Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Nov. 30, 2018 | Jan. 14, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | AURA SYSTEMS INC | |
Entity Central Index Key | 826,253 | |
Trading Symbol | AUSI | |
Amendment Flag | false | |
Current Fiscal Year End Date | --02-28 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2018 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,019 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 48,801,770 |
Balance Sheets (Unaudited)
Balance Sheets (Unaudited) - USD ($) | Nov. 30, 2018 | Feb. 28, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 20,857 | $ 748,008 |
Other current assets | 50,969 | 42,165 |
Total current assets | 71,826 | 790,173 |
Investment in Joint Venture | 250,000 | 250,000 |
Total assets | 321,826 | 1,040,173 |
Current liabilities: | ||
Accounts payable | 5,427,491 | 5,377,259 |
Accrued expenses | 3,323,498 | 3,211,635 |
Customer advances | 1,136,542 | 503,632 |
Shares to be issued | 2,280,964 | |
Notes payable | 777,537 | 777,537 |
Convertible note payable and accrued interest-related party, net of discount | 3,568,514 | 3,342,685 |
Convertible notes payable, net of discount | 575,000 | 625,000 |
Notes payable and accrued interest- related party | 5,715,669 | 5,353,980 |
Total current liabilities | 20,524,251 | 21,472,692 |
Note payable-related party | 3,000,000 | 3,000,000 |
Convertible notes payable | 1,232,977 | 1,232,977 |
Total liabilities | 24,757,228 | 25,705,669 |
Commitments and contingencies | ||
Stockholders' deficit: | ||
Common stock, $0.0001 par value; 150,000,000 shares authorized at November 30 and February 28, 2018; 48,801,770 and 41,437,035 issued and outstanding at November 30 and February 28, 2018, respectively | 4,881 | 4,144 |
Subscription receivable | (75,000) | (1,300,000) |
Additional paid-in capital | 442,958,394 | 438,247,091 |
Accumulated deficit | (467,323,677) | (461,616,731) |
Total stockholders' deficit | (24,435,402) | (24,665,496) |
Total liabilities and stockholders' deficit | $ 321,826 | $ 1,040,173 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) (Unaudited) - $ / shares | Nov. 30, 2018 | Feb. 28, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 48,801,770 | 41,437,035 |
Common stock, shares outstanding | 48,801,770 | 41,437,035 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | Nov. 30, 2018 | Nov. 30, 2017 | |
Income Statement [Abstract] | ||||
Net Revenues | $ 39,274 | |||
Cost of goods sold | 37,032 | 110,026 | ||
Gross Profit | 37,032 | (70,752) | ||
Expenses | ||||
Engineering, research and development expenses | 138,417 | 25,250 | 302,293 | 25,250 |
Selling, general and administrative expenses | 790,985 | 822,616 | 4,789,451 | 1,753,419 |
Total costs and expenses | 928,402 | 847,866 | 5,091,744 | 1,778,669 |
Loss from operations | (966,434) | (847,866) | (5,162,496) | (1,778,669) |
Other (income) and expense | ||||
Interest expense, net | 295,221 | 802,272 | 848,593 | 2,628,323 |
Other (income) expense, net | 48,789 | 11,396 | (304,142) | 808,532 |
Total other (income) expense | 344,011 | 813,668 | 544,451 | 3,436,855 |
Net Loss | $ (1,310,445) | $ (1,661,534) | $ (5,706,947) | $ (5,215,524) |
Total basic and diluted loss per share | $ (0.03) | $ (0.07) | $ (0.13) | $ (0.28) |
Weighted average shares used to compute basic and diluted income (loss) per share | 48,801,770 | 18,086,913 | 44,356,148 | 17,903,538 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Cash flow from operating activities: | ||
Net Loss | $ (5,706,947) | $ (5,215,524) |
Adjustments to reconcile Net loss to net cash used in operating activities | ||
Amortization of debt discount | 43,417 | |
FMV of warrants issued for services | 438,826 | 177,737 |
Stock issued for services | 1,992,250 | 990,205 |
(Increase) decrease in: | ||
Accounts receivable | ||
Other current assets and deposit | (8,804) | (3,694) |
Increase (decrease) in: | ||
Accounts payable, customer deposit and accrued expenses | 1,382,524 | 1,943,520 |
Net cash used in operations | (1,902,151) | (2,064,340) |
Investing Activities: | ||
Investment in Joint Venture | (250,000) | |
Net cash used in investing activities | (250,000) | |
Financing activities: | ||
Issuance of common stock | 1,000,000 | |
Proceeds from subscription receivable | 1,225,000 | |
Proceeds from convertible notes payable | 1,434,593 | |
Payment on notes payable | (50,000) | (197,970) |
Investor Advance | 1,000,000 | |
Net cash provided by financing activities: | 1,175,000 | 3,236,623 |
Net increase (decrease) in cash & cash equivalents | (727,151) | 922,284 |
Cash and cash equivalents at beginning of period | 748,008 | 255,869 |
Cash and cash equivalents at end of period | 20,857 | 1,178,153 |
Cash paid during the period for: | ||
Interest | 37,500 | |
Income taxes |
Accounting Policies
Accounting Policies | 9 Months Ended |
Nov. 30, 2018 | |
Accounting Policies [Abstract] | |
ACCOUNTING POLICIES | NOTE 1 – ACCOUNTING POLICIES Accounting principles In the opinion of management, the accompanying balance sheets and related interim statements of income and comprehensive income, and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K for the year ended February 28, 2018 filed on June 13, 2018 with the U.S. Securities and Exchange Commission. Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Recently Issued Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03, Interest–Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs will continue to be reported as interest expense. It is effective for annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied retrospectively to each prior period presented. The Company is currently in the process of evaluating the impact of adoption of ASU 2015-03 on its balance sheets. In January 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) 2016-01, which amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Changes to the current guidance primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The new standard is effective for fiscal years and interim periods beginning after December 15, 2017, and upon adoption, an entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently evaluating the impact of adopting this guidance. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this Update supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently evaluating the impact of adopting ASU No. 2016-02 on our financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation, or ASU No. 2016-09. The areas for simplification in this Update involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public entities, the amendments in this Update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted in any interim or annual period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. We are currently evaluating the impact of adopting ASU No. 2016-09 on our financial statements. In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Statements,” which requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2019 (fiscal year 2021 for the Company). The Company has not yet determined the potential effects of the adoption of ASU 2016-13 on its Financial Statements. Reclassifications Certain reclassifications have been made to the comparative financial statements to conform to the current period presentation. |
