Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Nov. 30, 2021 | Jan. 14, 2022 | |
Cover [Abstract] | ||
Entity Registrant Name | SALONA GLOBAL MEDICAL DEVICE CORPORATION | |
Entity Central Index Key | 0001617765 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-28 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 44,790,162 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2022 | |
Entity Emerging Growth Company | true | |
Entity Small Business | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 333-255642 | |
Entity Incorporation, State or Country Code | A1 | |
Entity Address, Address Line One | 3330 Caminito Daniella | |
Entity Address, City or Town | Del Mar | |
City Area Code | 800 | |
Local Phone Number | 760-6826 | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92014 | |
Entity Tax Identification Number | 00-0000000 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - CAD ($) | Nov. 30, 2021 | Feb. 28, 2021 |
Assets | ||
Cash and cash equivalents | $ 5,639,759 | $ 7,080,768 |
Restricted cash | 0 | 5,425,374 |
Accounts receivable | 5,440,245 | 0 |
Inventories | 4,834,534 | 0 |
Marketable securities | 0 | 488,684 |
Prepaids expenses and other receivables | 381,009 | 135,065 |
Total current assets | 16,295,547 | 13,129,891 |
Restricted cash | 487,977 | 0 |
Property and equipment, net | 1,524,666 | 0 |
Operating right-of-use assets, net | 4,053,453 | 0 |
Intangible assets, net | 7,130,590 | 0 |
Goodwill | 13,484,016 | 0 |
Total assets | 42,976,249 | 13,129,891 |
Liabilities | ||
Subscription receipts | 0 | 5,425,374 |
Line of credit | 4,874,088 | 0 |
Accounts payable and accrued liabilities | 3,343,759 | 1,047,784 |
Current portion of debt | 270,046 | 0 |
Current portion of lease liability | 235,562 | 0 |
Other liabilities | 566,111 | 15,000 |
Obligation for issuance of shares | 18,851,548 | 0 |
Total current liabilities | 28,141,114 | 6,488,158 |
Debt, net of current portion | 730,527 | 0 |
Lease liability, net of current portion | 4,027,464 | 0 |
Total liabilities | 32,899,105 | 6,488,158 |
Stockholders' equity | ||
Common stock, value | 36,552,873 | 31,065,513 |
Additional paid-in-capital | 4,188,096 | 3,625,762 |
Accumulated other comprehensive income | 1,071,826 | 943,320 |
Deficit | (32,216,130) | (28,992,862) |
Total stockholders' equity | 10,077,144 | 6,641,733 |
Total liabilities and stockholders' equity | 42,976,249 | 13,129,891 |
Class A Common stock [Member] | ||
Stockholders' equity | ||
Common stock, value | $ 480,479 | $ 0 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parentheticals) - Common Stock [Member] - $ / shares | Nov. 30, 2021 | Feb. 28, 2021 |
Common stock, No par value | $ 0 | $ 0 |
Common stock, shares issued | 44,790,162 | 33,813,308 |
Common stock, shares outstanding | 44,790,162 | 33,813,308 |
Common Class A [Member] | ||
Common stock, No par value | $ 0 | $ 0 |
Common stock, shares issued | 1,355,425 | |
Common stock, shares outstanding | 1,355,425 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss - CAD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 5,286,702 | $ 223,587 | $ 9,850,915 | $ 293,411 |
Cost of revenue | ||||
Direct service personnel | 953,260 | 0 | 1,230,443 | 0 |
Direct material costs | 2,431,065 | 0 | 5,306,949 | 0 |
Direct material costs | 239,741 | 0 | 239,741 | 0 |
Total cost of revenue | 3,624,066 | 0 | 6,777,133 | 0 |
Gross margin | 1,662,636 | 223,587 | 3,073,782 | 293,411 |
Operating expenses | ||||
General and administrative | 1,652,592 | 277,901 | 3,254,217 | 823,754 |
Total operating expenses | 1,652,592 | 277,901 | 3,254,217 | 823,754 |
Net income (loss) before the undernoted | 10,044 | (54,314) | (180,435) | (530,343) |
Amortization of intangible assets | (165,552) | 0 | (244,340) | 0 |
Depreciation of property and equipment | (65,458) | 0 | (131,414) | 0 |
Amortization of right-of-use assets | (67,817) | 0 | (106,700) | 0 |
Interest expense | (121,518) | 0 | (265,602) | 0 |
Foreign exchange loss | (48,934) | 0 | (38,397) | 0 |
Gain on debt settlement | 0 | 0 | 15,538 | 0 |
Transaction costs including legal, financial, audit, US & Canadian regulatory expenses | (1,044,455) | (306,909) | (2,269,923) | (306,909) |
Net loss before taxes | (1,503,690) | (361,223) | (3,221,273) | (837,252) |
Income tax expense | (7) | 0 | (1,995) | |
Net Loss | (1,503,697) | (361,223) | (3,223,268) | (837,252) |
Other comprehensive loss | ||||
Foreign currency translation gain (loss) | 112,505 | (45,406) | 128,506 | (300,397) |
Comprehensive loss | $ (1,391,192) | $ (406,629) | $ (3,094,762) | $ (1,137,649) |
Net loss per share | ||||
Basic and diluted (in dollars per share) | $ (0.03) | $ (0.01) | $ (0.08) | $ (0.02) |
Weighted average number of common shares outstanding (in shares) | 44,790,162 | 33,796,168 | 41,480,296 | 33,788,824 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Equity - CAD ($) | Common Stock [Member] | Common Stock [Member]Common Class A [Member] | Additional paid-in capital [Member] | Accumulated other comprehensive income [Member] | Deficit [Member] | Total |
Balance at Feb. 29, 2020 | $ 31,055,842 | $ 3,392,371 | $ 1,373,748 | $ (26,325,439) | $ 9,496,522 | |
Balance (in shares) at Feb. 29, 2020 | 33,785,154 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock based compensation | 136,004 | 136,004 | ||||
Shares issued on exercise of options | $ 9,671 | (4,323) | 5,348 | |||
Shares issued on exercise of options (in shares) | 28,154 | |||||
Shares for debt settlement | 0 | |||||
Foreign currency translation | (300,397) | (300,397) | ||||
Net loss for the period | (837,252) | (837,252) | ||||
Balance at Nov. 30, 2020 | $ 31,065,513 | 3,524,052 | 1,073,351 | (27,162,691) | 8,500,225 | |
Balance (in shares) at Nov. 30, 2020 | 33,813,308 | |||||
Balance at Feb. 29, 2020 | $ 31,055,842 | 3,392,371 | 1,373,748 | (26,325,439) | $ 9,496,522 | |
Balance (in shares) at Feb. 29, 2020 | 33,785,154 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Shares issued on exercise of options (in shares) | 28,154 | |||||
Shares exchanged to Class A Shares | $ 0 | |||||
Balance at Feb. 28, 2021 | $ 31,065,513 | 3,625,762 | 943,320 | (28,992,862) | $ 6,641,733 | |
Balance (in shares) at Feb. 28, 2021 | 33,813,308 | |||||
Balance at Aug. 31, 2020 | $ 31,055,842 | 3,459,175 | 1,118,757 | (26,801,468) | 8,832,306 | |
Balance (in shares) at Aug. 31, 2020 | 33,785,154 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock based compensation | 69,200 | 69,200 | ||||
Shares issued on exercise of options | $ 9,671 | (4,323) | 5,348 | |||
Shares issued on exercise of options (in shares) | 28,154 | |||||
Foreign currency translation | (45,406) | (45,406) | ||||
Net loss for the period | (361,223) | (361,223) | ||||
Balance at Nov. 30, 2020 | $ 31,065,513 | 3,524,052 | 1,073,351 | (27,162,691) | 8,500,225 | |
Balance (in shares) at Nov. 30, 2020 | 33,813,308 | |||||
Balance at Feb. 28, 2021 | $ 31,065,513 | 3,625,762 | 943,320 | (28,992,862) | 6,641,733 | |
Balance (in shares) at Feb. 28, 2021 | 33,813,308 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock based compensation | 757,792 | 757,792 | ||||
Shares issued on exercise of options | $ 572,350 | (195,458) | $ 376,892 | |||
Shares issued on exercise of options (in shares) | 1,605,042 | 1,605,042 | ||||
Shares exchanged to Class A Shares | $ (480,479) | $ 480,479 | ||||
Shares exchanged to Class A Shares (in shares) | (1,355,425) | 1,355,425 | ||||
Shares for debt settlement | $ 94,999 | $ 94,999 | ||||
Shares for debt settlement (in shares) | 737,000 | |||||
Shares issued on financing, net | $ 5,300,490 | 5,300,490 | ||||
Shares issued on financing, net (in shares) | 9,990,237 | |||||
Foreign currency translation | 128,506 | 128,506 | ||||
Net loss for the period | (3,223,268) | (3,223,268) | ||||
Balance at Nov. 30, 2021 | $ 36,552,873 | $ 480,479 | 4,188,096 | 1,071,826 | (32,216,130) | 10,077,144 |
Balance (in shares) at Nov. 30, 2021 | 44,790,162 | 1,355,425 | ||||
Balance at Aug. 31, 2021 | $ 36,552,873 | $ 480,479 | 3,895,604 | 959,321 | (30,712,433) | 11,175,844 |
Balance (in shares) at Aug. 31, 2021 | 44,790,162 | 1,355,425 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock based compensation | 292,492 | 292,492 | ||||
Foreign currency translation | 112,505 | 112,505 | ||||
Net loss for the period | (1,503,697) | (1,503,697) | ||||
Balance at Nov. 30, 2021 | $ 36,552,873 | $ 480,479 | $ 4,188,096 | $ 1,071,826 | $ (32,216,130) | $ 10,077,144 |
Balance (in shares) at Nov. 30, 2021 | 44,790,162 | 1,355,425 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Cash Flows - CAD ($) | 9 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Operating activities | ||
Net loss | $ (3,223,268) | $ (837,252) |
Non-cash items: | ||
Depreciation and amortization | 482,454 | 0 |
Interest accretion on lease liability | 146,430 | 0 |
Realized gain on sale of marketable securities | (10,059) | 42,141 |
Stock based compensation | 757,792 | 136,004 |
Change in fair value of marketable securities | (6,849) | 204,671 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,065,676) | 0 |
Prepaid expenses and other receivables | 290,101 | 124,519 |
Inventories | 408,873 | 0 |
Accounts payable and accrued liabilities | 872,727 | (70,225) |
Other liabilities | 11,455 | 0 |
Net cash used in operating activities | (1,336,020) | (400,142) |
Investing activities | ||
Cash and restricted cash received on acquisition of SDP | 461,321 | 0 |
Cash received on acquisition of Simbex, LLC | 632,697 | 0 |
Proceeds on sale of marketable securities | 496,526 | 259,720 |
Purchase of marketable securities | 0 | (178,269) |
Acquisition of property and equipment | (41,051) | 0 |
Acquisition of Simbex, LLC | (5,907,079) | 0 |
Return of escrow | 215,320 | 0 |
Net cash (used in) provided by investing activities | (4,142,266) | 81,451 |
Financing activities | ||
Repayment of long-term debt | (2,086,323) | 0 |
Draws from line of credit | 898,998 | 0 |
Issuance costs | (124,884) | 0 |
Proceeds from exercise of stock options | 376,892 | 5,348 |
Lease payments | (156,750) | 0 |
Net cash (used in) provided by financing activities | (1,092,067) | 5,348 |
Effect of foreign exchange rates on cash | 191,947 | (281,631) |
Decrease in cash and cash equivalents and restricted cash | (6,570,353) | (313,343) |
Cash and cash equivalents and restricted cash, opening | 12,506,142 | 8,349,422 |
Cash and cash equivalents and restricted cash, closing | 6,127,736 | 7,754,448 |
Supplementary | ||
Interest | 265,602 | 0 |
Income taxes | 1,995 | 0 |
Common stock issued for debt | 94,999 | 0 |
Restricted cash including the closing balance above | $ 487,977 | $ 0 |
Description of the business
Description of the business | 9 Months Ended |
Nov. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the business [Text Block] | 1. Description of the business Salona Global Medical Device Corporation (formerly known as Brattle Street Investment Corp.) ("we," "us," "our," "Salona," or the "Company"), is a publicly traded company listed on the TSX Venture Exchange (the "Exchange" or "TSXV"). The Company is an acquisition oriented, US-based and revenue generating medical technology company. The Company aims to leverage the liquid Canadian capital markets to acquire small to midsize US and internationally based medical device products and companies with the goal of expanding sales and improving operations. The Company's aim is to create a large, broad-based medical device company with global reach. The Company was incorporated under the Canada Business Corporations Act The Company's registered office is Suite 200E - 1515A Bayview Avenue, East York, Ontario. On December 21, 2020, the Company consolidated its issued and outstanding common shares on the basis of 7.37 post-consolidation common shares for 10 pre-consolidation common shares (the "Consolidation"). These shares were retroactively restated on the unaudited condensed consolidated statements of stockholders' equity. On May 21, 2021, the Company closed on an acquisition of South Dakota Partners Inc. ("SDP"). On September 30, 2021, the Company closed on an acquisition of Simbex, LLC ("Simbex") On November 29, 2021, the Company launched a new U.S. sales subsidiary called ALG Health Plus, LLC (ALG Health Plus), aimed at selling medical devices and supplies to small, independent hospitals and group purchasing organization ("GPO"), organizations that offer small medical offices and clinics access to devices and supplies on a larger scale creating efficiencies by aggregating purchasing volumes. Salona has created the LLC with an arm's length seasoned U.S. sales executive ("Agent") and his team with deep contacts and current sales relationships in the independent hospital and GPO sales channel on an exclusive basis. As part of the agreements to acquire the sales channel and existing customers, the Agent will receive 1,000,000 Salona Class "A" Shares (defined and details regarding these restricted, non-voting shares is below) so long as the LLC generates at least US$1,000,000 in profitable revenue for the quarter ending February 28, 2022. Salona has formed the LLC by contributing US$10,000 in organizational expenses and is the sole manager of the LLC, and, as such, holds all of the voting and participating units of the LLC. In addition to the initial revenue target of US$1,000,000 for the quarter ending February 28, 2022, for every US$50 block in marginal profit above market transfer pricing ("Sales Channel EBITDA") for the LLC during each quarter commencing with the three months ended February 28, 2022, and each of the quarterly periods thereafter through February 28, 2024 (up to US$10,000,000 in Sales Channel EBITDA), the Agent will receive $72 in Salona Class "A" Shares (based on the market price of the Salona Common Shares on November 29, 2021). The Agent has contributed the exclusive rights to sell to certain customers and related sales orders and supply agreements, in exchange for non-voting, non-participating units of the LLC that are exchangeable pursuant to a contribution and exchange agreement (the "Contribution and Exchange Agreement") with Salona into Class "A" non-voting common shares of Salona ("Salona Class "A" Shares"). The Salona Class "A" Shares have the same attributes as the common shares of Salona ("Salona Common Shares"), except that are not listed on the TSX Venture Exchange, do not carry the right to vote, and are convertible, subject to certain terms and conditions, including a provision prohibiting a holder of Salona Class "A" Shares from converting Salona Class "A" Shares for Salona Common Shares if it would result in such holder holding more than 9.9% of the Salona Common Shares, into Salona Common Shares on a one-for-one basis. In addition, pursuant to the Contribution and Exchange Agreement, the Agent is restricted from holding more than 500,000 Salona Common Shares at any time and the maximum allotment is no more than 21,000,000 Salona Class "A" Shares. The Company's operations could be significantly adversely affected by the effects of a widespread global outbreak of a contagious disease, including the recent outbreak of respiratory illness caused by COVID-19. The Company cannot accurately predict the impact COVID-19 will have on its operations and the ability of others to meet their obligations with the Company, including uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak, and the length of travel and quarantine restrictions imposed by governments of affected countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could further affect the Company's operations and ability to finance its operations. |
Basis of presentation
Basis of presentation | 9 Months Ended |
Nov. 30, 2021 | |
Basis Of Presentation [Abstract] | |
Basis of presentation [Text Block] | 2. Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") and in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Regulation S-X. The information furnished herein reflects all adjustments, consisting only of normal recurring adjustments, which in the opinion of management, are necessary to fairly state the Company's financial position, the results of its operations, and cash flows for the periods presented. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with U.S. GAAP were omitted pursuant to such rules and regulations. The financial information contained in this report should be read in conjunction with the Annual Report on Form 10-K for the fiscal years ended February 28, 2021 and February 29, 2020. The results of operations for the three and nine months ended November 30, 2021 are not necessarily indicative of the results for the year ending February 28, 2022. Functional and presentation currency These unaudited condensed consolidated financial statements are expressed in Canadian dollars unless otherwise stated. The functional currency of the Company is Canadian dollars, and the functional currency of its subsidiaries Inspira Financial Company, Inspira SaaS Billing Services, Simbex, LLC, ALG Health Plus, LLC and SDP is US dollars. |
