $ - $ 828,232 February 28, 2021 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 1,366,375 $ - $ 1,366,375 Total liabilities $ - $ 1,366,375 $ - $ 1,366,375 The Company estimated the fair value of the derivative warrant liability using the Binomial Model (see Note 14). |
Earnings (loss) per share | E arnings (loss) per share The Company’s earnings (loss) per share amounts have been computed based on the weighted-average number of shares of common stock outstanding for the period. Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of shares of common stock assuming all potential shares had been issued, and the additional shares of common stock were dilutive. Diluted earnings (loss) per share reflects the potential dilution, using the as-if-converted method for convertible debt, and the treasury stock method for options and warrants, which could occur if all potentially dilutive securities were exercised The following information sets forth the computation of basic and diluted net increase in the Company's net assets per share resulting from operations for the years ended February 28, 2022 and 2021: Year Ended February 28, 2022 2021 Numerator Net income (loss) $ (3,991,863 ) $ 44,748 Adjustment for interest expense on convertible notes - 220,179 Adjusted net income (loss) $ (3,991,863 ) $ 264,927 Denominator Denominator for basic weighted average share 76,805,616 61,768,215 Adjustment for dilutive effect of convertible notes - 3,435,419 Denominator for diluted weighted average share 76,805,616 65,203,634 Earnings (loss) per share Basic earnings (loss) per share: $ (0.05 ) $ 0.00 Diluted earnings (loss) per share $ (0.05 ) $ 0.00 For the years ended February 28, 2022, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have had an anti-dilutive effect. The potentially dilutive securities consisted of the following: February 28, February 28, Warrants 4,800,834 5,662,272 Options 5,059,769 3,040,002 Convertible notes 3,749,961 - Total 13,610,564 8,702,274 |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current year presentation. These reclassifications have no effect on the previously reported financial position, results of operations and cash flows (see Note 3). |
Segments | Segments The Company operates in one segment for the manufacture and delivery of generator sets. In accordance with the “ Segment Reporting |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Credit Losses – Measurement of Credit Losses on Financial Instruments (“ASC 326”). The standard significantly changes how entities will measure credit losses for most financial assets, including accounts and notes receivables. The standard will replace today’s “incurred loss” approach with an “expected loss” model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. As a small business filer, the standard will be effective for the Company for interim and annual reporting periods beginning after March 1, 2023. Management is currently assessing the impact of adopting this standard on the Company’s financial statements and related disclosures. In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “ Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40). In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission (the “SEC”) did not or are not believed by management to have a material impact on the Company’s present or future financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Accounting Policies [Abstract] | |
Schedule of assets and liabilities at fair value | February 28, 2022 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 828,232 $ - $ 828,232 Total liabilities $ - $ 828,232 $ - $ 828,232 February 28, 2021 Level 1 Level 2 Level 3 Total Liabilities Derivative warrant liability $ - $ 1,366,375 $ - $ 1,366,375 Total liabilities $ - $ 1,366,375 $ - $ 1,366,375 |
Schedule of earnings (loss) per share | Year Ended February 28, 2022 2021 Numerator Net income (loss) $ (3,991,863 ) $ 44,748 Adjustment for interest expense on convertible notes - 220,179 Adjusted net income (loss) $ (3,991,863 ) $ 264,927 Denominator Denominator for basic weighted average share 76,805,616 61,768,215 Adjustment for dilutive effect of convertible notes - 3,435,419 Denominator for diluted weighted average share 76,805,616 65,203,634 Earnings (loss) per share Basic earnings (loss) per share: $ (0.05 ) $ 0.00 Diluted earnings (loss) per share $ (0.05 ) $ 0.00 |
Schedule of anti-dilutive securities excluded from computation of diluted net loss per share | February 28, February 28, Warrants 4,800,834 5,662,272 Options 5,059,769 3,040,002 Convertible notes 3,749,961 - Total 13,610,564 8,702,274 |
Restatement of Previously Iss_2
Restatement of Previously Issued Financial Statements (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of the company’s previously issued balance | As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Accrued expenses (including accrued interest) $ 1,288,107 $ - $ 3,668 $ 1,291,775 [1] Note payable 159,922 - (3,668 ) 156,255 [1] Derivative warrant liability - 1,366,375 - 1,366,375 [A] Additional paid-in capital 446,126,640 (136,004 ) - 446,249,272 [B] 258,636 - [C] Accumulated deficit $ (465,883,499 ) $ (1,366,375 ) $ - $ (467,372,506 ) [A] 136,004 - [B] (258,636 ) - [C] |
Schedule of the company’s previously issued statement of operations | As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Selling, general and administrative expense $ 1,318,602 $ 258,636 $ - $ 1,577,238 [C] Interest expense 1,293,409 (13,460 ) - 1,279,949 [B] Gain on extinguishment of debt 866,887 (133,500 ) 2,713,652 3,447,039 [2] Gain on extinguishment of derivative warrant liability - 13,611 - 13,611 [A] Change in fair value of derivative warrant liability - (432,714 ) - (432,714 ) [A] Other income 2,720,652 - (2,713,652 ) 7,000 [2] Net income $ 842,528 $ (797,780 ) $ - $ 44,748 Net income per share, basic and diluted $ 0.01 $ 0.00 |
Schedule of the company’s previously issued statement of shareholder deficit | Common Stock Common Additional Accumulated Total Balance, February 29, 2020, as previously reported 56,400,874 $ 5,639 $ 443,417,452 $ (466,726,027 ) $ (23,302,937 ) Prior period revisions 192,641 19 130,977 (691,227 ) (560,231 ) Corrections of errors (4,469 ) - Balance, February 29, 2020, as restated 56,589,046 $ 5,658 $ 443,548,428 $ (467,417,254 ) $ (23,863,168 ) Balance, February 28, 2021, as previously reported 71,107,442 $ 7,109 $ 446,126,640 $ (465,883,499 ) $ (19,749,750 ) Prior period revisions - - 122,632 (1,489,007 ) (1,366,375 ) Corrections of errors (4,433 ) - Balance, February 28, 2021, as restated 71,103,009 $ 7,109 $ 446,249,272 $ (467,372,506 ) $ (21,116,125 ) |