Going Concern
Going Concern | 9 Months Ended |
Nov. 30, 2018 | |
Going Concern [Abstract] | |
GOING CONCERN | NOTE 2 – GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. During the nine months ended November 30, 2018 and November 30, 2017, the Company incurred losses of $5,706,947 and $5,215,524, respectively and had negative cash flows from operating activities of $1,902,151 and $2,064,340, respectively. If the Company is unable to generate profits and is unable to continue to obtain financing for its working capital requirements, it may have to curtail its business sharply or cease business altogether. Substantial additional capital resources will be required to fund continuing expenditures related to our research, development, manufacturing and business development activities. The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, to retain its current financing, to obtain additional financing, and ultimately to attain profitability. The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty. During the next twelve months we intend to restart operations of our AuraGen/VIPER business both domestically and internationally. At the next annual meeting the shareholders will vote for five board candidates. The new board intends to hire a new management team. In addition, we plan to acquire a new facility of approximately 45,000 square feet for operations, as well as rebuild the engineering, QA, and sales teams to support the operations. We anticipate being able to fund these additions in the upcoming fiscal year. |
Notes Payable
Notes Payable | 9 Months Ended |
Nov. 30, 2018 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | NOTE 3 – NOTES PAYABLE Notes payable consisted of the following: November 30, February 28, 2018 Notes payable, at 10% and 5% $ 3,777,537 $ 3,777,537 Convertible Promissory Note dated August 10, 2012 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 264,462 264,462 Convertible Promissory Note dated October 2, 2012 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 133,178 133,178 Senior secured convertible notes dated May 7, 2013 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 757,155 757,155 Senior secured convertible notes dated June 20, 2013 with an interest are of 5% per annum On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 203,182 203,182 Convertible notes dated April 2016 thru February 2017 with an interest rate of 5% per annum. Although the notes were required to be converted into shares of common stock upon shareholder approval of the 7:1 reverse stock split that occurred on February 14, 2018 per the terms of the note agreement, the company chose to allow the note holder not to convert and to have the note paid over an eleven-month period. A single payment of $50,000 was made in April 2018. 450,000 500,000 5,585,514 5,635,514 Less: Current portion $ 1,352,537 $ 1,402,537 Long-term portion $ 4,232,977 $ 4,232,977 CONVERTIBLE DEBT On May 7, 2013, the Company transferred 4 notes payable with a total principal value of $1,000,000 together with accrued interest, and consulting fees to a senior secured convertible note with a principal value of $1,087,000 (“New Kenmont Note”) and warrants to Kenmont Capital Partners. The New Kenmont Note had a 1-year maturity date and was convertible into shares of common stock at the conversion price of $1.38per share. As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. The warrants were subsequently exercised. The Company recorded $342,020 as a discount, which was amortized over the life of the note. There is a remaining principle and interest balance of $378,490 as of November 30, 2018. On May 7, 2013, the Company transferred 2 note payables with a total principal value of $550,000 together with accrued interest to a senior secured convertible note with a principal value of $558,700 (“New LPD Note”) and warrants to LPD Investments, Ltd. The New LPD Note had a 1-year maturity date and was convertible into shares of common stock at the conversion price of $1.38 per share. As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. The warrants were subsequently exercised. The Company recorded $175,793 as a discount, which will be amortized over the life of the note. There is a remaining principle and interest balance of $171,472 as of November 30, 2018. On May 7, 2013, the Company entered into an agreement with an individual for the sale of $750,000 of secured convertible note payable (the “Note”) and warrants. The Note had a 1-year maturity date and was convertible into shares of common stock at the conversion price of $1.38 per share. As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. The warrants entitle the holder to acquire 1,000,000 shares and have an initial exercise price of $1.38 per share and have a 7-year term. The Company recorded $235,985 as a discount, which will be amortized over the life of the note. There is a remaining principle and interest balance of $243,638 as of November 30, 2018. On January 30, 2017, the Company entered into an amendment to the agreements described immediately above with five of seven secured creditors holding a security interest in all of the Company’s assets except for its patents and other intellectual properties. The five secured creditors signing the amendment represented in excess of 95% of the total, secured debt. The amendment provided that all accrued and unpaid interest will be added to the principal amount. The amended notes provided for no interest from November 1, 2016 to February 14, 2018, the date on which the 1-for-7 reverse stock split became effective and at which time 80% of the total debt, including accrued interest, was converted into shares of common stock and a new five year 5% per annum convertible note was issued for the remainder. The amendment also provides that if the Company enters into a “Qualified Financing” (defined as receipt by the Company of not less than $4,000,000 in aggregate gross proceeds from the sale of securities