AITX Artificial Intelligence Technology Solutions Inc (PK)

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	May 31, 2024 (unaudited)			February 29, 2024*
ASSETS
Current assets:
Cash	$	193,103		$	105,926
Accounts receivable, net		616,464			756,084
Device parts inventory, net		1,830,467			2,131,599
Prepaid expenses and deposits		454,158			622,957
Total current assets		3,094,192			3,616,566
Operating lease asset		1,105,225			1,139,188
Revenue earning devices, net of accumulated depreciation of $1,209,072 and $952,844, respectively		3,351,949			2,480,002
Fixed assets, net of accumulated depreciation of $391,199 and $349,878, respectively		278,931			268,075
Trademarks		29,676			27,080
Investment at cost		50,000			50,000
Security deposit		15,880			15,880
Total assets	$	7,925,853		$	7,596,791
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	2,011,624		$	2,032,707
Advances payable- related party		1,594			1,594
Customer deposits		62,233			73,702
Current operating lease liability		231,141			237,653
Current portion of deferred variable payment obligation		1,096,700			904,377
Loan payable - related party		275,013			257,438
Deferred compensation for CEO		538,767			538,767
Current portion of loans payable, net of discount of $65,629 and $688,598		17,554,356			13,190,882
Vehicle loan - current portion		38,522			38,522
Current portion of accrued interest payable		6,939,788			4,440,009
Total current liabilities		28,749,738			21,715,651
Non-current operating lease liability		864,447			889,360
Loans payable, net of discount of $538,143 and $4,118,332, respectively		14,961,218			14,798,532
Deferred variable payment obligation		2,525,000			2,525,000
Incentive compensation plan payable		2,500,000			2,500,000
Accrued interest payable		3,979,841			5,367,805
Total liabilities		53,580,244			47,796,348

Commitments and Contingencies		-			-

Redeemable Preferred Stock (Temporary Equity):
Series B Convertible, Redeemable Preferred Stock. $0.001 par value; 8% cumulative dividend payable quarterly, $1,200 stated value, 5,000 shares authorized, 215 and 0 shares issued and outstanding at May 31, 2024 and February 29, 2024, respectively		257,712			—

Stockholders’ deficit:
Preferred Stock, undesignated; 15,535,000 shares authorized; no shares issued and outstanding at May 31, 2024 and February 29, 2024, respectively		—			—
Series G Redeemable Preferred Stock. $0.001 par value; 100,000 shares authorized, no shares issued and outstanding at May 31, 2024 and February 29, 2024, respectively		—			—
Series E Preferred Stock, $0.001 par value; 4,350,000 shares authorized; 3,350,000 and 3,350,000 shares issued and outstanding, respectively		3,350			3,350
Series F Convertible Preferred Stock, $1.00 par value; 10,000 shares authorized; 2,533 and 2,533 shares issued and outstanding, respectively		2,533			2,533
Preferred stock, value		2,533			2,533
Common Stock, $0.00001 par value; 12,500,000,000 shares authorized 10,318,917,383 and 9,238,750,958 shares issued, issuable and outstanding, respectively		103,190			92,388
Additional paid-in capital		95,240,915			92,565,513
Preferred stock to be issued		99,086			99,086
Accumulated deficit		(141,361,177	)		(132,962,427	)
Total stockholders’ deficit		(45,912,103	)		(40,199,557	)
Total liabilities and stockholders’ deficit	$	7,925,853		$	7,596,791

*	Derived from audited information

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended May 31, 2024			Three Months Ended May 31, 2023

Revenues	$	1,182,800		$	385,208

Cost of Goods Sold		295,593			11,342

Gross Profit		887,207			373,866

Operating expenses:
Research and development (including related party charges of $631,584 (2023-$882,015))		640,710			891,757
General and administrative		2,720,191			2,200,602
Depreciation and amortization		297,549			167,942
Operating lease cost and rent		62,013			62,542
Total operating expenses		3,720,463			3,322,843

Loss from operations		(2,833,256	)		(2,948,977	)

Other income (expense), net:
Interest expense		(1,361,103	)		(1,606,216	)
Total other income (expense), net		(1,361,103	)		(1,606,216	)

Net income (loss)	$	(4,194,359	)	$	(4,555,193	)

Net income (loss) per share - basic	$	(0.00	)	$	(0.00	)

Net income (loss) per share - diluted	$	(0.00	)	$	(0.00	)

Weighted average common share outstanding - basic		9,882,118,105			5,964,709,322

Weighted average common share outstanding - diluted		9,882,118,105			5,964,709,322

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ DEFICIT

(Unaudited)

	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Deficit
	Temporary Equity				Shareholder’s Deficit
	Series B				Series E				Series F								Additional					Total
	Preferred Stock				Preferred Stock				Preferred Stock				Common Stock				Paid-In		Accumulated			Shareholders’
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital		Deficit			Deficit

Balance at February 28, 2023		—		—		3,350,000	$	3,350		2,533	$	101,619		5,848,741,599	$	58,489	$	80,247,252	$	(112,253,711	)	$	(31,843,001	)
Issuance of shares, net of $81,285 issuance costs		—		—		—		—		—		—		280,929,190		2,809		1,316,100		—			1,318,909
Relative fair value of Series F warrants issued with debt		—		—		—		—		—		—		—		—		947,447		—			947,447
Stock based compensation		—		—		—		—		—		—		—		—		52,721		—			52,721
Net income		—		—		—		—		—		—		—		—		—		(4,555,193	)		(4,555,193	)
Balance at May 31, 2023		—	$	—		3,350,000	$	3,350		2,533	$	101,619		6,129,670,789	$	61,298	$	82,563,520	$	(116,808,904	)	$	(34,079,117	)

	Temporary Equity						Shareholder’s Deficit
	Series B						Series E				Series F								Additional						Total
	Preferred Stock						Preferred Stock				Preferred Stock				Common Stock				Paid-In			Accumulated			Shareholders’
	Shares			Amount			Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			Deficit

Balance at February 29, 2024		—			—			3,350,000	$	3,350		2,533	$	101,619		9,238,750,958	$	92,388	$	92,565,513		$	(132,962,427	)	$	(40,199,557	)
Balance		—			—			3,350,000	$	3,350		2,533	$	101,619		9,238,750,958	$	92,388	$	92,565,513		$	(132,962,427	)	$	(40,199,557	)
Cumulative Effect Adjustment RFVdiscount per adoption of ASU 2020-06 at March 1, 2024		—			—			—		—		—		—		—		—		—			(4,175,535	)		(4,175,535	)
Issuance of shares, net of $116,046 issuance costs		—			—			—		—		—		—		1,080,166,425		10,802		2,671,791			—			2,682,593
Issuance of shares, net of issuance costs		—			—			—		—		—		—		1,080,166,425		10,802		2,671,791			—			2,682,593
Issuance of Series B Preferred Shares		300			360,000			—		—		—		—		—		—		(82,000	)		—			(82,000	)
Series B Preferred Shares issued as commitment fee		20			24,000			—		—		—		—		—		—		(24,000	)		—			(24,000	)
Series B Preferred shares issued as dividend		2			2,568			—		—		—		—		—		—		(2,568	)		—			(2,568	)
Redemption of Series B Preferred shares		(107	)		(128,856	)		—		—		—		—		—		—		28,856			(28,856	)		—
Stock based compensation		—			—			—		—		—		—		—		—		83,323			—			83,323
Net income		—			—			—		—		—		—		—		—		—			(4,194,359	)		(4,194,359	)
Balance at May 31, 2024		215		$	257,712			3,350,000	$	3,350		2,533	$	101,619		10,318,917,383	$	103,190	$	95,240,915		$	(141,361,177	)	$	(45,912,103	)
Balance		215		$	257,712			3,350,000	$	3,350		2,533	$	101,619		10,318,917,383	$	103,190	$	95,240,915		$	(141,361,177	)	$	(45,912,103	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Three Months Ended May 31, 2024			Three Months Ended May 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	(4,194,359	)	$	(4,555,193	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		297,549			167,942
Bad debts expense		13,000			16,000
Inventory provision		210,000			—
Reduction of right of use asset		31,425			28,767
Accretion of lease liability		31,065			33,775
Stock based compensation		83,323			115,721
Amortization of debt discounts		27,625			557,219
Increase in related party accrued payroll and interest		17,575			36,740
Changes in operating assets and liabilities:
Accounts receivable		126,620			(142,799	)
Prepaid expenses and deposits on inventory		167,562			74,809
Device parts inventory		(1,070,087	)		(324,652	)
Accounts payable and accrued expenses		(21,083	)		(7,354	)
Customer deposits		(11,469	)		26,560
Operating lease liability payments		(58,715	)		(62,542	)
Current portion of deferred variable payment obligations for payments		192,323			62,634
Accrued interest payable		1,111,815			981,370
Net cash used in operating activities		(3,045,831	)		(2,991,003	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets		(19,132	)		(3,463	)
Acquisition of trademarks		(2,596	)		—
Net cash (used in) investing activities		(21,728	)		(3,463	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Share proceeds net of issuance costs		2,682,592			1,318,909
Proceeds on issuance of Series B shares		278,000			—
Redemption of Series B shares		(128,856	)		—
Proceeds from loans payable		350,000			1,050,000
Repayment of loans payable		(27,000	)		(27,000	)
Net cash provided by (used in) financing activities		3,154,736			2,341,909

Net change in cash		87,177			(652,557	)

Cash, beginning of period		105,926			939,759

Cash, end of period	$	193,103		$	287,202

Supplemental disclosure of cash and non-cash transactions:
Cash paid for interest	$	25,015		$	1,375
Cash paid for income taxes	$	—		$	—

Noncash investing and financing activities:
Transfer from device parts inventory to fixed assets	$	1,161,219		$	473,122
Cumulative Effect Adjustment RFV discount per adoption of ASU 2020-06 at March 1, 2024	$	4,175,535		$	—
Series B preferred shares issued as dividend	$	2,568		$	—
Discount applied to face value of loans	$	—		$	150,000
Series F warrants issued as part of debt issuance	$	—		$	947,447

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. GENERAL INFORMATION

Artificial Intelligence Technology Solutions Inc. (“AITX” or the “Company”) was incorporated in Florida on March 25, 2010 and reincorporated in Nevada on February 17, 2015. On August 24, 2018, Artificial Intelligence Technology Solutions Inc., changed its name from On the Move Systems Corp (“OMVS”).