Schedule of the company’s previously issued statement of cash flows | As of February 28, 2021 As Previously Adjustments Reclassifications As Restated Notes Cash flows from operating activities: Net income $ 842,528 $ (797,780 ) $ - $ 44,748 [A] [B] [C] Gain on extinguishment of liabilities (3,585,639 ) 133,500 5,100 (3,447,039 ) [B] Gain on debt settlement (71,775 ) (71,775 ) Gain on extinguishment of derivative warrant liability - (13,611 ) - (13,611 ) [A] Change in fair value of derivative warrant liability - 432,714 - 432,714 [A] Share-based compensation expense 193,750 258,636 - 452,386 [C] Changes in working capital assets and liabilities: Operating lease right-to-use asset - - 7,220 7,220 Accounts payable and accrued expenses 99,839 - (185,308 ) (85,469 ) [1] Accrued interest on notes payable 847,987 (13,460 ) 251,983 1,086,510 [B] [1] Operating lease liability (10,564 ) - (7,220 ) (17,784 ) Supplemental schedule of non-cash transactions: Notes payable converted into shares of common stock $ 267,000 $ (267,000 ) $ - $ - [B] |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | February 28, February 28, Raw materials $ 129,836 $ 91,739 Work-in-process 14,421 - Finished goods - 2,427 Total inventory $ 144,257 $ 94,166 |
Prepaid and Other Current Ass_2
Prepaid and Other Current Assets (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Other Current Assets [Abstract] | |
Schedule of prepaid and other current assets | February 28, February 28, Prepaid annual software licenses $ 94,907 $ - Prepaid commissions 73,390 63,500 Vendor advances 35,500 37,400 Other prepaid expenses 51,656 14,303 Total other current assets $ 255,453 $ 115,203 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | February 28, 2022 2021 Leasehold improvements $ 56,530 $ - Machinery and equipment 276,762 15,613 Vehicle 96,334 - Computer equipment 59,816 - Furniture and fixtures 10,592 - 500,034 15,613 Less accumulated depreciation and amortization (15,508 ) (743 ) $ 484,526 $ 14,870 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Convertible Notes Payable [Abstract] | |
Schedule of convertible notes payable | February 28, 2022 February 28, 2021 Convertible notes payable $ 1,402,971 $ 1,402,971 Non-current - (1,402,971 ) Current $ 1,402,971 $ - |
Convertible Note Payable-Rela_2
Convertible Note Payable-Related Party (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Convertible Note Payable Related Party [Abstract] | |
Schedule of convertible note payable – related party | February 28, 2022 February 28, 2021 Convertible note payable $ 3,000,000 $ 3,000,000 Non-current - (3,000,000 ) Current $ 3,000,000 $ - |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Notes Payable [Abstract] | |
Schedule of notes payable consisted | February 28, 2022 February 28, 2021 Secured notes payable (a) Note payable-EID loan $ 150,000 $ 150,000 (b) Notes payable-vehicles and equipment 265,616 - Unsecured notes payable (c) Notes payable-PPP loans - 74,405 (d) Note payable-Abdou - 120,181 (e) Note payable-other-in default 10,000 10,000 Total $ 425,616 $ 354,586 Non-current 327,658 156,255 |
Notes Payable-Related Parties_2
Notes Payable-Related Parties-In Default (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Notes Payable Related Parties [Abstract] | |
Schedule of notes payable-related parties | February 28, February 28, Unsecured notes payable (a) Notes payable-Koppel-in default $ 5,607,323 $ 5,607,323 Accrued interest-Koppel-in default 6,533,318 5,710,464 Subtotal-Koppel-in default 12,140,641 11,317,787 (b) Note payable- Gagerman-in default 82,000 82,000 Accrued interest-Gagerman-in default 73,428 65,228 Subtotal-Gagerman-in default 155,428 147,228 (c) Note payable-Jiangsu Shengfeng-in default 700,000 700,000 Total $ 12,996,069 $ 12,165,015 Non-current - - Current $ 12,996,069 $ 12,165,015 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses | February 28, February 28, (As Restated) Accrued payroll and related expenses $ 431,597 $ 547,412 Accrued interest-convertible notes payable 284,063 213,884 Accrued interest-convertible notes payable related party 562,911 412,911 Accrued interest-notes payable 36,541 28,822 Other accrued expenses 377,061 88,746 $ 1,692,173 $ 1,291,775 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Disclosure Text Block [Abstract] | |
schedule of lease expense and supplemental cash flow information related to leases | Year ended Year ended Lease Cost Operating lease cost (included in general and administration in the Company’s statement of operations) $ 279,000 $ 170,000 Other Information Cash paid for amounts included in the measurement of lease liabilities for the years ended February 28, 2022 $ 222,000 $ - Weighted average remaining lease term – operating leases (in years) 4.5 5.5 Average discount rate – operating leases 10.0 % 10.0 % |
schedule of supplemental balance sheet information related to leases | At Operating leases Long-term right-of-use assets $ 1,000,467 Short-term operating lease liabilities $ 179,450 Long-term operating lease liabilities 867,484 Total operating lease liabilities $ 1,046,934 |
Schedule of maturities of the Company’s lease liability | Year Ending February 28: Operating 2023 $ 275,000 2024 283,000 2025 292,000 2026 300,000 2027 128,000 Total lease payments 1,278,000 Less: Imputed interest/present value discount (231,066 ) Present value of lease liabilities $ 1,046,934 |
Derivative Warrant Liabilities
Derivative Warrant Liabilities (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of derivative warrant liabilities | February 28, February 28, Stock price $ 0.41 $ 0.35 Risk free interest rate 1.0 % 1.8 % Expected volatility 170 % 232 % Expected life in years 0.98 2.0 Expected dividend yield 0 % 0 % Number of warrants 4,800,834 5,662,272 Fair value of derivative warrant liability $ 828,232 $ 1,366,375 |
Schedule of derivative outstanding warrant liabilities | Number of Fair Value of Derivative Warrant Liability February 29, 2020 (As Restated) 5,816,939 $ 947,272 Change in fair value of derivative warrant liability - 432,714 Gain on extinguishment on expiration of warrants (154,667 ) (13,611 ) February 28, 2021 (As Restated) 5,662,272 $ 1,366,375 Change in fair value of derivative warrant liability - (476,603 ) Gain on extinguishment on expiration of warrants (861,438 ) (61,540 ) February 28, 2022 4,800,834 $ 828,232 |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Stockholders' Deficit (Tables) [Line Items] | |
Schedule of stock options outstanding | Number of Shares Exercise Weighted Average Intrinsic Value Total options, February 29, 2020 (As Restated) 1,040,001 $ 1.40 $ - Granted 4,250,000 0.38 225,000 Exercised - - - Cancelled - - - Total options, February 28, 2021 (As Restated) 5,290,001 $ 0.77 $ 225,000 Granted - - - Exercised - - - Cancelled (230,232 ) 1.40 - Total options, February 28, 2022 5,059,769 $ 0.55 $ 360,000 Exercisable, February 28, 2022 5,059,769 $ 0.55 $ 360,000 |
Schedule of exercise prices and information related to options | Range of Exercise Price Stock Outstanding Stock Exercisable Weighted Average Remaining Contractual Life Weighted Average Exercise Outstanding Weighted Average Exercise Price of Options Exercisable $0.25 to $1.40 5,059,769 5,059,769 3.25 $ 0.55 $ 0.55 |
Schedule of Warrants | Number of Exercise Outstanding, February 29, 2020 5,816,939 $ 1.40 Granted - - Exercised - - Cancelled (154,667 ) 1.40 Outstanding, February 28, 2021 5,662,272 $ 1.40 Granted - - Exercised - - Cancelled (861,438 ) 1.40 Outstanding, February 28, 2022 4,800,834 $ 1.40 |