in one or a series of related transactions after the execution date), then the Company shall remit to the holder the “Cash Payment Amount” as set forth in the amendment. On June 20, 2013, the Company entered into an agreement with four individuals for the sale of $325,000 of secured convertible notes payable (the “Notes”) and warrants. The Notes had a 1-year maturity date and were convertible into shares of common stock at the conversion price of $0.50 per share. The warrants were subsequently exercised. The Company recorded $63,622 as a discount, which will be amortized over the life of the notes. There is a remaining principle and interest balance of $278,638 as of November 30, 2018. On August 19, 2013, the Company entered into an agreement with a member of its Board of Directors for the sale of $2,500,000 of convertible notes payable (the “BOD Notes”) and warrants. The BOD Notes carry a base interest rate of 9.5%, had a 4-year maturity date and are convertible into shares of common stock at the conversion price of $0.50 per share. The warrants were subsequently exercised. The Company recorded $667,118 as a discount, which will be amortized over the life of the note. There is a remaining principle and interest balance of $3,546,354 as of November 30, 2018. On February 21, 2017, the Company entered into several Refinancing Agreements with a debt holder totaling $2,237,456 including interest of $489,466. The agreements waived all events of default and provided for new five-year 5% convertible notes with no interest for the first six months. Upon the effective date of February 14, 2018 of the 1 for 7 reverse stock split the notes were converted into 1,164,555 shares of common stock. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Nov. 30, 2018 | |
Accrued Expenses [Abstract] | |
ACCRUED EXPENSES | NOTE 4 – ACCRUED EXPENSES Accrued expenses consisted of the following: November 30, February 28, Accrued payroll and related expenses $ 2,785,229 $ 2,775,312 Accrued interest 538,269 401,323 Other - 35,000 Total $ 3,323,498 $ 3,211,635 Accrued payroll and related expenses consists of salaries and vacation time accrued but not paid to employees due to our lack of financial resources. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Nov. 30, 2018 | |
Shareholders' Equity [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 5 – SHAREHOLDERS’ EQUITY Common Stock During the nine months ended November 30, 2018, we issued 2,256,444 shares of common stock, valued at $2,280,964 to Harry Kurtzman on behalf of BetterSea LLC, a greater than 15% shareholder as part of the restructuring agreement. We issued an additional 5,108,291 shares of common stock valued at $1,992,251 to Harry Kurtzman on behalf of BetterSea LLC as a settlement for disputes. During the nine months ended November 30, 2018, we issued 742,857 warrants to members of our board of directors. The warrants have a term of five years and an exercise price of $1.40. The company recorded an expense of $312,072 for the issuance of these warrants. During the nine months ended November 30, 2018, we re-priced to $1.40 all outstanding employee options and warrants that had a previous exercise price greater than $1.40. The company recorded an expense of $105,352 as a result of the re-pricing. During the nine months ended November 30, 2017, we issued 5,000,000 (714,268 shares post reverse split) shares of common stock for $1,000,000 in conjunction with our Chinese Joint Venture, we issued 5,116,959 (730,995 shares post reverse split) shares of common stock valued at $665,204 as part of a settlement agreement, and we issued 2,500,000 (357,142 shares post reverse split) shares of common stock valued at $325,000 in connection with a consulting agreement. Employee Stock Options During the nine months ended November 30, 2018, there were no stock options granted to employees and 742,857 stock options with an exercise price of $1.40 per share granted to directors, which are set forth below under “Warrants.” In September 2006, our Board of Directors adopted the 2006 Employee Stock Option Plan. Activity in this plan is as follows: 2006 Plan Weighted- Aggregate Number of Outstanding, February 28, 2018 $ 1.40 $ 0.00 1,032,000 Cancelled - Granted - - - Outstanding, November 30, 2018 $ 1.40 $ 0.00 1,032,000 The exercise prices for the options outstanding at November 30, 2018, and information relating to these options is as follows: Options Outstanding Exercisable Options Range of Exercise Number Weighted Weighted Weighted Number Weighted $1.40 1,032,000 1.25 years $ 1.40 1.25 years 1,032,000 $ 1.40 Warrants Activity in issued and outstanding warrants is as follows: Number of Shares Exercise Prices Outstanding, February 28, 2018 8,743,505 $0.70-$1.40 Granted 742,857 $ 1.40 Exercised - - Cancelled Outstanding, November 30, 2018 9,486,362 $0.70-$1.40 The exercise prices for the warrants outstanding at November 30, 2018, and information relating to these warrants is as follows: Range of Exercise Stock Warrants Stock Warrants Weighted- Weighted- Weighted- Intrinsic $1.40 742,857 742,857 52 months $ 1.40 $ 1.40 $ 0.00 $1.40 5,154,646 5,154,646 51 months $ 1.40 $ 1.40 $ 0.00 $0.70-$1.40 2,783,002 2,783,002 28 months $ 1.20 $ 1.20 $ 0.00 $1.40 154,666 154,666 27 months $ 1.40 $ 1.40 $ 0.00 $1.40 651,191 651,191 14 months $ 1.40 $ 1.40 $ 0.00 9,486,362 9,486,362 |
Related Parties Transactions
Related Parties Transactions | 9 Months Ended |
Nov. 30, 2018 | |
Related Parties Transactions [Abstract] | |
RELATED PARTIES TRANSACTIONS | NOTE 6 – RELATED PARTIES TRANSACTIONS On January 24, 2017, the Company entered into a Debt Refinancing Agreement with Mr. Breslow, a former Director of the Company. Pursuant to the agreement, both Mr. Breslow and the Company acknowledged that total debt owed to Mr. Breslow was $23,872,614 including $8,890,574 of accrued interest. Mr. Breslow agreed to cancel and forgive all interest due, waive all events of default and sign a new five-year convertible note in the amount of $14,982,041 providing for no interest for six months and interest of 5% per annum thereafter payable monthly in arrears. The note also provides various default provisions. In accordance with the agreement, on February 14, 2018, the effective date of the 1 for 7 reverse stock split $11,982,041 of the note was converted into 7,403,705 shares of common stock and the then accrued interest of $9,388,338 was forgiven. A new $3,000,000 note representing the remaining balance was entered into due and payable in five years bearing interest at 5% per annum payable monthly in arrears. At November 30, 2018, the balance in