Significant accounting policies
Significant accounting policies | 9 Months Ended |
Nov. 30, 2021 | |
Accounting Policies [Abstract] | |
Significant accounting policies [Text Block] | 3. Significant accounting policies a) Basis of consolidation These statements consolidate the accounts of the Company and its wholly owned subsidiaries, namely, Simbex, LLC ("Simbex"), ALG Health Plus, LLC ("ALG Health Plus"), South Dakota Partners Inc. ("SDP"), Inspira Financial Company ("IFC"), 1077863 B.C., Ltd ("1077863"), and Inspira SAAS Billing Inc. ("IFS") in the United States. The Company owns 100% of its subsidiaries. Intercompany balances and transactions are eliminated upon consolidation. b) Basis of measurement The unaudited condensed consolidated financial statements of the Company have been prepared on an historical cost basis except marketable securities which are carried at fair value. c) Use of estimates The preparation of unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. This applies to useful lives of non-current assets, impairment of non-current assets, valuation of stock-based compensation, allowance for doubtful accounts, provisions for inventory and valuation allowance for deferred tax assets. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. d) Operating segments An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company's other components. All operating segments' operating results are reviewed regularly by the Company's CEO to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. As of November 30, 2021, the Company has one segment, healthcare operations, which includes production and sale of medical devices to businesses in the United States. Assets, liabilities, revenues and expense from these segments are disclosed in the unaudited condensed consolidated balance sheets and statement of operations and comprehensive loss. e) Fair value of financial instruments The Company's financial instruments consist principally of cash and cash equivalents, restricted cash, marketable securities, accounts receivable, accounts payable and accrued liabilities, line of credit, long term debt, contingent liability, lease liabilities and other liabilities. Financial Accounting Standards Board ("FASB") Accounting Standards Codification (ASC) Topic 820, Fair Value Measurements and Disclosures, requires disclosure of the fair value of financial instruments held by the Company. FASB ASC Topic 825, Financial Instruments, defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization, low risk of counterparty default and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain assets or liabilities within the fair value hierarchy. The Company did not have any transfers of assets and liabilities between the levels of the fair value measurement hierarchy during the years presented. As of November 30, 2021, and February 28, 2021, respectively, the Company did not identify any financial assets and liabilities other than marketable securities, contingent liabilities and assets resulting from the SDP Simbex and acquisitions that would be required to be presented on the balance sheet at fair value. f) Revenue recognition Revenue comprises of goods and services provided to the Company's contracted customers and sales-based royalty charged by the company to licensees of the Intellectual Property (IP) developed by the company. In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers ("ASC 606"), the Company recognizes revenue upon the transfer of goods or services to a customer at an amount that reflects the expected consideration to be received in exchange for those goods or services. Simbex accounts for a customer contract when the rights of the parties, including the payment terms, are identified, the contract has commercial substance, collection of consideration is probable, and the contract has been signed and agreed to by both parties. Revenue is recognized when, or as, performance obligations are satisfied by transferring control or economic benefit of the service to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for its services. Revenue is reported net of any revenue-based taxes assessed by governmental authorities that are imposed on revenue producing transactions. The principles in ASC 606 are applied using the following five steps: (i) Identify the contract with a customer; (ii) Identify the performance obligation(s) in the contract; (iii) Determine the transaction price; (iv) Allocate the transaction price to the performance obligation(s) in the contract; and (v) Recognize revenue when (or as) the performance obligation(s) are satisfied. Revenue is recognized at a point-in-time upon transfer of control of goods or services to customers, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract, at an amount that reflects the consideration the Company expects to receive in exchange for the goods or services. As an allowed exception to the general requirements under ASC 606, for sales- or usage-based royalties that are attributable to a license of intellectual property, revenue is recognized at the later of: when the subsequent sale or usage occurs; and t he satisfaction or partial satisfaction of the performance obligation to which some or all of the sales- or usage-based royalty has been allocated Provisions for discounts, returns and other adjustments are provided for in the period the related sales are recorded. The Company has concluded that it is the principal in its revenue arrangements because it controls the goods or services before transferring them to the customer. The Company typically provides warranties for general repairs of defects that existed at the time of sale. These assurance-type warranties are accounted for as warranty provisions, if any. g) Research and development costs Research and development costs are generally expensed as incurred. These costs primarily consist of personnel and related expenses. h) Inventories Inventories comprises of raw-material, work-in-progress and finished goods, which consist principally of electrodes, electronic components, subassemblies, steel, hardware, and fasteners and are stated at the lower of cost (first-in, first-out) or net realizable value and include direct labor, materials, and other related costs. The Company periodically reviews inventory for evidence of slow-moving or obsolete items, and writes inventory down to net realizable value, as needed. This write-down is based on management's review of inventories on hand, compared to estimated future usage and sales, shelf-life assumptions, and assumptions about the likelihood of obsolescence. If actual market conditions are less favorable than those projected by the Company, additional inventory write-downs may be required. Inventory impairment charges establish a new cost basis for inventory and charges are not reversed subsequently to income, even if circumstances later suggest that increased carrying amounts are recoverable. i) Goodwill Goodwill represents the excess of costs over fair value of net assets acquired from our business combinations. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but instead are tested for impairment at least annually in accordance with the FASB issued Accounting Standards Update ("ASU") No. 2017-04 Intangibles-Goodwill and Other (Topic 350). Because an assembled workforce cannot be sold or transferred separately from the other assets in the business, any value attributed to it is subsumed into goodwill. The Company evaluates the carrying value of goodwill annually and between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. Such circumstances could include, but are not limited to, (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. When evaluating whether the goodwill is impaired, the Company compares the fair value of the reporting unit to which the goodwill is assigned to its carrying amount, including goodwill. The Company identifies the reporting unit on a basis that is similar to its method for identifying operating segments as defined by the Segment Reporting Topic of the FASB ASC. If the carrying amount of a reporting unit exceeds its fair value, then the amount of the impairment loss must be measured. This evaluation is applied annually on each impairment testing date (February 28) unless there is a triggering event present during an interim period. j) Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Asset Life Machinery and equipment 3 - 10 years Computer equipment and software 3 - 5 years Furniture and fixtures 7 - 10 years Leasehold improvements Lower of 15 years or lease period k) Right-of-use asset The Company's right-of-use assets consist of leased assets recognized in accordance with ASC 842, Leases l) Intangible assets Intangible asset consists of trademarks, intellectual property, customer base and non-competes (Note 4). Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives and are measured at cost less accumulated amortization and accumulated impairment losses per the table below: Intangible asset Life Tradename - Trademarks Lower of 5 years or useful life Non-competes Lower of 5 years or useful life Intellectual Property Lower of 5 years or useful life Customer Base Lower of 15 years or useful life The intangible assets with finite useful lives are reviewed for impairment when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the long-lived assets. The next assessment of useful lives will take place as at the fiscal year ending February 28, 2022. m) Business Combination and Contingent consideration A business combination is a transaction or other event in which control over one or more businesses is obtained. A business is an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs or other economic benefits. A business consists of inputs and processes applied to those inputs that have the ability to create outputs that provide a return to the Company and its shareholders. A business need not include all of the inputs and processes that were used by the acquiree to produce outputs if the business can be integrated with the inputs and processes of the Company to continue to produce outputs. The Company considers several factors to determine whether the set of activities and assets is a business. Business acquisitions are accounted for using the acquisition method whereby acquired assets and liabilities are recorded at fair value as of the date of acquisition with the excess of the purchase consideration over such fair value being recorded as goodwill and allocated to reporting units ("RUs"). If the fair value of the net assets acquired exceeds the purchase consideration, the difference is recognized immediately as a gain in the condensed consolidated statement of operations and comprehensive loss. Acquisition related costs are expensed during the period in which they are incurred, except for the cost of debt or equity instruments issued in relation to the acquisition which is included in the carrying amount of the related instrument. Certain fair values may be estimated at the acquisition date pending confirmation or completion of the valuation process. Where provisional values are used in accounting for a business combination, they are adjusted retrospectively in subsequent periods. However, the measurement period will not exceed one year from the acquisition date. The determination of the value of goodwill and intangible assets arising from business combinations requires extensive use of accounting estimates and judgments to allocate the purchase price to the fair value of the net tangible and intangible assets acquired. The total purchase price for the acquisition of South Dakota Partners Inc. ("SDP") comprised of amounts allocated to stock, including a contingent consideration liability representing the impact of expected revenue and net working capital shortfalls and a contingent consideration asset which represents potential future earnout payments to the Company that are contingent on SDP's business achieving certain milestones. Contingent consideration classified as an asset or liability is remeasured to fair value at each reporting date until the contingency is resolved, with changes in fair value recognized in profit or loss. The total purchase price for the acquisition of Simbex, LLC (Simbex) consisted of cash, capital stock, and a contingent consideration liability representing earnout payments of cash and stock, subject to achieving certain EBITDA targets. n) Concentration risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company limits its exposure to credit loss by placing its cash with high credit quality financial institutions. During the period ended November 30, 2021, SDP had 407 customers with two of those customers accounting for over 75% ( nil nil o) Recently issued pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses ("ASU 2016-13"), which changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. This update is effective for annual periods beginning after December 15, 2023, as amended by ASU No. 2019-10, and interim periods within those periods, and early adoption is permitted. The Company is in the process of determining the impact the adoption will have on its condensed consolidated financial statements as well as whether to early adopt the new guidance. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes which amends ASC 740 Income Taxes (ASC 740). This update is intended to simplify accounting for income taxes by removing certain exceptions to the general principles in ASC 740 and amending existing guidance to improve consistent application of ASC 740. This update is effective for fiscal years beginning after December 15, 2021. The guidance in this update has various elements, some of which are applied on a prospective basis and others on a retrospective basis with earlier application permitted. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In January 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) The Company adopted ASU 2020-01 as of January 1, 2021. The adoption did not have any material impact on the Company's Consolidated Financial Statements. In May 2020, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815- 40):Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This update provides guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic. This update is effective for fiscal years beginning after December 15, 2021. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In August 2020, the FASB issued guidance that simplifies the accounting for debt with conversion options, revises the criteria for applying the derivative scope exception for contracts in an entity's own equity, and improves the consistency for the calculation of earnings per share. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2021. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In March 2020, the FASB issued guidance providing optional expedients and exceptions to account for the effects of reference rate reform to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued. The optional guidance, which became effective on March 12, 2020, and can be applied through December 21, 2022, has not impacted our condensed consolidated financial statements. The Company has various contracts that reference LIBOR and is assessing how this standard may be applied to specific contract modifications through December 31, 2022. Management does not believe that any recently issued, but not yet effective, accounting standards could have a material effect on the accompanying condensed consolidated financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances. |
Acquisitions
Acquisitions | 9 Months Ended |
Nov. 30, 2021 | |
Business Combinations [Abstract] | |