Robotic Assistance Devices, LLC (“RAD”), was incorporated in the State of Nevada on July 26, 2016 as a Limited Liability Company. On July 25, 2017, Robotic Assistance Devices LLC converted to a C Corporation, Robotic Assistance Devices, Inc., through the issuance of 10,000 common shares to its sole shareholder.

On August 28, 2017, AITX completed the acquisition of RAD (the “Acquisition”), whereby AITX acquired all the ownership and equity interest in RAD for 3,350,000 shares of AITX Series E Preferred Stock and 2,450 shares of Series F Convertible Preferred Stock. AITX’s prior business focus was transportation services, and was exploring the on-demand logistics market by developing a network of logistics partnerships. As a result of the closing of the Acquisition, AITX has succeeded to the business of RAD, and AITX’s business going forward will consist of one segment activity, which is the delivery of artificial intelligence and robotic solutions for operational, security and monitoring needs.

The Acquisition was treated as a reverse recapitalization effected by a share exchange for financial accounting and reporting purposes since substantially all of AITX’s operations were disposed of as part of the consummation of the transaction. Therefore, no goodwill or other intangible assets were recorded by AITX as a result of the Acquisition. RAD is treated as the accounting acquirer as its stockholders control the Company after the Acquisition, even though AITX was the legal acquirer. As a result, the assets and liabilities and the historical operations that are reflected in these financial statements are those of RAD as if RAD had always been the reporting company.

2. GOING CONCERN

The accompanying unaudited consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

For the three months ended May 31, 2024, the Company had negative cash flow from operating activities of $3,045,831. As of May 31, 2024, the Company has an accumulated deficit of $141,361,177, and negative working capital of $25,655,546. Management does not anticipate having positive cash flow from operations in the near future. These factors raise a substantial doubt about the Company’s ability to continue as a going concern for the twelve months following the issuance of these financial statements.

The Company does not have the resources at this time to repay all its credit and debt obligations, make any payments in the form of dividends to its shareholders or fully implement its business plan. Without additional capital, the Company will not be able to remain in business. At the same time management points to its successful history with maintaining Company operations and reminds all with reasonable confidence this will continue. Management has plans to address the Company’s financial situation as follows:

Management is committed to raise either non-dilutive funds or minimally dilutive funds. There is no assurance that these funds will be able to be raised nor can we provide assurance that these possible raises may not have dilutive effects. In March 2023, the Company entered into an equity financing agreement whereby an investor will purchase up to $30,000,000 of the Company’s common stock at a discount over a two-year period. There remains approximately $16 million left to issue under this arrangement. Management believes that it has the necessary support to continue operations by continuing its funding methods in the following ways: growing revenues, through equity proceeds, and issuing non-convertible debt. Management has had many recent conversations with the Company’s primary debt holder and believes that the non-convertible debt on the balance sheet will be extended. Management notes that non-convertible debt on the books has been extended by this debt holder twice in the past and notes that this debt holder has been a strong supporter of the Company.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

3. ACCOUNTING POLICIES

Basis of Presentation and Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and in conformity with the condensing instructions on Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto in the Company’s latest Annual Report filed with the SEC on Form 10-K/A as filed on May 29, 2024. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Robotic Assistance Devices, Inc., Robotic Assistance Devices Group , Inc, Robotic Assistance Devices Mobile, Inc., and Robotic Assistance Devices Residential, Inc.. All significant intercompany accounts and transactions have been eliminated in consolidation. The unaudited consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, which are, in the opinion of management, necessary for a fair presentation of such statements. The results of operations for the three months ended May 31, 2024, are not necessarily indicative of the results that may be expected for the entire year.

Use of Estimates

In order to prepare financial statements in conformity with accounting principles generally accepted in the United States, management must make estimates, judgements and assumptions that affect the amounts reported in the financial statements and determine whether contingent assets and liabilities, if any, are disclosed in the financial statements. The ultimate resolution of issues requiring these estimates and assumptions could differ significantly from resolution currently anticipated by management and on which the financial statements are based. The most significant estimates included in these consolidated financial statements are those associated with the assumptions used to value preferred stock.

Reclassifications

Certain amounts in the Company’s consolidated financial statements for prior periods have been reclassified to conform to the current period presentation. These reclassifications have not changed the results of operations of prior periods.

Concentrations

Loans payable

At May 31, 2024 there were $33,119,346 of loans payable, $28,890,506 or 87% of these loans to companies controlled by one individual. At February 29, 2024 there were $32,796,345 of loans payable, $28,540,506 or 87% of these loans to companies controlled by the same individual.

Cash

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and money market instruments. The Company places its cash and cash equivalents with high-quality, U.S. financial institutions and, to date has not experienced losses on any of its balances.

Accounts Receivable

Accounts receivable are comprised of balances due from customers, net of estimated allowances for uncollectible accounts. In determining collectability, historical trends are evaluated, and specific customer issues are reviewed on a periodic basis to arrive at appropriate allowances. There was an allowance of $81,000 and $68,000 provided as of May 31, 2024 and February 29, 2024, respectively. For the three months ended May 31, 2024, two customers account for 57% of total accounts receivable . For the three months ended May 31, 2023, two customers account for 51% of total accounts receivable.

Device Parts Inventory

Device parts inventory is stated at the lower of cost or net realizable value using the weighted average cost method. The Company records a valuation reserve for obsolete and slow-moving inventory, relying principally on specific identification of such inventory. The Company uses these device parts in the assembly of revenue earning devices (and demo devices) as well as research and development. Depending on use, the Company will transfer the parts to the corresponding asset or expense if used in research and development. A charge to income is taken when factors that would result in a need for an increase in the valuation, such as excess or obsolete inventory, are noted. As of May 31, 2024, and February 29, 2024, there was a valuation reserve of $1,169,000 and $959,000, respectively.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Revenue Earning Devices

Revenue earning devices are stated at cost. Depreciation is provided on a straight-line basis over the estimated useful life of 48 months. The Company continually evaluates revenue earning devices to determine whether events or changes in circumstances have occurred that may warrant revision of the estimated useful life or whether the devices should be evaluated for possible impairment. The Company uses a combination of the undiscounted cash flows and market approaches in assessing whether an asset has been impaired. The Company measures impairment losses based upon the amount by which the carrying amount of the asset exceeds the fair value.

Fixed Assets

Fixed assets are stated at cost. Depreciation is provided on the straight-line method based on the estimated useful lives of the respective assets which range from two to five years. Major repairs or improvements are capitalized. Minor replacements and maintenance and repairs which do not improve or extend asset lives are expensed currently.

Computer equipment and software		2 or 3 years
Office equipment		4 years
Manufacturing equipment		7 years
Warehouse equipment		5 years
Tooling		2 years
Demo Devices		4 years
Vehicles		3 years
Leasehold improvements		5 years, the life of the lease

The Company periodically evaluates the fair value of fixed assets whenever events or changes in circumstances indicate that its carrying amounts may not be recoverable. Upon retirement or other disposition of fixed assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss, if any, is recognized in income.

Research and Development

Research and development costs are expensed in the period they are incurred in accordance with ASC 730, Research and Development unless they meet specific criteria related to technical, market and financial feasibility, as determined by Management, including but not limited to the establishment of a clearly defined future market for the product, and the availability of adequate resources to complete the project. If all criteria are met, the costs are deferred and amortized over the expected useful life or written off if a product is abandoned. At May 31, 2024 and February 29, 2024, the Company had no deferred development costs.

Contingencies

Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that it is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions.

Sales of Future Revenues

The Company has entered into transactions, as more fully described in footnote 8, in which it has received funding from investors in exchange for which it will make payments to those investors based on the level of sales of certain revenue categories, generally based on a percentage of sales for those certain revenues. The Company determines whether these agreements constitute sales of future revenues or are in substance debt based on the facts and circumstances of each agreement, with the following primary criteria determinative of whether the agreement constitutes a sale of future revenues or debt:

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	●	Does the agreement purport, in substance, to be a sale
	●	Does the Company have continuing involvement in the generation of cash flows due the investor
	●	Is the transaction cancellable by either party through payment of a lump sum or other transfer of assets
	●	Is the investors rate of return is implicitly limited by the terms of the agreement
	●	Does the Company’s revenue for a reporting period underlying the agreement have only a minimal impact on the investor’s rate of return
	●	Does the investor have recourse relating to payments due

In the event a transaction is determined to be a sale of future revenues, it is recorded as deferred revenue and amortized using the sum-of-the-revenue method. In the event a transaction is determined to be debt, it is recorded as debt and amortized using the effective interest method. As of the date of these financial statements, the Company has determined that all such agreements are debt.

Revenue Recognition

ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”, supersedes the revenue recognition requirements and industry specific guidance under Revenue Recognition (Topic 605). Topic 606 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. Topic 606 defines a five-step process that must be evaluated and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than required under existing accounting principles generally accepted in the United States of America (“U.S. GAAP”) including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The Company adopted Topic 606 on March 1, 2018, using the modified retrospective method. Under the modified retrospective method, prior period financial positions and results will not be adjusted. There was no cumulative effect adjustment recognized as a result of this adoption. Refer to Note 4 – Revenue from Contracts with Customers for additional information. For the three months ended May 31, 2024, two customers accounted for 65% of total revenue and for the three months ended May 31, 2023, three customers accounted for 57% of total revenue.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized when items of income and expense are recognized in the financial statements in different periods than when recognized in the tax return. Deferred tax assets arise when expenses are recognized in the financial statements before the tax returns or when income items are recognized in the tax return prior to the financial statements. Deferred tax assets also arise when operating losses or tax credits are available to offset tax payments due in future years. Deferred tax liabilities arise when income items are recognized in the financial statements before the tax returns or when expenses are recognized in the tax return prior to the financial statements. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Act”) was signed into law. ASC 740, Accounting for Income Taxes requires companies to recognize the effects of changes in tax laws and rates on deferred tax assets and liabilities and the retroactive effects of changes in tax laws in the period in which the new legislation is enacted. The Company’s gross deferred tax assets were revalued based on the reduction in the federal statutory tax rate from 35% to 21%. A corresponding offset has been made to the valuation allowance, and any potential other taxes arising due to the Tax Act will result in reductions to the Company’s net operating loss carryforward and valuation allowance. The Company will continue to analyze the Tax Act to assess its full effects on the Company’s financial results, including disclosures, for the Company’s fiscal year ending February 28, 2025, but the Company does not expect the Tax Act to have a material impact on the Company’s consolidated financial statements.