Notes Payable and accrued interest-related party, current, includes $3,268,081 plus accrued interest of $2,319,357 to Mr. Kopple (a former Board member), a 10% shareholder. Related Parties Transactions also includes $82,000 of unsecured notes payable plus accrued interest of $46,231 to our CEO pursuant to a demand note entered into on April 5, 2014. At November 30, 2018, the balance in Convertible note payable and accrued interest-related party, long term, includes $2,000,000 of unsecured convertible notes payable plus accrued interest of $1,546,354 and an unsecured convertible note of $20,000 plus accrued interest of $2,160 to Mr. Kopple. Subscriptions receivable at November 30, 2018 includes $175,000 for the issuance of 357,143 shares which were previously issued. The balance in notes payable - long term, includes $3,000,000 to Mr. Breslow, a 20% shareholder. During the nine months ended November 30, 2018, we issued 2,256,444 shares of common stock, valued at $2,280,964 to Harry Kurtzman on behalf of BetterSea LLC, a greater than 15% shareholder as part of the restructuring agreement. We issued an additional 5,108,291 shares of common stock valued at $1,992,251 to Harry Kurtzman on behalf of BetterSea LLC as a settlement for disputes. During the nine months ended November 30, 2018, BetterSea LLC billed the company $314,645 for services rendered and was paid $316,963. The company also employs the law firm of TMK Assoc., owned by the daughter of Harry Kurtzman, as its corporate attorney. In the nine months ended November 30, 2018, TMK Assoc. has billed the company $324,581 for services rendered and has been paid $279,351. During the nine months ended November 30, 2018, the company paid Mr. Si Ryong Yu $80,000 for consulting services. During the nine months ended November 30, 2018, the company received $1,225,000 from Elimelech Lowy, a greater than 40% shareholder as partial payment on a subscription receivable of $1,300,000 for stock issued in February 2018. The agreement had called for the stock to be paid for at the time of issuance. |
Commitments
Commitments | 9 Months Ended |
Nov. 30, 2018 | |
Commitments [Abstract] | |
COMMITMENTS | NOTE 7 – COMMITMENTS Leases Our facilities consist of approximately 20,000 rented square feet in Stanton, California. The Stanton facility is currently being used for small quantity assembly and testing using components that are produced by various suppliers as well as for general offices, engineering and warehousing. The rent for the Stanton facility is $10,000 per month. The facility is not sufficient for our near term anticipated needs and the Company is actively looking for a new facility. The Company arrangements for the Stanton facility are on a month-per-month rent. Joint Venture In March 2017, the Company entered into a joint venture with a Chinese partner to form Jiangsu Shengfeng Mobile Power Technology Co., Ltd. (“Jiangsu Shengfeng”) to address the Chinese market. Under the Jiangsu Shengfeng joint venture agreement, Aura owns 49% of the venture and our Chinese partner owns 51%. The Chinese partner contributed approximately $9.25 million to the venture –– principally in the form of facilities and equipment as wells as approximately $500,000 in cash. The Company contributed to the venture in the form of $250,000 in cash as well as a limited license to the joint venture to manufacture, sell and service the AuraGen ® ® In addition, our Chinese partner invested $2,000,000 in Aura common stock at $1.40 per share for a total of 1,428,571 shares of common stock and is required to purchase a minimum of $1,250,000 of product from the Company supported by letters of credit for distribution until their factory is built, equipment installed, and staff hired and properly trained by Aura personnel. Aura has also committed to supply personnel for six months at no cost other than to reimburse for travel, room and board. This commitment has been fulfilled and Aura is under no further obligation to supply personnel at no cost. The agreement was subject to the approval of the Chinese Government which was received in April 2017. Contingencies We are subject to the legal proceedings and claims discussed below as well as certain other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. Our management evaluates our exposure to these claims and proceedings individually and in the aggregate and evaluates potential losses on such litigation if the amount of the loss is estimable and the loss is probable. In June 2016, the Company became one of several defendants named in a lawsuit filed by two of seven secured creditors demanding repayment of loans totaling $125,000 plus accrued interest and exemplary damages. The Company entered into an amended agreement with the five other secured creditors representing in excess of 95% of the total secured debt. In August 2018 the two secured creditors who brought suit against the Company were awarded approximately $240,000 at trial. The Company intends to appeal this award. The Company is presently engaged in a dispute with one of its former directors, Robert Kopple, relating to approximately $5.4 million and approximately 3.14 million warrants which Mr. Kopple claims to be owed to him and his affiliates by the Company. In July 2017, Mr. Kopple filed suit against the Company as well as against Mr. Gagerman (currently not a director) and director Mr. Diaz-Verson, Jr. together with former directors Mr. Breslow and Mr. Howsmon in connection with these allegations. Mssrs. Diaz-Verson, Jr., Breslow and Howsmon have each been dismissed from this suit. The Company believes that it has valid defenses in these matters and intends to vigorously defend against these claims. In April 2018, the Company filed suit against its former counsel, Kilpatrick Townsend &Stockton LLP relating to various acts of malpractice and breach of fiduciary duty committed by the firm in connection with its representation of Aura. In June 2018, Kilpatrick Townsend &Stockton LLP filed a cross-complaint against the Company claiming approximately $400,000 in allegedly unpaid legal fees. The Company believes that it has valid defenses to these claims and intends to vigorously defend against these claims. The Company has a dispute with its former landlord and vacated its former premises prior to the end of its lease. The premises have been released to a third party and no action has been filed against the Company, nor does the Company believe it has any liability. Further while the Company believes it has claims against the landlord based on their actions, the Company has nonetheless elected to accrue the amount due for unpaid rent. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Nov. 30, 2018 | |
