Document and Entity Information
Document and Entity Information | 12 Months Ended |
Feb. 28, 2018shares | |
Document And Entity Information [Abstract] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Feb. 28, 2018 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | FY |
Trading Symbol | LBIX |
Entity Registrant Name | LEADING BRANDS INC |
Entity Central Index Key | 884,247 |
Current Fiscal Year End Date | --02-28 |
Entity Well-known Seasoned Issuer | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Common Stock, Shares Outstanding | 2,802,412 |
Consolidated Balance Sheets
Consolidated Balance Sheets - CAD ($) | Feb. 28, 2018 | Feb. 28, 2017 |
Current | ||
Cash and cash equivalents | $ 786,340 | $ 4,315,028 |
Restricted cash (note 2) | 583,012 | |
Accounts receivable | 85,628 | |
Inventory (Note 3) | 361,102 | |
Prepaid expenses and deposits (Note 5) | 81,143 | 129,520 |
Total Current Assets | 1,450,495 | 4,891,278 |
Property, plant and equipment (Note 4) | 3,157 | 765,024 |
Intangible assets (Note 6) | 279,189 | |
Assets attributable to discontinued operations (Note 16) | 26,195 | |
Total Assets | 1,453,652 | 5,979,686 |
Current | ||
Accounts payable and accrued liabilities | 117,405 | 605,046 |
Liabilities attributable to discontinued operations (Note 16) | 250,000 | 300,000 |
Derivative Liability - non-employee stock options(Note 9) | 23,024 | 46,352 |
Total Liabilities | 390,429 | 951,398 |
Shareholders' Equity | ||
Share Capital (Note 7(a)) Authorized 500,000,000 common shares without par value 20,000,000 preferred shares without par value Issued 2,802,412 common shares (2017 - 2,802,412) | 31,305,247 | 31,305,247 |
Additional paid-in capital | 19,455,359 | 19,455,359 |
Accumulated other comprehensive income- currency translation adjustment | 577,916 | |
Accumulated deficit | (49,697,383) | (46,310,234) |
Total Stockholders Equity | 1,063,223 | 5,028,288 |
Total Liabilities and Shareholders' Equity | $ 1,453,652 | $ 5,979,686 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Feb. 28, 2018 | Feb. 28, 2017 |
Statement of Financial Position [Abstract] | ||
Common Stock, Shares Authorized | 500,000,000 | 500,000,000 |
Common Stock, No Par Value | ||
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, No Par Value | ||
Common Stock, Shares, Issued | 2,802,412 | 2,802,412 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Expenses (income) | |||
Selling, general and administrative | $ 876,088 | $ 726,530 | $ 1,277,127 |
Depreciation of property, plant, equipment and intangible asset | 1,053 | 1,053 | 1,316 |
Interest income | (19,703) | (4,900) | |
Other income | (3,995) | ||
Change in fair value of derivative liability | (23,328) | (13,638) | (81,317) |
Operating Expenses | 830,115 | 713,945 | 1,192,226 |
Loss before income tax | (830,115) | (713,945) | (1,192,226) |
Income tax provision (recovery) (Note 10) | 0 | 0 | 0 |
Net loss from continuing operations | (830,115) | (713,945) | (1,192,226) |
Net loss from discontinued operations (Note 16) | (2,557,034) | (5,795,744) | (111,058) |
Net and Comprehensive loss | $ (3,387,149) | $ (6,509,689) | $ (1,303,284) |
Basic and diluted loss per common share | |||
Continuing operations | $ (0.30) | $ (0.25) | $ (0.41) |
Discontinued operations | (0.91) | (2.05) | (0.04) |
Net basic loss per common share | $ (1.21) | $ (2.31) | $ (0.45) |
Weighted average common shares outstanding | |||
Basic and diluted (Note 7(e)) | 2,802,412 | 2,820,647 | 2,880,882 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Cash provided by (used in) Operating activities | |||
Net loss from continuing operations | $ (830,115) | $ (713,945) | $ (1,192,226) |
Net loss from discontinued operations | (2,557,034) | (5,795,744) | (111,058) |
Net loss for the year | (3,387,149) | (6,509,689) | (1,303,284) |
Items not involving cash | |||
Depreciation of property, plant, equipment and intangible asset | 74,398 | 634,692 | 705,024 |
Leasehold inducement | (22,234) | 22,234 | |
Loss on disposal of assets | 752 | 1,581,672 | 1,757 |
Loss on sale of legacy beverage operations | 1,071,396 | ||
Stock based compensation (Note 8) | 104,850 | ||
Change in derivative liability (Note 9) | (23,328) | (13,638) | (81,317) |
Deferred income tax provision (recovery) | 2,480,257 | (436,654) | |
Changes in non-cash operating working capital | |||
Accounts receivable, net | (53,809) | 238,949 | (21,445) |
Inventory, net | 102,137 | 606,928 | 348,596 |
Prepaid expenses and other assets | 19,257 | 260,931 | (127,063) |
Accounts payable and accruals | (400,513) | (609,672) | (46,571) |
Net Cash Provided by (Used in) Operating Activities | (2,596,859) | (1,351,804) | (833,873) |
Investing activities | |||
Purchase of property, plant and equipment | (10,449) | (200,221) | |
Purchase of intangible asset | (20,053) | (120,146) | (210,892) |
Proceeds on disposal of assets | 11,000 | 5,654,397 | 1,199 |
Cash outflow on business disposition | (339,764) | ||
Net Cash Provided by (Used in) Investing Activities | (348,817) | 5,523,802 | (409,914) |
Financing activity | |||
Repurchase of common shares | (139,789) | (176,316) | |
Net Cash Provided by (Used in) Financing Activities | (139,789) | (176,316) | |
Increase (Decrease) in cash and cash equivalents | (2,945,676) | 4,832,209 | (1,420,104) |
Cash and cash equivalents, beginning of year | 4,315,028 | 282,819 | 1,702,922 |
Cash and cash equivalents, including restricted cash, end of year | 1,369,352 | 4,315,028 | 282,819 |
Supplementary disclosure of cash flow information | |||
Interest received | (23,698) | (4,900) | |
Interest paid | 85 | ||
Income taxes | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - CAD ($) | Total | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-In Capital [Member] | AOCI [Member] | Accum. Deficit [Member] |
Beginning Balance at Feb. 28, 2015 | $ 13,073,486 | $ 32,401,440 | $ 18,591,391 | $ 577,916 | $ (38,497,261) | |
Beginning Balance (Shares) at Feb. 28, 2015 | 2,900,542 | |||||
Net loss | (1,303,284) | (1,303,284) | ||||
Shares repurchased under provisions of the share repurchase plan | (176,316) | $ (454,708) | 278,392 | |||
Shares cancelled | $ (454,708) | 454,708 | ||||
Shares cancelled (Shares) | (40,705) | |||||
Stock based compensation expense (Note 8) | 83,880 | 83,880 | ||||
Ending Balance at Feb. 29, 2016 | 11,677,766 | $ 31,946,732 | 18,953,663 | 577,916 | (39,800,545) | |
Ending Balance (Shares) at Feb. 29, 2016 | 2,859,837 | |||||
Net loss | (6,509,689) | (6,509,689) | ||||
Shares repurchased under provisions of the share repurchase plan | (139,789) | (641,485) | 501,696 | |||
Shares cancelled | $ (641,485) | $ 641,485 | ||||
Shares cancelled (Shares) | (57,425) | |||||
Ending Balance at Feb. 28, 2017 | 5,028,288 | $ 31,305,247 | 19,455,359 | 577,916 | (46,310,234) | |
Ending Balance (Shares) at Feb. 28, 2017 | 2,802,412 | |||||
Net loss | (3,387,149) | (3,387,149) | ||||
Foreign exchange translation adjustment | (577,916) | $ (577,916) | ||||
Ending Balance at Feb. 28, 2018 | $ 1,063,223 | $ 31,305,247 | $ 19,455,359 | $ (49,697,383) | ||
Ending Balance (Shares) at Feb. 28, 2018 | 2,802,412 |
Operations and Summary of Signi
Operations and Summary of Significant Accounting Principles | 12 Months Ended |
Feb. 28, 2018 | |
Accounting Policies [Abstract] | |
Operations and Summary of Significant Accounting Principles | 1. Operations and Summary of Significant Accounting Principles Nature of Operations Leading Brands, Inc. (the “Company”) and its former subsidiaries were previously involved in the development, marketing and distribution of the Company’s beverage brands. As of September 18, 2017, the Company decided to exit the beverage business and pursue the production of film, television and gaming content via the acquisition of Liquid Media Group (“ Liquid Arrangement The Company entered into the Arrangement to acquire 100% of Liquid pursuant to the transaction. The Company’s shareholders are anticipated to hold 25.8% and Liquid shareholders are anticipated to hold 74.2% of the post-transaction entity. The agreed valuation of existing Company shares was determined to be $1.78 USD per share. The Company also announced its intention, that at the time of the closing of the transaction, that all of its Board members, with the exception of Mr. Tom Gaglardi, would resign and be replaced by Messrs. Jackson, Brezer and Cruz, and Ms. Katsoolis, who are directors and an officer of Liquid. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP). The consolidated financial statements include the accounts of the Company and its former subsidiaries until disposal. All intercompany transactions and balances have been eliminated in consolidation. The Company has experienced losses, negative operating cash flows and has discontinued its former operating businesses which raises substantial doubt about its ability to continue operating as a going concern within one year of the date of the financial statements. To alleviate this situation, the Company has plans in place to improve its financial position and liquidity by reducing costs that are not expected to have an adverse impact on the Company’s ability to transition to a new business segment. These include, among other cost reduction measures, the director’s fees as well as the CEO’s consulting fees being waived for a specified period if certain criteria are not met in relation to the Liquid transaction. As of the date of these financial statements, the Company has sufficient liquidity to meet its ongoing cash requirements for one year after the issuance date of the financial statements due to its planned cost management and reduction measures. Therefore, although substantial doubt has been raised, this has been alleviated by management’s plans. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. On an ongoing basis, the Company evaluates its estimates, including those related to inventories, trade receivables, useful lives of property, plant and equipment, capitalization of intangible assets, the useful lives of intangible assets, income taxes, and stock-based compensation, among others. The reported amounts and note disclosure are determined using management’s best estimates based on assumptions that reflect the most probable set of economic conditions and planned course of action. Actual results could differ from those estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. 