Leases

Lease agreements are evaluated to determine if they are sales/finance leases meeting any of the following criteria at inception: (a) transfer of ownership of the underlying asset; (b) purchase option that is reasonably certain of being exercised; (c) the lease term is greater than a major part of the remaining estimated economic life of the underlying asset; or (d) if the present value of the sum of lease payments and any residual value guaranteed by the lessee that has not already been included in lease payments in accordance with ASC 842-10-30-5(f) equals or exceeds substantially all of the fair value of the underlying asset.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

If at its inception, a lease meets any of the four lease criteria above, the lease is classified by the Company as a sales/finance; and if none of the four criteria are met, the lease is classified by the Company as an operating lease.

Operating lease payments are recognized as an expense in the income statement on a straight-line basis over the lease term, whereby an equal amount of rent expense is attributed to each period during the term of the lease, regardless of when actual payments are made. This generally results in rent expense in excess of cash payments during the early years of a lease and rent expense less than cash payments in the later years. The difference between rent expense recognized and actual rental payments is recorded as deferred rent and included in liabilities.

Distinguishing Liabilities from Equity

The Company relies on the guidance provided by ASC Topic 480, Distinguishing Liabilities from Equity, to classify certain redeemable and/or convertible instruments. The Company first determines whether a financial instrument should be classified as a liability. The Company will determine the liability classification if the financial instrument is mandatorily redeemable, or if the financial instrument, other than outstanding shares, embodies a conditional obligation that the Company must or may settle by issuing a variable number of its equity shares.

Once the Company determines that a financial instrument should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability section and the equity section of the balance sheet (“temporary equity”). The Company will determine temporary equity classification if the redemption of the financial instrument is outside the control of the Company (i.e. at the option of the holder). Otherwise, the Company accounts for the financial instrument as permanent equity.

Our Chief Executive Officer/ Chairman holds sufficient shares of the Company’s voting preferred stock that give sufficient voting rights under the articles of incorporation and bylaws of the Company such that the CEO/ Chairman can at any time unilaterally vote to increase the number of authorized shares of common stock of the Company, without the need to call a general meeting of common shareholders of the Company.

Initial Measurement

The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received.

Subsequent Measurement – Financial Instruments Classified as Liabilities

The Company records the fair value of its financial instruments classified as liabilities at each subsequent measurement date. The changes in fair value of its financial instruments classified as liabilities are recorded as other income (expenses).

Fair Value of Financial Instruments

ASC Topic 820, Fair Value Measurements and Disclosures (“ASC Topic 820”) provides a framework for measuring fair value in accordance with generally accepted accounting principles.

ASC Topic 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs).

- 11 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC Topic 820 are described as follows:

	●	Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date.

	●	Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

	●	Level 3 – Inputs that are unobservable for the asset or liability.

Measured on a Recurring Basis

The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell:

	Amount at		Fair Value Measurement Using
	Fair Value		Level 1		Level 2		Level 3
May 31, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

February 29, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, prepaid expenses and advances, accounts payable and accrued expenses, approximate their fair values because of the short maturity of these instruments.

Earnings (Loss) per Share

Basic earnings (loss) per share (“EPS”) is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS give effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used to determine the number of shares assumed to be purchased from the exercise of stock options and/or warrants. Diluted EPS excluded all dilutive potential shares if their effect is anti-dilutive.

Basic loss per common share is computed based on the weighted average number of shares outstanding during the period. Diluted loss per share is computed in a manner similar to the basic loss per share, except the weighted-average number of shares outstanding is increased to include all common shares, including those with the potential to be issued by virtue of convertible debt and other such convertible instruments. Diluted loss per share contemplates a complete conversion to common shares of all convertible instruments only if they are dilutive in nature with regards to earnings per share.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Recently Issued Accounting Pronouncements

Recently Issued Accounting Standards Adopted

In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. Under ASU 2020-06, the embedded conversion features are no longer separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, or that do not result in substantial premiums accounted for as paid-in capital. Consequently, a convertible debt instrument will be accounted for as a single liability measured at its amortized cost, as long as no other features require bifurcation and recognition as derivatives. The new guidance also requires the if-converted method to be applied for all convertible instruments. The amendments in ASU 2020-06 are effective for public entities, excluding smaller reporting companies as defined, for fiscal years beginning after December 15, 2021. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. A reporting entity is not permitted to adopt the guidance in an interim period, other than the first interim period of its fiscal year. The Company adopted the standard using a modified retrospective approach. The adjustment to the Company’s accumulated deficit at March 1, 2024 was $4,175,535 with a corresponding adjustment to loans payable.

4. REVENUE FROM CONTRACTS WITH CUSTOMERS

Revenue is earned primarily from two sources: 1) direct sales of goods or services and 2) short-term rentals. Direct sales of goods or services are accounted for under Topic 606, and short-term rentals are accounted for under Topic 842 (which addresses lease accounting and was adopted on March 1, 2019).

As disclosed in the revenue recognition section of Note 3 – Accounting Polices, the Company adopted Topic 606 in accordance with the effective date on March 1, 2018. Note 3 includes disclosures regarding the Company’s method of adoption and the impact on the Company’s financial statements. Revenue is recognized on direct sales of goods or services when it transfers promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services.

After adopting Topic 842, also referred to above in Note 3, the Company is accounting for revenue earned from rental activities where an identified asset is transferred to the customer and the customer has the ability to control that asset. The Company recognizes revenue from its device rental activities when persuasive evidence of a contract exists, the performance obligations have been satisfied, the transaction price is fixed or determinable and collection is reasonably assured. Performance obligations associated with device rental transactions are satisfied over the rental period. Rental periods are short-term in nature. Therefore, the Company has elected to apply the practical expedient which eliminates the requirement to disclose information about remaining performance obligations. Payments are due from customers at the completion of the rental, except for customers with negotiated payment terms, generally net 30 days or less, which are invoiced and remain as accounts receivable until collected.

The following table presents revenues from contracts with customers disaggregated by product/service:

	Three Months Ended May 31, 2024		Three Months Ended May 31, 2023
Device rental activities	$	980,536	$	238,149
Direct sales of goods and services		202,264		147,059
Revenue	$	1,182,800	$	385,208

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

5. LEASES

We lease certain warehouses, and office space. Leases with an initial term of 12 months or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. For lease agreements entered into or reassessed after the adoption of Topic 842, we did not combine lease and non-lease components.

There is no lease renewal. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Below is a summary of our lease assets and liabilities at May 31, 2024 and February 29, 2024.

Leases	Classification	May 31, 2024		February 29, 2024
Assets
Operating	Operating Lease Assets	$	1,105,225	$	1,139,188
Liabilities
Current
Operating	Current Operating Lease Liability	$	231,141	$	237,653
Noncurrent
Operating	Noncurrent Operating Lease Liabilities		864,447		889,360
Total lease liabilities		$	1,095,588	$	1,127,013

Note: As most of our leases do not provide an implicit rate, we use our incremental borrowing rate of 10% which for the leases noted above was based on the information available at commencement date in determining the present value of lease payments. We compare against loans we obtain to acquire physical assets and not loans we obtain for financing. The loans we obtain for financing are generally at significantly higher rates and we believe that physical space or vehicle rental agreements are in line with physical asset financing agreements. CAM charges were not included in operating lease expense and were expensed in general and administrative expenses as incurred.

Operating lease cost and rent was $62,013 and $62,542 for the three months ended May 31, 2024 and May 31, 2023, respectively.

6. REVENUE EARNING DEVICES

Revenue earning devices consisted of the following:

	May 31, 2024			February 29, 2024
Revenue earning devices	$	4,561,021		$	3,432,846
Less: Accumulated depreciation		(1,209,072	)		(952,844	)
Total	$	3,351,949		$	2,480,002

During the three months ended May 31, 2024, the Company made total additions to revenue earning devices of $1,128,175 which were transfers from inventory. During the three months ended May 31, 2023, the Company made total additions to revenue earning devices of $444,412 which were transfers from inventory.

Depreciation expense was $256,228 and $122,841 for the three months ended May 31, 2024, and 2023 respectively.

- 14 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

7. FIXED ASSETS

Fixed assets consisted of the following:

	May 31, 2024			February 29, 2024
Automobile	$	74,237		$	74,237
Demo devices		227,395			194,352
Tooling		107,020			107,020
Machinery and equipment		8,825			8,825
Computer equipment		157,448			150,387
Office equipment		15,312			15,312
Furniture and fixtures		21,225			21,225
Warehouse equipment		31,712			19,639
Leasehold improvements		26,956			26,956
Fixed assets gross		670,130			617,953
Less: Accumulated depreciation		(391,199	)		(349,878	)
	$	278,931		$	268,075

During the three months ended May 31, 2024, the Company made additions of $52,177 of which $33,045 were transfers from inventory with remaining additions of $19,132. During the three months ended May 31, 2023, the Company made additions of $32,173 of which $28,710 were transfers from inventory with remaining additions of $3,463.

Depreciation expense was $41,321 and $45,101 for the three months ended May 31, 2024, and 2023 respectively.

8. DEFERRED VARIABLE PAYMENT OBLIGATION

On February 1, 2019 the Company entered into an agreement with an investor whereby the investor would pay up to $900,000 in exchange for a perpetual 9% rate payment (Payments) on the Company’s reported quarterly revenue from operations excluding any gains or losses from financial instruments (Revenues). At February 29, 2020 the investor has advanced the full $900,000.

On May 9, 2019 the Company entered into two similar arrangements with two investors:

	(1)	The investor would pay up to $400,000 in exchange for a perpetual 4% rate Payment on the Company’s reported quarterly Revenues. At February 29, 2020, $400,000 has been paid to the Company.

	(2)	The investor would pay up to $50,000 in exchange for a perpetual 1.11% rate Payment on the Company’s reported quarterly Revenues. At February 29, 2020, $50,000 has been paid to the Company.