Two Thousand Eleven Director and Executive Officers Stock Option Plan [Member] | |
Stockholders' Deficit (Tables) [Line Items] | |
Schedule of exercise prices and information related to options | Range of Exercise Price Stock Stock Weighted Weighted Weighted $ 1.40 4,800,834 4,800,834 0.98 $ 1.40 $ 1.40 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 28, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Company recorded an income tax expense | FY2022 FY2021 Current: Federal $ - $ - State - 800 Total current $ - $ 800 Deferred: Federal $ - $ - State - - Total deferred $ - $ - Total Provision $ - $ 800 |
Schedule of valuation allowance for the deferred tax assets on the expected future | FY2022 FY2021 Federal tax benefit at statutory rate 21 % 21 % State tax benefit, net of federal benefit 7 % 7 % Change in valuation allowance (28 )% (28) % Total 0 % 0 % |
Schedule of significant components of our deferred tax asset | FY2022 FY2021 Deferred tax asset Net operating loss carryforwards $ 42,141,000 $ 46,999,000 Gross deferred tax assets 42,141,000 46,999,000 Valuation allowance (42,141,000 ) (46,999,000 ) Net deferred tax asset (liability) $ - $ - |
Organization and Operations (De
Organization and Operations (Details) | 12 Months Ended |
Feb. 28, 2022 USD ($) shares | |
Accounting Policies [Abstract] | |
Incurred net profit | $ 4,000,000 |
Cash flows from operating activities | 2,600,000 |
Stockholders deficit | 21,200,000 |
Working capital deficit | 21,700,000 |
Convertible notes payable aggregate amount | $ 13,000,000 |
Going concern year | 1 year |
Cash | $ 150,000 |
Common stock, shares issued (in Shares) | shares | 1,153,666 |
Cash proceeds | $ 346,100 |
Notes payable and accrued interest | $ 12,100,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Revenue percentage | 100% | |
Revenues (in Dollars) | $ 100,000 | $ 115,000 |
Price discount | 2% | |
Wrote-down inventories (in Dollars) | $ 36,000 | |
Federal deposit insurance corporation (in Dollars) | 250,000 | |
Research and development costs (in Dollars) | 600,000 | $ 200,000 |
Derivative liabilities (in Dollars) | 1 | |
Convertible notes payable-related party plus accrued interest (in Dollars) | $ 1 | |
Minimum [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Estimated useful lives | 3 years | |
Maximum [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Estimated useful lives | 10 years | |
One Customer [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Revenue percentage | 18% | 83% |
One Vendors [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Aggregate of accounts payable percentage | 44% | 34% |
Two Vendors [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Aggregate of accounts payable percentage | 13% | 31% |
Three Vendors [Member] | ||
Summary of Significant Accounting Policies (Details) [Line Items] | ||
Aggregate of accounts payable percentage | 15% | 13% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of assets and liabilities at fair value - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Summary of Significant Accounting Policies (Details) - Schedule of assets and liabilities at fair value [Line Items] | ||
Derivative warrant liability | $ 828,232 | $ 1,366,375 |
Total liabilities | 828,232 | 1,366,375 |
Level 1 [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of assets and liabilities at fair value [Line Items] | ||
Derivative warrant liability | ||
Total liabilities | ||
Level 2 [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of assets and liabilities at fair value [Line Items] | ||
Derivative warrant liability | 828,232 | 1,366,375 |
Total liabilities | 828,232 | 1,366,375 |
Level 3 [Member] | ||
Summary of Significant Accounting Policies (Details) - Schedule of assets and liabilities at fair value [Line Items] | ||
Derivative warrant liability | ||
Total liabilities |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of earnings (loss) per share - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Numerator | ||
Net income (loss) | $ (3,991,863) | $ 44,748 |
Adjustment for interest expense on convertible notes | 220,179 | |
Adjusted net income (loss) | $ (3,991,863) | $ 264,927 |
Denominator | ||
Denominator for basic weighted average share (in Shares) | 76,805,616 | 61,768,215 |
Adjustment for dilutive effect of convertible notes | ||
Adjustment for dilutive effect of convertible notes (in Shares) | 3,435,419 | |
Denominator for diluted weighted average share (in Shares) | 76,805,616 | 65,203,634 |
Earnings (loss) per share | ||
Basic earnings (loss) per share: (in Dollars per share) | $ (0.05) | $ 0 |
Basic earnings (loss) per share: (in Dollars per share) | 0 | |
Diluted earnings (loss) per share (in Dollars per share) | $ (0.05) | 0 |
Diluted earnings (loss) per share (in Dollars per share) | $ 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details) - Schedule of anti-dilutive securities excluded from computation of diluted net loss per share - shares | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 13,610,564 | 8,702,274 |
Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 4,800,834 | 5,662,272 |
Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 5,059,769 | 3,040,002 |
Convertible securities [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total | 3,749,961 |
Restatement of Previously Iss_3
Restatement of Previously Issued Financial Statements (Details) - USD ($) | 12 Months Ended | |||
Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | Feb. 28, 2018 | |
Restatement of Previously Issued Financial Statements (Details) [Line Items] | ||||
Warrant derivative liability | $ 828,232 | $ 1,366,375 | ||
Accumulated deficit | (471,364,369) | (467,372,506) | ||
Net increase in fair value | 419,103 | |||
Other expense | 432,714 | |||
Expiring warrants | 13,611 | |||
Gain on its extinguishment | 133,500 | |||
Stock compensation expense | 612,093 | 452,386 | ||
Accrued interest | 3,668 | 3,668 | ||
Accrued wages and accounts payable | 2,713,652 | |||
Gain on extinguishment of debt | $ 2,713,652 | |||
Adjustment [Member] | ||||
Restatement of Previously Issued Financial Statements (Details) [Line Items] | ||||
Warrant derivative liability | $ 947,271 | |||
Accumulated deficit | $ 947,271 | $ 256,044 | ||
Interest expense debt | 13,460 | |||
Stock options [Member] | ||||
Restatement of Previously Issued Financial Statements (Details) [Line Items] | ||||
Stock compensation expense | $ 258,636 |
Restatement of Previously Iss_4
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued balance | 12 Months Ended |
Feb. 28, 2021 USD ($) | |
As Previously Reported [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Accrued expenses (including accrued interest) | $ 1,288,107 |
Note payable | 159,922 |
Derivative warrant liability | |
Additional paid-in capital | 446,126,640 |
Accumulated deficit | (465,883,499) |
Adjustments [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Accrued expenses (including accrued interest) | |
Note payable | |