1. Operations and Summary of Significant Accounting Principles (continued) Foreign Currency Translation The Company’s functional and reporting currency is the Canadian dollar. Foreign-currency denominated transactions are translated at the rate of exchange prevailing at the time of the transaction. Monetary assets and liabilities have been translated into Canadian dollars at the year-end Cash & Cash Equivalents Amounts recognized as cash and cash equivalents include investments of surplus cash in highly liquid securities with maturities at date of purchase of three months or less. Restricted Cash Restricted cash is comprised of cash held in a trust account pursuant to the terms of an escrow agreement arising from the disposition of the Company’s legacy beverage business. Accounts Receivable Accounts receivable invoices are recorded when the products are delivered and title transfers to customers or when bottling services are performed and collection of related receivables is reasonably assured. Allowances for doubtful accounts are based primarily on historical write-off 2018 2017 2016 Allowances for Doubtful Accounts Balance at beginning of year $ — $ — $ 36,329 Write-off — — (36,329 ) Balance at end of year $ — $ — $ — Inventory Raw materials and finished goods purchased for resale are valued at the lower of cost, determined on a first-in, first-out The remainder of this page is intentionally left blank. Property, plant and equipment Property, plant and equipment are recorded at cost and are amortized using the declining-balance method at annual rates as follows: Plant and equipment 7%—20% Buildings 5% Automotive equipment 20% Land improvements 8% Furniture, fixtures, computer hardware and software 20% Leasehold improvements are amortized over the lesser of their expected life or the lease term. Management reviews property, plant and equipment for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable. If required an undiscounted operating cash flow analysis is completed to determine if impairment exists. When testing for impairment of assets held for use, assets and liabilities are grouped at the lowest level for which cash flows are separately identifiable. If impairment is determined to exist, the loss is calculated based on estimated fair value. Intangible Assets Licenses and patents are recorded at cost and are amortized over their expected useful life of ten years. Management reviews intangible assets for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable. If required an undiscounted operating cash flow analysis is completed to determine if impairment exists. When testing for impairment of assets held for use, assets and liabilities are grouped at the lowest level for which cash flows are separately identifiable. If impairment is determined to exist, the loss is calculated based on estimated fair value. Leases Leases are classified as either capital or operating in nature. Capital leases are those which substantially transfer the benefits and risks of ownership to the lessee. Obligations recorded under capital leases are reduced by the principal portion of lease payments. The imputed interest portion of the lease payment is charged to expense. Revenue Recognition Revenue on sales of products is recognized when the products are delivered and title transfers to customers. Revenues from the provision of manufacturing, packaging or other services are recognized when the services are performed and collection of related receivables is reasonably assured. The Company records shipping and handling revenue as a component of sales revenue, and shipping and handling costs are included in the cost of sales. Incentives offered to customers including rebates, cash discounts, volume discounts, and slotting fees are recorded as a reduction of net sales when sales are recognized. Advertising Costs Advertising costs, which also include samples, trade show, product demo, and media promotion costs are expensed as incurred. During the years ended February 28, 2018, February 28, 2017 and February 29, 2016, the Company incurred advertising costs of $171,075, $496,456 and $603,502, respectively. Earnings (loss) per common share Basic Earnings (Loss) Per Share (“EPS”) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the year. Diluted EPS gives effect to all dilutive potential common shares outstanding during the year including stock options and warrants using the treasury stock method. In computing diluted EPS, the average stock price for the year is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Stock-Based Compensation Compensation costs are charged to the Consolidated Statements of Comprehensive Loss. Compensation costs for employees are amortized over the period from the grant date to the date the options vest. Compensation expense for non-employees non-employees re-measured paid-in The Company uses the Black-Scholes option valuation model to calculate the fair value of stock options at the date of grant. Option pricing models require the input of highly subjective assumptions, including the expected price volatility. Changes in these assumptions can materially affect the fair value estimate. Changes in fair value of options granted to non-employees Income Tax Deferred income tax assets and liabilities are computed based on differences between the carrying amount of assets and liabilities on the balance sheet and their corresponding tax values using the enacted income tax rates by tax jurisdiction when these differences are expected to be realized. Deferred income tax assets also result from unused loss carry-forwards and other deductions. The valuation of deferred income tax assets is reviewed annually and adjusted, if necessary, by use of a valuation allowance to reflect the estimated realizable amount. Significant management judgement is required in determining the provision for income taxes, the deferred income tax assets and liabilities and any valuation allowance recorded against the net future income tax assets. Management evaluates all available evidence, such as recent and expected future operating results by tax jurisdiction, and current and enacted tax legislation and other temporary differences between book and tax accounting to determine whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. Management has determined certain of these deferred tax assets do not meet the more likely than not criteria, and accordingly, these deferred income tax asset amounts have been partially offset by a valuation allowance (Note 10). No reserves for an uncertain tax position have been recorded for the years ended February 28, 2018 and February 28, 2017. Comprehensive Income (loss) Comprehensive income (loss) includes both net earnings and other comprehensive income which are presented in a single continuous statement. Fair Value Measurements The book value of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: Level 1—quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2—observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and Level 3—assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company had certain financial liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP. As at February 28, 2018 and February 28, 2017, the derivative liability on non-employee Reclassification Certain prior period amounts have been reclassified to conform to current year presentation. There was no change to previously reported shareholders’ equity or accumulated deficit. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standard Board, or FASB, issued Accounting Standards Update No. 2014-09, 2014-09) 2014-09 ASU 2014-09 2014-09 2014-09; 2014-09 2014-09. 2015-14 Recent Accounting Pronouncements (continued) after December 15, 2017. The Company is continuing to assess the potential effects of these ASUs on its consolidated financial statements, business processes, systems and controls. While the assessment process is ongoing, the Company anticipates adopting the standard using the modified retrospective transition approach. Under this approach, the new standard would apply to all new contracts initiated on or after March 1, 2018. For existing contracts that have remaining obligations as of March 1, 2018, any difference between the recognition criteria in these ASUs and the Company’s current revenue recognition practices would be recognized using a cumulative effect adjustment to the opening balance of retained earnings. The Company continues to evaluate the impact that the adoption will have on its consolidated financial statements and disclosures. In July 2015, the FASB issued ASU 2015-11, 2015-11”). 2015-11, 2015-11 2015-11 In February 2016, the FASB issued Accounting Standards Update No. 2016-02 2016-2), 2016-2 2016-02 In March 2016, the FASB issued authoritative guidance under ASU 2016-09, 2016-09 2016-09 In June 2016, the FASB issued ASU No. 2016-13, 2016-13”). available-for-sale available-for-sale Recent Accounting Pronouncements (continued) should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. ASU 2016-13 2016-13 In August 2016, the FASB issued ASU No. 2016-15, 2016-15”), zero-coupon predominance principle. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company will adopt this guidance in the first quarter of fiscal 2019. The adoption of this amendment is not expected to have a material impact on our consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, 2016-18”), beginning-of-period end-of-period Recent Accounting Pronouncements (continued) In January 2017, the FASB issued Accounting Standards Update 2017-01, 2017-01”). 2017-01 2017-01 In January 2017, the FASB issued Accounting Standards Update 2017-04, 2017-04”). 2017-04 2017-04 In May 2017, the FASB issued Accounting Standards Update 2017-09, 2017-09”). 2017-09 2017-09 The remainder of this page is intentionally left blank. |
Restricted Cash
Restricted Cash | 12 Months Ended |
Feb. 28, 2018 | |
Receivables [Abstract] | |
Restricted Cash | 2. Restricted Cash As at February 28, 2018, the Company held $583,012 in restricted cash (2017—$nil). Restricted cash is held by the Company’s legal counsel in a trust account pursuant to the terms of an escrow agreement arising from the disposition of the Company’s legacy beverage business. These funds are held aside for the purpose of existing claims, excluded liabilities and financial lease liabilities during the escrow period as specified in the terms of the sale agreement in relation to the Company’s legacy beverage business. |
Inventory
Inventory | 12 Months Ended |
Feb. 28, 2018 | |
Inventory Disclosure [Abstract] | |