These variable payments (Payments) are to be made 30 days after the end of each fiscal quarter. If the Payments would deplete RAD’s available cash by more than 30%, the Payments may be deferred for up to 12 months after the quarterly report at an interest rate of 6% per annum on the unpaid amount.

In the event that at least 10% of the assets of the Company are sold by the Company, the investors would be entitled to the fair market value (FMV) of all future Payments associated with the assets sold as determined by an independent valuator to be chosen by the investors. The FMV cannot exceed 30% of the total asset disposition price defined as the total price paid for the assets plus all future Payments associated with the assets sold. In the event that the common or preferred shares are sold by the Company to a third party as to effect a change in control, then the investors must be paid the FMV of all future Payments in one lump payment. The FMV cannot exceed 30% of the share disposition price defined as the total price the third party paid for the shares plus the total value of all future Payments.

- 15 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

On November 18, 2019, the Company entered into another similar arrangement with the (February 1, 2019) investor above whereby the investor would advance up to $225,000 in exchange for a perpetual 2.25% rate Payment on the Company’s quarterly Revenues (commencing on quarter ending May 31, 2020). At February 29, 2020, the investor has advanced $109,000 and the investor advanced the $116,000 remainder as of May 2020.

On December 30, 2019, the Company entered into another similar arrangement with a new investor whereby the investor would advance up to $100,000 in exchange for a perpetual 1.00% rate Payment on the Company’s quarterly Revenues (commencing quarter ended November 30, 2020). At February 29, 2020, the investor has advanced $50,000 with the remainder to be advanced no later than June 30, 2020. If the total investor advances turns out to be less than $100,000, this would not constitute a breach of the agreement, rather the 1.00% rate would be adjusted on a pro-rata basis.

On April 22, 2020, the Company entered into another similar arrangement with the (first May 9, 2019) investor above whereby the investor would advance up to $100,000 in exchange for a perpetual 1.00% rate Payment on the Company’s quarterly Revenues. At May 31, 2020, the investor has fully funded this commitment.

On July 1, 2020, the Company entered into a similar agreement with the first investor whereby the investor would pay up to $800,000 in exchange for a perpetual 2.75% rate payment (Payment) on the Company’s reported quarterly revenue. These Payments are to be made 90 days after the fiscal quarter with the first payment being due no later than May 31, 2021. If the Payments would deplete RAD’s available cash by more than 20%, the payment may be deferred. The investor had agreed to pay $100,000 per month over an 8 month period with the first payment due July 2020 and the final payment no later than February 28, 2021. As at August 31, 2020 the investor had fully funded the $800,000 commitment.

On August 27, 2020, the Company and the first investor referred to above consolidated the three separate agreements of February 1, 2019 for $900,000, November 18, 2019 for $225,000 and July 1, 2020 for $800,000 into a new agreement for a total of $1,925,000. This new agreement is for similar terms as the above agreements save for the following: the rate payment is revised to 14.25% payable on revenues commencing the quarter ended August 31, 2020. Upon an event of default that we are unable to cure in the time allotted under the agreements, these Payments may be secured with a priority lien by UCC filing against all of our assets, but is subordinated to equipment financing or leasing agreements on the products the Company leases to its customers.

In summary of all agreements mentioned above if in the event that at least 10% of the assets of the Company are sold by the Company, the investors would be entitled to the fair market value (FMV) of all future Payments associated with the assets sold as determined by an independent valuator to be chosen by the investors. The FMV cannot exceed 43.77% of the total asset disposition price defined as the total price paid for the assets plus all future Payments associated with the assets sold. In the event that the common or preferred shares are sold by the Company to a third party as to effect a change in control, then the investors must be paid the FMV of all future Payments in one lump payment. The FMV cannot exceed 43.77% of the share disposition price defined as the total price the third party paid for the shares plus the total value of all future Payments. As of March 1, 2021 as a result of the amendment with the first investor noted below. This aggregate asset disposition % was reduced from 43.77 % to 33.77%.

The Payments first become payable on June 30, 2019 (unless otherwise indicated) based on the quarterly Revenues for the quarter ended May 31, 2019 and accrue every quarter thereafter. As of May 31, 2024, the Company has accrued $1,096,700 in Payments of which $604,811 are in arrears. As of February 29, 2024, the Company has accrued approximately $904,377 in Payments, of which $542,176 is in arrears. No notices have been sent to the Company.

On March 1, 2021, the first investor referred to above whose aggregate investment is $1,925,000 revised his agreements as follows:

	1)	The rate payment was reduced from 14.25 % to 9.65 %
	2)	The asset disposition % (see below) was reduced from 31 % to 21%

In consideration for the above changes, the investor received 40 Series F Convertible Preferred Stock and a warrant to purchase 367 shares of its Series F Convertible Preferred Stock with a five-year term and an exercise price of $1.00. During the three months ended May 31, 2021, the warrant holder exercised warrants to acquire 38 shares of Series F Convertible Preferred Stock. The Company attributed a fair value based on recent transactions for the Series F Preferred stock and warrants of $33,015,214 and recorded a loss on settlement of debt with a corresponding adjustment to paid in capital.

- 16 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

The Company retains total involvement in the generation of cash flows from these revenue streams that form the basis of the payments to be made to the investors under this agreement. Because of this, the Company has determined that the agreements constitute debt agreements. As of May 31, 2024, and February 29, 2024, the long-term balances other than Payments already owed is the cash received of $2,525,000 and $2,525,000, respectively.

For both the three months ended May 31, 2024, and year ended February 29, 2024, the Company has received $0 related to the deferred payment obligation since there were no new agreements during this period. The balance remains $2,525,000 at both May 31, 2024 and February 29, 2024.

9. RELATED PARTY TRANSACTIONS

For both the three months ended May 31, 2024 and May 31, 2023 , the Company had no repayments of net advances from its loan payable-related party. At May 31, 2024, the loan payable-related party was $275,013 and $257,438 at February 29, 2024. Included in the balance due to the related party at May 31, 2024 is $198,481 of deferred salary and interest, $152,513 of which bears interest at 12%. As of February 29, 2024, included in the balance due to the related party is $140,013 of deferred salary all of which bears interest at 12%. The accrued interest included in loan at May 31, 2024 and February 29, 2024 was $36,974 and $32,468, respectively.

Pursuant to the amended Employment Agreement with its Chief Executive Officer, for the three months ended May 31, 2024 the Company accrued $0 (three months ended May 31 2023-$63,000) of incentive compensation plan payable with a corresponding recognition of stock based compensation due to the expectation of additional awards being met. This will be payable in Series G Preferred Shares which are redeemable at the Company’s option at $1,000 per share. At May 31, 2024 and February 29, 2024 there was $2,500,000 and $2,500,000 of incentive compensation payable.

During the three months ended May 31, 2024 and 2023, the Company was charged $631,584 and $882,015, respectively for fees for research and development from a company partially owned by a principal shareholder.

10. OTHER DEBT – VEHICLE LOAN

In December 2016, RAD entered into a vehicle loan for $47,704 secured by the vehicle. The loan is repayable over 5 years maturing November 9, 2021, and repayable $1,019 per month including interest and principal. In November 2017, RAD entered into another vehicle loan secured by the vehicle for $47,661. The loan is repayable over 5 years, maturing October 24, 2022 and repayable at $923 per month including interest and principal. The principal repayments made were $0 for both the year ended February 28, 2022 and February 28, 2021. Regarding the second vehicle loan, the vehicle was returned at the end of fiscal 2019 and the car was subsequently sold by the lender for proceeds of $21,907 which went to reduce the outstanding balance of the loan. A loss of $3,257 was recorded as well. A balance of $21,578 remains on this vehicle loan at both February 28, 2021 and February 29, 2020. For the first vehicle loan, the vehicle was retired in 2020, the proceeds of the disposal of $18,766 was applied against the balance of the loan with a $5,515 gain on the remaining asset value of $13,251. A balance of $16,944 remains on this vehicle loan at both February 28, 2022 and February 28, 2021. The remaining total balances of the amounts owed on the vehicle loans were $38,522 and $38,522 as of May 31, 2024 and February 29, 2024, respectively, of which all were classified as current.

- 17 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

11. LOANS PAYABLE

Loans payable at May 31, 2024 consisted of the following:

SCHEDULE OF LOANS PAYABLE

									Annual
Date	Maturity		Description			Principal			Interest Rate
July 18, 2016		July 18, 2017	Promissory note	(1	)*	$	3,500			22	%
December 10, 2020		March 1, 2025	Promissory note	(2	)		3,921,168			12	%
December 10, 2020		March 1, 2025	Promissory note	(3	)		2,754,338			12	%
December 10, 2020		December 10, 2024	Promissory note	(4	)		165,605			12	%
December 14, 2020		December 14, 2023	Promissory note	(5	)*		310,375			12	%
December 30, 2020		March 1, 2025	Promissory note	(6	)		350,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(7	)		25,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(8	)		145,000			12	%
January 14, 2021		March 1, 2025	Promissory note	(9	)		550,000			12	%
February 22, 2021		March 1, 2025	Promissory note	(10	)		1,650,000			12	%
March 1, 2021		March 1, 2025	Promissory note	(11	)		6,000,000			12	%
June 8, 2021		June 8, 2025	Promissory note	(12	)		2,750,000			12	%
July 12, 2021		July 26, 2026	Promissory note	(13	)		3,749,360			7	%
September 14, 2021		September 14, 2025	Promissory note	(14	)		1,650,000			12	%
July 28, 2022		March 1, 2025	Promissory note	(15	)		170,000			15	%
August 30, 2022		August 30,2025	Promissory note	(16	)		3,000,000			15	%
September 7, 2022		March 1, 2025	Promissory note	(17	)		400,000			15	%
September 8, 2022		March 1, 2025	Promissory note	(18	)		475,000			15	%
October 13, 2022		March 1, 2025	Promissory note	(19	)		350,000			15	%
October 28, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 9, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 10, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 15, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
January 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
February 6, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 5. 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 20, 23		October 31, 2026	Promissory note	(20	)		400,000			15	%
May 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
October 27, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 30, 2023		April 30, 2025	Purchase Agreement	(21	)		350,000			35	%
March 8, 2024		August 8, 2025	Purchase Agreement	(22	)		350,000			35	%
						$	33,119,346

Less: current portion of loans payable							(17,619,985	)
Less: discount on non-current loans payable							(538,143	)
Non-current loans payable, net of discount						$	14,961,218

Current portion of loans payable						$	17,619,985
Less: discount on current portion of loans payable							(65,629	)
Current portion of loans payable, net of discount						$	17,554,356

*	In default

On March 1, 2024 the Company adjusted the relative fair value unamortized discount on the above notes by $4,175,535 with a corresponding adjustment to accumulated deficit to apply ASU 2020-06.