Accounting Policies [Abstract] | |
Accounting principles | Accounting principles In the opinion of management, the accompanying balance sheets and related interim statements of income and comprehensive income, and cash flows include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in the Company’s annual report on Form 10-K for the year ended February 28, 2018 filed on June 13, 2018 with the U.S. Securities and Exchange Commission. |
Estimates | Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03, Interest–Imputation of Interest (Subtopic 835-30) (“ASU 2015-03”), which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs will continue to be reported as interest expense. It is effective for annual reporting periods beginning after December 15, 2016. Early adoption is permitted. The new guidance will be applied retrospectively to each prior period presented. The Company is currently in the process of evaluating the impact of adoption of ASU 2015-03 on its balance sheets. In January 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) 2016-01, which amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Changes to the current guidance primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the ASU clarifies guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The new standard is effective for fiscal years and interim periods beginning after December 15, 2017, and upon adoption, an entity should apply the amendments by means of a cumulative-effect adjustment to the balance sheet at the beginning of the first reporting period in which the guidance is effective. Early adoption is not permitted except for the provision to record fair value changes for financial liabilities under the fair value option resulting from instrument-specific credit risk in other comprehensive income. The Company is currently evaluating the impact of adopting this guidance. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this Update supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. We are currently evaluating the impact of adopting ASU No. 2016-02 on our financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation, or ASU No. 2016-09. The areas for simplification in this Update involve several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public entities, the amendments in this Update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods. Early adoption is permitted in any interim or annual period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. An entity that elects early adoption must adopt all of the amendments in the same period. Amendments related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet the minimum statutory withholding requirement should be applied retrospectively. Amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement and the practical expedient for estimating expected term should be applied prospectively. An entity may elect to apply the amendments related to the presentation of excess tax benefits on the statement of cash flows using either a prospective transition method or a retrospective transition method. We are currently evaluating the impact of adopting ASU No. 2016-09 on our financial statements. In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Statements,” which requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for annual reporting periods, and interim periods therein, beginning after December 15, 2019 (fiscal year 2021 for the Company). The Company has not yet determined the potential effects of the adoption of ASU 2016-13 on its Financial Statements. |
Reclassifications | Reclassifications Certain reclassifications have been made to the comparative financial statements to conform to the current period presentation. |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Nov. 30, 2018 | |
Notes Payable [Abstract] | |
Schedule of notes payable | November 30, February 28, 2018 Notes payable, at 10% and 5% $ 3,777,537 $ 3,777,537 Convertible Promissory Note dated August 10, 2012 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 264,462 264,462 Convertible Promissory Note dated October 2, 2012 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 133,178 133,178 Senior secured convertible notes dated May 7, 2013 with an interest rate of 5% per annum. On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 757,155 757,155 Senior secured convertible notes dated June 20, 2013 with an interest are of 5% per annum On January 30, 2017, this note was amended providing, among other things, for the conversion of 80% of the principal and accrued interest into common stock at $1.386 per share conditioned on the occurrence of certain future events the last of which was completed on February 14, 2018. Further details are provided below. 203,182 203,182 Convertible notes dated April 2016 thru February 2017 with an interest rate of 5% per annum. Although the notes were required to be converted into shares of common stock upon shareholder approval of the 7:1 reverse stock split that occurred on February 14, 2018 per the terms of the note agreement, the company chose to allow the note holder not to convert and to have the note paid over an eleven-month period. A single payment of $50,000 was made in April 2018. 450,000 500,000 5,585,514 5,635,514 Less: Current portion $ 1,352,537 $ 1,402,537 Long-term portion $ 4,232,977 $ 4,232,977 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Nov. 30, 2018 | |
Accrued Expenses [Abstract] | |
Schedule of accrued expenses | November 30, February 28, Accrued payroll and related expenses $ 2,785,229 $ 2,775,312 Accrued interest 538,269 401,323 Other - 35,000 Total $ 3,323,498 $ 3,211,635 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Nov. 30, 2018 | |
Shareholders' Equity [Abstract] | |
Schedule of employee stock option plan | 2006 Plan Weighted- Aggregate Number of Outstanding, February 28, 2018 $ 1.40 $ 0.00 1,032,000 Cancelled - Granted - - - Outstanding, November 30, 2018 $ 1.40 $ 0.00 1,032,000 |
Schedule of exercise price options outstanding | Options Outstanding Exercisable Options Range of Exercise Number Weighted Weighted Weighted Number Weighted $1.40 1,032,000 1.25 years $ 1.40 1.25 years 1,032,000 $ 1.40 |
Schedule of activity in issued and outstanding warrants | Number of Shares Exercise Prices Outstanding, February 28, 2018 8,743,505 $0.70-$1.40 Granted 742,857 $ 1.40 Exercised - - Cancelled Outstanding, November 30, 2018 9,486,362 $0.70-$1.40 |