Inventory | 3. Inventory 2018 2017 Finished goods, net $ — $ 279,666 Raw materials — 81,436 $ — $ 361,102 The ending balance above includes a total inventory obsolescence provision of $nil as at February 28, 2018 (2017—$15,638). 2018 2017 2016 Inventory Obsolescence Provision Balance at beginning of year $ 15,638 $ 39,870 $ 114,744 Obsolescence provision 278,646 404,767 75,000 Write-off (294,284 ) (428,999 ) (149,874 ) Balance at end of year $ — $ 15,638 $ 39,870 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Feb. 28, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 4. Property, Plant and Equipment 2018 Cost Accumulated Net Furniture and fixtures $ 59,190 $ 58,812 $ 378 Computer hardware and software 271,177 268,398 2,779 $ 330,367 $ 327,210 $ 3,157 2017 Cost Accumulated Net Plant and equipment $ 379,688 $ 94,431 $ 285,257 Automotive equipment 61,550 38,251 23,299 Leasehold improvements 500,724 220,510 280,214 Furniture and fixtures 212,652 187,768 24,884 Computer hardware and software 1,761,497 1,610,127 151,370 $ 2,916,111 $ 2,151,087 $ 765,024 Property, plant and equipment does not include any assets acquired under capital leases (2017—$nil). Accumulated amortization does not include any assets acquired under capital leases (2017—$nil). As at February 28, 2018, $nil assets are attributable to discontinued operations (2017—$760,814). The 2017 property, plant and equipment assets that are attributable to discontinued operations pertains to the Company’s legacy beverage business. |
Prepaid Expenses and Deposits
Prepaid Expenses and Deposits | 12 Months Ended |
Feb. 28, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Deposits | 5. Prepaid Expenses and Deposits 2018 2017 Slotting fees $ — $ 3,792 Insurance premiums 43,347 52,561 Rental deposits and other 37,796 99,362 $ 81,143 $ 155,715 Attributable to discontinued operations $ — $ 26,195 Attributable to continuing operations $ 81,143 $ 129,520 |
Intangible Assets
Intangible Assets | 12 Months Ended |
Feb. 28, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 6. Intangible Assets 2018 Cost Amortization Net Brand Licence and Patent $ — $ — $ — 2017 Cost Amortization Net Brand Licence and Patent $ 331,037 $ 33,848 $ 297,189 The brand licence and patent were sold as part of the disposition of the legacy beverage operations. The loss on the disposition of these intangible assets was included in the loss on disposition of the legacy beverage operations (see Note 16). |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | 7. Shareholders’ Equity a) Share capital Number of Authorized Shares 2018 Common shares without par value 500,000,000 Preferred shares without par value 9,999,900 Series “A” preferred shares 1,000,000 Series “B” preferred shares 100 Series “C” preferred shares 1,000,000 Series “D” preferred shares 4,000,000 Series “E” preferred shares 4,000,000 20,000,000 a) Share capital (continued) There are no preferred shares outstanding as at February 28, 2018 (2017—Nil). In the year ended February 28, 2017, the Company repurchased and cancelled 57,425 of its issued and outstanding shares in the amount of $139,789. Since the average issue price of cancelled common shares at the time of repurchase was $11.17, share capital has been reduced by $641,485 and additional paid-in In the year ended February 29, 2016, the Company repurchased and cancelled 40,705 of its issued and outstanding shares in the amount of $176,316. Since the average issue price of cancelled common shares at the time of repurchase was $11.17, share capital has been reduced by $454,708 and additional paid-in b) Shareholder protection rights plan On August 26, 2003, a Shareholder Protection Rights Plan was adopted whereby one share purchase right is attached to each outstanding common share, exercisable only in the case of a specific event, such as the acquisition by an acquirer of 20% or more of the issued common shares of the Company, and at a predetermined calculated price. At the Annual General Meeting on June 30, 2010, shareholders approved the updating and five-year extension of the Company’s Shareholder Protection Rights Plan to 2015. At the Annual General Meeting in June 2015, shareholders approved an updated and five-year extension of the Company’s Shareholder Protection Rights Plan to 2020. c) Stock options The Company occasionally grants stock options to its employees, officers, directors and consultants to purchase common shares of the Company. The options granted are exercisable at a price which is equal to or greater than the fair market value of the common shares at the date the options are granted. The options are granted with varied vesting periods including immediately, one and five years. Options granted generally have a life of 10 years. The Company does not have a formal stock option plan. At February 28, 2018, stock options were outstanding and exercisable as follows: Exercise Price Number of Weighted Weighted Number of Weighted $2.45 447,000 2.25 $ 2.45 447,000 $ 2.45 $2.45 50,000 0.70 $ 2.45 50,000 $ 2.45 $3.00 80,000 0.32 $ 3.00 80,000 $ 3.00 $3.50 10,000 0.70 $ 3.50 10,000 $ 3.50 $3.50 55,000 1.50 $ 3.50 55,000 $ 3.50 $3.69 25,000 7.37 $ 3.69 25,000 $ 3.69 $6.20 2,000 0.10 $ 6.20 2,000 $ 6.20 669,000 669,000 c) Stock options (continued) A summary of the Company’s stock option activity is as follows: Outstanding Weighted Average Options outstanding as at February 28, 2015 856,767 2.98 Granted 25,000 3.69 Expired (1,767 ) 5.35 Options outstanding as at February 29, 2016 880,000 2.99 Cancelled (12,000 ) 6.91 Options exercisable, February 28, 2017 868,000 2.94 Expired (10,000 ) 15.75 Cancelled (189,000 ) 3.20 Options exercisable, February 28, 2018 669,000 2.68 Options vested and expected to vest 669,000 2.68 The aggregate intrinsic value of stock options exercised during the year ended February 28, 2018 was $nil USD (2017—$nil, 2016—$nil). The aggregate intrinsic value of stock options outstanding as at February 28, 2018 was $nil USD (2017—$nil, 2016—$nil). The aggregate intrinsic value of stock options exercisable as at February 28, 2018 was $nil USD (2017—$nil, 2016—$nil). As of February 28, 2018, the Company has Nil (2017 – nil) non-vested As of February 28, 2018, there was $nil of total unrecognized compensation cost related to non-vested d) Warrants A summary of the Company’s warrant activity and related information for the year ended February 28, 2018 is as follows: Outstanding Weighted Average Warrants outstanding at February 28, 2015 February 29, 2016 and February 27, 2017 25,000 3.40 Granted — — Exercised — — Expired (1) (25,000 ) 3.40 Warrants outstanding at February 28, 2018 — — e) (1) The warrants expired on January 26, 2018 Earnings (loss) per common share For the years ended February 28, 2018, February 28, 2017, and February 29, 2016, common equivalent shares (consisting of shares issuable on exercise of stock options and warrants) totaling nil, nil and 905,000 respectively, were not included in the computation of diluted earnings per share because the effect was anti-dilutive. 2018 2017 2016 Weighted average shares – Basic EPS 2,802,412 2,820,647 2,880,882 Plus: incremental shares from assumed exercise of stock options — — — Weighted average shares – diluted EPS 2,802,412 2,820,647 2,880,882 2018 2017 2016 Net loss from continuing operations $ (830,115 ) $ (713,945 ) $ (1,192,226 ) Net loss from discontinued operations (2,557,034 ) (5,795,744 ) (111,058 ) Net loss $ (3,387,149 ) $ (6,509,689 ) $ (1,303,284 ) Change in fair value of dilutive stock options — — — Adjusted net loss $ (3,387,149 ) $ (6,509,689 ) $ (1,303,284 ) Basic and diluted loss per common share 2018 2017 2016 Continuing operations (0.30 ) $ (0.25 ) $ (0.41 ) Discontinued operations (0.91 ) (2.05 ) (0.04 ) Net basic earnings (loss) per common share (1.21 ) $ (2.31 ) $ (0.45 ) |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
Stock-Based Compensation | 8. Stock-Based Compensation The weighted average date-of-grant 2018 2017 2016 Risk-free rate — — 1.45 % Dividend yield Nil % Nil % Nil % Volatility factor of the expected market price of the Company’s common shares — — 99 % Weighted average expected life of the options (months) — — 120 On January 26, 2015 the Company entered into a consulting agreement where the Company is committed to issue 25,000 warrants, with an exercise price of US$3.40 and an expiry date of January 26, 2018. The warrants had a grant date fair value of $32,570 (Note 9). As at February 28, 2015, the warrants had been earned, and are included in the outstanding warrants table in Note 7(d). There were no options granted during the year ended February 28, 2018 (2017: nil). In connection with the vesting of certain employees’, officers’ and directors’ stock options, and warrants for the year ended February 28, 2018, the Company has recorded stock option compensation of $nil (2017—$nil; 2016—$83,880) which was credited to additional paid-in |
Derivative Liability
Derivative Liability | 12 Months Ended |
Feb. 28, 2018 | |
Fair Value Disclosures [Abstract] | |
Derivative Liability | 9. Derivative Liability In accordance with ASC 815-40-15, non-employees The non-employee re-valued The non-employee 2018 2017 2016 Derivative liability, opening balance $ 46,352 $ 59,990 $ 120,337 Warrants issued during the year — — — Options issued during the year — — 20,970 Change in fair value of options and warrants (23,328 ) (13,638 ) (81,317 ) Derivative liability, closing balance $ 23,024 $ 46,352 $ 59,990 An estimate for the fair value of non-employee As at February 28, 2018 the warrants granted to consultants expired unexercised. The exercise of non-employee |
Income Tax
Income Tax | 12 Months Ended |
Feb. 28, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax | 10. Income Tax Earnings before income taxes and the provision for income taxes consisted of the following for the years ended February 28, 2018, February 28, 2017, and February 29, 2016: 2018 2017 2016 (Loss) from continuing operations $ (830,115 ) $ (713,945 ) $ (1,192,226 ) (Loss) from discontinued operations (2,557,034 ) (3,315,217 ) (547,712 ) (Loss) before income taxes: Canada $ (3,387,149 ) $ (4,029,162 ) $ (1,739,938 ) United States — — — Total $ (3,387,149 ) $ (4,029,162 ) $ (1,739,938 ) Provision (recovery) for income taxes: Current $ — $ — $ — Deferred, Canada — 2,480,257 (436,654 ) Deferred, United States — — — Total $ — $ 2,480,257 $ (436,654 ) Income tax computed at statutory tax rates reconciles to the income tax provision, using a 26% (2017 – 26%, 2016 – 26%) statutory tax rate, as follows: 2018 2017 2016 Tax at statutory rates at CDN rates $ (880,659 ) $ (1,047,652 ) $ (452,384 ) Foreign loss taxed at US rates — — — Effect of foreign exchange on loss carry-forwards — — (704,281 ) Non-deductible 8,122 (55,681 ) 7,352 Deferred tax assets transferred upon disposition of subsidiaries 8,614,637 — — Change in estimates and other items, net (141,625 ) — — Change in valuation allowance (7,600,475 ) 3,583,590 712,659 Income tax provision (recovery) for year $ — $ 2,480,257 $ (436,654 ) As at February 28, 2018, the Company has accumulated net operating losses in the amount of approximately $2.1 million which can be applied against future earnings in Canada and $nil in the United States. The net operating loss carry forward amounts commence to expire in 2036 through 2038. Significant components of the Company’s deferred tax assets and liabilities are as follows: 2018 2017 Operating and other losses carried forward $ 552,145 $ 6,589,096 Property, plant and equipment (210 ) 1,451,069 Trademark and deferred costs — 112,245 Total deferred tax assets 551,935 8,152,410 Valuation allowance (551,935 ) (8,152,410 ) Net deferred tax assets $ — $ — Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of tax assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company has recognized a valuation allowance for those deferred tax assets for which realization is not more likely than not to occur. The tax years that remain open to examination by the tax authorities are generally 2013-2018. The net operating losses from prior years are subject to adjustment under examination to the extent they remain unutilized in an open year. There are no uncertain tax positions to recognize at February 28, 2018 and 2017. |