Acquisitions [Text Block] | 4. Acquisitions South Dakota Partners Inc. ("SDP") Purchase Price The Company completed the purchase all of the capital stock of South Dakota Partners Inc. (SDP), under the Purchase Agreement dated May 21, 2021. Under the Purchase Agreement, Salona acquired the manufacturer specializing in medical- devices, full electronics box builds, PCBA's, electrodes, drug delivery and many other products involving electronics, electro-mechanical assemblies, and various types of material conversion. The acquisition includes all of the current customers, contract -rights, inventory, equipment, workforce, and manufacturing infrastructure. At the time of the transaction, there were no material relationships between the seller and Salona or any of its affiliates, or any director or officer of Salona, or any associate of any such officer or director. As consideration, the Company will issue 26,000,000 shares of common stock valued at $12,340,570 subject to earn-out adjustments, including revenue shortfall adjustment and adjusted net assets adjustments. The Company assumed all of the assets and liabilities of SDP. In accordance with ASC 805 "Business Combinations" the measurement period for the acquisition is for one year during which the Company may re-evaluate the assets acquired, liabilities assumed and the goodwill resulting from the transaction as well as the change in amortization as a result of changes in the provisional amounts as if the accounting had been completed at the acquisition date. The allocation of the purchase price to the assets acquired and liabilities assumed based on an estimate of fair values at the date of acquisition as follows: Cash $ 255 Restricted Cash 461,066 Accounts Receivable 2,763,621 Inventories 4,958,833 Prepaid expenses 21,651 Property and equipment 1,409,421 Right-of-use assets 2,343,947 Intangible Assets 2,199,444 Goodwill 8,532,798 Accounts payable (821,244 ) Accrued expenses (201,733 ) Line of credit (3,732,414 ) Debt (2,971,350 ) Lease liability (2,498,095 ) Other liabilities (384,420 ) Total adjusted purchase price $ 12,081,780 The business combination accounting is not yet complete and the amounts assigned to assets acquired and liabilities assumed are provisional. Therefore, this may result in future adjustments to the provisional amounts as information is obtained about facts and circumstances that existed at the acquisition date. The amount allocated to identifiable intangible assets was determined by the Company's management. Intangible assets other than goodwill are being amortized over their useful life in accordance with the guidance contained in the FASB issued ASC Topic 350 "Goodwill and Other Intangible Assets". Management estimates that the amount of goodwill that will be deductible for income tax purposes in the current year is $438,490. This amount is expected to increase in future years. Goodwill $ 8,532,798 Tradename - Trademarks 341,929 Intellectual Property 320,823 Customer Base 1,266,405 Non-Competes 270,287 Total identifiable intangible assets $ 10,732,242 The table below summarizes the value of the total consideration given in the transaction: Stock (Parent Special Stock) $ 12,340,570 Floor Guarantee/Contingent Liability 1,139,910 Earn-out /Contingent Consideration (Revenue) (21,924 ) Earn-out /Contingent Consideration (Net Assets) (1,376,776 ) Total Consideration $ 12,081,780 The contingent consideration asset represents potential future earnout payments to the Company that are contingent on SDP's business achieving certain milestones. The fair value of the contingent consideration asset of $1,398,700 was recognized on the acquisition date and was measured using unobservable (Level 3) inputs. The value of the contingent consideration asset at November 30, 2021 was $1,398,700. The actual number of shares to be issued as consideration will vary depending upon the future revenues and net assets of the acquiree, for the period and as at the end of the twelve months following the month of the acquisition date. Accordingly, a liability of $12,081,780 has been recorded as at November 30, 2021 for shares of common stock to be issued and related to the acquisition. Post-acquisition, SDP contributed substantially to the Company's balance sheet and made up greater than 50% of the Company's assets. Since acquisition, SDP has generated $8,080,154 of revenue and has generated net earnings of $359,289. These amounts are included in the condensed consolidated statements of operations and comprehensive loss. Simbex, LLC ("Simbex") Purchase Price: The Company completed the purchase all the capital stock of Simbex, LLC (Simbex), under the Purchase Agreement dated September 30, 2021. Under the Purchase Agreement, Salona acquired the company which provides mechanical and electrical design and engineering services as well as consultancy services in the field of biomechanical systems and medical devices. The acquisition includes all its current customers, contract rights, work-in-process, equipment, workforce, as well as its consulting, design, and engineering infrastructure. At the time of the transaction, there were no material relationships between the seller and Salona or any of its affiliates, or any director or officer of Salona, or any associate of any such officer or director. As consideration, the Company provided $5,691,759 cash as well as issuing 6,383,954 shares of common stock valued at $15,288,000 subject to earn-out adjustments, including revenue shortfall adjustment and adjusted net assets adjustments. The Company assumed all the assets and liabilities of Simbex. In accordance with ASC 805 "Business Combinations" the measurement period for the acquisition is for one year during which the Company may re-evaluate the assets acquired, liabilities assumed and the goodwill resulting from the transaction as well as the change in amortization as a result of changes in the provisional amounts as if the accounting had been completed at the acquisition date. The allocation of the purchase price to the assets acquired and liabilities assumed based on an estimate of fair values at the date of acquisition as follows: Cash $ 632,697 Accounts Receivable 1,402,315 Work-in-process 301,180 Prepaid expenses 34,992 Property and equipment 122,916 Other receivables 6,395 Intangible Assets 5,175,486 Goodwill 4,951,218 Accounts payable and accrued liabilities (33,560 ) Accrued expenses (1,095 ) Other liabilities (131,016 ) Total adjusted purchase price $ 12,461,528 The business combination accounting is not yet complete and the amounts assigned to assets acquired and liabilities assumed are provisional. Therefore, this may result in future adjustments to the provisional amounts as information is obtained about facts and circumstances that existed at the acquisition date. Since acquisition, Simbex has generated $1,670,797 of revenue and has generated net earnings of $206,145. These amounts are included in the condensed consolidated statements of operations and comprehensive loss. The amount allocated to identifiable intangible assets was determined by the Company's management. Other intangibles assets are being amortized over their useful life in accordance with the guidance contained in the FASB issued ASC Topic 350 "Goodwill and Other Intangible Assets". Management estimates that the amount of goodwill that will be deductible for income tax purposes in the current year is $137,534. This amount is expected to increase in future years. Goodwill $ 4,951,218 Tradename - Trademarks 933,865 Customer Base 3,648,148 Non-Competes 593,473 Total identifiable intangible assets $ 10,126,704 The table below summarizes the value of the total consideration given in the transaction: Cash $ 4,428,900 Working Capital Adjustment 1,262,859 Value of Escrowed Stock 126,540 Value of Earnout / Contingent Consideration 6,643,229 Total Consideration $ 12,461,528 The Working Capital Adjustment comprises: the closing cash payment, the closing escrowed stock valued at USD100,000, valued at the 30-day Volume Weighted Average Price ("VWAP") determined as of the closing date, pro-rata bonuses to be paid to employees for 2021, and ordinary course bonuses for 2022. The Earnout is based on Management's forecast of 2022 Earnings before interest, tax, depreciation, and amortization (EBITDA) and has been valued by Management using the Black-Scholes model. Pro Forma Combined Financials: The following are the unaudited pro forma results of operations for the period ended November 30, 2021, and the year ended February 28, 2021, as if SDP and Simbex had been acquired on March 1, 2020. The pro forma results include estimates and assumptions which management believes are reasonable. These assumptions include an adjustment to operating income for one-time transactional costs that would not have occurred without the acquisition of SDP and Simbex. Additionally, the pro forma results do not include any cost savings or other effects of the planned integration of these entities and may not be fully indicative of the results that would have occurred if the business combination had been in effect on the dates indicated. For the nine months ended November 30, 2021 For the year ended Revenues 18,296,896 22,636,911 Cost of revenue 11,555,073 13,059,839 Gross margin 6,741,823 9,577,072 Operating expenses (6,709,453) (8,514,391) Income from operations 32,370 1,062,681 Transaction costs (2,937,030) (1,652,664) Depreciation and amortization (680,814) (990,238) Foreign exchange loss (38,397) — Gain on debt settlement 15,538 — Interest expense (349,113) (515,040) Net loss before taxes (3,957,446) (2,095,261) Tax recovery (expense) 328,937 (50,789) Net loss (3,628,509) (2,146,050) |
Accounts receivable
Accounts receivable | 9 Months Ended |
Nov. 30, 2021 | |
Receivables [Abstract] | |
Accounts receivable [Text Block] | 5. Accounts receivable November 30, February 28, Trade accounts receivable $ 5,276,208 $ - Allowance for doubtful accounts (42,441 ) - Other receivables 206,478 - Total accounts receivable $ 5,440,245 $ - Other receivables consist of reimbursable costs from a customer of SDP and taxes receivable. |
Disaggregation of Revenues
Disaggregation of Revenues | 9 Months Ended |
Nov. 30, 2021 | |
Disaggregation of Revenue [Abstract] | |
Disaggregation of Revenues [Text Block] | 6. Disaggregation of Revenues Three months ended Nine months ended November 30, November 30, November 30, November 30, Sales $ 5,247,943 $ - $ 9,750,920 $ - Loan interest - 22,429 - 39,190 Fees and other - 14,058 - 50,621 Collections of provisioned loans - 317,515 - 399,702 Interest, fees, and other recovered 29,637 - 62,735 - Total operating revenues $ 5,277,580 $ 354,002 $ 9,813,655 $ 489,513 Investment income $ 9,062 $ 5,796 $ 20,352 $ 50,710 Gain (loss) on sale of marketable securities 35 548 10,059 (42,141 ) Change in fair value of marketable securities 25 (136,759 ) 6,849 (204,671 ) Net investment income (loss) $ 9,122 $ (130,415 ) $ 37,260 $ (196,102 ) Total revenue $ 5,286,702 $ 223,587 $ 9,850,915 $ 293,411 The Company recognizes the interest and other amounts collected, on the impaired loans, as revenue only on collection as the future economic benefits are uncertain. Revenues for credit receivables (loans) have been disaggregated between loans that are provisioned and those that have not been provisioned. Loans that are not provisioned are accounted for under the accrual method of accounting. The principal loan repayments of fully provisioned loans are recorded as an offset to provision for losses. The interest, fees, and other revenue is recorded on a cash basis as reflected above. The other investments were to a related company and were considered fully impaired. |
Inventories
Inventories | 9 Months Ended |
Nov. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories [Text Block] | 7. Inventories The Company allocates inventory into three major buckets: Raw material, work in progress, and finished goods. November 30, 2021 Raw materials $ 4,422,023 Work in progress 304,959 Finished goods 107,552 Total $ 4,834,534 |
Property and equipment
Property and equipment | 9 Months Ended |
Nov. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment [Text Block] | 8. Property and equipment Cost Acquired on May 21, 2021 and Additions Disposal Translation November 30, 2021 Machinery and equipment $ 1,430,378 $ 41,051 $ - $ 78,474 $ 1,549,903 Computer equipment and software 70,029 - - 4,156 74,185 Furniture and fixtures 9,721 - - 577 10,298 Leasehold improvements 23,400 - - 1,389 24,789 Total $ 1,533,528 $ 41,051 $ - $ 84,596 $ 1,659,175 Accumulated amortization May 21, 2021 and Additions Disposal Translation November 30, 2021 Machinery and equipment $ - $ 118,932 $ - $ 2,800 $ 121,732 Computer equipment and software - 10,142 - 239 10,381 Furniture and fixtures - 858 - 20 878 Leasehold improvements - 1,482 - 36 1,518 Total $ - $ 131,414 $ - $ 3,095 $ 134,509 Net Book Value $ 1,533,528 $ 1,524,666 Life of assets are a continuation of the life from SDP and Simbex (the acquired entities). |
Intangible assets
Intangible assets | 9 Months Ended |
Nov. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets [Text Block] | 9. Intangible assets Acquired on May 21 and September 30, November 30, Cost 2021 Additions Disposal 2021 Tradename - Trademarks $ 1,275,794 $ — $ — $ 1,275,794 Intellectual Property 320,823 — — 320,823 Customer Base 4,914,553 — — 4,914,553 Non-Competes 863,760 — — 863,760 Total $ 7,374,930 $ — $ — $ 7,374,930 May 21, and September 30, November 30, Accumulated amortization 2021 Additions Disposal 2021 Tradename - Trademarks $ — $ 69,860 $ — $ 69 860 Intellectual Property — 35,782 — 35,782 Customer Base — 88,392 — 88,392 Non-Competes — 50,306 — 50,306 Total $ — 244,340 $ — $ 244,340 Net Book Value $ 7,374,930 7,130,590 |
Accounts payable, accrued liabi
Accounts payable, accrued liabilities and other liabilities | 9 Months Ended |
Nov. 30, 2021 | |
Payables and Accruals [Abstract] | |
Accounts payable, accrued liabilities and other liabilities [Text Block] | 10. Accounts payable, accrued liabilities and other liabilities November 30, February 28, Accounts payable $ 2,782,000 $ 479,767 Accrued liabilities 561,759 568,017 Total $ 3,343,759 $ 1,047,784 Other liabilities include unearned customer deposits and unearned revenues. |
Line of credit and debt
Line of credit and debt | 9 Months Ended |
Nov. 30, 2021 | |
Debt Disclosure [Abstract] | |
Line of credit and debt [Text Block] | 11. Line of credit and debt Lines of credit There is a line of credit facility with a financial institution whereby the Company, secured only by the assets of SDP and not the Parent or any other subsidiary, may borrow up to US$3,500,000 with a maturity on August 1, 2021. Borrowings bear interest at 4.5% and any accrued unpaid interest is due on a monthly basis. The balance was secured by substantially all assets of SDP. As of November 30, 2021, the balance outstanding under the agreement was $nil. The line of credit was refinanced along with several other loans on June 9, 2021. The line of credit facility is with a financial institution whereby the Company, through SDP, may borrow up to US$5,400,000 with a maturity on August 1, 2023. Borrowings' bear interest at 4% or prime +0.75%, whichever is greater, and any accrued unpaid interest is due on a monthly basis. The balance is secured by substantially all assets of SDP and not the Parent or any other subsidiary. As of November 30, 2021, the balance outstanding under the agreement was $4,874,088 (US$3,814,850). In accordance with the refinanced agreement, the Company is subject to a financial covenant and is required to maintain a minimum tangible net worth (calculated based on the Company's July 31, 2021 consolidated balance sheet less $400,000 USD), which must be met on monthly basis. Additionally, the Company cannot make any loans, advances, intercompany transfers of cash flow at any time. Since the execution of the debt line on June 9, 2021, to November 30, 2021, the Company was in compliance with the financial covenant. Debt South Dakota Development Corporation State of South Dakota Governor's Office of Economic Development Other Notes payable Covid- Related Loans Crestmark term loan Total Debt Acquired on May 21, 2021 $ 509,544 $ 28,480 $ 1,549,288 $ 884,038 $ — $ 2,971,350 Additions — — — 934,650 934,650 Forgiveness of loan — — (819,104 ) — (819,104 ) Principal repayments (526,800 ) (29,445 ) (1,601,760 ) — (53,534 ) (2,211,539 ) Translation 17,256 965 52,472 32,277 22,246 125,216 Balance November 30, 2021 — — — 97,211 903,362 1,000,573 Less: current portion (97,211 ) (172,835 ) (270,046 ) Long-term portion $ — $ — $ — $ — $ 730,527 $ 730,527 South Dakota Development Corporation ("SDDC") This debt line was refinanced along with several other loans subsequent to period end. The Company, through SDP and secured against only SDP assets and not the Parent or any other subsidiary, may borrow up to $800,000 under the promissory note agreement entered in connection with the purchase of the assets of DJO Global Empi Division by SDP and borrowings are guaranteed by the stockholders of the Company. The debt accrues interest at 2% with monthly payments of principal and interest beginning in March 2017 through maturity in May 2021. As of November 30, 2021, the balance of the note was $ nil State of South Dakota Governor's Office of Economic Development ("GOED") On March 6, 2018, the Company borrowed $200,000 with the State of South Dakota Governor's Office of Economic Development for the purpose of financing the growth of the Company. The debt accrues interest at 3 % with monthly payments of principal and interest beginning in June 2018 through maturity in May 2021. The borrowings were guaranteed by the stockholders of the Company. As of November 30, 2021, the balance of the note was $ nil Other Notes Pa yable On February 1, 2019, the Company borrowed $1,500,120 from a financial institution in connection with the acquisition in Note 4. The debt accrued interest at 5.25% with monthly principal and interest payments required through maturity in January 2024. The borrowings were secured by substantially all the assets of the Company. As of November 30, 2021, the balance of the note was $ nil The Company was also party to two additional notes payable with maturity dates of October 2023 and November 2024, with interest rates of 9.00% and 5.25%, respectively. As of November 30, 2021, the balance on these notes totaled $nil. There was no prepayment penalty associated with early settlement. Covid Related Loans On February 2, 2021, SDP borrowed $944,542 (US$736,887) from a financial institution in connection with the United States Payroll Protection Program ("PPP"). The PPP is a fully forgivable loan issued by accredited financial institutions on behalf of the US Government. The loan bears interest at 1.00% with payments of principal and interest of US$13,740 beginning on December 2, 2021. The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the eight-week period. SDP initially recorded the proceeds of the PPP Loan as debt and derecognizes the liability when the loan is paid off or it believes forgiveness is reasonably certain. Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness is reduced if full-time headcount declines, or if salaries and wages decrease. The Company had recognized the government grant over the period to match the grant with the related costs, predominantly offset against labor expense. The loan was forgiven in its entirety on June 14, 2021. On May 8, 2020, SDP borrowed US$150,000 from the United States Small Business Administration ("SBA") in connection with the Economic Injury Disaster Loan ("EIDL") program. EIDL is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. EIDL proceeds can be used to cover a wide array of working capital and normal operating expenses, such as continuation to health care benefits, rent, utilities, and fixed debt payments. The debt bears interest at 2.75% per year and is not forgivable. Payments of principal and interest of $809 (US$641) per month beginning 12 months from inception of the loan over a 30-year period. The debt balance as of November 30, 2021, was $97,211 (US$76,085). Re-financing of Select Liabilities On June 9, 2021, SDP refinanced the existing line of credit facility, GOED and SDDC loans, with two new loans. Term Note On June 9, 2021, the Company borrowed $936,895 (US$750,000) with a financial institution, Crestmark. The loan is secured by a loan and security agreement and may not exceed 92% of the value of SDP's machinery and equipment. The debt accrues interest at 6% with monthly payments of principal and interest in the amount of $18,294 (US$14,500) beginning on the first day of the first full month following the initial funding and maturing on June 1, 2024. The borrowings are guaranteed by the stockholders of the Company. As of November 30, 2021, the balance of the note was $903,362. |
Restricted cash
Restricted cash | 9 Months Ended |
Nov. 30, 2021 | |
Restricted Cash Equivalents [Abstract] | |
Restricted cash [Text Block] | 12. Restricted cash PPP loan deposit in escrow In compliance with the United States Small Business Administration ("SBA") guidelines on change of control for entities that are actively seeking forgiveness of a grant, the Company placed $889,473 in escrow with Dacotah Bank pending forgiveness of the loan. On June 14, 2021, the SBA issued the forgiveness payment for PPP loan and, as a result, the escrowed funds were released in whole back to the Company and are no longer restricted at the date of issuance of these unaudited condensed consolidated financial statements. |
Leases
Leases | 9 Months Ended |
Nov. 30, 2021 | |
Leases [Abstract] | |
Leases [Text Block] | 13. Leases Set out below are the carrying amount of right of use assets and the movements during the period: Right-of-use assets Acquired $ 3,955,533 Amortization (106,700 ) Impact of modification 51,177 Translation 153,443 Balance, November 30, 2021 $ 4,053,453 Lease liability Current Long-term Acquired $ 4,109,681 $ 310,464 $ 3,799,217 Interest lease expense 146,430 Lease payments (156,750 ) Translation 163,665 Balance, November 30, 2021 $ 4,263,026 $ 235,562 $ 4,027,464 Future minimum lease payments payable are as follows: Twelve months ending November 30, 2022 $ 520,948 Twelve months ending November 30, 2023 486,772 Twelve months ending November 30, 2024 485,366 Twelve months ending November 30, 2025 495,074 Twelve months ending November 30, 2026 505,747 2027 and thereafter 4,022,411 Total future minimum lease payments 6,516,318 Less: Interest on lease liabilities (2,253,292 ) Total present value of minimum lease payments 4,263,026 Less: current portion 235,562 Non-current portion $ 4,027,464 SDP facility lease In October 2018, SDP sold its facility in Clear Lake, South Dakota for $2,634,667 (US$2,182,461). In connection with the sale, SDP entered into a lease agreement for the facility with an initial lease term of 15 years for a base annual rental of $230,533 (US$190,965), with four extension options of five years each. The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined. Per the lease agreement, the Company delivered a letter of credit in the amount of $487,977 (US$381,930), which is recorded in restricted cash on the condensed consolidated balance sheet. Simbex office space lease On October 1, 2021, Simbex LLC entered into a lease agreement for an office space located in Lebanon, NH with an initial lease term of 3 years for a base annual rental of $201,155 (US$157,440), with an option to extend for five years. The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined. Per the lease agreement, the Company is also responsible to pay a prorated share of the building overhead monthly as additional rent. The annual amount for this additional rent is $119,350 (US $93,413). Inspira Financial Company office space lease On September 13, 2021, Inspira Financial Company entered into a lease agreement for an office space located in Encino, CA with an initial lease term of 6 months for a base annual rental of $40,287 (US$31,532), with an option for Salona to extend for 3, 6 and 12 months. Pursuant to the lease agreement, the Company is also responsible to pay a prorated share of the building overhead monthly as additional rent. The annual amount for this additional rent is $8,049 (US $6,300). The Company has elected the practical expedient permitted under the Financial Accounting Standards Board issued Accounting Standard Codification 842, Leases |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Nov. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity [Text Block] | 14. Stockholders' Equity a. Share capital Unlimited voting common shares without par value Unlimited non-voting convertible Class A shares without par value Issuances As of November 30, 2021, and February 28, 2021, the Company had 44,790,162 and 33,813,308 common shares outstanding, respectively, with a value of $36,552,873 and $31,065,513, respectively. As of November 30, 2021, and February 28, 2021, the Company had 1,355,425 and no Class A shares outstanding, respectively, with a value of $480,479 and $0, respectively. On September 6, 2020, the Company entered into a share for debt agreement, pursuant to which it issued an aggregate of 737,000 shares of common stock in satisfaction of $114,498 (US$88,000) of indebtedness owed to a service provider. The 737,000 shares of common stock were valued at $94,999 based on the share price on May 21, 2021, the date of issuance. A gain of $15,538 was recognized on the settlement of this debt. On May 20, 2021, 1,492,425 shares of common stock were issued on the exercise of 1,492,425 stock options for proceeds of $355,500. On May 20, 2021, pursuant to a share exchange agreement, an aggregate of 1,355,425 shares of common stock with a value of $480,479 were exchanged for 1,355,425 Class A shares. On May 21, 2021, 9,990,237 shares of common stock were issued in connection with the financing closed on December 21, 2020 for $5,300,490 in proceeds at market value. On August 20, 2021, 112,617 shares of common stock were issued on the exercise of 112,617 stock options for proceeds of $21,392. b. Share based compensation The Company amended its stock option plan ("Option Plan") as follows: The Company's Board of Directors determines, among other things, the eligibility of individuals to participate in the Option Plan and the term, vesting periods, and the exercise price of options granted under the Option Plan. The stock option vesting ranges over a 1 year to 10-year period. The outstanding stock options at August 31, 2021 are as follows: Grant date Exercise price Number of options Number of vested options Weighted Avg (years) March 28, 2014 $ 2.13 5,103 5,103 2.33 February 27, 2017 0.45 25,246 25,246 0.24 September 23, 2019 0.19 450,470 394,161 2.82 May 29, 2020 0.27 73,700 73,700 3.49 August 18, 2020 0.19 73,700 73,700 8.72 June 8, 2021 0.99 663,300 — 4.50 June 8, 2021 0.86 1,672,990 — 4.50 June 8, 2021 0.86 250,000 250,000 4.50 July 7, 2021 1.39 400,000 — 4.72 Total $ 0.83 3,614,509 821,910 4.35 A summary of the Company's stock options are as follows: Number of Options Weighted Avg. Exercise Price Balance as at February 29, 2020 1,181,709 0.27 Options exercised (28,154 ) 0.19 Options issued 1,639,825 0.23 Balance as at February 28, 2021 2,793,380 $ 0.27 Options exercised (1,605,042 ) 0.23 Options expired (560,119 ) — Options issued 2,986,290 0.93 Balance as at November 30, 2021 3,614,509 $ 0.83 The Company recognized $292,492 and $757,792 of stock-based compensation for the three and nine months ended November 30, 2021, respectively ($69,200 and $136,004 for the three and nine months ended November 30, 2020, respectively). On May 29, 2020, the Company issued 884,400 options to two directors, which were fully vested, and have been exercised during the period ended, and 73,700 options to an employee of the Company. The options are exercisable for a period of five years at an exercise price of $0.27 per option. The fair value of the options was estimated on the date of the grant at $0.12 per option using the Black- Scholes option pricing model with the following assumptions: expected volatility of 115%; expected dividend yield of 0%; risk-free interest rate of 99.62%; stock price of $0.16; and expected life of 3 years. On August 18, 2020, the Company issued 608,025 options to two directors, which were fully vested, and have been exercised during the period ended, and 73,700 options to an employee of the Company. The options are exercisable for a period of ten years at an exercise price of $0.19 per option. The fair value of the options was estimated on the date of the grant at $0.12 per option using the Black-Scholes option pricing model with the following assumptions: expected volatility of 115%; expected dividend yield of 0%; risk- free interest rate of 99.71%; stock price of $0.16; and expected life of 3 years. On June 8, 2021, the Company issued 663,300 options to an officer of the Company. The options are exercisable for a period of five years at an exercise price of $0.99 per option. The fair value of the options was estimated on the date of the grant at $0.58 per option using the Black-Scholes option pricing model with the following assumptions: expected volatility of 100%; expected dividend yield of 0%; risk-free interest rate of 99.12%; stock price of $0.80; and expected life of 5 years. On June 8, 2021, the Company issued 1,672,990 options to four directors, and 250,000 options to two employees of the Company in total. The options are exercisable for a period of five years at an exercise price of $0.86 per option. The fair value of the options was estimated on the date of the grant at $0.59 per option using the Black-Scholes option pricing model with the following assumptions: expected volatility of 100%; expected dividend yield of 0%; risk-free interest rate of 99.12%; stock price of $0.80; and expected life of 5 years. On July 7, 2021, the Company issued 250,000 options to one director and 150,000 options to an employee of the Company, which were fully vested. The options are exercisable for a period of five years at an exercise price of $1.39 per option. The fair value of the options was estimated on the date of the grant at $0.64 per option using the Black-Scholes option pricing model with the following assumptions: expected volatility of 190%; expected dividend yield of 0%; risk-free interest rate of 99.06%; stock price of $1.39; and expected life of 5 years. |
Related party transactions
Related party transactions | 9 Months Ended |
Nov. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related party transactions [Text Block] | 15. Related party transactions The Company's transactions with related parties were carried out on normal commercial terms and in the course of the Company's business. Other than disclosed elsewhere in the Company's unaudited condensed consolidated financial statements, related party transactions are as follows. Nine months ended November 30, 2021 November 30, 2020 Salaries and short-term benefits 104,062 122,696 Stock based compensation 535,603 136,004 Total 639,665 258,700 Salary, allowance and other include salary, consulting fees, car allowance, vacation pay, bonus and other allowances paid or payable to a shareholder, directors and executive officers of the Company. Included in accounts payable and accrued liabilities is $nil (February 28, 2021 - $114,498) due to a director of the Company. |
Capital management
Capital management | 9 Months Ended |
Nov. 30, 2021 | |
Capital Management [Abstract] | |
Capital management [Text Block] | 16. Capital management The Company's objectives when managing capital are to: (a) maintain financial flexibility in order to preserve its ability to meet financial obligations and continue as a going concern; (b) maintain a capital structure that allows the Company to finance its growth using internally generated cash flow and debt capacity; and (c) optimize the use of its capital to provide an appropriate investment return to its shareholders commensurate with risk. The Company's financial strategy is formulated and adapted according to market conditions in order to maintain a flexible capital structure that is consistent with its objectives and the risk characteristics of its underlying assets. The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of its underlying assets. To maintain or adjust its capital structure, the Company may, from time to time, change the amount of dividends paid to shareholders, return capital to shareholders by way of normal course issuer bid, issue new shares, or reduce liquid assets to repay other debt. |
Net loss per share
Net loss per share | 9 Months Ended |
Nov. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net loss per share [Text Block] | 17. Net loss per share Three months ended Nine months ended November 30, 2021 November 30, 2020 November 30, 2021 November 30, 2020 Net loss (1,503,697 ) (361,223 ) (3,223,268 ) (837,252 ) Weighted average number of common shares 44,790,162 33,796,168 41,480,296 33,788,824 Net loss per share from operations Basic (0.03 ) (0.01 ) (0.08 ) (0.02 ) Diluted (0.03 ) (0.01 ) (0.08 ) (0.02 ) |
Operating expenses
Operating expenses | 9 Months Ended |
Nov. 30, 2021 | |
General and Administrative Expense [Abstract] | |
Operating expenses [Text Block] | 18. Operating expenses General and administrative expenses include stock-based compensation of $757,792 for the nine-months ended November 30, 2021 ($136,004 November 30, 2020) and $292,492 for the three-months ended November 30, 2021 ($69,200 November 30,2020), as well as rent and facility costs, professional fees, public company expenses, insurance and other general expenses. |
Transaction costs including leg
Transaction costs including legal, financial, audit, US and Canadian regulatory costs | 9 Months Ended |
Nov. 30, 2021 | |
Costs and Expenses [Abstract] | |
Transaction costs including legal, financial, audit, US and Canadian regulatory costs [Text Block] | 19. Transaction costs including legal, financial, audit, US and Canadian regulatory costs The Company incurred substantial cost associated with the Change of Business transaction, due diligence of acquisition targets, financing costs, US regulatory costs and the associated accounting and regulatory costs. While these costs are crucial to future operations, they do not represent regular operational costs of the business. The Company presents these costs separately to better allow investors to evaluate the operational status of the Company independently of financing, regulatory and other transaction focused expenses. During the three and nine months ended November 30, 2021, these costs were as follows: Three months ended Nine months ended November 30, 2021 November 30, 2020 November 30, 2021 November 30, 2020 Consulting and professional fees 202,455 - 1,243,042 - General expenses 842,000 306,909 1,026,881 306,909 Transaction Costs Including: Audit, Legal, and US 1,044,455 306,909 2,269,923 306,909 |