Derivative warrant liability | 1,366,375 |
Additional paid-in capital | (136,004) |
Total liabilities | 258,636 |
Accumulated deficit | (1,366,375) |
Total stockholders’ deficit | 136,004 |
Total liabilities and stockholders’ deficit | (258,636) |
Reclassifications [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Accrued expenses (including accrued interest) | 3,668 |
Note payable | (3,668) |
Derivative warrant liability | |
Additional paid-in capital | |
Total liabilities | |
Accumulated deficit | |
Total stockholders’ deficit | |
Total liabilities and stockholders’ deficit | |
As Restated [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Accrued expenses (including accrued interest) | 1,291,775 |
Note payable | 156,255 |
Derivative warrant liability | 1,366,375 |
Additional paid-in capital | 446,249,272 |
Accumulated deficit | $ (467,372,506) |
Restatement of Previously Iss_5
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of operations | 12 Months Ended |
Feb. 28, 2021 USD ($) $ / shares | |
As Previously Reported [Member] | |
Condensed Income Statements, Captions [Line Items] | |
Selling, general and administrative expense | $ 1,318,602 |
Interest expense | 1,293,409 |
Gain on extinguishment of debt | 866,887 |
Gain on extinguishment of derivative warrant liability | |
Change in fair value of derivative warrant liability | |
Other income | 2,720,652 |
Net income | $ 842,528 |
Net income per share, basic and diluted (in Dollars per share) | $ / shares | $ 0.01 |
Adjustments [Member] | |
Condensed Income Statements, Captions [Line Items] | |
Selling, general and administrative expense | $ 258,636 |
Interest expense | (13,460) |
Gain on extinguishment of debt | (133,500) |
Gain on extinguishment of derivative warrant liability | 13,611 |
Change in fair value of derivative warrant liability | (432,714) |
Other income | |
Net income | (797,780) |
Reclassifications [Member] | |
Condensed Income Statements, Captions [Line Items] | |
Selling, general and administrative expense | |
Interest expense | |
Gain on extinguishment of debt | 2,713,652 |
Gain on extinguishment of derivative warrant liability | |
Change in fair value of derivative warrant liability | |
Other income | (2,713,652) |
Net income | |
As Restated [Member] | |
Condensed Income Statements, Captions [Line Items] | |
Selling, general and administrative expense | 1,577,238 |
Interest expense | 1,279,949 |
Gain on extinguishment of debt | 3,447,039 |
Gain on extinguishment of derivative warrant liability | 13,611 |
Change in fair value of derivative warrant liability | (432,714) |
Other income | 7,000 |
Net income | $ 44,748 |
Net income per share, basic and diluted (in Dollars per share) | $ / shares | $ 0 |
Restatement of Previously Iss_6
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit - USD ($) | 12 Months Ended | |
Feb. 28, 2021 | Feb. 28, 2020 | |
As Previously Reported [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ (19,749,750) | $ (23,302,937) |
As Previously Reported [Member] | Common Stock [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ 7,109 | $ 5,639 |
Balance (in Shares) | 71,107,442 | 56,400,874 |
As Previously Reported [Member] | Additional Paid-In Capital [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ 446,126,640 | $ 443,417,452 |
As Previously Reported [Member] | Accumulated Deficit [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | (465,883,499) | (466,726,027) |
Prior period revisions [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Prior period revisions | (1,366,375) | (560,231) |
Prior period revisions [Member] | Common Stock [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Prior period revisions | $ 19 | |
Prior period revisions (in Shares) | 192,641 | |
Prior period revisions [Member] | Additional Paid-In Capital [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Prior period revisions | $ 122,632 | $ 130,977 |
Prior period revisions [Member] | Accumulated Deficit [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Prior period revisions | (1,489,007) | (691,227) |
Corrections of errors [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Corrections of errors | ||
Corrections of errors [Member] | Common Stock [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Corrections of errors (in Shares) | (4,433) | (4,469) |
As Restated [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ (21,116,125) | $ (23,863,168) |
As Restated [Member] | Common Stock [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ 7,109 | $ 5,658 |
Balance (in Shares) | 71,103,009 | 56,589,046 |
As Restated [Member] | Additional Paid-In Capital [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ 446,249,272 | $ 443,548,428 |
As Restated [Member] | Accumulated Deficit [Member] | ||
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of shareholder deficit [Line Items] | ||
Balance | $ (467,372,506) | $ (467,417,254) |
Restatement of Previously Iss_7
Restatement of Previously Issued Financial Statements (Details) - Schedule of the company’s previously issued statement of cash flows | 12 Months Ended |
Feb. 28, 2021 USD ($) | |
As Previously Reported [Member] | |
Cash flows from operating activities: | |
Net income | $ 842,528 |
Gain on extinguishment of liabilities | (3,585,639) |
Gain on extinguishment of derivative warrant liability | |
Change in fair value of derivative warrant liability | |
Share-based compensation expense | 193,750 |
Changes in working capital assets and liabilities: | |
Operating lease right-to-use asset | |
Accounts payable and accrued expenses | 99,839 |
Accrued interest on notes payable | 847,987 |
Operating lease liability | (10,564) |
Supplemental schedule of non-cash transactions: | |
Notes payable converted into shares of common stock | 267,000 |
Adjustments [Member] | |
Cash flows from operating activities: | |
Net income | (797,780) |
Gain on extinguishment of liabilities | 133,500 |
Gain on extinguishment of derivative warrant liability | (13,611) |
Change in fair value of derivative warrant liability | 432,714 |
Share-based compensation expense | 258,636 |
Changes in working capital assets and liabilities: | |
Operating lease right-to-use asset | |
Accounts payable and accrued expenses | |
Accrued interest on notes payable | (13,460) |
Operating lease liability | |
Supplemental schedule of non-cash transactions: | |
Notes payable converted into shares of common stock | (267,000) |
Reclassifications [Member] | |
Cash flows from operating activities: | |
Net income | |
Gain on extinguishment of liabilities | 5,100 |
Gain on debt settlement | (71,775) |
Gain on extinguishment of derivative warrant liability | |
Change in fair value of derivative warrant liability | |
Share-based compensation expense | |
Changes in working capital assets and liabilities: | |
Operating lease right-to-use asset | 7,220 |
Accounts payable and accrued expenses | (185,308) |
Accrued interest on notes payable | 251,983 |
Operating lease liability | (7,220) |
Supplemental schedule of non-cash transactions: | |