Schedule of exercise prices warrants outstanding | Range of Exercise Stock Warrants Stock Warrants Weighted- Weighted- Weighted- Intrinsic $1.40 742,857 742,857 52 months $ 1.40 $ 1.40 $ 0.00 $1.40 5,154,646 5,154,646 51 months $ 1.40 $ 1.40 $ 0.00 $0.70-$1.40 2,783,002 2,783,002 28 months $ 1.20 $ 1.20 $ 0.00 $1.40 154,666 154,666 27 months $ 1.40 $ 1.40 $ 0.00 $1.40 651,191 651,191 14 months $ 1.40 $ 1.40 $ 0.00 9,486,362 9,486,362 |
Going Concern (Details)
Going Concern (Details) | 3 Months Ended | 9 Months Ended | ||
Nov. 30, 2018USD ($)ft² | Nov. 30, 2017USD ($) | Nov. 30, 2018USD ($)ft² | Nov. 30, 2017USD ($) | |
Going Concern (Textual) | ||||
Net Loss | $ (1,310,445) | $ (1,661,534) | $ (5,706,947) | $ (5,215,524) |
Cash flows from operating activities | $ 1,902,151 | $ 2,064,340 | ||
Area of land | ft² | 45,000 | 45,000 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Nov. 30, 2018 | Feb. 28, 2018 |
Debt Instrument [Line Items] | ||
Convertible notes payable | $ 5,585,514 | $ 5,635,514 |
Less: Current portion | 1,352,537 | 1,402,537 |
Long-term portion | 4,232,977 | 4,232,977 |
Notes payable [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 3,777,537 | 3,777,537 |
Convertible Promissory Note dated August 10, 2012 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | 264,462 | 264,462 |
Convertible Promissory Note dated October 2, 2012 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | 133,178 | 133,178 |
Senior secured convertible notes dated May 7, 2013 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | 757,155 | 757,155 |
Senior secured convertible notes dated June 20, 2013 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | 203,182 | 203,182 |
Convertible notes dated April 2016 thru February 2017 [Member] | ||
Debt Instrument [Line Items] | ||
Convertible notes payable | $ 450,000 | $ 500,000 |
Notes Payable (Parenthetical) (
Notes Payable (Parenthetical) (Details) | 9 Months Ended |
Nov. 30, 2018USD ($)$ / shares | |
Notes payable [Member] | Minimum [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 5.00% |
Notes payable [Member] | Maximum [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 10.00% |
Convertible Promissory Note dated August 10, 2012 [Member] | |
Debt Instrument [Line Items] | |
Conversion price per share of notes payable | $ 1.386 |
Conversion percentage | 80.00% |
Converted into common stock price | 5.00% |
Converted instrument date | Feb. 14, 2018 |
Convertible Promissory Note dated October 2, 2012 [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 5.00% |
Conversion price per share of notes payable | $ 1.386 |
Conversion percentage | 80.00% |
Converted instrument date | Feb. 14, 2018 |
Senior secured convertible notes dated May 7, 2013 [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 5.00% |
Conversion price per share of notes payable | $ 1.386 |
Conversion percentage | 80.00% |
Converted instrument date | Feb. 14, 2018 |
Senior secured convertible notes dated June 20, 2013 [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 5.00% |
Conversion price per share of notes payable | $ 1.386 |
Conversion percentage | 80.00% |
Converted instrument date | Feb. 14, 2018 |
Convertible notes dated April 2016 thru February 2017 [Member] | |
Debt Instrument [Line Items] | |
Notes payable interest rate | 5.00% |
Reverse stock split | 7:1 reverse stock split. |
Converted instrument date | Feb. 14, 2018 |
Note holders single payment | $ | $ 50,000 |
Notes Payable (Details Textual)
Notes Payable (Details Textual) | Feb. 21, 2017USD ($)shares | Aug. 19, 2013USD ($)$ / shares | Jun. 20, 2013USD ($)$ / shares | May 07, 2013USD ($)Notes$ / sharesshares | Jan. 30, 2017 | Nov. 30, 2018USD ($) | Nov. 30, 2017USD ($) |
Notes Payable (Textual) | |||||||
Amortization of debt discount | $ 43,417 | ||||||
Unsecured Debt [Member] | |||||||
Notes Payable (Textual) | |||||||
Reverse stock split, description | 1 for 7 reverse stock split. | ||||||
Due date of notes | Feb. 14, 2018 | ||||||
Notes maturity date, term | 5 years | ||||||
Notes payable interest rate | 5.00% | ||||||
Refinancing agreements totaling | $ 2,237,456 | ||||||
Interest of debt | $ 489,466 | ||||||
Converted shares of common stock | shares | 1,164,555 | ||||||
Secured convertible note payable [Member] | Warrant [Member] | |||||||
Notes Payable (Textual) | |||||||
Pre conversion debt principal amount | $ 325,000 | ||||||
Conversion price per share of notes payable | $ / shares | $ 0.50 | ||||||
Amortization of debt discount | $ 63,622 | ||||||
Remaining principle and interest balance | 278,638 | ||||||
Notes maturity date, term | 1 year | ||||||
Convertible Debt [Member] | |||||||
Notes Payable (Textual) | |||||||
Description of convertible promissory note | The Company entered into an amendment to the agreements described immediately above with five of seven secured creditors holding a security interest in all of the Company's assets except for its patents and other intellectual properties. The five secured creditors signing the amendment represented in excess of 95% of the total, secured debt. The amendment provided that all accrued and unpaid interest will be added to the principal amount. The amended notes provided for no interest from November 1, 2016 to February 14, 2018, the date on which the 1-for-7 reverse stock split became effective and at which time 80% of the total debt, including accrued interest, was converted into shares of common stock and a new five year 5% per annum convertible note was issued for the remainder. The amendment also provides that if the Company enters into a "Qualified Financing" (defined as receipt by the Company of not less than $4,000,000 in aggregate gross proceeds from the sale of securities in one or a series of related transactions after the execution date), then the Company shall remit to the holder the "Cash Payment Amount" as set forth in the amendment. | ||||||
Kenmont Capital Partners [Member] | Secured convertible note payable [Member] | |||||||
Notes Payable (Textual) | |||||||
Pre conversion debt principal amount | $ 1,000,000 | ||||||
Debt amount | $ 1,087,000 | ||||||
Conversion price per share of notes payable | $ / shares | $ 1.38 | ||||||
Amortization of debt discount | $ 342,020 | ||||||
Reverse stock split, description | As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. | ||||||
Remaining principle and interest balance | 378,490 | ||||||
Number of notes payable to transferred | Notes | 4 | ||||||
Notes maturity date, term | 1 year | ||||||
LPD Investments, Ltd [Member] | Secured convertible note payable [Member] | |||||||
Notes Payable (Textual) | |||||||
Pre conversion debt principal amount | $ 550,000 | ||||||
Debt amount | $ 558,700 | ||||||