(1)	This note was transferred from convertible notes payable because in August 2022 it was no longer convertible due to restrictions placed on the lender.

- 18 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(2)	This promissory note was issued as part of a debt settlement whereby $2,683,357 in convertible notes and associated accrued interest of $1,237,811 totaling $3,921,168 was exchanged for this promissory note of $3,921,168, and a warrant to purchase 450,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a relative fair value of $990,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(3)	This promissory note was issued as part of a debt settlement whereby $1,460,794 in convertible notes and associated accrued interest of $1,593,544 totaling $3,054,338 was exchanged for this promissory note of $3,054,338, and a warrant to purchase 250,000,000 shares at an exercise price of $0.002 per share and a three-year maturity having a relative fair value of $550,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. $300,000 has been repaid during the year ended February 29, 2024. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(4)	This promissory note was issued as part of a debt settlement whereby $103,180 in convertible notes and associated accrued interest of $62,425 totaling $165,605 was exchanged for this promissory note of $165,605, and a warrant to purchase 80,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $176,000.The maturity date was extended from December 10, 2023 to December 10, 2024 on February 29, 2024 and a fee of $22,958 was paid and charged to interest expense.

(5)	This promissory note was issued as part of a debt settlement whereby $235,000 in convertible notes and associated accrued interest of $75,375 totaling $310,375 was exchanged for this promissory note of $310,375, and a warrant to purchase 25,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $182,500.

(6)	The note, with an original principal amount of $350,000, may be pre-payable at any time. The note balance includes an original issue discount of $35,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $271,250. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $271,250 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. On March 1, 2024, the unamortized relative fair value discount of $65,092 was removed with a corresponding adjustment to accumulated deficit. A $8,399 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,515, with an unamortized discount of $6,884 at May 31, 2024.

(7)	This promissory note was issued as part of a debt settlement whereby $9,200 in convertible notes and associated accrued interest of $6,944 totaling $16,144 was exchanged for this promissory note of $25,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(8)	This promissory note was issued as part of a debt settlement whereby $79,500 in convertible notes and associated accrued interest of $28,925 totaling $108,425 was exchanged for this promissory note of $145,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(9)	The note, with an original principal amount of $550,000, may be pre-payable at any time. The note balance includes an original issue discount of $250,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $380,174. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $380,174 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $80,284 was removed with a corresponding adjustment to accumulated deficit. A $10,559 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from January 14, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,936, with an unamortized discount of $8,623 at May 31, 2024.

- 19 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(10)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 100,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $1,342,857. The discount and warrant are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,342,857 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. The maturity date was extended from February 22, 2022 to February 22, 2024 on February 28, 2022 in exchange for warrants to purchase 50,000,000 at an exercise price of $.0164 and a 3-year term. These warrants have a fair value of $950,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $497,614 was removed with a corresponding adjustment to accumulated deficit. A $55,585 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from February 22, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $9,484, with an unamortized discount of $46,101 at May 31, 2024.

(11)	The unsecured note may be pre-payable at any time. Cash proceeds of $5,400,000 were received. The note balance of $6,000,000 includes an original issue discount of $600,000 and was issued with a warrant to purchase 300,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $4,749,005 using Black-Scholes with assumptions described in note 13. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $4,749,005 with a corresponding adjustment to paid in capital for the relative value of the warrant.. The maturity was extended from March 1, 2022 to March 1, 2024 on February 28, 2022 in exchange for warrants to purchase 150,000,000 shares of common stock at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $2,850,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. This note has been fully amortized. This note was again extended to March 1, 2025.

(12)	The note, with an original principal balance of $2,750,000, may be pre-payable at any time. The note balance includes an original issue discount of $50,000 and was issued with a warrant to purchase 170,000,000 shares at an exercise price of $0.064 per share with a 3-year term and having a relative fair value of $2,035,033. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $2,035,033 with a corresponding adjustment to paid in capital. The maturity date was extended from June 8, 2022 to June 8, 2024 on February 28, 2022 in exchange for warrants to purchase 85,000,000 at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $1,615,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $33,547 was removed with a corresponding adjustment to accumulated deficit. A $4,121 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $100, with an unamortized discount of $4,021 at May 31, 2024. This note was extended to June 8, 2025.

(13)	This loan, with an original principal balance of $4,000,160, was in exchange for 184 Series F preferred shares from a former director. The interest and principal are payable at maturity. The loan is unsecured. For the three and nine months ended November 30, 2023 there were repayments of $27,000 and $81,000 , respectively on the note.

(14)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 250,000,000 shares at an exercise price of $0.037 per share with a 3-year term and having a relative fair value of $1,284,783, The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,284,783 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $572,549 was removed with a corresponding adjustment to accumulated deficit. A $66,846 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $5,627, with an unamortized discount of $61,219 at May 31, 2024. This note was extended to September 14, 2025.

(15)	Original $170,000 note may be pre-payable at any time. The note balance includes an original issue discount of $20,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from July 28, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

- 20 -

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(16)	A warrant holder exchanged 955,000,000 warrants for a promissory note of $3,000,000, bearing interest at 15% with a two year maturity. The fair value of the warrants was determined to be $2,960,500 with a corresponding adjustment to paid-in capital and a debt discount of $39,500 which will be amortized over the term of the loan. Principal and interest due at maturity. On March 1, 2024, the unamortized relative fair value discount of $11,535 was removed with a corresponding adjustment to accumulated deficit. This note has been fully amortized. This note was extended to August 30, 2025.

(17)	Original $400,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 7, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(18)	Original $475,000 note may be pre-payable at any time. The note balance includes an original issue discount of $75,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 8, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(19)	Original $350,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of the Company’s s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from October 13, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(20)	On October 28, 2022 the Company entered into an loan facility with a lender for up to $4,000,000 including an original issue discount of $500,000. In exchange the Company will issue one series F Preferred Share, extended 329 series F warrants with a March 1, 2026 maturity to a new October 31, 2033 maturity, and issue up to 10 tranches with each tranche of $400,000, with cash proceeds of $350,000 an original issue discount of $50,000, October 31, 2026 maturity, and 61 Series F warrants with a October 31, 2033 maturity. Secured by a general security charging all of the Company’s present and after-acquired property. At February 29, 2024 the Company has issued all 10 tranches totaling $ 4,000,000 as follows:

	October 28, 2022, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants and 1 Series F Preferred Share having a relative fair value of $299,399. On March 1, 2024, the unamortized relative fair value discount of $286,775 was removed with a corresponding adjustment to accumulated deficit. A $47,892 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $610, with an unamortized discount of $47,282 at May 31, 2024.

November 9, 2022, $400,000 loan, original issue discount of $50,000 , 61 Series F Preferred Share warrants having a relative fair value of $299,750. On March 1, 2024, the unamortized relative fair value discount of $288,513 was removed with a corresponding adjustment to accumulated deficit. A $48,126 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $803, with an unamortized discount of $47,323 at May 31, 2024.

November 10, 2022, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $302,020. On March 1, 2024, the unamortized relative fair value discount of $291,694 was removed with a corresponding adjustment to accumulated deficit. A $48,290 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $791, with an unamortized discount of $47,499 at May 31, 2024.

November 15, 2022, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $299,959. On March 1, 2024, the unamortized relative fair value discount of $287,814 was removed with a corresponding adjustment to accumulated deficit. A $47,976 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $814, with an unamortized discount of $47,162 at May 31, 2024.

January 11, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $299,959. On March 1, 2024, the unamortized relative fair value discount of $286,813 was removed with a corresponding adjustment to accumulated deficit. A $48,124 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $830, with an unamortized discount of $47,294 at May 31, 2024.

February 6, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $299,959. On March 1, 2024, the unamortized relative fair value discount of $288,342 was removed with a corresponding adjustment to accumulated deficit. A $48,294 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $806, with an unamortized discount of $47,488 at May 31, 2024.

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(20)	April 5, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $296,245. On March 1, 2024, the unamortized relative fair value discount of $286,821 was removed with a corresponding adjustment to accumulated deficit. A $48,409 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $830, with an unamortized discount of $47,579 at May 31, 2024. April 20, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $302,219. On March 1, 2024, the unamortized relative fair value discount of $294,824 was removed with a corresponding adjustment to accumulated deficit. A $48,777 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $702, with an unamortized discount of $48,075 at May 31, 2024. May 11, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $348,983. On March 1, 2024, the unamortized relative fair value discount of $348,831 was removed with a corresponding adjustment to accumulated deficit. A $49,978 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $81, with an unamortized discount of $49,897 at May 31, 2024. October 27 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $261,759. On March 1, 2024, the unamortized relative fair value discount of $254,487 was removed with a corresponding adjustment to accumulated deficit. A $48,611 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,287, with an unamortized discount of $47,324 at May 31, 2024.

(21)	On November 30, 2023 , the Company entered into an agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on April 30,2024 through to April 30, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after-acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment. The Company has missed the April and May 2024 payments and is in discussions with lender to remedy this. No notices have been sent.

(22)	On March 8, 2024 , the Company entered into another agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on August 8, 2024 through to August 80, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after- acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

12. STOCKHOLDERS’ EQUITY (DEFICIT)

Summary or Preferred Stock Activity

Series B Convertible, Redeemable Preferred Stock (Temporary Equity)

On April 27, 2024, in connection with a Share Purchase Agreement the Company created a new class Of Series B Convertible Redeemable Preferred Shares with 5,000 authorized shares. The Company received gross proceeds of $300,000 with net proceeds of $278,000 less $10,000 in legal fees and 12,000 in broker fees both charged against paid in capital. In addition, as a commitment fee the Company issued an additional 20 Series B Convertible Redeemable Preferred Shares, with a fair value of $24,000 charged to paid in capital. The shares have a redemption value of $1,200 per share. The Company must redeem one third of these shares in 30, days and each 30 days thereafter until all the shares are redeemed at 90 days. The Company must also pay an 8% dividend from issue date to redemption date. On May 30, the Company issued a dividend of 2.14 shares Series B Convertible Redeemable Preferred Shares having a value of $ 2,568 and redeemed 107.38 Series B shares for $128,856 including a deemed dividend of $28,856 which represents the redemption value over the purchase cost of the shares.