Notes payable converted into shares of common stock | |
As Restated [Member] | |
Cash flows from operating activities: | |
Net income | 44,748 |
Gain on extinguishment of liabilities | (3,447,039) |
Gain on debt settlement | (71,775) |
Gain on extinguishment of derivative warrant liability | (13,611) |
Change in fair value of derivative warrant liability | 432,714 |
Share-based compensation expense | 452,386 |
Changes in working capital assets and liabilities: | |
Operating lease right-to-use asset | 7,220 |
Accounts payable and accrued expenses | (85,469) |
Accrued interest on notes payable | 1,086,510 |
Operating lease liability | (17,784) |
Supplemental schedule of non-cash transactions: | |
Notes payable converted into shares of common stock |
Inventories (Details) - Schedul
Inventories (Details) - Schedule of inventories - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Schedule of inventories [Abstract] | ||
Raw materials | $ 129,836 | $ 91,739 |
Work-in-process | 14,421 | |
Finished goods | 2,427 | |
Total inventory | $ 144,257 | $ 94,166 |
Prepaid and Other Current Ass_3
Prepaid and Other Current Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Nov. 30, 2019 | |
Prepaid and Other Current Assets (Details) [Line Items] | ||
Ownership percentage | 49% | |
Joint venture Contribution | $ 250,000 | |
Fair value of order placed | $ 1,000,000 | |
Notes payable | $ 700,000 | |
Jiangsu Shengfeng [Member] | ||
Prepaid and Other Current Assets (Details) [Line Items] | ||
Ownership percentage | 51% | |
Joint venture Contribution | $ 9,750,000 | |
Working capital | 500,000 | |
Advance payment | $ 700,000 |
Prepaid and Other Current Ass_4
Prepaid and Other Current Assets (Details) - Schedule of prepaid and other current assets - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Schedule of prepaid and other current assets [Abstract] | ||
Prepaid annual software licenses | $ 94,907 | |
Prepaid commissions | 73,390 | 63,500 |
Vendor advances | 35,500 | 37,400 |
Other prepaid expenses | 51,656 | 14,303 |
Total other current assets | $ 255,453 | $ 115,203 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 14,765 | $ 743 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details) - Schedule of property and equipment - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | $ 500,034 | $ 15,613 |
Less accumulated depreciation and amortization | (15,508) | (743) |
Property, plant and equipment, net | 484,526 | 14,870 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 56,530 | |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 276,762 | 15,613 |
Vehicle [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 96,334 | |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | 59,816 | |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated useful lives | $ 10,592 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details) - USD ($) | 12 Months Ended | ||
Feb. 28, 2022 | Aug. 31, 2021 | Feb. 28, 2021 | |
Convertible Notes Payable [Abstract] | |||
Aggregate amount | $ 4,000,000 | $ 330,000 | |
Outstanding balance | $ 1,402,971 | $ 1,402,971 | |
Interest per annum | 5% | ||
Conversion price per share (in Dollars per share) | $ 1.4 | ||
Maturity date, description | The notes were originally due in 2014 to 2017, and were all amended in 2018 and the maturity date for all the notes was changed to January 11, 2023. | ||
Accrued interest | $ 284,063 | $ 213,884 |
Convertible Notes Payable (De_2
Convertible Notes Payable (Details) - Schedule of convertible notes payable - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Schedule of convertible notes payable [Abstract] | ||
Convertible notes payable | $ 1,402,971 | $ 1,402,971 |
Non-current | (1,402,971) | |
Current | $ 1,402,971 |
Convertible Note Payable-Rela_3
Convertible Note Payable-Related Party (Details) - USD ($) | Jan. 24, 2017 | Feb. 28, 2022 | Feb. 28, 2021 |
Convertible Note Payable Related Party [Abstract] | |||
Convertible note | $ 3,000,000 | ||
Interest per annum | 5% | ||
Conversion price per share (in Dollars per share) | $ 1.4 | ||
Accrued interest | $ 562,911 | $ 412,911 |
Convertible Note Payable-Rela_4
Convertible Note Payable-Related Party (Details) - Schedule of convertible note payable – related party - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Schedule of convertible note payable – related party [Abstract] | ||
Convertible note payable | $ 3,000,000 | $ 3,000,000 |
Non-current | (3,000,000) | |
Current | $ 3,000,000 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 | Apr. 23, 2020 | Jun. 20, 2013 | Feb. 28, 2022 | Feb. 28, 2021 | |
Notes Payable (Details) [Line Items] | |||||
Description of economic injury disaster loan | On July 1, 2020, the Company received a $150,000 loan under this program. The proceeds can be used to fund payroll, healthcare benefits, rent and other qualifying expenses, and the loan is not subject to a loan forgiveness provision. The loan is due July 1, 2050, interest accrues at 3.75% per annum, and is secured by the assets of the Company. | ||||
Description of notes payable vehicle and equipment | the Company purchased two pieces of equipment and a vehicle for $329,297 as a part of its efforts to expand its operations and research and development capacities. The Company made down payments aggregating $41,300 with the balance financed by two notes payable aggregating $287,997. The notes are secured by the equipment and vehicle purchased. One note is due in 36 equal monthly payments of approximately $6,100 each, including interest at 2.9% per annum. The second note is due in 72 equal monthly payments of approximately $1,500 each, including interest at 10.9% interest per annum. As of February 28, 2022, the balance of the notes was $265,616. | ||||
Notes payable interest rate | 10% | ||||
Total gain on extinguishment of debt | $ 167,104 | ||||
Convertible notes payable aggregate amount | $ 125,000 | ||||
Convertible notes payable description | The loans were not paid when due, and in September 2019, the note holders and the Company reached a settlement for past due principal, accrued interest, and fees of approximately $325,000. As of February 28, 2020, the outstanding balance of the settlement note was $215,181. During the year ended February 28, 2021, the Company paid $95,000 of the note, and as of February 28, 2021, the outstanding balance was $120,181. During the year ended February 28, 2022, the Company paid the remaining balance of $120,181. | ||||
Description of other notes payable | During the year ended February 28, 2021, an aggregate of $743,386, consisting of $491,537 of demand notes principal and $251,849 of accrued interest, was extinguished as the related statute of limitations were determined to have expired (see Note 12). | ||||
Notes payable on accrued interest | $ 36,541 | $ 28,822 | |||
PPP Loan [Member] | |||||
Notes Payable (Details) [Line Items] | |||||
Loan amount | $ 91,200 | $ 74,405 | |||
Notes payable interest rate | 1% | ||||
Principal and accrued interest | $ 92,000 | $ 75,100 |
Notes Payable (Details) - Sched