Conversion price per share of notes payable | $ / shares | $ 1.38 | ||||||
Amortization of debt discount | $ 175,793 | ||||||
Reverse stock split, description | As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. | ||||||
Remaining principle and interest balance | 171,472 | ||||||
Number of notes payable to transferred | Notes | 2 | ||||||
Notes maturity date, term | 1 year | ||||||
Refinancing Agreements [Member] | Secured convertible note payable [Member] | |||||||
Notes Payable (Textual) | |||||||
Pre conversion debt principal amount | $ 750,000 | ||||||
Conversion price per share of notes payable | $ / shares | $ 1.38 | ||||||
Term of warrant | 7 years | ||||||
Amortization of debt discount | $ 235,985 | ||||||
Number of common shares entitlement on exercise of warrant one (in shares) | shares | 1,000,000 | ||||||
Reverse stock split, description | As of the 1 for 7 reverse split 80% of this note was converted into stock at a price of $1.38 per share. | ||||||
Remaining principle and interest balance | 243,638 | ||||||
Notes maturity date, term | 1 year | ||||||
Initial exercise price | $ / shares | $ 1.38 | ||||||
Refinancing Agreements [Member] | Board of Directors [Member] | Secured convertible note payable [Member] | |||||||
Notes Payable (Textual) | |||||||
Pre conversion debt principal amount | $ 2,500,000 | ||||||
Conversion price per share of notes payable | $ / shares | $ 0.50 | ||||||
Amortization of debt discount | $ 667,118 | ||||||
Remaining principle and interest balance | $ 3,546,354 | ||||||
Notes maturity date, term | 4 years | ||||||
Notes payable interest rate | 9.50% |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Nov. 30, 2018 | Feb. 28, 2018 |
Accrued Expenses [Abstract] | ||
Accrued payroll and related expenses | $ 2,785,229 | $ 2,775,312 |
Accrued interest | 538,269 | 401,323 |
Other | 35,000 | |
Total | $ 3,323,498 | $ 3,211,635 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - 2006 Plan [Member] | 9 Months Ended |
Nov. 30, 2018USD ($)$ / sharesshares | |
Weighted - Average Exercise Price | |
Weighted - Average Exercise Price, Outstanding, February 28, 2018 | $ / shares | $ 1.40 |
Weighted - Average Exercise Price, Cancelled | $ / shares | |
Weighted - Average Exercise Price, Granted | $ / shares | |
Weighted - Average Exercise Price, Outstanding, November 30, 2018 | $ / shares | $ 1.40 |
Aggregate Intrinsic Value | |
Aggregate Intrinsic Value, Outstanding, February 28, 2018 | $ | $ 0 |
Aggregate Intrinsic Value, Outstanding, November 30, 2018 | $ | $ 0 |
Number of Options | |
Number of Options, Outstanding, February 28, 2018 | shares | 1,032,000 |
Number of Options, Cancelled | shares | |
Number of Options, Granted | shares | |
Number of Options, Outstanding, November 30, 2018 | shares | 1,032,000 |
Shareholders' Equity (Details 1
Shareholders' Equity (Details 1) - $1.40 [Member] | 9 Months Ended |
Nov. 30, 2018$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options Outstanding, Range of Exercise Price | $ 1.40 |
Options Outstanding, Number | shares | 1,032,000 |
Options Outstanding, Weighted Average Remaining Life | 1 year 2 months 30 days |
Options Outstanding, Weighted Average Exercise Price | $ 1.40 |
Exercisable Options, Weighted Average Remaining Life | 1 year 2 months 30 days |
Exercisable Options, Number | shares | 1,032,000 |
Exercisable Options, Weighted Average Exercise Price | $ 1.40 |
Shareholders' Equity (Details 2
Shareholders' Equity (Details 2) - Warrants [Member] | 9 Months Ended |
Nov. 30, 2018$ / sharesshares | |
Class of Stock [Line Items] | |
Number of Shares, Outstanding, February 28, 2018 | shares | 8,743,505 |
Number of Shares, Granted | shares | 742,857 |
Number of Shares, Exercised | shares | |
Number of Shares, Cancelled | shares | |
Number of Shares, Outstanding, November 30, 2018 | shares | 9,486,362 |
Exercise Prices, Granted | $ 1.40 |
Exercise Prices, Exercised | |
Exercise Prices, Cancelled | |
Minimum [Member] | |
Class of Stock [Line Items] | |
Exercise Prices, Outstanding, February 28, 2018 | 0.70 |
Exercise Prices, Outstanding, November 30, 2018 | 0.70 |
Maximum [Member] | |
Class of Stock [Line Items] | |
Exercise Prices, Outstanding, February 28, 2018 | 1.40 |
Exercise Prices, Outstanding, November 30, 2018 | $ 1.40 |
Shareholders' Equity (Details 3
Shareholders' Equity (Details 3) - Warrant [Member] - $ / shares | 9 Months Ended | |
Nov. 30, 2018 | Feb. 28, 2018 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Stock Warrants Outstanding | 9,486,362 | 8,743,505 |
Stock Warrants Exercisable | 9,486,362 | |
$1.40 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | $ 1.40 | |
Stock Warrants Outstanding | 742,857 | |
Stock Warrants Exercisable | 742,857 | |
Weighted-Average Remaining Contractual Life | 52 months | |
Weighted-Average Exercise Price of Warrants Outstanding | $ 1.40 | |
Weighted-Average Exercise Price of Warrants Exercisable | 1.40 | |
Intrinsic Value | 0 | |
$1.40 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | $ 1.40 | |
Stock Warrants Outstanding | 5,154,646 | |
Stock Warrants Exercisable | 5,154,646 | |
Weighted-Average Remaining Contractual Life | 51 months | |
Weighted-Average Exercise Price of Warrants Outstanding | $ 1.40 | |
Weighted-Average Exercise Price of Warrants Exercisable | 1.40 | |
Intrinsic Value | $ 0 | |
$0.70-$1.40 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Stock Warrants Outstanding | 2,783,002 | |
Stock Warrants Exercisable | 2,783,002 | |
Weighted-Average Remaining Contractual Life | 28 months | |
Weighted-Average Exercise Price of Warrants Outstanding | $ 1.20 | |
Weighted-Average Exercise Price of Warrants Exercisable | 1.20 | |
Intrinsic Value | 0 | |
$0.70-$1.40 [Member] | Maximum [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | 1.40 | |
$0.70-$1.40 [Member] | Minimum [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | 0.70 | |
$1.40 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | $ 1.40 | |
Stock Warrants Outstanding | 154,666 | |
Stock Warrants Exercisable | 154,666 | |
Weighted-Average Remaining Contractual Life | 27 months | |
Weighted-Average Exercise Price of Warrants Outstanding | $ 1.40 | |
Weighted-Average Exercise Price of Warrants Exercisable | 1.40 | |
Intrinsic Value | 0 | |
$1.40 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Range of Exercise Prices | $ 1.40 | |
Stock Warrants Outstanding | 651,191 | |
Stock Warrants Exercisable | 651,191 | |
Weighted-Average Remaining Contractual Life | 14 months | |
Weighted-Average Exercise Price of Warrants Outstanding | $ 1.40 | |
Weighted-Average Exercise Price of Warrants Exercisable | 1.40 | |
Intrinsic Value | $ 0 |
