Derivative Warrant Liability

12 Months Ended

Feb. 28, 2023

Derivative Warrant Liability [Abstract]

DERIVATIVE WARRANT LIABILITY

NOTE 12 – DERIVATIVE WARRANT LIABILITY

In prior years under prior management, the Company issued warrants in prior years that include a fundamental transaction provision that could give rise to an obligation to pay cash to the warrant holder. The Company determined that the warrants do not satisfy the criteria for classification as equity instruments due to the existence of the cash settlement feature that is not within the sole control of the Company, and the warrants are accounted for as liabilities in accordance with ASC 815. The fair value of the warrants is remeasured at each reporting period, and the change in the fair value is recognized in earnings in the accompanying statements of operations. The warrant liability will ultimately be converted into the Company’s equity when the warrants are exercised, or will be extinguished on the expiration of the outstanding warrants.

The following tables summarize the derivative warrant liability:

	February 28, 2023			February 28, 2022
(amounts in thousands, except share and per share data)
Stock price	$	0.25		$	0.41
Risk free interest rate		4.7	%		1.0	%
Expected volatility		190	%		170	%
Expected life in years		0.97			0.98
Expected dividend yield		0	%		0	%
Number of warrants		113,100			4,800,834
Fair value of derivative warrant liability	$	9		$	828

	Number of Warrants Outstanding			Fair Value of Derivative Warrant Liability
(amounts in thousands, except share data)
February 29, 2021		5,622,272		$	1,366
Change in fair value of derivative warrant liability		-			(477	)
Gain on extinguishment on expiration of warrants		(861,438	)		(61	)
February 28, 2022		4,800,834		$	828
Change in fair value of derivative warrant liability		-			(582	)
Gain on extinguishment on expiration of warrants		(4,687,734	)		(237	)
February 28, 2023		113,100		$	9