Commitments
Commitments | 12 Months Ended |
Feb. 28, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | 11. Commitments The Company is committed to an operating lease pertaining to an office space. On September 15, 2017 in connection with the Company’s sale of its former subsidiaries, the Company entered into a series of share purchase and escrow agreements whereby the Company deposited $600,000 in escrow as security for potential financial lease liabilities (as well as excluded liabilities and existing claims) relating to the office lease between Leading Brands of Canada, Inc. and the landlord. The office lease is currently being subleased and has not resulted in additional payments from the Company since the sale of the Company’s subsidiaries. The Company expects that the remaining exposure of the office lease commitment is until April 2019. The minimum amounts due over the remaining terms of that agreement is as follows: 2019 $ 123,073 2020 20,512 Total future minimum payments $ 143,585 During the years ended February 28, 2018, February 28, 2017 and February 29, 2016, the Company incurred rental expenses of $101,542, $553,763, and $705,765 respectively. |
Contingencies
Contingencies | 12 Months Ended |
Feb. 28, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | 12. Contingencies The Company is a party to various legal claims which have arisen in the normal course of business, none of which are expected to have a material adverse effect on the financial position, results of operations, or cash flows of the Company. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Feb. 28, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 13. Related Party Transactions Related party transactions not disclosed elsewhere are as follows: 2018 2017 2016 i) Incurred consulting fees with a company related by a director in common $ 2,813 $ — $ 21,000 ii) Incurred management service fees with a company related by an officer in common $ 67,500 $ — $ — iii) Incurred professional service fees with a company related by a director in common $ — $ — $ 132,000 iv) Incurred marketing consulting services with a company related by a director in common $ — $ 3,113 $ 5,619 v) Incurred bottling services from a company related by a director in common $ 160,642 $ 305,289 $ 218,812 vi) Incurred consulting fees with a company related by an officer in common $ — $ 213,311 $ 150,000 vii) Incurred services from a company related by a director in common $ — $ 1,775 $ 1,055 viii) Purchased supplies from a company related by a director in common $ — $ 1,728 $ 1,273 On September 15, 2017, the Company entered into an agreement with a company that has certain officers and directors in common with the Company, to dispose of its legacy beverage assets for $325,000 (see Note 16). Further, the executive employment agreement between the Company, Leading Brands of Canada Inc. and Ralph McRae, effective June 1, 2015 was terminated on September 15, 2017. Upon termination of the agreement, and pursuant to the severance payment clause, the $900,000 severance obligation was fully satisfied. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Feb. 28, 2018 | |
Investments, All Other Investments [Abstract] | |
Fair Value of Financial Instruments | 14. Fair Value of Financial Instruments The Company’s financial assets and financial liabilities as at February 28, 2018, measured at fair value on a recurring basis are summarized below: Quoted Significant Significant Balance, Cash and restricted cash $ 1,369,352 $ — $ — $ 1,369,352 Derivative liability — — (23,024 ) (23,024 ) $1,369,352 $— $(23,024) $1,346,328 The Company’s financial assets and financial liabilities as at February 28, 2017, measured at fair value on a recurring basis are summarized below: Quoted Significant Significant Balance, Cash $ 4,315,028 $ — $ — $ 4,315,028 Derivative liability — — (46,352 ) (46,352 ) $4,315,028 $— $(46,352) $4,268,676 The fair value of cash and cash equivalents and restricted cash approximates its carrying value. The fair value of the derivative liability for non-employee |
Segmented Information
Segmented Information | 12 Months Ended |
Feb. 28, 2018 | |
Segment Reporting [Abstract] | |
Segmented Information | 15. Segmented Information The Company previously operated in one industry segment being the production and distribution of beverages. The Company’s principal operations were comprised of an integrated bottling and distribution system for beverages. Substantially, all of the Company’s operations, assets and employees are located in Canada and net revenue from export sales during all the years reported are less than 10%. During the year ended February 28, 2018, the Company’s ten largest customers comprised approximately 75% (2017—93%; 2016—96%) of revenue and no one customer comprised more than 26% (2017—74%; 2016—84%) of revenue. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Feb. 28, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 16. Discontinued Operations On December 15, 2016 the Company approved the discontinuation of all activities relating to the Company’s co-packing co-packing On September 15, 2017 the Company disposed of its legacy beverage assets to a company that has certain officers and directors in common with the Company for $325,000, which amount is net of assumed liabilities for certain employee obligations and other matters, all of which is subject to certain working capital adjustments. All costs associated with the discontinuation were recorded as of February 28, 2018. In conjunction with the discontinuance of the co-packing Assets of discontinued operation: 2018 2017 Accounts Receivable $ — $ — Prepaid expenses and deposits — 26,195 Total current assets — 26,195 Property, plant and equipment — — Deferred tax assets — — Total assets $ — $ 26,195 Liabilities of discontinued operation Accounts payable and accrued liabilities $ 250,000 $ 300,000 Lease inducement — — Total liabilities $ 250,000 $ 300,000 Amounts presented for the years ended February 28, 2018, February 28, 2017, and February 29, 2016 have been reclassified to conform to the current presentation. The following table provides the amounts reclassified for the years then ended: Amounts reclassified 2018 2017 2016 Gross Revenue $ 1,114,877 $ 9,625,481 $ 11,513,289 Less: Discounts, rebates slotting fees (291,689 ) (696,659 ) (502,085 ) Net Revenue 823,188 8,928,822 11,011,204 Cost of sales 902,087 6,699,947 7,856,351 Selling, general, and administrative 1,337,951 3,331,967 2,987,235 Depreciation 73,345 633,639 703,708 Foreign exchange (gain) loss (5,859 ) (3,186 ) 9,865 Loss on disposition of legacy beverage operations 1,071,946 Loss on disposal of assets 752 1,581,672 1,757 3,380,222 12,244,039 11,558,916 Net Income (loss) before taxes (2,557,034 ) (3,315,217 ) (547,712 ) Income tax provision (recovery) — 2,480,527 (436,654 ) Total amount reclassified as discontinued operations $ (2,557,034 ) $ (5,795,744 ) $ (111,058 ) |
Subsequent Events
Subsequent Events | 12 Months Ended |
Feb. 28, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events On March 23, 2018, the Nasdaq Listing Qualifications Staff (“ Nasdaq Staff Listing Rule non-compliance |
Operations and Summary of Sig24
Operations and Summary of Significant Accounting Principles (Policies) | 12 Months Ended |
Feb. 28, 2018 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations Leading Brands, Inc. (the “Company”) and its former subsidiaries were previously involved in the development, marketing and distribution of the Company’s beverage brands. As of September 18, 2017, the Company decided to exit the beverage business and pursue the production of film, television and gaming content via the acquisition of Liquid Media Group (“ Liquid Arrangement The Company entered into the Arrangement to acquire 100% of Liquid pursuant to the transaction. The Company’s shareholders are anticipated to hold 25.8% and Liquid shareholders are anticipated to hold 74.2% of the post-transaction entity. The agreed valuation of existing Company shares was determined to be $1.78 USD per share. The Company also announced its intention, that at the time of the closing of the transaction, that all of its Board members, with the exception of Mr. Tom Gaglardi, would resign and be replaced by Messrs. Jackson, Brezer and Cruz, and Ms. Katsoolis, who are directors and an officer of Liquid. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP). The consolidated financial statements include the accounts of the Company and its former subsidiaries until disposal. All intercompany transactions and balances have been eliminated in consolidation. The Company has experienced losses, negative operating cash flows and has discontinued its former operating businesses which raises substantial doubt about its ability to continue operating as a going concern within one year of the date of the financial statements. To alleviate this situation, the Company has plans in place to improve its financial position and liquidity by reducing costs that are not expected to have an adverse impact on the Company’s ability to transition to a new business segment. These include, among other cost reduction measures, the director’s fees as well as the CEO’s consulting fees being waived for a specified period if certain criteria are not met in relation to the Liquid transaction. As of the date of these financial statements, the Company has sufficient liquidity to meet its ongoing cash requirements for one year after the issuance date of the financial statements due to its planned cost management and reduction measures. Therefore, although substantial doubt has been raised, this has been alleviated by management’s plans. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. On an ongoing basis, the Company evaluates its estimates, including those related to inventories, trade receivables, useful lives of property, plant and equipment, capitalization of intangible assets, the useful lives of intangible assets, income taxes, and stock-based compensation, among others. The reported amounts and note disclosure are determined using management’s best estimates based on assumptions that reflect the most probable set of economic conditions and planned course of action. Actual results could differ from those estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
