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Common Shares and Warrants | 12 Months Ended
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Aug. 31, 2018
Equity [Abstract] |
Common Shares and Warrants |
12. | Common Shares and Warrants
| Fiscal 2018 Activity On October 27, 2017 the Company extended the expiration date of warrants originally issued on January 9, 2017, with a one-year expiration date. The warrant quantity and exercise price remain unchanged, 500,000 warrants exercisable at $0.44, will now expire on January 9, 2019. There was a $Nil effect on the modification of the warrants. During the year ended August 31, 2018 the Company granted a total of 1,000,000 warrants with a fair value of $1,011,822 pursuant to consulting agreements signed during the year. The value of the warrants was recorded in consulting fees on the statement of operations. The company also granted a total of 35,913 warrants with a value of $21,646 which were recorded as a share issue cost within additional paid in capital for a net effect of $Nil. During the year ended August 31, 2018 the Company recognized $51,448 in consulting expense for warrants previously granted to a consultant upon vesting. A summary of share issuance is presented relating to option and warrant exercises, agreement requirements and debt settlement is presented below:
Type of Issuance |  | Number of Shares |  |  | Total Value |
Warrant Exercise(1) |  |  | 6,364,145 |  |  | $ | 1,773,522 |
Option Exercise |  |  | 545,875 |  |  | $ | 93,703 |
Per Agreements(2) |  |  | 633,056 |  |  | $ | 769,056 |
Debt Settlement(3) |  |  | 14,634 |  |  | $ | 12,000 |
|  |  | 7,557,710 |  |  | $ | 2,648,281 |
___________
| (1) Includes 111,291 broker warrants exercised for gross proceeds of $39,522
| (2) The Company awarded the restricted common shares as required by intellectual property performance thresholds within an existing management consulting contracts for patent application filings (Note 9, 15)
| (3) Issued to settle outstanding debts (Note 15)
| Fiscal 2017 Activity During September and October 2017 the Company received $93,500 of private placement receivable (Note 7) as at August 31, 2016. On October 11, 2016, pursuant to its agreement with Docherty Management Ltd. (Note 17), the Company issued 252,000 common shares with a value of $35,760. On October 11, 2016, pursuant to the Advisory Agreement, the Company issued 750,000 warrants with an exercise price of $0.14 per share and term of five years, in return for consulting services. The Company recognized the fair value of $32,252 from 250,000 of such warrants for services received during the year ended August 31, 2016, and further recognized $59,490 for the remaining 500,000 warrants issued in return for consulting services received during the year ended August 31, 2017. The Company reached an agreement with a director to settle the outstanding amount pursuant to an advisory agreement (Note 15), through issuance of common shares of the Company.
Date |  | Amount(2) |  |  | Shares |  |  | Price |
October 31, 2016(1) |  | $ | 16,000 |  |  |  | 114,286 |  |  | $ | 0.14 |
February 27, 2017 |  | $ | 16,000 |  |  |  | 29,091 |  |  | $ | 0.55 |
May 31, 2017 |  | $ | 12,000 |  |  |  | 35,294 |  |  | $ | 0.34 |
August 25, 2017 |  | $ | 12,000 |  |  |  | 32,433 |  |  | $ | 0.37 |
____________
| (1) | A Total of $8,000 of the $16,000 was recognized as consulting fees during the year ended August 31, 2016.
| (2) | There was a $NIL difference between the fair value of the shares issued and the carrying value of the debt.