At May 31, 2024 there remains 215 Series B Convertible Redeemable Preferred Shares having a value of $ $257,712 in Temporary Equity.

Summary of Preferred Stock Warrant Activity

	Number of Series F Preferred Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		939	$	1.00		9.50
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		939	$	1.00		9.40

Summary of Common Stock Activity

For the three months ended May 31, 2024, the Company issued 1,080,166,425 common shares with gross proceeds of 2,789,639 and net proceeds of $2,682,593 after issuance costs of $116,046.

Summary of Common Stock Warrant Activity

For the three months ended May 31, 2024 and May 31, 2023, the Company recorded a total of $47,462 and $0 respectively, to stock-based compensation for options and warrants with a corresponding adjustment to additional paid-in capital.

	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		300,595,661	$	0.003		1.00
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		300,595,661	$	0.003		0.75

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Summary of Common Stock Option Activity -Employee Stock Options

SUMMARY OF COMMON STOCK OPTION ACTIVITY

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		188,667,035		$	0.02		4.10
Issued		—			—		—
Exercised		—			—		—
Forfeited, extinguished and cancelled		(3,011,029	)	$	0.02		(4.60	)
Outstanding at May 31, 2024		185,656,006		$	0.02		4.00

13. COMMITMENTS AND CONTINGENCIES

Litigation

Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions.

The related legal costs are expensed as incurred.

Operating Lease

On March 10, 2021, the Company entered into a 10 year lease agreement for q manufacturing facility at 10800 Galaxie Avenue, Ferndale, Michigan, 48220, commencing on May 1, 2021 through to April 30, 2031 with a minimum base rent of $15,880 per month. The base rent increase by 3% per annum commencing May 1, 2024. The Company paid a security deposit of $15,880.

On September 30, 2021, the Company entered into a 3-year lease agreement for a vehicle commencing September 30, 2021 through to September 30, 2024 with a minimum base rent of $1,538 per month. The Company paid a down payment of $18,462.

On January 28, 2022, the Company entered into a 2-year lease agreement for office space at 1516 E Edinger, Santa Ana, California, 92705, commencing on February 1, 2022 through to January 31, 2024 with a minimum base rent of $1,500 per month. The Company paid a security deposit of $1,500. This lease expired on January 31, 2024 and was not renewed.

On February 5, 2024, the Company entered into a 3-year lease agreement for a vehicle commencing February 5, 2024 through to February 5, 2027 with a minimum base rent of $1,223 per month. The Company paid a down payment of $9,357.

The Company’s leases are accounted for as operating leases. Rent expense and operating lease cost are recorded over the lease terms on a straight-line basis. Rent expense and operating lease cost was $62,013 and $62,542 for the three months ended May 31, 2024 and May 31, 2023, respectively.

Maturity of Lease Liabilities	Operating Leases
May 31, 2025	$	231,141
2025	$	231,141
May 31, 2026		225,348
2026		225,348
May 31, 2027		219,418
2027		219,418
May 31, 2028		207,557
2028		207,557
May 31, 2029		207,558
2029		207,558
May 31, 2030 and after		397,820
2030 and after		397,820
Total lease payments		1,488,842
Less: Interest		(393,254	)
Present value of lease liabilities	$	1,095,588

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ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

14. EARNINGS (LOSS) PER SHARE

The net income (loss) per common share amounts were determined as follows:

	May 31, 2024			May 31, 2023
	For the Three Months Ended
	May 31, 2024			May 31, 2023
Numerator:
Net income (loss) available to common shareholders	$	(4,194,359	)	$	(4,555,193	)

Effect of common stock equivalents
Add: interest expense on convertible debt		—			—
Net income (loss) adjusted for common stock equivalents		(4,194,359	)		(4,555,193	)

Denominator:
Weighted average shares – basic		9,882,118,105			5,964,709,322

Net income (loss) per share – basic	$	(0.00	)	$	(0.00	)

Denominator:
Weighted average shares – diluted		9,882,118,105			5,964,709,322

Net income (loss) per share – diluted	$	(0.00	)	$	(0.00	)

The anti-dilutive shares of common stock equivalents for the three months ended May 31, 2024 and 2023 were as follows:

	May 31, 2024		May 31, 2023^*
	For the Three Months Ended
	May 31, 2024		May 31, 2023*
Convertible Series F Preferred Shares		35,600,264,971		—
Convertible Redeemable Series B Preferred Shares		59,933,023		—
Stock options and warrants		486,251,667		396,917,451
Total		36,146,449,661		396,917,451

On August 23, 2021, the Company filed amended Series F preferred shares such that Series F preferred shares are not convertible into common stock by a holder until (A) August 23, 2023 or (B) the date on which such a conversion may be required for the purpose of (i) uplisting the Company to a new stock exchange, or (ii) selling more than 50% of the Company’s assets. Had these Series F preferred shares been convertible at November 30, 2023 and 2022 the dilutive effects would be as follows:

	May 31, 2024		May 31, 2023
	For the Three Months Ended
	May 31, 2024		May 31, 2023
Convertible Series F Preferred Shares		—		21,147,364,222
Anti-dilutive shares of common stock		—		21,147,364,222

15. SUBSEQUENT EVENTS

During June and July 2024, the Company issued 838,844,221 common shares pursuant to a share purchase agreement for gross proceeds of $3,261,225, issuance costs of $130,449 and net proceeds of $3,127,701.

In June 2024, the Company issued an 8% dividend Series B Convertible Redeemable Preferred Shares of 1.39 shares having a value $1,668 and redeemed 108.08 shares for $129,670 which includes a dividend of $29,670.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

The following discussion of our financial condition and results of operations for the three months ended May 31, 2024 and May 31, 2023 should be read in conjunction with our unaudited consolidated financial statements and the notes to those statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under Item 1A. Risk Factors appearing in our Annual Report on Form 10-K/A for the year ended February 29, 2024, as filed on May 29, 2024 with the SEC. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements.

Unless expressly indicated or the context requires otherwise, the terms “AITX”, the “Company”, “we”, “us”, and “our” refer to Artificial Intelligence Technology Solutions Inc.

Overview

AITX was incorporated in Florida on March 25, 2010. AITX reincorporated into Nevada on February 17, 2015. AITX’s fiscal year end is February 28 (February 29 during leap year). AITX is located at 10800 Galaxie Ave., Ferndale Michigan, 48220, and our telephone number is 877-767-6268.

AITX’s mission is to apply Artificial Intelligence (AI) technology to solve enterprise problems categorized as expensive, repetitive, difficult to staff, and outside of the core competencies of the client organization.

A short list of basic examples include:

	1.	Typical security guard-related functions such as monitoring a parking lot during and after hours and responding appropriately. This scenario applies to perimeters, interior yard areas, and related similar environments.

	2.	Integrated hardware/software with AI-driven responses, simulating and expanding on what legacy or manned solutions could perform.

	3.	Automation of common access control functions through technology utilizing facial recognition and machine vision, leapfrogging most legacy solutions in use today.

RAD solutions are unique because they:

	1.	Start with an AI-driven autonomous response utilizing cellular-optimized communications, while easily connecting to a human operator for a manned response, as needed.

	2.	Use unique hardware purpose-built by RAD for delivery of these solutions. Various form factors have been customized to deliver this new functionality.

	3.	Deliver services through RAD-developed software and cloud services, allowing enterprise IT groups to focus on core competencies instead of maintenance of complex video and security platforms.

We encourage everyone to ensure they have the most up to date news by visiting AITX at AITX News - AITX - Artificial Intelligence Technology Solutions.

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Management Discussion and Analysis

Results of Operations for the Three Months Ended May 31, 2024 and 2023

The following table shows our results of operations for the three months ended May 31, 2024 and 2023. The historical results presented below are not necessarily indicative of the results that may be expected for any future period.

	Period
	Three Months Ended			Three Months Ended			Change
	May 31, 2024			May 31, 2023			Dollars			Percentage
Revenues	$	1,182,800		$	385,208		$	797,592			207	%
Gross profit		887,207			373,866			513,341			137	%
Operating expenses		3,720,463			3,322,843			397,620			12	%
Loss from operations		(2,833,256	)		(2,948,977	)		115,721			4	%
Other income (expense), net		(1,361,103	)		(1,606,216	)		(245,113	)		15	%
Net loss	$	(4,194,359	)	$	(4,555,193	)	$	(360,834	)		(8	%)

Revenue

The following table presents revenues from contracts with customers disaggregated by product/service:

	Three Months Ended		Three Months Ended		Change
	May 31, 2024		May 31, 2023		Dollars		Percentage
Device rental activities	$	980,536	$	238,149	$	742,387		312	%
Direct sales of goods and services		202,264		147,059		55,205		38	%
	$	1,182,800	$	385,208	$	797,592		207	%

Total revenue for the three-month period ended May 31, 2024 was $1,182,800 which represented an increase of $797,592 compared to total revenue of $385,208 for the three months ended May 31, 2023. Rental activities increased by $742,387 or 312%, as the Company continues to grow its product line and customer base. Direct sales grew by 38% driven by higher training revenue for the three months ended May 31, 2024.

Gross profit

Total gross profit for the three-month period ended May 31, 2024 was $887,207 which represented an increase of $513,341 compared to gross profit of $373,866 for the three months ended May 31, 2023. The increase is consistent with the increase in revenues as well as changes in product mix. And inventory adjustments. The gross profit % of 75% for the three-month period ended May 31, 2024 compares with the gross profit % of 97% for the three month period ended May 31, 2023. The prior period gross margin % is higher due to inventory adjustments.