Marketable Securities
Marketable Securities | 9 Months Ended |
Nov. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities [Text Block] | 20. Marketable Securities Marketable securities are classified as held for trading. The fair value of marketable securities is based on quoted prices in active markets and are measured at level 1 in the fair value hierarchy. The investments comprise of the following equities and balances as at November 30, 2021 and February 28, 2021: Details Quantity Average cost Market price/ unit Total Fair Value November 30, February 28, $ $ $ $ Callable shares - - - - 310,529 Short term bond ETF - - - - 166,267 Publicly traded common shares - - - - 11,888 Total investments - 488,684 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Nov. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 21. Subsequent Events The Company's management has evaluated subsequent events up to January 14, 2022, the date the condensed consolidated financial statements were issued, pursuant to the requirements of ASC 855 and has determined the following material subsequent event: December 7, 2021, as part of the Company's on-going strategy to incentivize key employees, managers and directors, the of the Company approved the grant of an aggregate of 1,298,150 stock options under its Stock Option Plan to eligible persons (including 41 employees of newly acquired Simbex, LLC), and Mr. Mejia (100,000). All options have been granted at an exercise price of $0.65 per share and expire in five years. |
Contingencies
Contingencies | 9 Months Ended |
Nov. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies [Text Block] | 22. Contingencies From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As at November 30, 2021, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company's operations. There are also no proceedings in which any of the Company's directors, officers or affiliates is an adverse party or has a material interest adverse to the Company's interest. |
Significant accounting polici_2
Significant accounting policies (Policies) | 9 Months Ended |
Nov. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of consolidation [Policy Text Block] | a) Basis of consolidation These statements consolidate the accounts of the Company and its wholly owned subsidiaries, namely, Simbex, LLC ("Simbex"), ALG Health Plus, LLC ("ALG Health Plus"), South Dakota Partners Inc. ("SDP"), Inspira Financial Company ("IFC"), 1077863 B.C., Ltd ("1077863"), and Inspira SAAS Billing Inc. ("IFS") in the United States. The Company owns 100% of its subsidiaries. Intercompany balances and transactions are eliminated upon consolidation. |
Basis of measurement [Policy Text Block] | b) Basis of measurement The unaudited condensed consolidated financial statements of the Company have been prepared on an historical cost basis except marketable securities which are carried at fair value. |
Use of estimates [Policy Text Block] | c) Use of estimates The preparation of unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. This applies to useful lives of non-current assets, impairment of non-current assets, valuation of stock-based compensation, allowance for doubtful accounts, provisions for inventory and valuation allowance for deferred tax assets. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
Operating segments [Policy Text Block] | d) Operating segments An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company's other components. All operating segments' operating results are reviewed regularly by the Company's CEO to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. As of November 30, 2021, the Company has one segment, healthcare operations, which includes production and sale of medical devices to businesses in the United States. Assets, liabilities, revenues and expense from these segments are disclosed in the unaudited condensed consolidated balance sheets and statement of operations and comprehensive loss. |
Fair value of financial instruments [Policy Text Block] | e) Fair value of financial instruments The Company's financial instruments consist principally of cash and cash equivalents, restricted cash, marketable securities, accounts receivable, accounts payable and accrued liabilities, line of credit, long term debt, contingent liability, lease liabilities and other liabilities. Financial Accounting Standards Board ("FASB") Accounting Standards Codification (ASC) Topic 820, Fair Value Measurements and Disclosures, requires disclosure of the fair value of financial instruments held by the Company. FASB ASC Topic 825, Financial Instruments, defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization, low risk of counterparty default and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs, other than Level 1, that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. The Company reviews the fair value hierarchy classification on a quarterly basis. Changes in the ability to observe valuation inputs may result in a reclassification of levels for certain assets or liabilities within the fair value hierarchy. The Company did not have any transfers of assets and liabilities between the levels of the fair value measurement hierarchy during the years presented. As of November 30, 2021, and February 28, 2021, respectively, the Company did not identify any financial assets and liabilities other than marketable securities, contingent liabilities and assets resulting from the SDP Simbex and acquisitions that would be required to be presented on the balance sheet at fair value. |
Revenue recognition [Policy Text Block] | f) Revenue recognition Revenue comprises of goods and services provided to the Company's contracted customers and sales-based royalty charged by the company to licensees of the Intellectual Property (IP) developed by the company. In accordance with Accounting Standards Codification 606 Revenue from Contracts with Customers ("ASC 606"), the Company recognizes revenue upon the transfer of goods or services to a customer at an amount that reflects the expected consideration to be received in exchange for those goods or services. Simbex accounts for a customer contract when the rights of the parties, including the payment terms, are identified, the contract has commercial substance, collection of consideration is probable, and the contract has been signed and agreed to by both parties. Revenue is recognized when, or as, performance obligations are satisfied by transferring control or economic benefit of the service to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for its services. Revenue is reported net of any revenue-based taxes assessed by governmental authorities that are imposed on revenue producing transactions. The principles in ASC 606 are applied using the following five steps: (i) Identify the contract with a customer; (ii) Identify the performance obligation(s) in the contract; (iii) Determine the transaction price; (iv) Allocate the transaction price to the performance obligation(s) in the contract; and (v) Recognize revenue when (or as) the performance obligation(s) are satisfied. Revenue is recognized at a point-in-time upon transfer of control of goods or services to customers, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract, at an amount that reflects the consideration the Company expects to receive in exchange for the goods or services. As an allowed exception to the general requirements under ASC 606, for sales- or usage-based royalties that are attributable to a license of intellectual property, revenue is recognized at the later of: when the subsequent sale or usage occurs; and t he satisfaction or partial satisfaction of the performance obligation to which some or all of the sales- or usage-based royalty has been allocated Provisions for discounts, returns and other adjustments are provided for in the period the related sales are recorded. The Company has concluded that it is the principal in its revenue arrangements because it controls the goods or services before transferring them to the customer. The Company typically provides warranties for general repairs of defects that existed at the time of sale. These assurance-type warranties are accounted for as warranty provisions, if any. |
Research and development costs [Policy Text Block] | g) Research and development costs Research and development costs are generally expensed as incurred. These costs primarily consist of personnel and related expenses. |
Inventories [Policy Text Block] | h) Inventories Inventories comprises of raw-material, work-in-progress and finished goods, which consist principally of electrodes, electronic components, subassemblies, steel, hardware, and fasteners and are stated at the lower of cost (first-in, first-out) or net realizable value and include direct labor, materials, and other related costs. The Company periodically reviews inventory for evidence of slow-moving or obsolete items, and writes inventory down to net realizable value, as needed. This write-down is based on management's review of inventories on hand, compared to estimated future usage and sales, shelf-life assumptions, and assumptions about the likelihood of obsolescence. If actual market conditions are less favorable than those projected by the Company, additional inventory write-downs may be required. Inventory impairment charges establish a new cost basis for inventory and charges are not reversed subsequently to income, even if circumstances later suggest that increased carrying amounts are recoverable. |
Goodwill [Policy Text Block] | i) Goodwill Goodwill represents the excess of costs over fair value of net assets acquired from our business combinations. Goodwill and intangible assets acquired in a purchase business combination and determined to have an indefinite useful life are not amortized, but instead are tested for impairment at least annually in accordance with the FASB issued Accounting Standards Update ("ASU") No. 2017-04 Intangibles-Goodwill and Other (Topic 350). Because an assembled workforce cannot be sold or transferred separately from the other assets in the business, any value attributed to it is subsumed into goodwill. The Company evaluates the carrying value of goodwill annually and between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. Such circumstances could include, but are not limited to, (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, or (3) an adverse action or assessment by a regulator. When evaluating whether the goodwill is impaired, the Company compares the fair value of the reporting unit to which the goodwill is assigned to its carrying amount, including goodwill. The Company identifies the reporting unit on a basis that is similar to its method for identifying operating segments as defined by the Segment Reporting Topic of the FASB ASC. If the carrying amount of a reporting unit exceeds its fair value, then the amount of the impairment loss must be measured. This evaluation is applied annually on each impairment testing date (February 28) unless there is a triggering event present during an interim period. |
Property and equipment [Policy Text Block] | j) Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Asset Life Machinery and equipment 3 - 10 years Computer equipment and software 3 - 5 years Furniture and fixtures 7 - 10 years Leasehold improvements Lower of 15 years or lease period |
Right-of-use asset [Policy Text Block] | k) Right-of-use asset The Company's right-of-use assets consist of leased assets recognized in accordance with ASC 842, Leases |
Intangible asset [Policy Text Block] | l) Intangible assets Intangible asset consists of trademarks, intellectual property, customer base and non-competes (Note 4). Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives and are measured at cost less accumulated amortization and accumulated impairment losses per the table below: Intangible asset Life Tradename - Trademarks Lower of 5 years or useful life Non-competes Lower of 5 years or useful life Intellectual Property Lower of 5 years or useful life Customer Base Lower of 15 years or useful life The intangible assets with finite useful lives are reviewed for impairment when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amounts. In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair value of the long-lived assets. The next assessment of useful lives will take place as at the fiscal year ending February 28, 2022. |
Business Combination and Contingent consideration [Policy Text Block] | m) Business Combination and Contingent consideration A business combination is a transaction or other event in which control over one or more businesses is obtained. A business is an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs or other economic benefits. A business consists of inputs and processes applied to those inputs that have the ability to create outputs that provide a return to the Company and its shareholders. A business need not include all of the inputs and processes that were used by the acquiree to produce outputs if the business can be integrated with the inputs and processes of the Company to continue to produce outputs. The Company considers several factors to determine whether the set of activities and assets is a business. Business acquisitions are accounted for using the acquisition method whereby acquired assets and liabilities are recorded at fair value as of the date of acquisition with the excess of the purchase consideration over such fair value being recorded as goodwill and allocated to reporting units ("RUs"). If the fair value of the net assets acquired exceeds the purchase consideration, the difference is recognized immediately as a gain in the condensed consolidated statement of operations and comprehensive loss. Acquisition related costs are expensed during the period in which they are incurred, except for the cost of debt or equity instruments issued in relation to the acquisition which is included in the carrying amount of the related instrument. Certain fair values may be estimated at the acquisition date pending confirmation or completion of the valuation process. Where provisional values are used in accounting for a business combination, they are adjusted retrospectively in subsequent periods. However, the measurement period will not exceed one year from the acquisition date. The determination of the value of goodwill and intangible assets arising from business combinations requires extensive use of accounting estimates and judgments to allocate the purchase price to the fair value of the net tangible and intangible assets acquired. The total purchase price for the acquisition of South Dakota Partners Inc. ("SDP") comprised of amounts allocated to stock, including a contingent consideration liability representing the impact of expected revenue and net working capital shortfalls and a contingent consideration asset which represents potential future earnout payments to the Company that are contingent on SDP's business achieving certain milestones. Contingent consideration classified as an asset or liability is remeasured to fair value at each reporting date until the contingency is resolved, with changes in fair value recognized in profit or loss. The total purchase price for the acquisition of Simbex, LLC (Simbex) consisted of cash, capital stock, and a contingent consideration liability representing earnout payments of cash and stock, subject to achieving certain EBITDA targets. |
Concentration risk [Policy Text Block] | n) Concentration risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash equivalents and accounts receivable. The Company limits its exposure to credit loss by placing its cash with high credit quality financial institutions. During the period ended November 30, 2021, SDP had 407 customers with two of those customers accounting for over 75% ( nil nil |