| On November 1, 2016, the Company issued 56,250 shares of its common stock for services amounting to $9,000, recognized within accounts payable and accrued liabilities as at August 31, 2016. On November 1, 2016, the Company issued 500,000 warrants to a consultant. Each warrant entitles the consultant to purchase one common share of the Company at a price of $0.31 per share with a term expiring on May 31, 2017. The Company recognized $48,313, representing the fair value of such warrants. During November, 2016, the Company provided to its warrant holders, an incentive for early exercise of their previously held warrants. Upon exercise of each warrant, in addition to the common shares of the Company, the warrant holders received a second warrant with identical terms to purchase one additional common share of the Company. The Company raised $737,508 from this early exercise warrant incentive program. A total of 3,245,000 warrants were exercised at a weighted average exercise price of $0.23 and the Company issued 3,245,000 common shares as well as 3,245,000 additional warrants to purchase common shares with an exercise price of $0.23 per share, expiring on May 14, 2017. The fair value of these additional warrants was determined to be $298,777, and is recorded within additional paid-in capital with a net effect of $nil. On January 10, 2017, the Company issued 500,000 warrants to a consultant. Each warrant entitles the consultant to purchase one common share of the Company at a price of $0.44 per share with a term expiring on January 9, 2018. The Company recognized $112,725, representing the fair value of such warrants. On April 3, 2017, the Company closed its brokered private placement of 4,104,280 units at a price per Unit of $0.42 for total gross proceeds of $1,723,798. Each Unit consists of one common share and one-half of one Share purchase warrant (2,052,140). Each whole Warrant entitles the holder to acquire one common share of the Company at a price of $0.60 per Share for a period of 24 months. The Agents received a cash commission of seven percent ($120,666) of the gross proceeds and 287,300 compensation units exercisable for a period of 24 months at an exercise price of $0.42 consisting of one common share and one half share purchase warrant. Each whole compensation warrant is exercisable for one common share at an exercise price of $0.60 for a period of 24 months following closing. The fair value of these compensation units was determined to be $64,162. There was $61,390 of other share issuance costs. On June 19, 2017, pursuant to the agreement with Alex Blanchard Capital (Note 16) the Company issued 200,000 warrants exercisable at $0.29 for two years. The Company recognized $37,878, representing the fair value of such warrants. On June 22, 2017, pursuant to the agreement with Mr. Chris Bunka (Note 17), the Company issued 210,000 common shares at $0.295 per share for $61,950, for services rendered as the Chief Executive Officer of the Company. On June 22, 2017, pursuant to the agreement with Mr. John Docherty (Note 17), the Company issued 210,000 common shares at $0.295 per share for $61,950, for services rendered as the President of the Company. On August 15, 2017, the Company issued 500,000 warrants to a consultant. Each warrant entitles the consultant to purchase one common share of the Company at a price of $0.44 per share with a term expiring on August 14, 2018. The Company recognized $34,344, representing the fair value of such warrants.
| On August 25, 2017, the Company issued 307,500 shares at $0.15 per share of its common stock for the conversion of the convertible debt of $45,000 plus accrued interest of $1,125 (Note 10).
| During the year ended August 31, 2017, a total of 1,014,125 incentive stock options were exercised for proceeds of $177,262. A total of 10,322,025 warrants were exercised for proceeds of $2,233,032, of which 3,245,000 warrants related to the early exercise warrant incentive program.
| A continuity schedule for warrants is presented below:
|  | Number of Warrants |  |  | Weighted Average Exercise Price $ |
Balance, August 31, 2016 |  |  | 12,136,241 |  |  |  | 0.18 |
Cancelled/Expired |  |  | (1,004,150 | ) |  |  | 0.22 |
Exercised |  |  | (10,322,025 | ) |  |  | 0.23 |
Issued |  |  | 8,034,440 |  |  |  | 0.36 |
Balance, August 31, 2017 |  |  | 8,844,506 |  |  |  | 0.29 |
Cancelled/Expired |  |  | (230,000 | ) |  |  | 0.17 |
Exercised |  |  | (6,364,145 | ) |  |  | 0.28 |
Issued |  |  | 1,035,913 |  |  |  | 1.48 |
Balance, August 31, 2018 |  |  | 3,286,274 |  |  |  | 0.72 |
| The fair value of share purchase warrants granted as broker warrants, compensation units, and compensatory warrants, was estimated as of the date of the grant by using the Black-Scholes option pricing model with the following assumptions:
|  | August 31 2018 |  |  | August 31 2017 |
Expected volatility |  | 100% - 154% |  |  | 102% - 138% |
Risk-free interest rate |  | 1.21% - 2.60% |  |  | 0.65% - 1.27% |
Expected life |  | 1.21 - 3 years |  |  | 0.46 - 2 years |
Dividend yield |  |  | 0.00% |  |  |  | 0.00% |
Estimated fair value per option |  | $0.40 - $1.48 |  |  | $0.09 - $0.20 |
| A summary of warrants outstanding as of August 31, 2018 is presented below:
# of Warrants |  |  | Weighted Average Remaining Contractual Life |  | Weighted Average Exercise Price $ |
| 500,000 |  |  | 0.36 years |  |  | 0.44 |
| 624,065 |  |  | 0.59 years |  |  | 0.60 |
| 212,209 |  |  | 0.59 years |  |  | 0.42 |
| 200,000 |  |  | 0.80 years |  |  | 0.29 |
| 750,000 |  |  | 3.11 years |  |  | 0.14 |
| 250,000 |  |  | 1.25 years |  |  | 0.83 |
| 500,000 |  |  | 1.38 years |  |  | 1.83 |
| 250,000 |  |  | 2.73 years |  |  | 2.73 |
| 3,286,274 |  |  | 1.48 years |  |  | 0.72 |

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
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