Foreign Currency Translation | Foreign Currency Translation The Company’s functional and reporting currency is the Canadian dollar. Foreign-currency denominated transactions are translated at the rate of exchange prevailing at the time of the transaction. Monetary assets and liabilities have been translated into Canadian dollars at the year-end |
Cash & Cash Equivalents | Cash & Cash Equivalents Amounts recognized as cash and cash equivalents include investments of surplus cash in highly liquid securities with maturities at date of purchase of three months or less. |
Restricted Cash | Restricted Cash Restricted cash is comprised of cash held in a trust account pursuant to the terms of an escrow agreement arising from the disposition of the Company’s legacy beverage business. |
Accounts Receivable | Accounts Receivable Accounts receivable invoices are recorded when the products are delivered and title transfers to customers or when bottling services are performed and collection of related receivables is reasonably assured. Allowances for doubtful accounts are based primarily on historical write-off 2018 2017 2016 Allowances for Doubtful Accounts Balance at beginning of year $ — $ — $ 36,329 Write-off — — (36,329 ) Balance at end of year $ — $ — $ — |
Inventory | Inventory Raw materials and finished goods purchased for resale are valued at the lower of cost, determined on a first-in, first-out |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are recorded at cost and are amortized using the declining-balance method at annual rates as follows: Plant and equipment 7%—20% Buildings 5% Automotive equipment 20% Land improvements 8% Furniture, fixtures, computer hardware and software 20% Leasehold improvements are amortized over the lesser of their expected life or the lease term. Management reviews property, plant and equipment for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable. If required an undiscounted operating cash flow analysis is completed to determine if impairment exists. When testing for impairment of assets held for use, assets and liabilities are grouped at the lowest level for which cash flows are separately identifiable. If impairment is determined to exist, the loss is calculated based on estimated fair value. |
Intangible Assets | Intangible Assets Licenses and patents are recorded at cost and are amortized over their expected useful life of ten years. Management reviews intangible assets for impairment when conditions exist that indicate the carrying amount of the assets may not be fully recoverable. If required an undiscounted operating cash flow analysis is completed to determine if impairment exists. When testing for impairment of assets held for use, assets and liabilities are grouped at the lowest level for which cash flows are separately identifiable. If impairment is determined to exist, the loss is calculated based on estimated fair value. |
Leases | Leases Leases are classified as either capital or operating in nature. Capital leases are those which substantially transfer the benefits and risks of ownership to the lessee. Obligations recorded under capital leases are reduced by the principal portion of lease payments. The imputed interest portion of the lease payment is charged to expense. |
Revenue Recognition | Revenue Recognition Revenue on sales of products is recognized when the products are delivered and title transfers to customers. Revenues from the provision of manufacturing, packaging or other services are recognized when the services are performed and collection of related receivables is reasonably assured. The Company records shipping and handling revenue as a component of sales revenue, and shipping and handling costs are included in the cost of sales. Incentives offered to customers including rebates, cash discounts, volume discounts, and slotting fees are recorded as a reduction of net sales when sales are recognized. |
Advertising Costs | Advertising Costs Advertising costs, which also include samples, trade show, product demo, and media promotion costs are expensed as incurred. During the years ended February 28, 2018, February 28, 2017 and February 29, 2016, the Company incurred advertising costs of $171,075, $496,456 and $603,502, respectively. |
Earnings (loss) per common share | Earnings (loss) per common share Basic Earnings (Loss) Per Share (“EPS”) is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the year. Diluted EPS gives effect to all dilutive potential common shares outstanding during the year including stock options and warrants using the treasury stock method. In computing diluted EPS, the average stock price for the year is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. |
Stock-Based Compensation | Stock-Based Compensation Compensation costs are charged to the Consolidated Statements of Comprehensive Loss. Compensation costs for employees are amortized over the period from the grant date to the date the options vest. Compensation expense for non-employees non-employees re-measured paid-in The Company uses the Black-Scholes option valuation model to calculate the fair value of stock options at the date of grant. Option pricing models require the input of highly subjective assumptions, including the expected price volatility. Changes in these assumptions can materially affect the fair value estimate. Changes in fair value of options granted to non-employees |
Income Tax | Income Tax Deferred income tax assets and liabilities are computed based on differences between the carrying amount of assets and liabilities on the balance sheet and their corresponding tax values using the enacted income tax rates by tax jurisdiction when these differences are expected to be realized. Deferred income tax assets also result from unused loss carry-forwards and other deductions. The valuation of deferred income tax assets is reviewed annually and adjusted, if necessary, by use of a valuation allowance to reflect the estimated realizable amount. Significant management judgement is required in determining the provision for income taxes, the deferred income tax assets and liabilities and any valuation allowance recorded against the net future income tax assets. Management evaluates all available evidence, such as recent and expected future operating results by tax jurisdiction, and current and enacted tax legislation and other temporary differences between book and tax accounting to determine whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. Management has determined certain of these deferred tax assets do not meet the more likely than not criteria, and accordingly, these deferred income tax asset amounts have been partially offset by a valuation allowance (Note 10). No reserves for an uncertain tax position have been recorded for the years ended February 28, 2018 and February 28, 2017. |
Comprehensive Income (loss) | Comprehensive Income (loss) Comprehensive income (loss) includes both net earnings and other comprehensive income which are presented in a single continuous statement. |
Fair Value Measurements | Fair Value Measurements The book value of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: Level 1—quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2—observable inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value drivers are observable; and Level 3—assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company had certain financial liabilities required to be recorded at fair value on a recurring basis in accordance with US GAAP. As at February 28, 2018 and February 28, 2017, the derivative liability on non-employee |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to current year presentation. There was no change to previously reported shareholders’ equity or accumulated deficit. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standard Board, or FASB, issued Accounting Standards Update No. 2014-09, 2014-09) 2014-09 ASU 2014-09 2014-09 2014-09; 2014-09 2014-09. 2015-14 Recent Accounting Pronouncements (continued) after December 15, 2017. The Company is continuing to assess the potential effects of these ASUs on its consolidated financial statements, business processes, systems and controls. While the assessment process is ongoing, the Company anticipates adopting the standard using the modified retrospective transition approach. Under this approach, the new standard would apply to all new contracts initiated on or after March 1, 2018. For existing contracts that have remaining obligations as of March 1, 2018, any difference between the recognition criteria in these ASUs and the Company’s current revenue recognition practices would be recognized using a cumulative effect adjustment to the opening balance of retained earnings. The Company continues to evaluate the impact that the adoption will have on its consolidated financial statements and disclosures. In July 2015, the FASB issued ASU 2015-11, 2015-11”). 2015-11, 2015-11 2015-11 In February 2016, the FASB issued Accounting Standards Update No. 2016-02 2016-2), 2016-2 2016-02 In March 2016, the FASB issued authoritative guidance under ASU 2016-09, 2016-09 2016-09 In June 2016, the FASB issued ASU No. 2016-13, 2016-13”). available-for-sale available-for-sale Recent Accounting Pronouncements (continued) should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down. ASU 2016-13 2016-13 In August 2016, the FASB issued ASU No. 2016-15, 2016-15”), zero-coupon predominance principle. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company will adopt this guidance in the first quarter of fiscal 2019. The adoption of this amendment is not expected to have a material impact on our consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, 2016-18”), beginning-of-period end-of-period Recent Accounting Pronouncements (continued) In January 2017, the FASB issued Accounting Standards Update 2017-01, 2017-01”). 2017-01 2017-01 In January 2017, the FASB issued Accounting Standards Update 2017-04, 2017-04”). 2017-04 2017-04 In May 2017, the FASB issued Accounting Standards Update 2017-09, 2017-09”). 2017-09 2017-09 The remainder of this page is intentionally left blank. |