Notes Payable (Details) - Schedule of notes payable consisted - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | $ 425,616 | $ 354,586 |
Non-current | 327,658 | 156,255 |
Secured notes payable [Member] | Note payable-EID loan [Member] | ||
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | 150,000 | 150,000 |
Secured notes payable [Member] | Notes payable-vehicles and equipment [Member] | ||
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | 265,616 | |
Unsecured notes payable [Member] | Notes payable-PPP loans [Member] | ||
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | 74,405 | |
Unsecured notes payable [Member] | Note payable-Abdou [Member] | ||
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | 120,181 | |
Unsecured notes payable [Member] | Note payable-other-in default [Member] | ||
Notes Payable (Details) - Schedule of notes payable consisted [Line Items] | ||
Total | $ 10,000 | $ 10,000 |
Notes Payable-Related Parties_3
Notes Payable-Related Parties-In Default (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Mar. 14, 2022 | Nov. 20, 2019 | Feb. 28, 2022 | Feb. 28, 2021 | Apr. 30, 2014 | |
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Accrued interest | $ 3,668 | $ 3,668 | |||
Fair value of warrants estimated | $ 1,000,000 | (476,602) | 432,714 | ||
Note payable amount | 5,607,323 | ||||
Kopple Notes [Member] | |||||
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Aggregate amount | $ 10,000,000 | 6,107,323 | |||
Accrued interest | 6,533,318 | 5,710,464 | |||
Notes payable and accrued interest | $ 12,140,641 | 11,317,787 | |||
Warrants exercisable shares (in Shares) | 3,331,664 | ||||
Kopple Notes [Member] | Minimum [Member] | |||||
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Unsecured bear interest rate | 5% | ||||
Kopple Notes [Member] | Maximum [Member] | |||||
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Unsecured bear interest rate | 15% | ||||
Gagerman Notes [Member] | |||||
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Accrued interest | $ 73,428 | 65,228 | |||
Notes payable and accrued interest | 155,428 | $ 147,228 | |||
Note payable amount | $ 82,000 | ||||
Bears interest, percentage | 10% | ||||
Jiangsu Shengfeng Note [Member] | |||||
Notes Payable-Related Parties-In Default (Details) [Line Items] | |||||
Return of joint venture | $ 700,000 | ||||
Non-interest-bearing promissory note | $ 700,000 | ||||
Principal due amount | $ 700,000 |
Notes Payable-Related Parties_4
Notes Payable-Related Parties-In Default (Details) - Schedule of notes payable-related parties - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Notes Payable-Related Parties-In Default (Details) - Schedule of notes payable-related parties [Line Items] | ||
Total | $ 12,996,069 | $ 12,165,015 |
Non-current | ||
Current | 12,996,069 | 12,165,015 |
Koppel [Member] | ||
Notes Payable-Related Parties-In Default (Details) - Schedule of notes payable-related parties [Line Items] | ||
Notes payable | 5,607,323 | 5,607,323 |
Accrued interest | 6,533,318 | 5,710,464 |
Subtotal | 12,140,641 | 11,317,787 |
Gagerman [Member] | ||
Notes Payable-Related Parties-In Default (Details) - Schedule of notes payable-related parties [Line Items] | ||
Notes payable | 82,000 | 82,000 |
Accrued interest | 73,428 | 65,228 |
Subtotal | 155,428 | 147,228 |
Jiangsu Shengfeng [Member] | ||
Notes Payable-Related Parties-In Default (Details) - Schedule of notes payable-related parties [Line Items] | ||
Notes payable | $ 700,000 | $ 700,000 |
Accrued Expenses (Details) - S
Accrued Expenses (Details) - Schedule of accrued expenses - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Schedule of accrued expenses [Abstract] | ||
Accrued payroll and related expenses | $ 431,597 | $ 547,412 |
Accrued interest-convertible notes payable | 284,063 | 213,884 |
Accrued interest-convertible notes payable related party | 562,911 | 412,911 |
Accrued interest-notes payable | 36,541 | 28,822 |
Other accrued expenses | 377,061 | 88,746 |
Accrued expenses | $ 1,692,173 | $ 1,291,775 |
Gain on Extinguishment of Debt
Gain on Extinguishment of Debt (Details) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Gain on Extinguishment of Debt (Details) [Line Items] | ||
Accrued wages and vendor payables | $ 2,704,000 | |
Notes payable and accrued interest | $ 743,000 | |
Gain on extinguishment of debt | $ 2,713,652 | |
Debt [Member] | ||
Gain on Extinguishment of Debt (Details) [Line Items] | ||
Gain on extinguishment of debt | $ 3,447,039 |
Leases (Details)
Leases (Details) - ft² | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Leases (Details) [Line Items] | ||
Rental description | The initial monthly base rental rate was approximately $22,000 per month and escalates 3% each year to approximately $26,000 per month in 2026. | |
Lease terms per annum discount rate | 10% | |
Stanton [Member] | ||
Leases (Details) [Line Items] | ||
Square feet of facility | 20,000 | |
Lake Forest, California [Member] | ||
Leases (Details) [Line Items] | ||
Square feet of facility | 18,000 |
Leases (Details) - Schedule of
Leases (Details) - Schedule of lease expense and supplemental cash flow information related to leases - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of lease expense and supplemental cash flow information related to leases [Abstract] | ||
Operating lease cost (included in general and administration in the Company’s statement of operations) | $ 279,000 | $ 170,000 |
Cash paid for amounts included in the measurement of lease liabilities for the years ended February 28, 2022 | $ 222,000 | |
Weighted average remaining lease term – operating leases (in years) | 4 years 6 months | 5 years 6 months |
Average discount rate – operating leases | 10% | 10% |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of supplemental balance sheet information related to leases | Feb. 28, 2022 USD ($) |
Schedule of supplemental balance sheet information related to leases [Abstract] | |
Long-term right-of-use assets | $ 1,000,467 |
Short-term operating lease liabilities | 179,450 |
Long-term operating lease liabilities | 867,484 |
Total operating lease liabilities | $ 1,046,934 |
Leases (Details) - Schedule o_3
Leases (Details) - Schedule of maturities of the Company’s lease liability | Feb. 28, 2022 USD ($) |
Schedule of maturities of the Company’s lease liability [Abstract] | |
2023 | $ 275,000 |
2024 | 283,000 |
2025 | 292,000 |
2026 | 300,000 |
2027 | 128,000 |
Total lease payments | 1,278,000 |
Less: Imputed interest/present value discount | (231,066) |
Present value of lease liabilities | $ 1,046,934 |
Derivative Warrant Liabilitie_2
Derivative Warrant Liabilities (Details) - Schedule of derivative warrant liabilities - Derivative Warrant Liabilities [Member] - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Derivative Warrant Liabilities (Details) - Schedule of derivative warrant liabilities [Line Items] | ||
Stock price (in Dollars per share) | $ 0.41 | $ 0.35 |
Risk free interest rate | 1% | 1.80% |
Expected volatility | 170% | 232% |
Expected life in years | 11 months 23 days | 2 years |
