Annual report pursuant to Section 13 and 15(d)

Derivative Liabilities (Tables)

v3.19.2
Derivative Liabilities (Tables)
 12 Months Ended
May 31, 2019
Schedule of Derivative Liabilities at Fair Value
The following tables summarize the fair value of the warrant derivative liability and related common shares as of inception date September 15, 2016, May 31, 2018 and May 31, 2019:    
 
    Shares Indexed     Derivative Liability  
Inception to date September 15, 2016
     7,333,334     $  5,179,200  
Balance May 31, 2018
     7,733,334       1,323,732  
Balance May 31, 2019
     7,733,334     $ 402,132  
Assumptions used in Estimating Fair Value of Warrant Derivative Liability
The Company estimated the fair value of the warrant derivative liability as of inception, May 31, 2018 and May 31, 2019, using the following assumptions:
 
    September 15,     May 31,     May 31,  
    2016     2018     2019  
Fair value of underlying stock
   $  0.78     $  0.49     $  0.39  
Risk free rate
     1.20 %      2.63 %      1.94 % 
Expected term (years)
     5       3.3       2.29  
Stock price volatility
     106 %      64 %      61 % 
Expected dividend yield
     —         —         —    
Probability of Fundamental Transaction
     50 %      50 %      50 % 
Probability of holder requesting cash payment
     50 %      50 %      50 % 
Registered Direct Equity Offering [Member] | Investor Warrants Issued With Registered Direct Equity Offering [Member]  
Assumptions used in Estimating Fair Value of Warrant Derivative Liability
    November 15,
2018		     January 30,
2019		     May 31, 2019  
    June Note     January Note  
Fair value of underlying stock
   $ 0.57     $ 0.49     $ 0.39     $ 0.39  
Risk free rate
     2.78 %      2.52 %      2.21 %      1.95 % 
Expected term (in years)
     1.61       2       1.07       1.67  
Stock price volatility
     58.8 %      61 %      62.2 %      62.2 % 
Expected dividend yield
     —         —         —         —    
Discount factor
     85 %      85 %      85 %      85 % 
Convertible Note Redemption Provision Derivative Liability [Member]  
Schedule of Derivative Liabilities at Fair Value
The following table summarizes the fair value of the convertible note redemption provision derivative liability as of inception dates November 15, 2018, January 30, 2019 and May 31, 2019:
 
          Derivative Liability  
    Net Proceeds     Inception Date     May 31, 2019  
Inception date June 2018 Note, November 15, 2018
   $ 5,000,000     $ 1,284,988     $ 847,103  
Inception date January 2019 Note, January 30, 2019
     5,000,000       1,465,008       1,158,034  
                   
 
 
  
                    $ 2,005,137