Operations and Summary of Sig25
Operations and Summary of Significant Accounting Principles (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Doubtful Accounts | 2018 2017 2016 Allowances for Doubtful Accounts Balance at beginning of year $ — $ — $ 36,329 Write-off — — (36,329 ) Balance at end of year $ — $ — $ — |
Schedule of Significant Acquisitions and Disposals of Property, Plant and Equipment | Property, plant and equipment Property, plant and equipment are recorded at cost and are amortized using the declining-balance method at annual rates as follows: Plant and equipment 7%—20% Buildings 5% Automotive equipment 20% Land improvements 8% Furniture, fixtures, computer hardware and software 20% |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | 2018 2017 Finished goods, net $ — $ 279,666 Raw materials — 81,436 $ — $ 361,102 |
Schedule of Inventory Obsolescence Provision | 2018 2017 2016 Inventory Obsolescence Provision Balance at beginning of year $ 15,638 $ 39,870 $ 114,744 Obsolescence provision 278,646 404,767 75,000 Write-off (294,284 ) (428,999 ) (149,874 ) Balance at end of year $ — $ 15,638 $ 39,870 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | 2018 Cost Accumulated Net Furniture and fixtures $ 59,190 $ 58,812 $ 378 Computer hardware and software 271,177 268,398 2,779 $ 330,367 $ 327,210 $ 3,157 2017 Cost Accumulated Net Plant and equipment $ 379,688 $ 94,431 $ 285,257 Automotive equipment 61,550 38,251 23,299 Leasehold improvements 500,724 220,510 280,214 Furniture and fixtures 212,652 187,768 24,884 Computer hardware and software 1,761,497 1,610,127 151,370 $ 2,916,111 $ 2,151,087 $ 765,024 |
Prepaid Expenses and Deposits (
Prepaid Expenses and Deposits (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Deposits | 2018 2017 Slotting fees $ — $ 3,792 Insurance premiums 43,347 52,561 Rental deposits and other 37,796 99,362 $ 81,143 $ 155,715 Attributable to discontinued operations $ — $ 26,195 Attributable to continuing operations $ 81,143 $ 129,520 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | 2018 Cost Amortization Net Brand Licence and Patent $ — $ — $ — 2017 Cost Amortization Net Brand Licence and Patent $ 331,037 $ 33,848 $ 297,189 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
Schedule of Stock by Class | Number of Authorized Shares 2018 Common shares without par value 500,000,000 Preferred shares without par value 9,999,900 Series “A” preferred shares 1,000,000 Series “B” preferred shares 100 Series “C” preferred shares 1,000,000 Series “D” preferred shares 4,000,000 Series “E” preferred shares 4,000,000 20,000,000 |
Schedule of Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | At February 28, 2018, stock options were outstanding and exercisable as follows: Exercise Price Number of Weighted Weighted Number of Weighted $2.45 447,000 2.25 $ 2.45 447,000 $ 2.45 $2.45 50,000 0.70 $ 2.45 50,000 $ 2.45 $3.00 80,000 0.32 $ 3.00 80,000 $ 3.00 $3.50 10,000 0.70 $ 3.50 10,000 $ 3.50 $3.50 55,000 1.50 $ 3.50 55,000 $ 3.50 $3.69 25,000 7.37 $ 3.69 25,000 $ 3.69 $6.20 2,000 0.10 $ 6.20 2,000 $ 6.20 669,000 669,000 |
Schedule of Share-based Compensation, Stock Options, Activity | A summary of the Company’s stock option activity is as follows: Outstanding Weighted Average Options outstanding as at February 28, 2015 856,767 2.98 Granted 25,000 3.69 Expired (1,767 ) 5.35 Options outstanding as at February 29, 2016 880,000 2.99 Cancelled (12,000 ) 6.91 Options exercisable, February 28, 2017 868,000 2.94 Expired (10,000 ) 15.75 Cancelled (189,000 ) 3.20 Options exercisable, February 28, 2018 669,000 2.68 Options vested and expected to vest 669,000 2.68 |
Schedule of Stockholders' Equity Note, Warrants or Rights, Activity | A summary of the Company’s warrant activity and related information for the year ended February 28, 2018 is as follows: Outstanding Weighted Average Warrants outstanding at February 28, 2015 February 29, 2016 and February 27, 2017 25,000 3.40 Granted — — Exercised — — Expired (1) (25,000 ) 3.40 Warrants outstanding at February 28, 2018 — — |
Schedule of Weighted Average Number of Shares | 2018 2017 2016 Weighted average shares – Basic EPS 2,802,412 2,820,647 2,880,882 Plus: incremental shares from assumed exercise of stock options — — — Weighted average shares – diluted EPS 2,802,412 2,820,647 2,880,882 |
Schedule of Earnings (Loss) per Common Share | 2018 2017 2016 Weighted average shares – Basic EPS 2,802,412 2,820,647 2,880,882 Plus: incremental shares from assumed exercise of stock options — — — Weighted average shares – diluted EPS 2,802,412 2,820,647 2,880,882 2018 2017 2016 Net loss from continuing operations $ (830,115 ) $ (713,945 ) $ (1,192,226 ) Net loss from discontinued operations (2,557,034 ) (5,795,744 ) (111,058 ) Net loss $ (3,387,149 ) $ (6,509,689 ) $ (1,303,284 ) Change in fair value of dilutive stock options — — — Adjusted net loss $ (3,387,149 ) $ (6,509,689 ) $ (1,303,284 ) Basic and diluted loss per common share 2018 2017 2016 Continuing operations (0.30 ) $ (0.25 ) $ (0.41 ) Discontinued operations (0.91 ) (2.05 ) (0.04 ) Net basic earnings (loss) per common share (1.21 ) $ (2.31 ) $ (0.45 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The estimated fair value of the stock options granted was determined using the Black-Scholes option pricing model with the following weighted-average assumptions: 2018 2017 2016 Risk-free rate — — 1.45 % Dividend yield Nil % Nil % Nil % Volatility factor of the expected market price of the Company’s common shares — — 99 % Weighted average expected life of the options (months) — — 120 |
Derivative Liability (Tables)
Derivative Liability (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Derivative Liabilities At Fair Value | The non-employee 2018 2017 2016 Derivative liability, opening balance $ 46,352 $ 59,990 $ 120,337 Warrants issued during the year — — — Options issued during the year — — 20,970 Change in fair value of options and warrants (23,328 ) (13,638 ) (81,317 ) Derivative liability, closing balance $ 23,024 $ 46,352 $ 59,990 |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Earnings Before Income Taxes and Provision for Income Taxes | Earnings before income taxes and the provision for income taxes consisted of the following for the years ended February 28, 2018, February 28, 2017, and February 29, 2016: 2018 2017 2016 (Loss) from continuing operations $ (830,115 ) $ (713,945 ) $ (1,192,226 ) (Loss) from discontinued operations (2,557,034 ) (3,315,217 ) (547,712 ) (Loss) before income taxes: Canada $ (3,387,149 ) $ (4,029,162 ) $ (1,739,938 ) United States — — — Total $ (3,387,149 ) $ (4,029,162 ) $ (1,739,938 ) Provision (recovery) for income taxes: Current $ — $ — $ — Deferred, Canada — 2,480,257 (436,654 ) Deferred, United States — — — Total $ — $ 2,480,257 $ (436,654 ) |
Schedule of Effective Income Tax Rate Reconciliation | Income tax computed at statutory tax rates reconciles to the income tax provision, using a 26% (2017 – 26%, 2016 – 26%) statutory tax rate, as follows: 2018 2017 2016 Tax at statutory rates at CDN rates $ (880,659 ) $ (1,047,652 ) $ (452,384 ) Foreign loss taxed at US rates — — — Effect of foreign exchange on loss carry-forwards — — (704,281 ) Non-deductible 8,122 (55,681 ) 7,352 Deferred tax assets transferred upon disposition of subsidiaries 8,614,637 — — Change in estimates and other items, net (141,625 ) — — Change in valuation allowance (7,600,475 ) 3,583,590 712,659 Income tax provision (recovery) for year $ — $ 2,480,257 $ (436,654 ) |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities are as follows: 2018 2017 Operating and other losses carried forward $ 552,145 $ 6,589,096 Property, plant and equipment (210 ) 1,451,069 Trademark and deferred costs — 112,245 Total deferred tax assets 551,935 8,152,410 Valuation allowance (551,935 ) (8,152,410 ) Net deferred tax assets $ — $ — |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | The minimum amounts due over the remaining terms of that agreement is as follows: 2019 $ 123,073 2020 20,512 Total future minimum payments $ 143,585 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Related party transactions not disclosed elsewhere are as follows: 2018 2017 2016 i) Incurred consulting fees with a company related by a director in common $ 2,813 $ — $ 21,000 ii) Incurred management service fees with a company related by an officer in common $ 67,500 $ — $ — iii) Incurred professional service fees with a company related by a director in common $ — $ — $ 132,000 iv) Incurred marketing consulting services with a company related by a director in common $ — $ 3,113 $ 5,619 v) Incurred bottling services from a company related by a director in common $ 160,642 $ 305,289 $ 218,812 vi) Incurred consulting fees with a company related by an officer in common $ — $ 213,311 $ 150,000 vii) Incurred services from a company related by a director in common $ — $ 1,775 $ 1,055 viii) Purchased supplies from a company related by a director in common $ — $ 1,728 $ 1,273 |
Fair Value of Financial Instr36
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Investments, All Other Investments [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The Company’s financial assets and financial liabilities as at February 28, 2018, measured at fair value on a recurring basis are summarized below: Quoted Significant Significant Balance, Cash and restricted cash $ 1,369,352 $ — $ — $ 1,369,352 Derivative liability — — (23,024 ) (23,024 ) $1,369,352 $— $(23,024) $1,346,328 The Company’s financial assets and financial liabilities as at February 28, 2017, measured at fair value on a recurring basis are summarized below: Quoted Significant Significant Balance, Cash $ 4,315,028 $ — $ — $ 4,315,028 Derivative liability — — (46,352 ) (46,352 ) $4,315,028 $— $(46,352) $4,268,676 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Feb. 28, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations - Balance Sheet | In conjunction with the discontinuance of the co-packing Assets of discontinued operation: 2018 2017 Accounts Receivable $ — $ — Prepaid expenses and deposits — 26,195 Total current assets — 26,195 Property, plant and equipment — — Deferred tax assets — — Total assets $ — $ 26,195 Liabilities of discontinued operation Accounts payable and accrued liabilities $ 250,000 $ 300,000 Lease inducement — — Total liabilities $ 250,000 $ 300,000 |
