NOTE 8 - COMMON STOCK

3 Months Ended

May 31, 2016

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

NOTE 8 – COMMON STOCK

a)           Common stock issued for cash

During the quarter ended May 31, 2016, the Company received $15,000 of common stock subscribed in common stock payable for 50,000 shares.  During the quarter ended May 31, 2016, the Company issued 83,333 shares of common stock for cash proceeds of $25,000.

During the year ended February 29, 2016, the Company issued 150,000 shares of common stock for cash proceeds of $45,000.

The Company issued promissory notes with stock granted as an incentive.  The stock was valued with relative fair value of common stock compared to fair market value of debt, common stock valued with closing price on date of agreement at $0.02. $960 recorded as a debt discount.  As the debt was due on demand, the discount was fully expensed in the first quarter ended May 31, 2015.   

During the quarter ended May 31, 2016, the Company issued 396,667 shares of common stock for cash proceeds of $119,000 which was received in prior years and was initially record in stock issued from stock payable as of February 29, 2016.

b)           Common stock for services

During the year ended February 29, 2008, the Company granted an officer and a director of the Company to the right to receive 2,500,000 common shares for past services provided. The fair value of each common share was $0.08 on the grant date. The shares, fully vested and non-forfeitable on the grant date, were issued in 2009. This balance is presented as Common Stock as of February 28, 2010. Further, in connection with a consulting services agreement, the Company also committed to issue 1,111,110 common shares with fair value of $88,889, being $0.08 per share based on the quoted market price of the Company’s common shares. This balance is presented as Common Stock Payable as of May 31, 2016 and February 29, 2016.

During the quarter ended May 31, 2016, the Company issued 225,000 common shares for consulting services and 26,000 common shares for interest expense. The fair value of each common share was $0.30 based on the closing trading price on the issue date and was recorded as consulting expense of $52,608.

During the year ended February 29, 2016, the Company issued 100,000 common shares for consulting services. The fair value of each common share was $0.30 based on the closing trading price on the issue date and was recorded as consulting expense of $30,000.

c)    Common stock rounding shares

On April 21, 2016, the Company completed a 10-for-one reverse split of its issued and outstanding shares of common stock.  Shares were rounded down 57 shares because of this split.

Options

Stock-based Compensation Plan

The Company has adopted a Stock Option Plan (‘the plan”) in which the Compensation Committee of the Board of Directors makes a determination to whom options should be granted and at what price and their terms of vesting.

The Company has elected to use the Black-Scholes option pricing model to determine the fair value of stock options granted. For employees, the compensation expense is amortized on a straight-line basis over the requisite service period which approximates the vesting period. Compensation expense for stock options granted to non-employees is amortized over the contract services period or, if none exists, from the date of grant until the options vest. Compensation associated with unvested options granted to non-employees is re-measured on each balance sheet date using the Black-Scholes option pricing model.

The expected volatility of options granted has been determined using the historical stock price. The Company uses historical data to estimate option exercise, forfeiture and employee termination within the valuation model. For non-employees, the expected term of the options approximates the full term of the options. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected term of the stock options. The Company has not paid and does not anticipate paying dividends on its common stock; therefore, the expected dividend yield is assumed to be zero. Based on the best estimate, management applied the estimated forfeiture rate of Nil in determining the expense recorded in the accompanying Statement of Loss.

The Company has granted directors common share purchase options. These options were granted with an exercise price equal to the market price of the Company’s stock on the date of the grant.

	May 31, 2016
	Options		Weighted Average Exercise Price
Outstanding and exercisable at beginning of the year		300,000		$	0.40
Issued during the year		-			-
Outstanding and exercisable, May 31, 2016		300,000		$	0.40

	February 29, 2016
	Options		Weighted Average Exercise Price
Outstanding and exercisable at beginning of the year		300,000		$	0.40
Issued during the year		-			-
Outstanding and exercisable, February 29, 2016		300,000		$	0.40

At May 31, 2016, the following director common share purchase options were outstanding entitling the holders thereof the right to purchase one common share for each share purchase option held:

		Exercise
Number		Price			Expiry Date
	300,000		$	0.30	December 31, 2016

Warrants

As of May 31, 2016 and February 29, 2016, the Company had no outstanding warrants.