Expected dividend yield | 0% | 0% |
Number of warrants (in Shares) | 4,800,834 | 5,662,272 |
Fair value of derivative warrant liability (in Dollars) | $ 828,232 | $ 1,366,375 |
Derivative Warrant Liabilitie_3
Derivative Warrant Liabilities (Details) - Schedule of derivative outstanding warrant liabilities - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of derivative outstanding warrant liabilities [Abstract] | ||
Number of Warrants Outstanding, Beginning balance | 5,662,272 | 5,816,939 |
Fair Value of Outstanding Warrants, Beginning balance | $ 1,366,375 | $ 947,272 |
Number of Warrants Outstanding, Revaluation of derivative liability for ourstanding warrants | ||
Fair Value of Outstanding Warrants, Revaluation of derivative liability for ourstanding warrants | $ (476,603) | $ 432,714 |
Number of Warrants Outstanding, Expiration of warrants - gain on extinguishment | (861,438) | (154,667) |
Fair Value of Outstanding Warrants, Expiration of warrants - gain on extinguishment | $ (61,540) | $ (13,611) |
Number of Warrants Outstanding, ending balance | 4,800,834 | 5,662,272 |
Fair Value of Outstanding Warrants, ending balance | $ 828,232 | $ 1,366,375 |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2021 | Oct. 31, 2011 | Sep. 30, 2009 | Feb. 28, 2022 | Feb. 28, 2021 | |
Stockholders' Deficit (Details) [Line Items] | |||||
Common stock, shares authorized | 150,000,000 | 150,000,000 | 150,000,000 | ||
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||
Fair value for settlement of debt (in Dollars) | $ 103,909 | $ 550,000 | $ 103,909 | ||
Common stock fair value (in Dollars) | 73,500 | ||||
Total option share value | 2,750,000 | ||||
Option expired term | 5 years | ||||
Aggregate fair value of options (in Dollars) | $ 576,879 | ||||
Volatility rate | 226% | ||||
Discount rate | 0.34% | ||||
Expected dividend yield rate | 0% | 0% | |||
Expected life | 3 years | ||||
Stock-based compensation expense (in Dollars) | $ 612,093 | $ 452,386 | |||
2006 Employee Stock Option Plan [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Grants options shares | 10,000,000 | ||||
Outstanding shares, percentage | 15% | ||||
2011 Plan [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Outstanding shares, percentage | 15% | ||||
Common Stock [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Aggregate of common stock shares | 12,016,095 | 14,513,963 | |||
Sold shares of common stock | 10,199,665 | 14,098,327 | |||
Issued shares | 415,636 | 1,571,429 | 415,636 | ||
Issued shares of common stock for services | 245,001 | 415,636 | |||
Minimum [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Volatility rate | 222% | ||||
Discount rate | 0.16% | ||||
Expected life | 2 years 6 months | ||||
Maximum [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Volatility rate | 226% | ||||
Discount rate | 0.57% | ||||
Expected life | 3 years | ||||
Stock Options [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Issued shares | 2,750,000 | 2,750,000 | |||
Stock-based compensation expense (in Dollars) | $ 258,636 | ||||
Private Placement [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Net proceeds of private placement (in Dollars) | $ 2,652,860 | $ 2,146,000 | |||
Board of Directors [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Aggregate of common stock shares | 2,750,000 | ||||
Options exercisable shares | 500,000 | ||||
Exercise price, per share (in Dollars per share) | $ 0.5 | $ 0.5 | |||
Vested shares | 750,000 | ||||
Vest period | 12 months | 12 months | |||
Option expired term | 5 years | ||||
Aggregate fair value of options (in Dollars) | $ 487,600 | ||||
Grant of stock option | 1,500,000 | ||||
Stock option shares issued | 1,500,000 | ||||
President [Member] | |||||
Stockholders' Deficit (Details) [Line Items] | |||||
Options exercisable shares | 2,250,000 | ||||
Exercise price, per share (in Dollars per share) | $ 0.25 | ||||
Vested shares | 2,000,000 |
Stockholders' Deficit (Detail_2
Stockholders' Deficit (Details) - Schedule of stock options outstanding - Directors and Officers 2011 plan [Member] - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Stockholders' Deficit (Details) - Schedule of stock options outstanding [Line Items] | ||
Total options, Beginning balance, Number of Shares | 5,290,001 | 1,040,001 |
Total options, Beginning balance, Exercise Price | $ 0.77 | $ 1.4 |
Total options, Beginning balance, Weighted Average Intrinsic Value | $ 225,000 | |
Granted, Number of Shares | 4,250,000 | |
Granted, Exercise Price | $ 0.38 | |
Granted, Weighted Average Intrinsic Value | $ 225,000 | |
Exercised, Number of Shares | ||
Exercised, Exercise Price | ||
Exercised, Weighted Average Intrinsic Value | ||
Cancelled, Number of Shares | (230,232) | |
Cancelled, Exercise Price | $ 1.4 | |
Cancelled, Weighted Average Intrinsic Value | ||
Total options, Beginning balance, Number of Shares | 5,059,769 | 5,290,001 |
Total options, Beginning balance, Exercise Price | $ 0.55 | $ 0.77 |
Total options, Beginning balance, Weighted Average Intrinsic Value | $ 360,000 | $ 225,000 |
Exercisable, Beginning balance, Number of Shares | 5,059,769 | |
Exercisable, Beginning balance, Exercise Price | $ 0.55 | |
Exercisable, Beginning balance, Weighted Average Intrinsic Value | $ 360,000 |
Stockholders' Deficit (Detail_3
Stockholders' Deficit (Details) - Schedule of exercise prices and information related to options | 12 Months Ended |
Feb. 28, 2022 $ / shares shares | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Stock Options Outstanding (in Shares) | shares | 5,059,769 |
Stock Options Exercisable (in Shares) | shares | 5,059,769 |
Weighted Average Remaining Contractual Life | 3 years 3 months |
Weighted Average Exercise Price of Options Outstanding | $ 0.55 |
Weighted Average Exercise Price of Options Exercisable | 0.55 |
Minimum [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price | 0.25 |
Maximum [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price | $ 1.4 |
Stockholders' Deficit (Detail_4
Stockholders' Deficit (Details) - Schedule of warrants - $ / shares | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of warrants [Abstract] | ||
Outstanding, Beginning balance, Number of Warrants | 5,662,272 | 5,816,939 |
Outstanding, Beginning balance, Exercise Price | $ 1.4 | $ 1.4 |
Granted, Number of Warrants | ||
Granted, Exercise Price | ||
Exercised, Number of Warrants | ||
Exercised, Exercise Price | ||
Cancelled, Number of Warrants | (861,438) | (154,667) |
Cancelled, Exercise Price | $ 1.4 | $ 1.4 |
Outstanding, Ending balance, Number of Warrants | 4,800,834 | 5,662,272 |
Outstanding, Ending balance, Exercise Price | $ 1.4 | $ 1.4 |
Stockholders' Deficit (Detail_5
Stockholders' Deficit (Details) - Schedule of exercise prices and information related to options - Exercise price one [Member] | 12 Months Ended |
Feb. 28, 2022 $ / shares shares | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Range of Exercise Price | $ 1.4 |
Stock Warrants Outstanding (in Shares) | shares | 4,800,834 |