Operating Expenses

	Period				Change
	Three Months Ended May 31, 2024		Three Months Ended May 31, 2023		Dollars			Percentage

Research and development	$	640,710	$	891,757	$	(251,047	)		(28	)%
General and administrative		2,720,191		2,200,602		519,589			24	%
Depreciation and amortization		297,549		167,942		129,607			77	%
Operating lease cost and rent		62,013		62,542		(529	)		(1	)%
Operating expenses	$	3,720,463	$	3,322,843	$	397,620			12	%

- 27 -

Our operating expenses were comprised of general and administrative expenses, research and development, and depreciation. General and administrative expenses consisted primarily of professional services, automobile expenses, advertising, salaries and wages, travel expenses and consultants. Our operating expenses during the three-month period ended May 31, 2024 and May 31, 2023, were $3,720,463 and $3,322,463, respectively. The overall increase of $397,620 was primarily attributable to the following changes in operating expenses of:

	●	General and administrative expenses increased by $519,589. In comparing the three months ended May 31, 2024 and May 31, 2023 this increase was primarily due to the following increases: wages and salaries by $129,516, freight and duties by $125,886, installation $30,754, RMC costs by $72,603, commissions by $63,883, travel by $12,646, professional fees by $70,954, subcontractors by $47,924, insurance by $13,585 and other G& A increases.

	●	Research and development decreased by $251,047 due to a reduction in funding on development of future products.

	●	Depreciation and amortization increased by $129,607 due to large increases in revenue earning devices, demo devices, as well as some fixed assets.

	●	Operating lease cost and rent decreased by $529.

Other Income (Expense)

Other income (expense) during the three months ended May 31, 2024 and May 31, 2023, was ($1,361,103) and ($1,606,216), respectively. The $245,113 decrease in other expense was primarily attributable to the amortization of debt discount decreasing because of the elimination of the unamortized relative fair value discount in the current quarter as a result of our implementation of ASU 2020-06.

Net loss

We had a net loss of $4,194,359 for the three months ended May 31, 2024, compared to a net loss of $4,555,193 for the three months ended May 31, 2023. The decrease in net loss of $360,834 is due to a number of factors: higher gross profit is reduced by higher general and administrative and depreciation in the three months ended May 31, 2024.

- 28 -

Liquidity, Capital Resources and Cash Flows

Management believes that we will continue to incur losses for the immediate future. Therefore, we will need additional equity or debt financing until we can achieve profitability and positive cash flows from operating activities, if ever. These conditions raise substantial doubt about our ability to continue as a going concern. Our unaudited condensed consolidated financial statements do not include and adjustments relating to the recovery of assets or the classification of liabilities that may be necessary should we be unable to continue as a going concern.

As of May 31, 2024, we had a cash balance of $193,103, accounts receivable(net) of $616,464, device parts inventory(net) of $1,830,467 and $28,749,738 in current liabilities. At the current cash consumption rate, we will need to consider additional funding sources going forward. We are taking proactive measures to reduce operating expenses and drive growth in revenue.

The successful outcome of future activities cannot be determined at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended business plan or generate positive operating results.

Capital Resources

The following table summarizes total current assets, liabilities and working capital (deficit) for the periods indicated:

	May 31, 2024			February 29, 2024
Current assets	$	3,094,192		$	3,616,566
Current liabilities		28,749,738			21,715,651
Working capital	$	(25,655,546	)	$	(18,099,085	)

As of May 31, 2024 and February 29, 2024, we had a cash balance of $193,103 and $105,926, respectively.

Summary of Cash Flows

	Three Months Ended May 31, 2024			Three Months Ended May 31, 2023
Net cash used in operating activities	$	(3,045,831	)	$	(2,991,003	)
Net cash used in investing activities	$	(21,728	)	$	(3,463	)
Net cash (used in) provided by financing activities	$	3,154,736		$	2,341,909

Net cash used in operating activities.

Net cash used in operating activities for the three months ended May 31, 2024 was $3,045,831 which included a net loss of $4,194,359, non-cash activity such as inventory provision $210,000 ,bad debts expense of $13,000, reduction of right of use asset of $31,425, accretion of lease liability $31,065, stock based compensation of $83,323, change in operating assets and liabilities of $436,966, amortization of debt discount of $27,625, increase in related party accrued payroll and interest of $17,575 and depreciation and amortization of $297,549 to derive the uses of cash in operations.

Net cash used in investing activities.

Net cash used in investing activities for the three months ended May 31, 2024 was $21,728 which was the purchase of fixed assets of $19,132 and an acquisition of trademark of $2,596.

Net cash provided by financing activities.

Net cash provided by financing activities for the three months ended May 31, 2024 was $3,154,736. This consisted of share proceeds net of issuance costs of 2,682,592, proceeds from loans payable of $350,000, reduced by repayments on loans payable of $27,000. We also had proceeds on issuance of Series B Convertible Redeemable Preferred Shares of $278,000 reduced by a redemption on those shares of $128,856.

Off-Balance Sheet Arrangements

None.

- 29 -

Critical Accounting Policies and Estimates

Critical accounting policies and estimates are further discussed in our Annual Report on Form 10-K for the year ended February 28, 2023, as filed on June 14, 2023.

Related Party Transactions

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable for a smaller reporting company.

ITEM 4. CONTROLS AND PROCEDURES

Management’s Report on Internal Control over Financial Reporting

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of May 31, 2024. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of May 31, 2024, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed by us under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

	1.	As of May 31, 2024, we did not maintain effective controls over our control environment. Specifically, we have not developed and effectively communicated to our employees our accounting policies and procedures. This has resulted in inconsistent practices. Further, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

	2.	As of May 31, 2024, we did not maintain effective controls over financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required were originally addressed in our financial statements. Accordingly, management has determined that this control deficiency constitutes a material weakness.

Our management, including our principal executive officer and principal financial officer, do not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

- 30 -

PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

This item is not applicable to smaller reporting companies.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Each issuance of securities was issued without registration in reliance of the exemption from registration Section 3(a)9 of the Securities Act of 1933.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

The Company has not defaulted upon senior securities.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable to the Company.

ITEM 5. OTHER INFORMATION

None.

- 31 -

ITEM 6. EXHIBITS

Exhibit No.		Description of Document

3.1		Articles of Incorporation (1)

3.2		Bylaws (2)

14		Code of Ethics (2)

21		Subsidiaries of the Registrant (3)

31.1		Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer. (3)

31.2		Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial and accounting officer. (3)

32.1		Section 1350 Certification of principal executive officer. (3)

32.2		Section 1350 Certification of principal financial accounting officer. (3)

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. (3)
101.SCH		Inline XBRL Taxonomy Extension Schema Document (3)
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document (3)
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document (3)
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document (3)
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document (3)
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) (3)

(1)	Incorporated by reference to our Form 10-KT file with the Securities and Exchange Commission on March 12, 2018.

(2)	Incorporated by reference to our Form S-1 filed with the Securities and Exchange Commission on August 4, 2010.

(3)	Filed or furnished herewith.

- 32 -

Device parts inventory, net

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Artificial Intelligence Technology Solutions Inc.

Date: July 15, 2024	BY:	/s/ Steven Reinharz
		Steven Reinharz
		President, Chief Executive Officer (principal executive officer)


Date: July 15, 2024	BY:	/s/ Anthony Brenz
		Anthony Brenz
		Chief Financial Officer (principal financial officer)

- 33 -

Exhibit 21.1

Artificial Intelligence Technology Solutions Inc.

Subsidiaries

Name		Jurisdiction of Incorporation
Robotic Assistance Devices, Inc.		Nevada
Robotic Assistance Devices Group, Inc.		Nevada
Robotic Assistance Devices Mobile, Inc.		Nevada
Robotic Assistance Devices Residential, Inc.		Nevada

Exhibit 31.1

RULE 13A-14(A)/15D-14(A) CERTIFICATION

I, Steven Reinharz, certify that:

1. I have reviewed this Form 10-Q for the period ended May 31, 2024 of Artificial Intelligence Technology Solutions Inc.

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15-d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 15, 2024	BY:	/s/ Steven Reinharz
		Steven Reinharz
		President, Chief Executive Officer (principal executive officer)

Exhibit 31.2

RULE 13A-14(A)/15D-14(A) CERTIFICATION

I, Anthony Brenz, certify that:

1. I have reviewed this Form 10-Q for the period ended May 31, 2024 of Artificial Intelligence Technology Solutions Inc.

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 15, 2024	BY:	/s/ Anthony Brenz
		Anthony Brenz
		Chief Financial Officer (principal financial officer)

Exhibit 32.1

SECTION 1350 CERTIFICATION

In connection with the quarterly report of Artificial Intelligence Technology Solutions Inc. (the “Company”) on Form 10-Q for the period ended May 31, 2024 as filed with the Securities and Exchange Commission (the “Report”), I, Steven Reinharz, President of the Company, certify, pursuant to 18 U.S.C. SS. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: July 15, 2024	BY:	/s/ Steven Reinharz
		Steven Reinharz
		President, Chief Executive Officer (principal executive officer)

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Exhibit 32.2

SECTION 1350 CERTIFICATION

In connection with the quarterly report of Artificial Intelligence Technology Solutions Inc. (the “Company”) on Form 10-Q for the period ended May 31, 2024 as filed with the Securities and Exchange Commission (the “Report”), I, Anthony Brenz, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. SS. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: July 15, 2024	BY:	/s/ Anthony Brenz
		Anthony Brenz
		Chief Financial Officer (principal financial officer)

Cover - shares	3 Months Ended
Cover - shares	May 31, 2024	Jul. 12, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	May 31, 2024
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2025
Current Fiscal Year End Date	--02-28
Entity File Number	000-55079
Entity Registrant Name	ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.
Entity Central Index Key	0001498148
Entity Tax Identification Number	27-2343603
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	10800 Galaxie Avenue
Entity Address, City or Town	Ferndale
Entity Address, State or Province	MI
Entity Address, Postal Zip Code	48220
City Area Code	(877)
Local Phone Number	787-6268
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		11,157,761,604

Condensed Consolidated Balance Sheets - USD ($)

May 31, 2024

Feb. 29, 2024

^[1]

Current assets:

Cash

$ 193,103

$ 105,926

Accounts receivable, net

616,464

756,084

1,830,467

2,131,599

Prepaid expenses and deposits

454,158

622,957

Total current assets

3,094,192

3,616,566

Operating lease asset

1,105,225

1,139,188

Revenue earning devices, net of accumulated depreciation of $1,209,072 and $952,844, respectively

3,351,949

2,480,002

Fixed assets, net of accumulated depreciation of $391,199 and $349,878, respectively