Schedule of Discontinued Operations - Income Statement | The following table provides the amounts reclassified for the years then ended: Amounts reclassified 2018 2017 2016 Gross Revenue $ 1,114,877 $ 9,625,481 $ 11,513,289 Less: Discounts, rebates slotting fees (291,689 ) (696,659 ) (502,085 ) Net Revenue 823,188 8,928,822 11,011,204 Cost of sales 902,087 6,699,947 7,856,351 Selling, general, and administrative 1,337,951 3,331,967 2,987,235 Depreciation 73,345 633,639 703,708 Foreign exchange (gain) loss (5,859 ) (3,186 ) 9,865 Loss on disposition of legacy beverage operations 1,071,946 Loss on disposal of assets 752 1,581,672 1,757 3,380,222 12,244,039 11,558,916 Net Income (loss) before taxes (2,557,034 ) (3,315,217 ) (547,712 ) Income tax provision (recovery) — 2,480,527 (436,654 ) Total amount reclassified as discontinued operations $ (2,557,034 ) $ (5,795,744 ) $ (111,058 ) |
Operations and Summary of Sig38
Operations and Summary of Significant Accounting Principles - Additional Information (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Significant Accounting Policies [Line Items] | |||
Ownership percentage by parent | 25.80% | ||
Operations and summary of significant accounting principles 1 | $ 0 | $ 0 | |
Operations and summary of significant accounting principles 2 | $ 171,075 | $ 496,456 | $ 603,502 |
Liquid Media Group [Member] | |||
Significant Accounting Policies [Line Items] | |||
Business acquisition, percentage of voting interests acquired | 100.00% | ||
Ownership percentage by non-controlling Owners | 74.20% | ||
Business acquisition share price per share | $ 1.78 |
Operations and Summary of Sig39
Operations and Summary of Significant Accounting Principles - Schedule of Allowance for Doubtful Accounts (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Allowance For Doubtful Accounts [Abstract] | |||
Balance at beginning of year | $ 0 | $ 0 | $ 36,329 |
Write-off of receivables | 0 | 0 | (36,329) |
Balance at end of year | $ 0 | $ 0 | $ 0 |
Operations and Summary of Sig40
Operations and Summary of Significant Accounting Principles - Schedule of Significant Acquisitions and Disposals of Property, Plant and Equipment (Detail) | 12 Months Ended |
Feb. 28, 2018 | |
Business Combinations [Abstract] | |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 1 | 7.00% |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 2 | 20.00% |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 3 | 5.00% |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 4 | 20.00% |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 5 | 8.00% |
Operations And Summary Of Significant Accounting Principles Schedule Of Significant Acquisitions And Disposals Of Property, Plant And Equipment 6 | 20.00% |
Restricted Cash - Additional In
Restricted Cash - Additional Information (Detail) | Feb. 28, 2018CAD ($) |
Restricted Cash and Investments [Abstract] | |
Restricted cash | $ 583,012 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Inventory Disclosure [Abstract] | ||
Finished goods, net | $ 0 | $ 279,666 |
Raw materials | 0 | 81,436 |
Inventory Total | $ 0 | $ 361,102 |
Inventory - Additional Informat
Inventory - Additional Information (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Inventory Disclosure [Abstract] | ||
Inventory | $ 0 | $ 15,638 |
Inventory - Schedule of Inven44
Inventory - Schedule of Inventory Obsolescence Provision (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Inventory Disclosure [Abstract] | |||
Balance at beginning of year | $ 15,638 | $ 39,870 | $ 114,744 |
Obsolescence provision | 278,646 | 404,767 | 75,000 |
Write-off of inventory | (294,284) | (428,999) | (149,874) |
Balance at end of year | $ 0 | $ 15,638 | $ 39,870 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Plant and equipment, cost | $ 379,688 | |
Automotive equipment, cost | 61,550 | |
Leasehold improvements, cost | 500,724 | |
Furniture and fixtures, cost | $ 59,190 | 212,652 |
Computer hardware and software, cost | 271,177 | 1,761,497 |
Cost | 330,367 | 2,916,111 |
Plant and equipment, accumulated depreciation | 94,431 | |
Automotive equipment, accumulated depreciation | 38,251 | |
Leasehold improvements, accumulated depreciation | 220,510 | |
Furniture and fixtures, accumulated depreciation | 58,812 | 187,768 |
Computer hardware and software, accumulated depreciation | 268,398 | 1,610,127 |
Accumulated depreciation | 327,210 | 2,151,087 |
Plant and equipment, net | 285,257 | |
Automotive equipment, net | 23,299 | |
Leasehold improvements, net | 280,214 | |
Furniture and fixtures, net | 378 | 24,884 |
Computer hardware and software, net | 2,779 | 151,370 |
Total property, plant and equipment, net | $ 3,157 | $ 765,024 |
Property, Plant and Equipment46
Property, Plant and Equipment - Additional Information (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Property, plant and equipment 1 | $ 0 | |
Property, plant and equipment 2 | 0 | |
Property, plant and equipment 3 | $ 0 | $ 760,814 |
Prepaid Expenses and Deposits -
Prepaid Expenses and Deposits - Schedule of Prepaid Expenses and Deposits (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Slotting fees | $ 0 | $ 3,792 |
Insurance premiums | 43,347 | 52,561 |
Rental deposits and other | 37,796 | 99,362 |
Prepaid expenses, deposits and other | 81,143 | 155,715 |
Attributable to discontinued operations | 0 | 26,195 |
Attributable to continuing operations | $ 81,143 | $ 129,520 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Finite-Lived Intangible Assets (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Brand Licence and Patent, Cost | $ 0 | $ 331,037 |
Brand Licence and Patent, Amortization | 0 | 33,848 |
Brand Licence and Patent, Net | $ 0 | $ 297,189 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Share Capital (Detail) | 12 Months Ended |
Feb. 28, 2018CAD ($) | |
Stockholders' Equity Note [Abstract] | |
Common shares without par value | $ 500,000,000 |
Preferred shares without par value | 9,999,900 |
Series "A" preferred shares | 1,000,000 |
Series "B" preferred shares | 100 |
Series "C" preferred shares | 1,000,000 |
Series "D" preferred shares | 4,000,000 |
Series "E" preferred shares | 4,000,000 |
Total share capital | $ 20,000,000 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) | 12 Months Ended | ||
Feb. 28, 2018CAD ($) | Feb. 28, 2017CAD ($) | Feb. 29, 2016CAD ($) | |
Stockholders' Equity Note [Abstract] | |||
Shareholders equity 1 | 0 | 0 | |
Shareholders equity 2 | 57,425 | ||
Shareholders equity 3 | $ 139,789 | ||
Shareholders equity 4 | 11.17 | ||
Shareholders equity 5 | 641,485 | ||
Shareholders equity 6 | 501,696 | ||
Shareholders equity 7 | 40,705 | ||
Shareholders equity 8 | $ 176,316 | ||
Shareholders equity 9 | 11.17 | ||
Shareholders equity 10 | 454,708 | ||
Shareholders equity 11 | 278,392 | ||
Shareholders equity 12 | 20.00% | ||
Shareholders equity 13 | 10 | ||
Shareholders equity 14 | $ 0 | 0 | 0 |
Shareholders equity 15 | 0 | 0 | 0 |
Shareholders equity 16 | $ 0 | $ 0 | $ 0 |
Shareholders equity 17 | 0 | 0 | 0 |
Shareholders equity 18 | 0 | 0 | |
Shareholders equity 19 | 0 | 0 | 905,000 |
Shareholders' Equity - Summar51
Shareholders' Equity - Summary of Stock Options Outstanding and Exercisable (Detail) | Feb. 28, 2018USD ($) | Feb. 28, 2018CAD ($)shares | Feb. 28, 2017CAD ($) | Feb. 28, 2017USD ($) |
Stockholders' Equity Note [Abstract] | ||||
Weighted Average Exercise Price (USD) | 2.45 | |||
Weighted Average Exercise Price (USD) | 2.45 | |||
Weighted Average Exercise Price (USD) | 3 | |||
Weighted Average Exercise Price (USD) | $ 3.50 | |||
Weighted Average Exercise Price (USD) | 3.50 | |||
Weighted Average Exercise Price (USD) | 3.69 | |||
Weighted Average Exercise Price (USD) | 6.20 | |||
Number of Options Exercisable | shares | 447,000 | |||
Number of Options Exercisable | shares | 50,000 | |||
Number of Options Exercisable | shares | 80,000 | |||
Number of Options Exercisable | shares | 10,000 | |||
Number of Options Exercisable | shares | 55,000 | |||
Number of Options Exercisable | shares | 25,000 | |||
Number of Options Exercisable | shares | 2,000 | |||
Number of Options Exercisable | $ 669,000 | |||
Weighted Average Exercise Price (USD) | $ 2.25 | |||
Weighted Average Exercise Price (USD) | 0.70 | |||
Weighted Average Exercise Price (USD) | 0.32 | |||
Weighted Average Exercise Price (USD) | 0.70 | |||
Weighted Average Exercise Price (USD) | 1.50 | |||
Weighted Average Exercise Price (USD) | 7.37 | |||
Weighted Average Exercise Price (USD) | 0.10 | |||
Weighted Average Remaining Contractual Life (Years) | 2.45 | |||
Weighted Average Remaining Contractual Life (Years) | 2.45 | |||
Weighted Average Remaining Contractual Life (Years) | 3 | |||
Weighted Average Remaining Contractual Life (Years) | 3.50 | |||
Weighted Average Remaining Contractual Life (Years) | 3.50 | |||
Weighted Average Remaining Contractual Life (Years) | 3.69 | |||
Weighted Average Remaining Contractual Life (Years) | 6.20 | |||
Number of Options Outstanding | $ 447,000 | |||
Number of Options Outstanding | 50,000 | |||
Number of Options Outstanding | 80,000 | |||
Number of Options Outstanding | 10,000 | |||
Number of Options Outstanding | 55,000 | |||
Number of Options Outstanding | 25,000 | |||
Number of Options Outstanding | 2,000 | |||
Number of Options Outstanding | $ 669,000 | |||
Exercise Price | 2.45 | |||
Exercise Price | $ 2.45 | |||
Exercise Price | 3 | 3 | ||
Exercise Price | 3.50 | 3.50 | ||
Exercise Price | 3.50 | 3.50 | ||
Exercise Price | $ 3.69 | |||
Exercise Price | 6.20 | 6.20 |
Shareholders' Equity - Summar52
Shareholders' Equity - Summary of Stock Options Activity (Detail) | 12 Months Ended | |||
Feb. 28, 2018CAD ($) | Feb. 28, 2018USD ($) | Feb. 28, 2017CAD ($) | Feb. 29, 2016CAD ($) | |
Stockholders' Equity Note [Abstract] | ||||
Outstanding Options | $ 856,767 | |||
Weighted Average Exercise Price (USD) | 2.98 | |||
Outstanding Options, Granted | $ 25,000 | |||
Outstanding Options, Expired | (1,767) | |||
Outstanding Options | $ 880,000 | |||
Outstanding Options, Cancelled | $ (12,000) | |||
Outstanding Options | $ 868,000 | |||
Outstanding Options, Expired | $ (10,000) | |||
Outstanding Options, Cancelled | (189,000) | |||
Options exercisable, February 28, 2018 | 669,000 | |||
Options vested and expected to vest | $ 669,000 | |||
Weighted Average Exercise Price (USD) | 6.91 | |||
Weighted Average Exercise Price (USD) | 2.94 | |||
Weighted Average Exercise Price (USD) | 15.75 | 15.75 | 3.69 | |
Weighted Average Exercise Price (USD) | 3.20 | 3.20 | ||