Shareholders' Equity (Details T
Shareholders' Equity (Details Textual) - USD ($) | 9 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Employee Stock Option [Member] | ||
Shareholders' Equity (Textual) | ||
Stock option granted | 742,857 | |
Exercise price | $ 1.40 | |
Board of Directors [Member] | ||
Shareholders' Equity (Textual) | ||
Warrants, description | We re-priced to $1.40 all outstanding employee options and warrants that had a previous exercise price greater than $1.40. The company recorded an expense of $105,352 as a result of the re-pricing. | |
Warrants issued | $ 312,072 | |
Warrants issued, shares | 742,857 | |
Warrants term | 5 years | |
Exercise price | $ 1.40 | |
Settlement Agreement [Member] | ||
Shareholders' Equity (Textual) | ||
Common stock shares issued | 5,116,959 | |
Common stock shares issued, value | $ 665,204 | |
Reverse stock split | 730,995 | |
Consulting Agreement [Member] | ||
Shareholders' Equity (Textual) | ||
Common stock shares issued | 2,500,000 | |
Common stock shares issued, value | $ 325,000 | |
Reverse stock split | 357,142 | |
Chinese Joint Venture [Member] | ||
Shareholders' Equity (Textual) | ||
Common stock shares issued | 5,000,000 | |
Common stock shares issued, value | $ 1,000,000 | |
Reverse stock split | 714,268 | |
BetterSea LLC [Member] | ||
Shareholders' Equity (Textual) | ||
Common stock shares issued | 2,256,444 | |
Common stock shares issued, value | $ 2,280,964 | |
Additional common stock shares issued | 5,108,291 | |
Common stock additional information, description | A greater than 15% shareholder as part of the restructuring agreement. | |
Additional common stock shares issued, value | $ 1,992,251 |
Related Parties Transactions (D
Related Parties Transactions (Details) - USD ($) | 1 Months Ended | 9 Months Ended | |||
Feb. 14, 2018 | Jan. 24, 2017 | Nov. 30, 2018 | Feb. 28, 2018 | Apr. 05, 2014 | |
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | $ 5,715,669 | $ 5,353,980 | |||
Convertible note, amount | $ 3,000,000 | ||||
Consulting services | 80,000 | ||||
Received from related party | 1,225,000 | ||||
Subscription receivable | $ 1,300,000 | ||||
Subscriptions Receivable [Member] | |||||
Related Parties Transactions (Textual) | |||||
Common stock issued, shares | 357,143 | ||||
Common stock shares issued, value | $ 175,000 | ||||
Accrued interest [Member] | Unsecured convertible notes payable [Member] | |||||
Related Parties Transactions (Textual) | |||||
Convertible note payable and accrued interest-related party, net of discount | 1,546,354 | ||||
Accrued interest [Member] | Unsecured convertible note [Member] | |||||
Related Parties Transactions (Textual) | |||||
Convertible note payable and accrued interest-related party, net of discount | $ 20,000 | ||||
Mr. Breslow [Member] | |||||
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | $ 14,982,041 | ||||
Debt amount | 23,872,614 | ||||
Shareholder, rate | 20.00% | ||||
Convertible note payable and accrued interest-related party, net of discount | $ 9,388,338 | $ 8,890,574 | |||
New debt agreement, term | 5 years | 5 years | |||
Convertible note, amount | $ 11,982,041 | ||||
Convertible note, shares | 7,403,705 | ||||
Reverse stock split, description | 1 for 7 reverse stock split. | ||||
Interest rate | 5.00% | 5.00% | |||
Notes payable - long term | $ 3,000,000 | ||||
Mr. Breslow [Member] | Unsecured Debt [Member] | |||||
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | $ 3,268,081 | ||||
CEO [Member] | Unsecured Debt [Member] | |||||
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | $ 82,000 | ||||
CEO [Member] | Accrued interest [Member] | |||||
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | $ 46,231 | ||||
Mr. Kopple [Member] | |||||
Related Parties Transactions (Textual) | |||||
Interest rate | 10.00% | ||||
Mr. Kopple [Member] | Convertible Secured Notes [Member] | |||||
Related Parties Transactions (Textual) | |||||
Convertible note payable and accrued interest-related party, net of discount | $ 2,000,000 | ||||
Mr. Kopple [Member] | Accrued interest [Member] | |||||
Related Parties Transactions (Textual) | |||||
Unsecured notes payable and accrued interest - related party | 2,319,357 | ||||
Convertible note payable and accrued interest-related party, net of discount | $ 2,160 | ||||
BetterSea LLC [Member] | |||||
Related Parties Transactions (Textual) | |||||
Common stock issued, shares | 2,256,444 | ||||
Common stock shares issued, value | $ 2,280,964 | ||||
Shareholder restructuring agreement, description | A greater than 15% shareholder as part of the restructuring agreement. | ||||
Additional common stock shares issued | 5,108,291 | ||||
Additional common stock shares issued, value | $ 1,992,251 | ||||
Related party billed for services rendered | 314,645 | ||||
Amount paid to related party | 316,963 | ||||
TMK Assoc., [Member] | |||||
Related Parties Transactions (Textual) | |||||
Related party billed for services rendered | 324,581 | ||||
Amount paid to related party | $ 279,351 |
Commitments (Details)
Commitments (Details) | 1 Months Ended | 9 Months Ended | |||
Mar. 31, 2017USD ($)$ / shares | Jun. 30, 2016USD ($) | Nov. 30, 2018USD ($)ft² | Nov. 30, 2017USD ($) | Jun. 30, 2018USD ($) | |
Commitments (Textual) | |||||
Area of facility (in square feet) | ft² | 20,000 | ||||
Rent per month | $ 10,000 | ||||
Payments for joint venture agreement | $ 9,250,000 | $ 250,000 | |||
Purchase a minimum of product | 500,000 | ||||
Company invested amount | 2,000,000 | ||||
Total shares of common stock | $ 1,428,571 | ||||
Repayments of loans | $ 125,000 | ||||
Contingencies description | The Company is presently engaged in a dispute with one of its former directors, Robert Kopple, relating to approximately $5.4 million and approximately 3.14 million warrants which Mr. Kopple claims to be owed to him and his affiliates by the Company. | ||||
Unpaid Legal fees | $ 400,000 | ||||
Joint venture (JV) agreement [Member] | |||||
Commitments (Textual) | |||||
Ownership percentage in joint venture | 49.00% | ||||
Purchase a minimum of product | $ 250,000 | ||||
Shares issue of price per share | $ / shares | $ 1.40 | ||||
Common stock purchase minimum amount | $ 1,250,000 | ||||
Secured debt, description | The Company entered into an amended agreement with the five other secured creditors representing in excess of 95% of the total secured debt. In August 2018 the two secured creditors who brought suit against the Company were awarded approximately $240,000 at trial. | ||||
Chinese company [Member] | |||||
Commitments (Textual) | |||||
Ownership percentage in joint venture | 51.00% |