Stock Warrants Exercisable (in Shares) | shares | 4,800,834 |
Weighted Average Remaining Contractual Life | 11 months 23 days |
Weighted Average Exercise Price of Warrants Outstanding | $ 1.4 |
Weighted Average Exercise Price of Warrants Exercisable | $ 1.4 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes (Details) [Line Items] | ||
Income tax expense | $ 800 | |
Valuation allowance | $ 4,800,000 | $ 5,800,000 |
Description of uncertain income tax | Company adopted the provisions of ASC 740, which requires companies to determine whether it is “more likely than not” that a tax position will be sustained upon examination by the appropriate taxing authorities before any tax benefit can be recorded in the financial statements. ASC 740 also provides guidance on the recognition, measurement, classification and interest and penalties related to uncertain tax positions. As of February 28, 2022 and 2021, no liability for unrecognized tax benefits was required to be recorded or disclosed. | |
Income tax, description | The Company has failed to file its California tax returns for the years ended February 28, 2015 thru February 28, 2022 due to its inability to pay the minimum annual franchise tax payment of $800. The balance of accrued income taxes related to unpaid California franchise tax of $4,800 represents six years of minimum taxes due. | |
Federal [Member] | ||
Income Taxes (Details) [Line Items] | ||
Operating loss carry-forwards | $ 168.4 | |
Taxable income | $ 96.8 |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of Company recorded an income tax expense - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Current: | ||
Federal | ||
State | 800 | |
Total current | 800 | |
Deferred: | ||
Federal | ||
State | ||
Total deferred | ||
Total Provision | $ 800 |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of valuation allowance for the deferred tax assets on the expected future | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of valuation allowance for the deferred tax assets on the expected future [Abstract] | ||
Federal tax benefit at statutory rate | 21% | 21% |
State tax benefit, net of federal benefit | 7% | 7% |
Change in valuation allowance | (28.00%) | (28.00%) |
Total | 0% | 0% |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of significant components of our deferred tax asset - USD ($) | Feb. 28, 2022 | Feb. 28, 2021 |
Deferred tax asset | ||
Net operating loss carryforwards | $ 42,141,000 | $ 46,999,000 |
Gross deferred tax assets | 42,141,000 | 46,999,000 |
Valuation allowance | (42,141,000) | (46,999,000) |
Net deferred tax asset (liability) |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 12 Months Ended | |
Feb. 28, 2022 | Feb. 28, 2021 | |
Related Party Transactions (Details) [Line Items] | ||
Incurred | $ 137,500 | $ 131,300 |
Accounts payable and accrued expenses | $ 218,507 | $ 602,501 |
Related party transactions, description | the Company issued 1,285,714 shares of common stock with a fair value of $450,000 for the settlement of accounts payable of $450,000 due to Bettersea. Also during fiscal 2022, the Company issued 285,715 shares of common stock with a fair value of $100,000 for the settlement of accounts payable of $100,000 due to the Company’s President. During fiscal 2021, the Company issued 415,636 common shares with a fair value of $103,909 for the settlement of accounts payable of $103,909 due to a 50% owner of Bettersea. There were no gains or losses recognized on these transactions. | |
Bettersea [Member] | ||
Related Party Transactions (Details) [Line Items] | ||
Ownership percentage | 11% | 10.40% |
Contingencies (Details)
Contingencies (Details) - USD ($) $ / shares in Units, shares in Millions | 1 Months Ended | 12 Months Ended | |||
Jul. 31, 2017 | Feb. 28, 2022 | Aug. 31, 2021 | Feb. 28, 2021 | Mar. 26, 2019 | |
Contingencies (Details) [Line Items] | |||||
Accrued salary and related charges | $ 2,704,000 | ||||
Principal amount and accrued interest | $ 4,000,000 | $ 330,000 | |||
Settlement amount | $ 13,000,000 | $ 108,400 | |||
Maturity date | Sep. 01, 2022 | ||||
Remaining balance | $ 221,600 | ||||
Percentage of accrues interest | 10% | ||||
Warrants exercised (in Shares) | 23 | ||||
Warrants exercisable term | 7 years | ||||
Warrants per share (in Dollars per share) | $ 0.1 | ||||
Description of loan fees and late payment | Under the terms of the settlement, we have agreed to pay an aggregate amount of $10 million over a period of seven years; $3 million of which is to be paid on or before June 8, 2022, after which, interest will accrue on the unpaid balance at a rate of 6%, compounded annually. All amounts, including all accrued interest, are to be paid no later than eight years from the date of the initial payment. The Kopple Parties have also received seven-year warrants to purchase up to an aggregate of approximately 3.3 million shares of our common stock at a price of $0.85 per share. The settlement also provides for standard mutual general release provisions and includes customary representations, warranties, and covenants, including certain increases in the amount payable to the Kopple Parties and the right of such parties to enter judgment against the Company if the Company remains in uncured default in its payment obligations under the settlement. As of June 8, 2022 and the date of this report, the Company has not yet paid the $3,000,000 installment due to Kopple. Pursuant to the agreement, the Company has 60 days to cure the nonpayment of the $3,000,000 default. | ||||
Stanton Facility [Member] | |||||
Contingencies (Details) [Line Items] | |||||
Accrued salary and related charges | $ 238,000 | ||||
Director [Member] | |||||
Contingencies (Details) [Line Items] | |||||
Shares issued (in Shares) | 27.5 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 12 Months Ended | ||
Mar. 14, 2022 | Feb. 28, 2022 | Feb. 28, 2021 | |
Subsequent Events (Details) [Line Items] | |||
Notes payable issued amount | $ 5,607,323 | ||
Notes payable | $ 12,140,641 | ||
Accrued interest amount | $ 11,317,787 | ||
Shares issued (in Shares) | 1,153,666 | ||
Cash proceeds | $ 346,100 | ||
Subsequent Event [Member] | |||
Subsequent Events (Details) [Line Items] | |||
Settlement description | Under the terms of the settlement, the Company agreed to pay Kopple an aggregate amount of $10,000,000, including $3,000,000 to be paid by June 8, 2022, and granted Koppel warrants exercisable into 3,331,664 shares of the Company’s common stock at a price of $0.85 per share. The fair value of the warrants is estimated to be $1,000,000, resulting in total consideration to Kopple of approximately $11,000,00. Pursuant to current accounting guidelines, the Company will only recognize any gain on the settlement of the Kopple notes and accrued interest of $12,140,161 upon completion of all settlement payments. As of June 8, 2022 and the date of this report, the Company has not yet paid the $3,000,000 installment due to Kopple. Pursuant to the agreement, the Company has 60 days to cure the nonpayment of the $3,000,000 default. |