Weighted Average Exercise Price (USD) | 5.35 | |||
Weighted Average Exercise Price (USD) | $ 2.68 | |||
Weighted Average Exercise Price (USD) | 2.99 | |||
Weighted Average Exercise Price (USD) | 2.68 | 2.68 |
Shareholders' Equity - Summar53
Shareholders' Equity - Summary of Warrant Activity and Related Information (Detail) | 12 Months Ended | |
Feb. 28, 2018CAD ($) | Feb. 28, 2018USD ($) | |
Stockholders' Equity Note [Abstract] | ||
Outstanding Warrants | $ 25,000 | |
Granted, Outstanding Warrants | 0 | |
Exercised, Outstanding Warrants | 0 | |
Expired, Outstanding Warrants | (25,000) | |
Outstanding Warrants | $ 0 | |
Warrants outstanding, Weighted Average Exercise Price (USD) | 3.40 | 3.40 |
Granted, Weighted Average Exercise Price (USD) | $ 0 | |
Exercised, Weighted Average Exercise Price (USD) | $ 0 | |
Expired, Weighted Average Exercise Price (USD) | 3.40 | 3.40 |
Warrants outstanding, Weighted Average Exercise Price (USD) | 0 | 0 |
Shareholders' Equity - Summar54
Shareholders' Equity - Summary of Weighted Average Number of Shares (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Stockholders' Equity Note [Abstract] | |||
Weighted average shares - Basic EPS | $ 2,802,412 | $ 2,820,647 | $ 2,880,882 |
Plus: incremental shares from assumed exercise of stock options | 0 | 0 | 0 |
Weighted average shares - diluted EPS | $ 2,802,412 | $ 2,820,647 | $ 2,880,882 |
Shareholders' Equity - Summar55
Shareholders' Equity - Summary of Schedule of Earnings (Loss) per Common Share (Detail) | 12 Months Ended | ||
Feb. 28, 2018CAD ($) | Feb. 28, 2017CAD ($) | Feb. 29, 2016CAD ($) | |
Stockholders' Equity Note [Abstract] | |||
Net loss from continuing operations | $ (830,115) | $ (713,945) | $ (1,192,226) |
Net loss from discontinued operations | (2,557,034) | (5,795,744) | (111,058) |
Net loss | (3,387,149) | (6,509,689) | (1,303,284) |
Change in fair value of dilutive stock options | 0 | 0 | 0 |
Adjusted net loss | $ (3,387,149) | $ (6,509,689) | $ (1,303,284) |
Continuing operations | (0.30) | (0.25) | (0.41) |
Discontinued operations | (0.91) | (2.05) | (0.04) |
Net basic earnings (loss) per common share | (1.21) | (2.31) | (0.45) |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) | Jan. 26, 2015CAD ($)shares | Feb. 28, 2018CAD ($) | Feb. 28, 2017CAD ($) | Feb. 29, 2016CAD ($) |
Stockholders' Equity Note [Abstract] | ||||
Stock-based Compensation 1 | 0 | 0 | ||
Stock-based Compensation 3 | shares | 25,000 | |||
Stock-based Compensation 4 | $ 3.40 | |||
Stock-based Compensation 5 | $ 32,570 | |||
Stock-based Compensation 6 | $ 0 | $ 0 | ||
Stock-based Compensation 7 | $ 0 | $ 0 | $ 83,880 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Stockholders' Equity Note [Abstract] | |||
Risk-free rate | $ 0 | $ 0 | $ 1.45 |
Dividend yield | |||
Volatility factor of the expected market price of the Company's common shares | $ 0 | $ 0 | $ 99 |
Weighted average expected life of the options (months) | $ 0 | $ 0 | $ 120 |
Derivative Liability - Schedule
Derivative Liability - Schedule of Derivative Liabilities At Fair Value (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Fair Value Disclosures [Abstract] | |||
Derivative liability, opening balance | $ 46,352 | $ 59,990 | $ 120,337 |
Warrants issued during the year | 0 | 0 | 0 |
Options issued during the year | 0 | 0 | 20,970 |
Change in fair value of options and warrants | (23,328) | (13,638) | (81,317) |
Derivative liability, closing balance | $ 23,024 | $ 46,352 | $ 59,990 |
Derivative Liability - Addition
Derivative Liability - Additional Information (Detail) | 12 Months Ended | ||
Feb. 28, 2018USD ($)mo | Feb. 28, 2017mo | Feb. 29, 2016mo | |
Fair Value Disclosures [Abstract] | |||
Derivative liability 1 | 1.90% | 0.67% | 0.69% |
Derivative liability 2 | 0 | 0 | 0 |
Derivative liability 3 | 105.99% | 91.47% | 59.90% |
Derivative liability 4 | mo | 33 | 27 | 38 |
Derivative liability 5 | $ | $ 4.11 |
Income Tax - Schedule of Earnin
Income Tax - Schedule of Earnings Before Income Taxes and Provision for Income Taxes (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Income Tax Disclosure [Abstract] | |||
(Loss) from continuing operations | $ (830,115) | $ (713,945) | $ (1,192,226) |
(Loss) from discontinued operations | (2,557,034) | (3,315,217) | (547,712) |
Canada | (3,387,149) | (4,029,162) | (1,739,938) |
United States | 0 | 0 | 0 |
Total | (3,387,149) | (4,029,162) | (1,739,938) |
Current | 0 | 0 | 0 |
Deferred, Canada | 0 | 2,480,257 | (436,654) |
Deferred, United States | 0 | 0 | 0 |
Total | $ 0 | $ 2,480,257 | $ (436,654) |
Income Tax - Additional Informa
Income Tax - Additional Information (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Income Tax Disclosure [Abstract] | |||
Income Tax | 26.00% | 26.00% | 26.00% |
Income Tax 4 | $ 2,100,000 | ||
Income Tax 5 | $ 0 |
Income Tax - Schedule of Effect
Income Tax - Schedule of Effective Income Tax Rate Reconciliation (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Jan. 29, 2016 | |
Income Tax Disclosure [Abstract] | |||
Tax at statutory rates at CDN rates | $ (880,659) | $ (1,047,652) | $ (452,384) |
Foreign loss taxed at US rates | 0 | 0 | 0 |
Effect of foreign exchange on loss carry-forwards | 0 | 0 | (704,281) |
Non-deductible expenses (revenue) | 8,122 | (55,681) | 7,352 |
Deferred tax assets transferred upon disposition of subsidiaries | 8,614,637 | 0 | 0 |
Change in estimates and other items, net | (141,625) | 0 | 0 |
Change in valuation allowance | (7,600,475) | 3,583,590 | 712,659 |
Income tax provision (recovery) for year | $ 0 | $ 2,480,257 | $ (436,654) |
Income Tax - Schedule of Deferr
Income Tax - Schedule of Deferred Tax Assets and Liabilities (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Income Tax Disclosure [Abstract] | ||
Operating and other losses carried forward | $ 552,145 | $ 6,589,096 |
Property, plant and equipment | (210) | 1,451,069 |
Trademark and deferred costs | 0 | 112,245 |
Total deferred tax assets | 551,935 | 8,152,410 |
Valuation allowance | (551,935) | (8,152,410) |
Net deferred tax assets | $ 0 | $ 0 |
Commitments - Additional Inform
Commitments - Additional Information (Detail) - CAD ($) | 12 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | Sep. 15, 2017 | |
Commitments [Abstract] | ||||
Escrow deposit | $ 600,000 | |||
Commitments | $ 101,542 | $ 553,763 | $ 705,765 |
Commitments - Schedule of Futur
Commitments - Schedule of Future Minimum Rental Payments for Operating Leases (Detail) | 12 Months Ended |
Feb. 28, 2018CAD ($) | |
Asset Purchase Agreement And Related License Agreement [Abstract] | |
2,019 | $ 123,073 |
2,020 | 20,512 |
Total future minimum payments | $ 143,585 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Related Party Transactions [Abstract] | |||
Incurred consulting fees with a company related by a director in common | $ 2,813 | $ 0 | $ 21,000 |
Incurred management service fees with a company related by an officer in common | 67,500 | 0 | 0 |
Incurred professional service fees with a company related by a director in common | 0 | 0 | 132,000 |
Incurred marketing consulting services with a company related by a director in common | 0 | 3,113 | 5,619 |
Incurred bottling services from a company related by a director in common | 160,642 | 305,289 | 218,812 |
Incurred consulting fees with a company related by an officer in common | 0 | 213,311 | 150,000 |
Incurred services from a company related by a director in common | 0 | 1,775 | 1,055 |
Purchased supplies from a company related by a director in common | $ 0 | $ 1,728 | $ 1,273 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - CAD ($) | Sep. 15, 2017 | Feb. 28, 2017 |
Related Party Transaction [Line Items] | ||
Disposal of legacy beverage assets | $ 325,000 | $ 26,195 |
Executive Employment Agreements [Member] | ||
Related Party Transaction [Line Items] | ||
Agreement termination period | Sep. 15, 2017 | |
Severance obligation | $ 900,000 |
Fair Value of Financial Instr68
Fair Value of Financial Instruments - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Fair Value Disclosures [Abstract] | ||
Cash | $ 1,369,352 | $ 4,315,028 |
Derivative liability | 0 | 0 |
Financial assets and financial liabilities | 1,369,352 | 4,315,028 |
Cash | 0 | 0 |
Derivative liability | 0 | 0 |
Financial assets and financial liabilities | 0 | 0 |
Cash | 0 | 0 |
Derivative liability | (23,024) | (46,352) |
Financial assets and financial liabilities | (23,024) | (46,352) |
Cash | 1,369,352 | 4,315,028 |
Derivative liability | (23,024) | (46,352) |
Financial assets and financial liabilities | $ 1,346,328 | $ 4,268,676 |
Segmented Information - Additio
Segmented Information - Additional Information (Detail) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Segment Reporting [Abstract] | |||
Segmented information 1 | 10.00% | ||
Segmented information 2 | 75.00% | 93.00% | 96.00% |
Segmented information 3 | 26.00% | 74.00% | 84.00% |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - CAD ($) | Sep. 15, 2017 | Feb. 28, 2017 |
Discontinued Operations and Disposal Groups [Abstract] | ||
Disposal of legacy beverage assets | $ 325,000 | $ 26,195 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Discontinued Operations Balance Sheet (Detail) - CAD ($) | 12 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Accounts Receivable | $ 0 | $ 0 |
Prepaid expenses and deposits | 0 | 26,195 |
Total current assets | 0 | 26,195 |
Property, plant and equipment | 0 | 0 |
Deferred tax assets | 0 | 0 |
Total assets | 0 | 26,195 |
Accounts payable and accrued liabilities | 250,000 | 300,000 |
Lease inducement | 0 | 0 |
Total liabilities | $ 250,000 | $ 300,000 |
Discontinued Operations - Sch72
Discontinued Operations - Schedule of Discontinued Operations Income Statement (Detail) - CAD ($) | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 29, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |||
Gross Revenue | $ 1,114,877 | $ 9,625,481 | $ 11,513,289 |
Less: Discounts, rebates slotting fees | (291,689) | (696,659) | (502,085) |
Net Revenue | 823,188 | 8,928,822 | 11,011,204 |
Cost of sales | 902,087 | 6,699,947 | 7,856,351 |
Selling, general, and administrative | 1,337,951 | 3,331,967 | 2,987,235 |
Depreciation | 73,345 | 633,639 | 703,708 |
Foreign exchange (gain) loss | (5,859) | (3,186) | 9,865 |
Loss on disposition of legacy beverage operations | 1,071,946 | 0 | 0 |
Loss on disposal of assets | 752 | 1,581,672 | 1,757 |
Net | 3,380,222 | 12,244,039 | 11,558,916 |
Net Income (loss) before taxes | (2,557,034) | (3,315,217) | (547,712) |
Income tax provision (recovery) | 0 | 2,480,527 | (436,654) |
Total amount reclassified as discontinued operations | $ (2,557,034) | $ (5,795,744) | $ (111,058) |