Recently issued pronouncements [Policy Text Block] | o) Recently issued pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses ("ASU 2016-13"), which changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. This update is effective for annual periods beginning after December 15, 2023, as amended by ASU No. 2019-10, and interim periods within those periods, and early adoption is permitted. The Company is in the process of determining the impact the adoption will have on its condensed consolidated financial statements as well as whether to early adopt the new guidance. In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes which amends ASC 740 Income Taxes (ASC 740). This update is intended to simplify accounting for income taxes by removing certain exceptions to the general principles in ASC 740 and amending existing guidance to improve consistent application of ASC 740. This update is effective for fiscal years beginning after December 15, 2021. The guidance in this update has various elements, some of which are applied on a prospective basis and others on a retrospective basis with earlier application permitted. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In January 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) The Company adopted ASU 2020-01 as of January 1, 2021. The adoption did not have any material impact on the Company's Consolidated Financial Statements. In May 2020, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815- 40):Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This update provides guidance for a modification or an exchange of a freestanding equity-classified written call option that is not within the scope of another Topic. This update is effective for fiscal years beginning after December 15, 2021. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In August 2020, the FASB issued guidance that simplifies the accounting for debt with conversion options, revises the criteria for applying the derivative scope exception for contracts in an entity's own equity, and improves the consistency for the calculation of earnings per share. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2021. The Company is currently evaluating the effect of this ASU on the Company's condensed consolidated financial statements and related disclosures. In March 2020, the FASB issued guidance providing optional expedients and exceptions to account for the effects of reference rate reform to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued. The optional guidance, which became effective on March 12, 2020, and can be applied through December 21, 2022, has not impacted our condensed consolidated financial statements. The Company has various contracts that reference LIBOR and is assessing how this standard may be applied to specific contract modifications through December 31, 2022. Management does not believe that any recently issued, but not yet effective, accounting standards could have a material effect on the accompanying condensed consolidated financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances. |
Significant accounting polici_3
Significant accounting policies (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of useful life for property plant and equipment [Table Text Block] | Asset Life Machinery and equipment 3 - 10 years Computer equipment and software 3 - 5 years Furniture and fixtures 7 - 10 years Leasehold improvements Lower of 15 years or lease period |
Schedule of finite-lived intangible assets [Table Text Block] | Intangible asset Life Tradename - Trademarks Lower of 5 years or useful life Non-competes Lower of 5 years or useful life Intellectual Property Lower of 5 years or useful life Customer Base Lower of 15 years or useful life |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Business Acquisition [Line Items] | |
Schedule of pro forma information acquisition [Table Text Block] | For the nine months ended November 30, 2021 For the year ended Revenues 18,296,896 22,636,911 Cost of revenue 11,555,073 13,059,839 Gross margin 6,741,823 9,577,072 Operating expenses (6,709,453) (8,514,391) Income from operations 32,370 1,062,681 Transaction costs (2,937,030) (1,652,664) Depreciation and amortization (680,814) (990,238) Foreign exchange loss (38,397) — Gain on debt settlement 15,538 — Interest expense (349,113) (515,040) Net loss before taxes (3,957,446) (2,095,261) Tax recovery (expense) 328,937 (50,789) Net loss (3,628,509) (2,146,050) |
South Dakota Partners Inc [Member] | |
Business Acquisition [Line Items] | |
Schedule of allocation of purchase price [Table Text Block] | Cash $ 255 Restricted Cash 461,066 Accounts Receivable 2,763,621 Inventories 4,958,833 Prepaid expenses 21,651 Property and equipment 1,409,421 Right-of-use assets 2,343,947 Intangible Assets 2,199,444 Goodwill 8,532,798 Accounts payable (821,244 ) Accrued expenses (201,733 ) Line of credit (3,732,414 ) Debt (2,971,350 ) Lease liability (2,498,095 ) Other liabilities (384,420 ) Total adjusted purchase price $ 12,081,780 |
Schedule of goodwill and other intangible assets [Table Text Block] | Goodwill $ 8,532,798 Tradename - Trademarks 341,929 Intellectual Property 320,823 Customer Base 1,266,405 Non-Competes 270,287 Total identifiable intangible assets $ 10,732,242 |
Schedule of value of total consideration [Table Text Block] | Stock (Parent Special Stock) $ 12,340,570 Floor Guarantee/Contingent Liability 1,139,910 Earn-out /Contingent Consideration (Revenue) (21,924 ) Earn-out /Contingent Consideration (Net Assets) (1,376,776 ) Total Consideration $ 12,081,780 |
Simbex, LLC [Member] | |
Business Acquisition [Line Items] | |
Schedule of allocation of purchase price [Table Text Block] | Cash $ 632,697 Accounts Receivable 1,402,315 Work-in-process 301,180 Prepaid expenses 34,992 Property and equipment 122,916 Other receivables 6,395 Intangible Assets 5,175,486 Goodwill 4,951,218 Accounts payable and accrued liabilities (33,560 ) Accrued expenses (1,095 ) Other liabilities (131,016 ) Total adjusted purchase price $ 12,461,528 |
Schedule of goodwill and other intangible assets [Table Text Block] | Goodwill $ 4,951,218 Tradename - Trademarks 933,865 Customer Base 3,648,148 Non-Competes 593,473 Total identifiable intangible assets $ 10,126,704 |
Schedule of value of total consideration [Table Text Block] | Cash $ 4,428,900 Working Capital Adjustment 1,262,859 Value of Escrowed Stock 126,540 Value of Earnout / Contingent Consideration 6,643,229 Total Consideration $ 12,461,528 |
Accounts receivable (Tables)
Accounts receivable (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Receivables [Abstract] | |
Schedule of accounts receivable [Table Text Block] | November 30, February 28, Trade accounts receivable $ 5,276,208 $ - Allowance for doubtful accounts (42,441 ) - Other receivables 206,478 - Total accounts receivable $ 5,440,245 $ - |
Disaggregation of Revenues (Tab
Disaggregation of Revenues (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Disaggregation of Revenue [Abstract] | |
Schedule of disaggregation of revenues [Table Text Block] | Three months ended Nine months ended November 30, November 30, November 30, November 30, Sales $ 5,247,943 $ - $ 9,750,920 $ - Loan interest - 22,429 - 39,190 Fees and other - 14,058 - 50,621 Collections of provisioned loans - 317,515 - 399,702 Interest, fees, and other recovered 29,637 - 62,735 - Total operating revenues $ 5,277,580 $ 354,002 $ 9,813,655 $ 489,513 Investment income $ 9,062 $ 5,796 $ 20,352 $ 50,710 Gain (loss) on sale of marketable securities 35 548 10,059 (42,141 ) Change in fair value of marketable securities 25 (136,759 ) 6,849 (204,671 ) Net investment income (loss) $ 9,122 $ (130,415 ) $ 37,260 $ (196,102 ) Total revenue $ 5,286,702 $ 223,587 $ 9,850,915 $ 293,411 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories [Table Text Block] | November 30, 2021 Raw materials $ 4,422,023 Work in progress 304,959 Finished goods 107,552 Total $ 4,834,534 |
Property and equipment (Tables)
Property and equipment (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment [Table Text Block] | Cost Acquired on May 21, 2021 and Additions Disposal Translation November 30, 2021 Machinery and equipment $ 1,430,378 $ 41,051 $ - $ 78,474 $ 1,549,903 Computer equipment and software 70,029 - - 4,156 74,185 Furniture and fixtures 9,721 - - 577 10,298 Leasehold improvements 23,400 - - 1,389 24,789 Total $ 1,533,528 $ 41,051 $ - $ 84,596 $ 1,659,175 Accumulated amortization May 21, 2021 and Additions Disposal Translation November 30, 2021 Machinery and equipment $ - $ 118,932 $ - $ 2,800 $ 121,732 Computer equipment and software - 10,142 - 239 10,381 Furniture and fixtures - 858 - 20 878 Leasehold improvements - 1,482 - 36 1,518 Total $ - $ 131,414 $ - $ 3,095 $ 134,509 Net Book Value $ 1,533,528 $ 1,524,666 |
Intangible assets (Tables)
Intangible assets (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets [Table Text Block] | Acquired on May 21 and September 30, November 30, Cost 2021 Additions Disposal 2021 Tradename - Trademarks $ 1,275,794 $ — $ — $ 1,275,794 Intellectual Property 320,823 — — 320,823 Customer Base 4,914,553 — — 4,914,553 Non-Competes 863,760 — — 863,760 Total $ 7,374,930 $ — $ — $ 7,374,930 May 21, and September 30, November 30, Accumulated amortization 2021 Additions Disposal 2021 Tradename - Trademarks $ — $ 69,860 $ — $ 69 860 Intellectual Property — 35,782 — 35,782 Customer Base — 88,392 — 88,392 Non-Competes — 50,306 — 50,306 Total $ — 244,340 $ — $ 244,340 Net Book Value $ 7,374,930 7,130,590 |
Accounts payable, accrued lia_2
Accounts payable, accrued liabilities and other liabilities (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued liabilities [Table Text Block] | November 30, February 28, Accounts payable $ 2,782,000 $ 479,767 Accrued liabilities 561,759 568,017 Total $ 3,343,759 $ 1,047,784 |
Line of credit and debt (Tables
Line of credit and debt (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of debt [Table Text Block] | South Dakota Development Corporation State of South Dakota Governor's Office of Economic Development Other Notes payable Covid- Related Loans Crestmark term loan Total Debt Acquired on May 21, 2021 $ 509,544 $ 28,480 $ 1,549,288 $ 884,038 $ — $ 2,971,350 Additions — — — 934,650 934,650 Forgiveness of loan — — (819,104 ) — (819,104 ) Principal repayments (526,800 ) (29,445 ) (1,601,760 ) — (53,534 ) (2,211,539 ) Translation 17,256 965 52,472 32,277 22,246 125,216 Balance November 30, 2021 — — — 97,211 903,362 1,000,573 Less: current portion (97,211 ) (172,835 ) (270,046 ) Long-term portion $ — $ — $ — $ — $ 730,527 $ 730,527 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Leases [Abstract] | |
Schedule of right-of-use assets and lease liabilities [Table Text Block] | Right-of-use assets Acquired $ 3,955,533 Amortization (106,700 ) Impact of modification 51,177 Translation 153,443 Balance, November 30, 2021 $ 4,053,453 Lease liability Current Long-term Acquired $ 4,109,681 $ 310,464 $ 3,799,217 Interest lease expense 146,430 Lease payments (156,750 ) Translation 163,665 Balance, November 30, 2021 $ 4,263,026 $ 235,562 $ 4,027,464 |
Schedule of future minimum lease payments payable [Table Text Block] | Twelve months ending November 30, 2022 $ 520,948 Twelve months ending November 30, 2023 486,772 Twelve months ending November 30, 2024 485,366 Twelve months ending November 30, 2025 495,074 Twelve months ending November 30, 2026 505,747 2027 and thereafter 4,022,411 Total future minimum lease payments 6,516,318 Less: Interest on lease liabilities (2,253,292 ) Total present value of minimum lease payments 4,263,026 Less: current portion 235,562 Non-current portion $ 4,027,464 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Stockholders' Equity Note [Abstract] | |
Schedule of outstanding stock options [Table Text Block] | Grant date Exercise price Number of options Number of vested options Weighted Avg (years) March 28, 2014 $ 2.13 5,103 5,103 2.33 February 27, 2017 0.45 25,246 25,246 0.24 September 23, 2019 0.19 450,470 394,161 2.82 May 29, 2020 0.27 73,700 73,700 3.49 August 18, 2020 0.19 73,700 73,700 8.72 June 8, 2021 0.99 663,300 — 4.50 June 8, 2021 0.86 1,672,990 — 4.50 June 8, 2021 0.86 250,000 250,000 4.50 July 7, 2021 1.39 400,000 — 4.72 Total $ 0.83 3,614,509 821,910 4.35 |
Schedule of stock option activity [Table Text Block] | Number of Options Weighted Avg. Exercise Price Balance as at February 29, 2020 1,181,709 0.27 Options exercised (28,154 ) 0.19 Options issued 1,639,825 0.23 Balance as at February 28, 2021 2,793,380 $ 0.27 Options exercised (1,605,042 ) 0.23 Options expired (560,119 ) — Options issued 2,986,290 0.93 Balance as at November 30, 2021 3,614,509 $ 0.83 |
Related party transactions (Tab
Related party transactions (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions [Table Text Block] | Nine months ended November 30, 2021 November 30, 2020 Salaries and short-term benefits 104,062 122,696 Stock based compensation 535,603 136,004 Total 639,665 258,700 |
Net loss per share (Tables)
Net loss per share (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Net loss per share [Table Text Block] | Three months ended Nine months ended November 30, 2021 November 30, 2020 November 30, 2021 November 30, 2020 Net loss (1,503,697 ) (361,223 ) (3,223,268 ) (837,252 ) Weighted average number of common shares 44,790,162 33,796,168 41,480,296 33,788,824 Net loss per share from operations Basic (0.03 ) (0.01 ) (0.08 ) (0.02 ) Diluted (0.03 ) (0.01 ) (0.08 ) (0.02 ) |
Transaction costs including l_2
Transaction costs including legal, financial, audit, US and Canadian regulatory costs (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Costs and Expenses [Abstract] | |
Schedule of transaction costs including legal, audit and US regulatory [Table Text Block] | Three months ended Nine months ended November 30, 2021 November 30, 2020 November 30, 2021 November 30, 2020 Consulting and professional fees 202,455 - 1,243,042 - General expenses 842,000 306,909 1,026,881 306,909 Transaction Costs Including: Audit, Legal, and US 1,044,455 306,909 2,269,923 306,909 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Nov. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of marketable securities [Table Text Block] | Details Quantity Average cost Market price/ unit Total Fair Value November 30, February 28, $ $ $ $ Callable shares - - - - 310,529 Short term bond ETF - - - - 166,267 Publicly traded common shares - - - - 11,888 Total investments - 488,684 |
Description of the business (Na
Description of the business (Narrative) (Details) | 9 Months Ended |
Nov. 30, 2021CAD ($)shares | |
Variable Interest Entity [Line Items] | |
Description of issued and outstanding common shares | On December 21, 2020, the Company consolidated its issued and outstanding common shares on the basis of 7.37 post-consolidation common shares for 10 pre-consolidation common shares (the "Consolidation"). |
Class A Common stock [Member] | |
Variable Interest Entity [Line Items] | |
Number of shares issued upon meeting revenue goal for quarter ended February 28, 2022 | 1,000,000 |
Revenue target per agreement for class a share award by quarter ended February 28, 2022 | $ | $ 1,000,000 |
Contribution And Exchange Agreement [Member] | |
Variable Interest Entity [Line Items] | |
Organizational expenses | $ | $ 10,000 |
Description of shares issued after initial revenue target achieved | In addition to the initial revenue target of US$1,000,000 for the quarter ending February 28, 2022, for every US$50 block in marginal profit above market transfer pricing ("Sales Channel EBITDA") for the LLC during each quarter commencing with the three months ended February 28, 2022, and each of the quarterly periods thereafter through February 28, 2024 (up to US$10,000,000 in Sales Channel EBITDA), the Agent will receive $72 in Salona Class "A" Shares (based on the market price of the Salona Common Shares on November 29, 2021). |
Contribution And Exchange Agreement [Member] | Class A Common stock [Member] | |
Variable Interest Entity [Line Items] | |
Description of issued and outstanding common shares | Salona Class "A" Shares from converting Salona Class "A" Shares for Salona Common Shares if it would result in such holder holding more than 9.9% of the Salona Common Shares, into Salona Common Shares on a one-for-one basis. |
Contribution And Exchange Agreement [Member] | Class A Common stock [Member] | Minimum [Member] | |
Variable Interest Entity [Line Items] | |
Number of shares issued to agents | 500,000 |
Contribution And Exchange Agreement [Member] | Class A Common stock [Member] | Maximum [Member] | |
Variable Interest Entity [Line Items] | |
Number of shares issued to agents | 21,000,000 |
Significant accounting polici_4
Significant accounting policies (Narrative) (Details) | 9 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Concentration Risk [Line Items] | ||
Subsidiary ownership percentage | 100.00% | |
Customer Concentration Risk [Member] | Revenues [Member] | Two Customers [Member] | ||
Concentration Risk [Line Items] | ||
Customer concentration risk | 75.00% | |
Customer Concentration Risk [Member] | Accounts receivable [Member] | Two Customers [Member] | ||
Concentration Risk [Line Items] | ||
Customer concentration risk | 89.00% |
Significant accounting polici_5
Significant accounting policies - Schedule of estimated useful lives of property and equipment (Details) | 9 Months Ended |
Nov. 30, 2021 | |
Machinery and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Machinery and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Computer equipment and software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Computer equipment and software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Furniture and fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 7 years |
Furniture and fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | Lower of 15 years or lease period |
Significant accounting polici_6
Significant accounting policies - Schedule of estimated useful lives of Intangible asset (Details) | 9 Months Ended |
Nov. 30, 2021 | |
Tradename - Trademarks [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | Lower of 5 years or useful life |
Non-Competes [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | Lower of 5 years or useful life |
Intellectual Property [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | Lower of 5 years or useful life |
Customer Base [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | Lower of 15 years or useful life |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) - CAD ($) | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | ||||
Sep. 30, 2021 | May 21, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | Feb. 28, 2021 | |
Business Acquisition [Line Items] | ||||||||
Cash consideration | $ 5,907,079 | $ 0 | ||||||
Liability for shares issued related to acquisition | $ 18,851,548 | $ 18,851,548 | 18,851,548 | $ 0 | ||||
Revenue | 5,286,702 | $ 223,587 | 9,850,915 | 293,411 | ||||
Net loss | (1,503,697) | $ (361,223) | (3,223,268) | $ (837,252) | ||||
South Dakota Partners Inc [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of common stock issued as consideration | 26,000,000 | |||||||
Value of common stock issued as consideration | $ 12,340,570 | 12,340,570 | ||||||
Deductible goodwill for income tax purposes | 438,490 | |||||||
Value of the contingent consideration asset | 1,398,700 | 1,398,700 | 1,398,700 | |||||
Liability for shares issued related to acquisition | 12,081,780 | 12,081,780 | 12,081,780 | |||||
Revenue | 8,080,154 | 10,529,076 | ||||||
Net loss | $ 359,289 | 119,009 | ||||||
Simbex, LLC [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration | $ 5,691,759 | |||||||
Number of common stock issued as consideration | 6,383,954 | |||||||
Value of common stock issued as consideration | $ 15,288,000 | |||||||
Deductible goodwill for income tax purposes | $ 137,534 | |||||||
Revenue | 1,670,797 | 7,664,991 | ||||||
Net loss | $ 206,145 | $ 741,435 |
Acquisitions - Schedule of allo
Acquisitions - Schedule of allocation of purchase price (Details) - CAD ($) | Nov. 30, 2021 | Sep. 30, 2021 | May 21, 2021 | Feb. 28, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 13,484,016 | $ 0 | ||
South Dakota Partners Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 255 | |||
Restricted Cash | 461,066 | |||
Accounts Receivable | 2,763,621 | |||
Inventories | 4,958,833 | |||
Prepaid expenses | 21,651 | |||
Property and equipment | 1,409,421 | |||
Right-of-use assets | 2,343,947 | |||
Intangible Assets | 2,199,444 | |||
Goodwill | 8,532,798 | |||
Accounts payable | (821,244) | |||
Accrued expenses | (201,733) | |||
Line of credit | (3,732,414) | |||
Debt | (2,971,350) | |||
Lease liability | (2,498,095) | |||
Other liabilities | (384,420) | |||
Total adjusted purchase price | $ 12,081,780 | |||
Simbex, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 632,697 | |||
Restricted Cash | 1,402,315 | |||
Work-in-process | 301,180 | |||
Prepaid expenses | 34,992 | |||
Property and equipment | 122,916 | |||
Other receivables | 6,395 | |||
Intangible Assets | 5,175,486 | |||
Goodwill | 4,951,218 | |||
Accounts payable | (33,560) | |||
Accrued expenses | (1,095) | |||
Other liabilities | (131,016) | |||
Total adjusted purchase price | $ 12,461,528 |
Acquisitions - Schedule of good
Acquisitions - Schedule of goodwill and other intangible assets (Details) - CAD ($) | Nov. 30, 2021 | Sep. 30, 2021 | May 21, 2021 | Feb. 28, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 13,484,016 | $ 0 | ||
South Dakota Partners Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 8,532,798 | |||
Tradename - Trademarks | 341,929 | |||
Intellectual Property | 320,823 | |||
Customer Base | 1,266,405 | |||
Non-Competes | 270,287 | |||
Total identifiable intangible assets | $ 10,732,242 | |||
Simbex, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 4,951,218 | |||
Tradename - Trademarks | 933,865 | |||
Customer Base | 3,648,148 | |||
Non-Competes | 593,473 | |||
Total identifiable intangible assets | $ 10,126,704 |
Acquisitions - Schedule of valu
Acquisitions - Schedule of value of total consideration (Details) - CAD ($) | 1 Months Ended | 7 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | May 21, 2021 | Nov. 30, 2021 | Nov. 30, 2021 | |
South Dakota Partners Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Stock (Parent Special Stock) | $ 12,340,570 | $ 12,340,570 | ||
Floor Guarantee/Contingent Liability | 1,139,910 | |||
Earn-out /Contingent Consideration (Revenue) | (21,924) | |||
Earn-out /Contingent Consideration (Net Assets) | $ (1,376,776) | |||
Total Consideration | $ 12,081,780 | |||
Simbex, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 4,428,900 | |||
Working Capital Adjustment | 1,262,859 | |||
Value of Escrowed Stock | 126,540 | |||
Stock (Parent Special Stock) | 15,288,000 | |||
Earn-out /Contingent Consideration (Net Assets) | 6,643,229 | |||
Total Consideration | $ 12,461,528 |
Acquisitions - Schedule of pro
Acquisitions - Schedule of pro forma information acquisition (Details) - CAD ($) | 9 Months Ended | 12 Months Ended |
Nov. 30, 2021 | Feb. 28, 2021 | |
Business Combinations [Abstract] | ||
Acquisitions revenues | $ 18,296,896 | $ 22,636,911 |
Cost of revenue | 11,555,073 | 13,059,839 |
Gross margin | 6,741,823 | 9,577,072 |
Operating expenses | (6,709,453) | (8,514,391) |
Income from operations | 32,370 | 1,062,681 |
Transaction costs | (2,937,030) | (1,652,664) |
Depreciation and amortization | (680,814) | (990,238) |
Foreign exchange loss | (38,397) | 0 |
Gain on debt settlement | 15,538 | 0 |
Interest expense | (349,113) | (515,040) |
Net loss before taxes | (3,957,446) | (2,095,261) |
Tax recovery (expense) | 328,937 | (50,789) |
Net loss | $ (3,628,509) | $ (2,146,050) |
Accounts receivable - Schedule
Accounts receivable - Schedule of accounts receivable (Details) - CAD ($) | Nov. 30, 2021 | Feb. 28, 2021 |
Receivables [Abstract] | ||
Trade accounts receivable | $ 5,276,208 | $ 0 |
Allowance for doubtful accounts | (42,441) | 0 |
Other receivable | 206,478 | 0 |
Total accounts receivable | $ 5,440,245 | $ 0 |
Disaggregation of Revenues - Sc
Disaggregation of Revenues - Schedule of disaggregation of revenues (Details) - CAD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | |
Disaggregation of Revenue [Abstract] | ||||
Sales | $ 5,247,943 | $ 0 | $ 9,750,920 | $ 0 |
Loan interest | 0 | 22,429 | 0 | 39,190 |
Fees and other | 0 | 14,058 | 0 | 50,621 |
Collections of provisioned loans | 0 | 317,515 | 0 | 399,702 |
Interest, fees, and other recovered | 29,637 | 0 | 62,735 | 0 |
Total operating revenues | 5,277,580 | 354,002 | 9,813,655 | 489,513 |
Investment income | 9,062 | 5,796 | 20,352 | 50,710 |
Gain (loss) on sale of marketable securities | 35 | 548 | 10,059 | (42,141) |
Change in fair value of marketable securities | 25 | (136,759) | 6,849 | (204,671) |
Net investment income (loss) | 9,122 | (130,415) | 37,260 | (196,102) |
Total revenue | $ 5,286,702 | $ 223,587 | $ 9,850,915 | $ 293,411 |
Inventories - Schedule of inven
Inventories - Schedule of inventories (Details) - CAD ($) | Nov. 30, 2021 | Feb. 28, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 4,422,023 | |
Work in progress | 304,959 | |
Finished goods | 107,552 | |
Total | $ 4,834,534 | $ 0 |
Property and equipment - Schedu
Property and equipment - Schedule of property and equipment (Details) - CAD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | |
Cost | |||||
Beginning balance | $ 1,533,528 | ||||
Additions | 41,051 | ||||
Disposal | 0 | ||||
Translation | 84,596 | ||||
Ending balance | $ 1,659,175 | 1,659,175 | $ 1,659,175 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 65,458 | $ 0 | 131,414 | 131,414 | $ 0 |
Disposal | 0 | ||||
Translation | 3,095 | ||||
Ending balance | 134,509 | 134,509 | 134,509 | ||
Net Book Value, beginning | 1,533,528 | 0 | |||
Net Book Value, ending | 1,524,666 | 1,524,666 | 1,524,666 | ||
Machinery and Equipment [Member] | |||||
Cost | |||||
Beginning balance | 1,430,378 | ||||
Additions | 41,051 | ||||
Disposal | 0 | ||||
Translation | 78,474 | ||||
Ending balance | 1,549,903 | 1,549,903 | 1,549,903 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 118,932 | ||||
Disposal | 0 | ||||
Translation | 2,800 | ||||
Ending balance | 121,732 | 121,732 | 121,732 | ||
Computer equipment and software [Member] | |||||
Cost | |||||
Beginning balance | 70,029 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Translation | 4,156 | ||||
Ending balance | 74,185 | 74,185 | 74,185 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 10,142 | ||||
Disposal | 0 | ||||
Translation | 239 | ||||
Ending balance | 10,381 | 10,381 | 10,381 | ||
Furniture and Fixtures [Member] | |||||
Cost | |||||
Beginning balance | 9,721 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Translation | 577 | ||||
Ending balance | 10,298 | 10,298 | 10,298 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 858 | ||||
Disposal | 0 | ||||
Translation | 20 | ||||
Ending balance | 878 | 878 | 878 | ||
Leasehold Improvements [Member] | |||||
Cost | |||||
Beginning balance | 23,400 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Translation | 1,389 | ||||
Ending balance | 24,789 | 24,789 | 24,789 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 1,482 | ||||
Disposal | 0 | ||||
Translation | 36 | ||||
Ending balance | $ 1,518 | $ 1,518 | $ 1,518 |
Intangible assets - Schedule of
Intangible assets - Schedule of intangible assets (Details) - CAD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | |
Cost | |||||
Beginning balance | $ 7,374,930 | ||||
Additions | 0 | ||||
Disposal | $ 0 | 0 | |||
Ending balance | 7,374,930 | 7,374,930 | $ 7,374,930 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 165,552 | $ 0 | 244,340 | 244,340 | $ 0 |
Disposal | 0 | ||||
Ending balance | 244,340 | 244,340 | 244,340 | ||
Net book Value, beginning | 7,374,930 | ||||
Net Book Value, ending | 7,130,590 | 7,130,590 | 7,130,590 | ||
Tradename - Trademarks [Member] | |||||
Cost | |||||
Beginning balance | 1,275,794 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Ending balance | 1,275,794 | 1,275,794 | 1,275,794 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 69,860 | ||||
Disposal | 0 | ||||
Ending balance | 69,860 | 69,860 | 69,860 | ||
Intellectual Property [Member] | |||||
Cost | |||||
Beginning balance | 320,823 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Ending balance | 320,823 | 320,823 | 320,823 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 35,782 | ||||
Disposal | 0 | ||||
Ending balance | 35,782 | 35,782 | 35,782 | ||
Customer Base [Member] | |||||
Cost | |||||
Beginning balance | 4,914,553 | ||||
Additions | 0 | ||||
Disposal | 0 | ||||
Ending balance | 4,914,553 | 4,914,553 | 4,914,553 | ||
Accumulated amortization | |||||
Additions | 0 | ||||
Disposal | 88,392 | ||||
Ending balance | 0 | 0 | 0 | ||
Non-Competes [Member] | |||||
Cost | |||||
Beginning balance | 863,760 | ||||
Additions | 0 | 0 | |||
Disposal | 0 | ||||
Ending balance | 863,760 | 863,760 | 863,760 | ||
Accumulated amortization | |||||
Beginning balance | 0 | ||||
Additions | 50,306 | ||||
Disposal | 0 | ||||
Ending balance | $ 50,306 | $ 50,306 | $ 50,306 |
Accounts payable and accrued li
Accounts payable and accrued liabilities - Schedule of accounts payable and accrued liabilities (Details) - CAD ($) | Nov. 30, 2021 | Feb. 28, 2021 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 2,782,000 | $ 479,767 |
Accrued liabilities | 561,759 | 568,017 |
Total | $ 3,343,759 | $ 1,047,784 |
Line of credit and debt (Narrat
Line of credit and debt (Narrative) (Details) | Aug. 01, 2021USD ($) | Jun. 09, 2021CAD ($) | Jun. 09, 2021USD ($) | Feb. 02, 2021USD ($) | May 08, 2020CAD ($) | May 08, 2020USD ($) | Nov. 30, 2021CAD ($) | Nov. 30, 2021USD ($) | Jun. 09, 2021USD ($) | Feb. 28, 2021CAD ($) | Feb. 02, 2021CAD ($) | Feb. 02, 2021USD ($) | Feb. 01, 2019CAD ($) | Mar. 06, 2018CAD ($) |
Debt Instrument [Line Items] | ||||||||||||||
Outstanding balance | $ 4,874,088 | $ 0 | ||||||||||||
Line of Credit [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Line of credit facility, maximum borrowing amount | $ 3,500,000 | $ 5,400,000 | ||||||||||||
Line of credit facility, interest rate | 4.50% | |||||||||||||
Outstanding balance | $ 4,874,088 | 3,814,850 | ||||||||||||
Line of Credit Facility, Covenant Terms | required to maintain a minimum tangible net worth (calculated based on the Company's July 31, 2021 consolidated balance sheet less $400,000 USD), which must be met on monthly basis | |||||||||||||
Line of credit facility, interest rate description | Borrowings' bear interest at 4% or prime +0.75%, whichever is greater | |||||||||||||
South Dakota Development Corporation [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Line of credit facility, maximum borrowing amount | $ 800,000 | |||||||||||||
Line of credit facility, interest rate | 2.00% | |||||||||||||
Outstanding balance | ||||||||||||||
State of South Dakota Governor's Office of Economic Development [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Borrowing amount | $ 200,000 | |||||||||||||
Interest rate, stated percentage | 3.00% | |||||||||||||
Outstanding balance | ||||||||||||||
Other Notes Payable - Financial Institution [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Borrowing amount | $ 1,500,120 | |||||||||||||
Interest rate, stated percentage | 5.25% | |||||||||||||
Outstanding balance | ||||||||||||||
Additional Notes Payable [Member] | Maturity date October 2023 [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Interest rate, stated percentage | 9.00% | |||||||||||||
Additional Notes Payable [Member] | Maturity date November 2024 [member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Interest rate, stated percentage | 5.25% | |||||||||||||
Outstanding balance | $ 0 | |||||||||||||
Paycheck Protection Program (“PPP”) Loan [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Borrowing amount | $ 150,000 | $ 944,542 | $ 736,887 | |||||||||||
Interest rate, stated percentage | 2.75% | 1.00% | 1.00% | |||||||||||
Periodic payment | $ 13,740 | $ 809 | $ 641 | |||||||||||
Outstanding balance | 97,211 | $ 76,085 | ||||||||||||
Term Note [Member] | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Borrowing amount | $ 936,895 | $ 750,000 | ||||||||||||
Interest rate, stated percentage | 6.00% | 6.00% | ||||||||||||
Periodic payment | $ 18,294 | $ 14,500 | ||||||||||||
Outstanding balance | $ 903,362 |
Line of credit and debt - Sched
Line of credit and debt - Schedule of debt (Details) - CAD ($) | 6 Months Ended | 9 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2021 | Nov. 30, 2020 | |
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | $ 2,971,350 | ||
Additions | 934,650 | $ 898,998 | $ 0 |
Forgiveness of loan | (819,104) | ||
Principal repayments | (2,211,539) | ||
Translation | 125,216 | ||
Balance, August 31, 2021 | 1,000,573 | 1,000,573 | |
Less: current portion | (270,046) | (270,046) | |
Long-term portion | 730,527 | 730,527 | |
South Dakota Development Corporation [Member] | |||
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | 509,544 | ||
Additions | 0 | ||
Forgiveness of loan | 0 | ||
Principal repayments | (526,800) | ||
Translation | 17,256 | ||
Balance, August 31, 2021 | 0 | 0 | |
Long-term portion | 0 | 0 | |
State of South Dakota Governor's Office of Economic Development [Member] | |||
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | 28,480 | ||
Additions | 0 | ||
Forgiveness of loan | 0 | ||
Principal repayments | (29,445) | ||
Translation | 965 | ||
Balance, August 31, 2021 | 0 | 0 | |
Long-term portion | 0 | 0 | |
Other Notes payable [Member] | |||
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | 1,549,288 | ||
Principal repayments | (1,601,760) | ||
Translation | 52,472 | ||
Balance, August 31, 2021 | 0 | 0 | |
Long-term portion | 0 | 0 | |
Covid-Related Loans [Member] | |||
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | 884,038 | ||
Additions | 0 | ||
Forgiveness of loan | (819,104) | ||
Principal repayments | 0 | ||
Translation | 32,277 | ||
Balance, August 31, 2021 | 97,211 | 97,211 | |
Less: current portion | (97,211) | (97,211) | |
Long-term portion | 0 | 0 | |
Crestmark term loan [Member] | |||
Debt Instrument [Line Items] | |||
Acquired on May 21, 2021 | 0 | ||
Additions | 934,650 | ||
Forgiveness of loan | 0 | ||
Principal repayments | (53,534) | ||
Translation | 22,246 | ||
Balance, August 31, 2021 | 903,362 | 903,362 | |
Less: current portion | (172,835) | (172,835) | |
Long-term portion | $ 730,527 | $ 730,527 |
Restricted cash (Narrative) (De
Restricted cash (Narrative) (Details) | Nov. 30, 2021CAD ($) |
PPP Loan Deposit In Escrow [Member] | |
Restricted Cash and Cash Equivalents Items [Line Items] | |
Restricted cash | $ 889,473 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | Oct. 01, 2021CAD ($) | Oct. 01, 2021USD ($) | Sep. 13, 2021CAD ($) | Sep. 13, 2021USD ($) | Oct. 31, 2018CAD ($) | Oct. 31, 2018USD ($) | Nov. 30, 2021CAD ($) | Oct. 01, 2021USD ($) | Sep. 13, 2021USD ($) | Feb. 28, 2021CAD ($) | Oct. 31, 2018USD ($) |
Lessee, Lease, Description [Line Items] | |||||||||||
Line of credit | $ 4,874,088 | $ 0 | |||||||||
Lease Agreements [Member] | SDP [Member] | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Sale of facility in Clear Lake, South Dakota | $ 2,634,667 | $ 2,182,461 | |||||||||
Amount of base annual rental | $ 230,533 | $ 190,965 | |||||||||
Renewal term of four extension options | 5 years | 5 years | |||||||||
Lease base rental amount description | The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined | The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined | |||||||||
Letter of credit | $ 487,977 | $ 381,930 | |||||||||
Lease Agreements [Member] | Simbex, LLC [Member] | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Amount of base annual rental | $ 201,155 | $ 157,440 | |||||||||
Renewal term of four extension options | 5 years | 5 years | |||||||||
Lease base rental amount description | The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined | The base rental amount increases annually on the first day of the lease year at the lesser of 2% or 1.25 times the change in the price index, as defined | |||||||||
Letter of credit | $ 119,350 | $ 93,413 | |||||||||
Lease Agreements [Member] | Inspira Financial [Member] | |||||||||||
Lessee, Lease, Description [Line Items] | |||||||||||
Amount of base annual rental | $ 40,287 | $ 31,532 | |||||||||
Letter of credit | $ 8,049 | $ 6,300 |
Leases - Schedule of right-of-u
Leases - Schedule of right-of-use assets and lease liabilities (Details) - CAD ($) | 3 Months Ended | 9 Months Ended | |||||
Nov. 30, 2021 | Aug. 31, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | May 21, 2021 | Feb. 28, 2021 | |
Leases [Abstract] | |||||||
Acquired | $ 3,955,533 | $ 0 | |||||
Amortization | $ (67,817) | (106,700) | $ 0 | (106,700) | $ 0 | ||
Impact of modification | 51,177 | ||||||
Translation | 153,443 | ||||||
Balance, November 30, 2021 | 4,053,453 | 4,053,453 | |||||
Lease liability, Acquired | 4,109,681 | ||||||
Interest lease expense | 146,430 | ||||||
Lease payments | (156,750) | (156,750) | $ 0 | ||||
Translation | $ 163,665 | ||||||
Lease liability, November 30, 2021 | 4,263,026 | 4,263,026 | |||||
Lease liability, current | 235,562 | 235,562 | $ 310,464 | $ 0 | |||
Lease liability, Long-term | $ 4,027,464 | $ 4,027,464 | $ 3,799,217 | $ 0 |
Leases - Schedule of future min
Leases - Schedule of future minimum lease payments payable (Details) - CAD ($) | Nov. 30, 2021 | May 21, 2021 | Feb. 28, 2021 |
Leases [Abstract] | |||
Twelve months ending November 30, 2022 | $ 520,948 | ||
Twelve months ending November 30, 2023 | 486,772 | ||
Twelve months ending November 30, 2024 | 485,366 | ||
Twelve months ending November 30, 2025 | 495,074 | ||
Twelve months ending November 30, 2026 | 505,747 | ||
2027 and thereafter | 4,022,411 | ||
Total future minimum lease payments | 6,516,318 | ||
Less: Interest on lease liabilities | (2,253,292) | ||
Total present value of minimum lease payments | 4,263,026 | $ 4,109,681 | |
Less: current portion | 235,562 | 310,464 | $ 0 |
Non-current portion | $ 4,027,464 | $ 3,799,217 | $ 0 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) | Dec. 07, 2021$ / shares | Jul. 07, 2021$ / sharesshares | Jun. 08, 2021$ / sharesshares | Sep. 06, 2020CAD ($)shares | Aug. 20, 2021CAD ($)shares | May 21, 2021CAD ($)shares | May 20, 2021CAD ($)shares | Aug. 18, 2020$ / sharesshares | May 29, 2020$ / sharesshares | Nov. 30, 2021CAD ($)shares | Nov. 30, 2020CAD ($)shares | Nov. 30, 2021CAD ($)$ / sharesshares | Nov. 30, 2020CAD ($)shares | Feb. 28, 2021CAD ($)$ / sharesshares | Aug. 31, 2021shares | Sep. 06, 2020USD ($) | Aug. 31, 2020shares | Feb. 29, 2020shares |
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Value of common shares outstanding | $ | $ 36,552,873 | $ 36,552,873 | $ 31,065,513 | |||||||||||||||
Number of common shares issued in satisfaction of indebtedness owed to service provider | 737,000 | 737,000 | ||||||||||||||||
Indebtedness owed to service provider | $ 114,498 | $ 88,000 | ||||||||||||||||
Value of common shares issued in satisfaction of indebtedness owed to service provider | $ | $ 94,999 | 94,999 | $ 0 | |||||||||||||||
Gain on settlement of debt | $ | $ 15,538 | 0 | $ 0 | $ 15,538 | 0 | |||||||||||||
Number of stock options exercised | 112,617 | 1,492,425 | 1,605,042 | 28,154 | ||||||||||||||
Proceeds from stock option excercised | $ | $ 21,392 | $ 355,500 | $ 376,892 | 5,348 | ||||||||||||||
Shares issued on financing, net (in shares) | 9,990,237 | |||||||||||||||||
Proceeds from issuance of common stock | $ | $ 5,300,490 | |||||||||||||||||
Share-based compensation | $ | $ 292,492 | $ 69,200 | $ 757,792 | $ 136,004 | ||||||||||||||
Number of share options granted | 2,986,290 | 1,639,825 | ||||||||||||||||
Exercisable period of stock option | 10 years | 5 years | ||||||||||||||||
Exercise price of stock options | $ / shares | $ 0.19 | $ 0.27 | $ 0.93 | $ 0.23 | ||||||||||||||
Fair value of per options estimated on date of grant | $ / shares | $ 0.12 | $ 0.12 | ||||||||||||||||
Expected volatility | 115.00% | 115.00% | ||||||||||||||||
Expected dividend yield | 0.00% | 0.00% | ||||||||||||||||
Risk-free interest rate | 99.71% | 99.62% | ||||||||||||||||
Stock price | $ / shares | $ 0.16 | $ 0.16 | ||||||||||||||||
Expected life | 3 years | 3 years | ||||||||||||||||
Common Stock [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Common shares outstanding | 44,790,162 | 33,813,308 | 44,790,162 | 33,813,308 | 33,813,308 | 44,790,162 | 33,785,154 | 33,785,154 | ||||||||||
Number of common shares issued in satisfaction of indebtedness owed to service provider | 737,000 | |||||||||||||||||
Value of common shares issued in satisfaction of indebtedness owed to service provider | $ | $ 94,999 | |||||||||||||||||
Number of stock options exercised | 28,154 | 1,605,042 | 28,154 | |||||||||||||||
Shares issued on financing, net (in shares) | 9,990,237 | |||||||||||||||||
Shares exchanged to Class A Shares | $ | $ (480,479) | |||||||||||||||||
Number of common shares exchanged | 1,355,425 | |||||||||||||||||
Common Stock [Member] | Class A Common stock [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Common shares outstanding | 1,355,425 | 1,355,425 | 1,355,425 | 1,355,425 | ||||||||||||||
Value of common shares outstanding | $ | $ 480,479 | $ 480,479 | ||||||||||||||||
Shares exchanged to Class A Shares | $ | $ 480,479 | $ 480,479 | $ 0 | |||||||||||||||
Number of common shares exchanged | 1,355,425 | |||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Exercise price of stock options | $ / shares | $ 0.65 | |||||||||||||||||
Stock Option Plan [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Number of common shares issuable | 47,175,923 | 47,175,923 | ||||||||||||||||
Percentage of common shares issued and outstanding immediately following completion of qualifying transaction | 20.00% | 20.00% | ||||||||||||||||
Stock Option Plan [Member] | Minimum [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Stock option vesting period | 1 year | |||||||||||||||||
Stock Option Plan [Member] | Maximum [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Stock option vesting period | 10 years | |||||||||||||||||
Director [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Number of share options granted | 250,000 | 1,672,990 | 608,025 | 884,400 | ||||||||||||||
Officer [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Number of share options granted | 663,300 | |||||||||||||||||
Exercisable period of stock option | 5 years | |||||||||||||||||
Exercise price of stock options | $ / shares | $ 0.99 | |||||||||||||||||
Fair value of per options estimated on date of grant | $ / shares | $ 0.58 | |||||||||||||||||
Expected volatility | 100.00% | |||||||||||||||||
Expected dividend yield | 0.00% | |||||||||||||||||
Risk-free interest rate | 99.12% | |||||||||||||||||
Stock price | $ / shares | $ 0.80 | |||||||||||||||||
Expected life | 5 years | |||||||||||||||||
Employee [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Number of share options granted | 150,000 | 250,000 | 73,700 | 73,700 | ||||||||||||||
Director And Employee [Member] | ||||||||||||||||||
Stockholders Equity Note [Line Items] | ||||||||||||||||||
Exercisable period of stock option | 5 years | 5 years | ||||||||||||||||
Exercise price of stock options | $ / shares | $ 1.39 | $ 0.86 | ||||||||||||||||
Fair value of per options estimated on date of grant | $ / shares | $ 0.64 | $ 0.59 | ||||||||||||||||
Expected volatility | 190.00% | 100.00% | ||||||||||||||||
Expected dividend yield | 0.00% | 0.00% | ||||||||||||||||
Risk-free interest rate | 99.06% | 99.12% | ||||||||||||||||
Stock price | $ / shares | $ 1.39 | $ 0.80 | ||||||||||||||||
Expected life | 5 years |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of outstanding stock options (Details) - $ / shares | 9 Months Ended | ||
Nov. 30, 2021 | Feb. 28, 2021 | Feb. 29, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.83 | $ 0.27 | $ 0.27 |
Number of options | 3,614,509 | 2,793,380 | 1,181,709 |
Number of vested options | 821,910 | ||
Weighted Avg Remaining Life (years) | 4 years 4 months 6 days | ||
March 28, 2014 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 2.13 | ||
Number of options | 5,103 | ||
Number of vested options | 5,103 | ||
Weighted Avg Remaining Life (years) | 2 years 3 months 29 days | ||
February 27, 2017 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.45 | ||
Number of options | 25,246 | ||
Number of vested options | 25,246 | ||
Weighted Avg Remaining Life (years) | 2 months 26 days | ||
September 23, 2019 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.19 | ||
Number of options | 450,470 | ||
Number of vested options | 394,161 | ||
Weighted Avg Remaining Life (years) | 2 years 9 months 25 days | ||
May 29, 2020 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.27 | ||
Number of options | 73,700 | ||
Number of vested options | 73,700 | ||
Weighted Avg Remaining Life (years) | 3 years 5 months 26 days | ||
August 18, 2020 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.19 | ||
Number of options | 73,700 | ||
Number of vested options | 73,700 | ||
Weighted Avg Remaining Life (years) | 8 years 8 months 19 days | ||
June 8, 2021 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.99 | ||
Number of options | 663,300 | ||
Number of vested options | 0 | ||
Weighted Avg Remaining Life (years) | 4 years 6 months | ||
June 8, 2021 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.86 | ||
Number of options | 1,672,990 | ||
Number of vested options | 0 | ||
Weighted Avg Remaining Life (years) | 4 years 6 months | ||
June 8, 2021 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 0.86 | ||
Number of options | 250,000 | ||
Number of vested options | 250,000 | ||
Weighted Avg Remaining Life (years) | 4 years 6 months | ||
July 7, 2021 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise price | $ 1.39 | ||
Number of options | 400,000 | ||
Number of vested options | 0 | ||
Weighted Avg Remaining Life (years) | 4 years 8 months 19 days |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of stock options activity (Details) - $ / shares | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Aug. 20, 2021 | May 20, 2021 | Aug. 18, 2020 | May 29, 2020 | Nov. 30, 2021 | Feb. 28, 2021 | |
Stockholders' Equity Note [Abstract] | ||||||
Number of options outstanding at beginning of period | 2,793,380 | 1,181,709 | ||||
Weighted average exercise price of share options outstanding in share-based payment arrangement at beginning of period | $ 0.27 | $ 0.27 | ||||
Number of share options exercised in share-based payment arrangement | (112,617) | (1,492,425) | (1,605,042) | (28,154) | ||
Weighted average exercise price of share options exercised in share-based payment arrangement | $ 0.23 | $ 0.19 | ||||
Number of share options expired in share-based payment arrangement | (560,119) | |||||
Weighted average exercise price of share options expired in share-based payment arrangement | $ 0 | |||||
Number of share options issued in share-based payment arrangement | 2,986,290 | 1,639,825 | ||||
Weighted average exercise price of share options issued in share-based payment arrangement | $ 0.19 | $ 0.27 | $ 0.93 | $ 0.23 | ||
Number of share options outstanding in share-based payment arrangement at end of period | 3,614,509 | 2,793,380 | ||||
Weighted average exercise price of share options outstanding in share-based payment arrangement at end of period | $ 0.83 | $ 0.27 |
Related party transactions (Nar
Related party transactions (Narrative) (Details) - CAD ($) | Nov. 30, 2021 | Feb. 28, 2020 |
Related Party Transactions [Abstract] | ||
Accounts payable and accrued liabilities due to a director | $ 0 | $ 114,498 |
Related party transactions - S
Related party transactions - Schedule of related party transactions (Details) - CAD ($) | 9 Months Ended | |
Nov. 30, 2021 | Nov. 30, 2020 | |
Related Party Transactions [Abstract] | ||
Salaries and short-term benefits | $ 104,062 | $ 122,696 |
Stock based compensation | 535,603 | 136,004 |
Total | $ 639,665 | $ 258,700 |
Net loss per share - Schedule o
Net loss per share - Schedule of net loss per share (Details) - CAD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (1,503,697) | $ (361,223) | $ (3,223,268) | $ (837,252) |
Weighted average number of common shares | 44,790,162 | 33,796,168 | 41,480,296 | 33,788,824 |
Net loss per share from continuing operations basic | $ (0.03) | $ (0.01) | $ (0.08) | $ (0.02) |
Net loss per share from continuing operations diluted | $ (0.03) | $ (0.01) | $ (0.08) | $ (0.02) |
Operating expenses - (Narrative
Operating expenses - (Narrative) (Details) - CAD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | |
General And Administrative Expenses [Line Items] | ||||
Stock-based compensation | $ 292,492 | $ 69,200 | $ 757,792 | $ 136,004 |
Transaction costs including l_3
Transaction costs including legal, financial, audit, US and Canadian regulatory costs - Schedule of transaction costs including legal, audit and US regulatory (Details) - CAD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2021 | Nov. 30, 2020 | Nov. 30, 2021 | Nov. 30, 2020 | |
Transaction Costs Including Legal Audit And United States Regulatory [Line Items] | ||||
Transaction costs including legal, audit and US regulatory | $ 1,044,455 | $ 306,909 | $ 2,269,923 | $ 306,909 |
Transactions Costs [Member] | ||||
Transaction Costs Including Legal Audit And United States Regulatory [Line Items] | ||||
Consulting and professional fees | 202,455 | 0 | 1,243,042 | 0 |
General expenses | 842,000 | 306,909 | 1,026,881 | 306,909 |
Transaction costs including legal, audit and US regulatory | $ 1,044,455 | $ 306,909 | $ 2,269,923 | $ 306,909 |
Marketable Securities - Schedul
Marketable Securities - Schedule of marketable securities (Details) - Level 1 [Member] - CAD ($) | Nov. 30, 2021 | Feb. 28, 2021 |
Marketable Securities [Line Items] | ||
Total Fair Value | $ 0 | $ 488,684 |
Callable Shares [Member] | ||
Marketable Securities [Line Items] | ||
Quantity | 0 | |
Average cost | $ 0 | |
Market price/ unit | $ 0 | |
Total Fair Value | $ 0 | 310,529 |
Short term bond ETF [Member] | ||
Marketable Securities [Line Items] | ||
Quantity | 0 | |
Average cost | $ 0 | |
Market price/ unit | $ 0 | |
Total Fair Value | $ 0 | 166,267 |
Publicly traded common shares [Member] | ||
Marketable Securities [Line Items] | ||
Quantity | 0 | |
Average cost | $ 0 | |
Market price/ unit | $ 0 | |
Total Fair Value | $ 0 | $ 11,888 |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) - $ / shares | Dec. 07, 2021 | Aug. 18, 2020 | May 29, 2020 | Nov. 30, 2021 | Feb. 28, 2021 |
Subsequent Event Line Items | |||||
Exercise price of stock options | $ 0.19 | $ 0.27 | $ 0.93 | $ 0.23 | |
Subsequent event [Member] | |||||
Subsequent Event Line Items | |||||
Exercise price of stock options | $ 0.65 | ||||
Term of stock options | five years | ||||
Subsequent event [Member] | Key employees, managers and directors [Member] | |||||
Subsequent Event Line Items | |||||
Aggregate number of stock options issued | 1,298,150 | ||||
Subsequent event [Member] | Mr. Mejia [Member] | |||||
Subsequent Event Line Items | |||||
Aggregate number of stock options issued | 100,000 |