278,931

268,075

Trademarks

29,676

27,080

Investment at cost

50,000

Security deposit

15,880

Total assets

7,925,853

7,596,791

Current liabilities:

Accounts payable and accrued expenses

2,011,624

2,032,707

Advances payable- related party

1,594

Customer deposits

62,233

73,702

Current operating lease liability

231,141

237,653

Current portion of deferred variable payment obligation

1,096,700

904,377

Loan payable - related party

275,013

257,438

Deferred compensation for CEO

538,767

Current portion of loans payable, net of discount of $65,629 and $688,598

17,554,356

13,190,882

Vehicle loan - current portion

38,522

Current portion of accrued interest payable

6,939,788

4,440,009

Total current liabilities

28,749,738

21,715,651

Non-current operating lease liability

864,447

889,360

Loans payable, net of discount of $538,143 and $4,118,332, respectively

14,961,218

14,798,532

Deferred variable payment obligation

2,525,000

Incentive compensation plan payable

2,500,000

Accrued interest payable

3,979,841

5,367,805

Total liabilities

53,580,244

47,796,348

Commitments and Contingencies

Redeemable Preferred Stock (Temporary Equity):

Series B Convertible, Redeemable Preferred Stock. $0.001 par value; 8% cumulative dividend payable quarterly, $1,200 stated value, 5,000 shares authorized, 215 and 0 shares issued and outstanding at May 31, 2024 and February 29, 2024, respectively

257,712

Common Stock, $0.00001 par value; 12,500,000,000 shares authorized 10,318,917,383 and 9,238,750,958 shares issued, issuable and outstanding, respectively

103,190

92,388

Additional paid-in capital

95,240,915

92,565,513

Preferred stock to be issued

99,086

Accumulated deficit

(141,361,177)

(132,962,427)

Total stockholders’ deficit

(45,912,103)

(40,199,557)

Total liabilities and stockholders’ deficit

7,925,853

7,596,791

Series G Preferred Stock [Member]

Series E Preferred Stock [Member]

Series F Preferred Stock [Member]

3,350

Balance, shares at Feb. 28, 2023

$ 2,533

[1]	Derived from audited information

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	May 31, 2024	Feb. 29, 2024
Accumulated depreciation, revenue earning devices	$ 1,209,072	$ 952,844
Accumulated depreciation, fixed assets	391,199	349,878
Discount of current portion of loans payable	65,629	688,598
Discount of loans payable	$ 538,143	$ 4,118,332
Series B convertible redeemable preferred stock - stated value	8.00%	8.00%
Cumulative dividend payable	$ 1,200	$ 1,200
Preferred stock, shares authorized	15,535,000	15,535,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.00001	$ 0.00001
Common stock, shares authorized	12,500,000,000	12,500,000,000
Common stock, shares issued	10,318,917,383	9,238,750,958
Common stock, shares outstanding	10,318,917,383	9,238,750,958
Redeemable Preferred Stock [Member]
Temporary equity, par value	$ 0.001	$ 0.001
Temporary equity, shares authorized	5,000	5,000
Temporary equity, shares issued	215	0
Temporary equity, shares outstanding	215	0
Series G Preferred Stock [Member]
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Preferred stock, par value	$ 0.001	$ 0.001
Series E Preferred Stock [Member]
Preferred stock, shares authorized	4,350,000	4,350,000
Preferred stock, shares issued	3,350,000	3,350,000
Preferred stock, shares outstanding	3,350,000	3,350,000
Preferred stock, par value	$ 0.001	$ 0.001
Series F Preferred Stock [Member]
Preferred stock, shares authorized	10,000	10,000
Preferred stock, shares issued	2,533	2,533
Preferred stock, shares outstanding	2,533	2,533
Preferred stock, par value	$ 1.00	$ 1.00

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
Income Statement [Abstract]
Revenues	$ 1,182,800	$ 385,208
Cost of Goods Sold	295,593	11,342
Gross Profit	887,207	373,866
Operating expenses:
Research and development (including related party charges of $631,584 (2023-$882,015))	640,710	891,757
General and administrative	2,720,191	2,200,602
Depreciation and amortization	297,549	167,942
Operating lease cost and rent	62,013	62,542
Total operating expenses	3,720,463	3,322,843
Loss from operations	(2,833,256)	(2,948,977)
Other income (expense), net:
Interest expense	(1,361,103)	(1,606,216)
Total other income (expense), net	(1,361,103)	(1,606,216)
Net income (loss)	$ (4,194,359)	$ (4,555,193)
Net income (loss) per share - basic	$ (0.00)	$ (0.00)
Net income (loss) per share - diluted	$ (0.00)	$ (0.00)
Weighted average common share outstanding - basic	9,882,118,105	5,964,709,322
Weighted average common share outstanding - diluted	9,882,118,105	5,964,709,322

Condensed Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
Income Statement [Abstract]
Related party charges	$ 631,584	$ 882,015

Condensed Consolidated Statement of Shareholders' Deficit (Unaudited) - USD ($)

Temporary Equity [Member]

Series B Preferred Stock [Member]

Preferred Stock [Member]

Series E Preferred Stock [Member]

Preferred Stock [Member]

Series F Preferred Stock [Member]

Common Stock [Member]

Additional Paid-in Capital [Member]

Retained Earnings [Member]

Total

Balance at Feb. 28, 2023

$ 3,350

$ 101,619

$ 58,489

$ 80,247,252

$ (112,253,711)

$ (31,843,001)

3,350,000

2,533

5,848,741,599

Issuance of shares, net of issuance costs

$ 2,809

1,316,100

1,318,909

Issuance of shares, net of issuance costs, shares

280,929,190

Relative fair value of Series F warrants issued with debt

947,447

Stock based compensation

52,721

Net income

(4,555,193)

Balance at May. 31, 2023

$ 3,350

$ 101,619

$ 61,298

82,563,520

(116,808,904)

(34,079,117)

Balance, shares at May. 31, 2023

3,350,000

2,533

6,129,670,789

Balance at Feb. 29, 2024

$ 3,350

$ 101,619

$ 92,388

92,565,513

(132,962,427)

(40,199,557)

^[1]

Balance, shares at Feb. 29, 2024

3,350,000

2,533

9,238,750,958

Issuance of shares, net of issuance costs

$ 10,802

2,671,791

2,682,593

Issuance of shares, net of issuance costs, shares

1,080,166,425

Stock based compensation

83,323

Net income

(4,194,359)

Cumulative Effect Adjustment RFVdiscount per adoption of ASU 2020-06 at March 1, 2024

(4,175,535)

Issuance of Series B Preferred Shares

$ 360,000

(82,000)

Issuance of Series B Preferred Shares,shares

300

Series B Preferred Shares issued as commitment fee

$ 24,000

(24,000)

Series B Preferred Shares issued as commitment fee, shares

Series B Preferred shares issued as dividend

$ 2,568

(2,568)

Series B Preferred shares issued as dividend,shares

Redemption of Series B Preferred shares

$ (128,856)

28,856

(28,856)

Redemption of Series B Preferred shares,shares

(107)

Balance at May. 31, 2024

$ 257,712

$ 3,350

$ 101,619

$ 103,190

$ 95,240,915

$ (141,361,177)

$ (45,912,103)

Balance, shares at May. 31, 2024

215

3,350,000

2,533

10,318,917,383

[1]	Derived from audited information

Condensed Consolidated Statement of Shareholders' Deficit (Unaudited) (Parenthetical) - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
Statement of Stockholders' Equity [Abstract]
Issuance cost of shares	$ 116,046	$ 81,285

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ (4,194,359)	$ (4,555,193)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	297,549	167,942
Bad debts expense	13,000	16,000
Inventory provision	210,000
Reduction of right of use asset	31,425	28,767
Accretion of lease liability	31,065	33,775
Stock based compensation	83,323	115,721
Amortization of debt discounts	27,625	557,219
Increase in related party accrued payroll and interest	17,575	36,740
Changes in operating assets and liabilities:
Accounts receivable	126,620	(142,799)
Prepaid expenses and deposits on inventory	167,562	74,809
Device parts inventory	(1,070,087)	(324,652)
Accounts payable and accrued expenses	(21,083)	(7,354)
Customer deposits	(11,469)	26,560
Operating lease liability payments	(58,715)	(62,542)
Current portion of deferred variable payment obligations for payments	192,323	62,634
Accrued interest payable	1,111,815	981,370
Net cash used in operating activities	(3,045,831)	(2,991,003)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets	(19,132)	(3,463)
Acquisition of trademarks	(2,596)
Net cash (used in) investing activities	(21,728)	(3,463)
CASH FLOWS FROM FINANCING ACTIVITIES:
Share proceeds net of issuance costs	2,682,592	1,318,909
Proceeds on issuance of Series B shares	278,000
Redemption of Series B shares	(128,856)
Proceeds from loans payable	350,000	1,050,000
Repayment of loans payable	(27,000)	(27,000)
Net cash provided by (used in) financing activities	3,154,736	2,341,909
Net change in cash	87,177	(652,557)
Cash, beginning of period	105,926	939,759
Cash, end of period	193,103	287,202
Supplemental disclosure of cash and non-cash transactions:
Cash paid for interest	25,015	1,375
Cash paid for income taxes
Noncash investing and financing activities:
Transfer from device parts inventory to fixed assets	1,161,219	473,122
Cumulative Effect Adjustment RFV discount per adoption of ASU 2020-06 at March 1, 2024	4,175,535
Series B preferred shares issued as dividend	2,568
Discount applied to face value of loans		150,000
Series F warrants issued as part of debt issuance		$ 947,447

GENERAL INFORMATION

3 Months Ended

May 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

GENERAL INFORMATION

1. GENERAL INFORMATION

GOING CONCERN

3 Months Ended

May 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

GOING CONCERN

2. GOING CONCERN

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

ACCOUNTING POLICIES

3 Months Ended

May 31, 2024

Accounting Policies [Abstract]

ACCOUNTING POLICIES

3. ACCOUNTING POLICIES

Basis of Presentation and Consolidation

Use of Estimates

Reclassifications

Concentrations

Loans payable

Cash

Accounts Receivable

Device Parts Inventory

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Revenue Earning Devices

Fixed Assets

Computer equipment and software		2 or 3 years
Office equipment		4 years
Manufacturing equipment		7 years
Warehouse equipment		5 years
Tooling		2 years
Demo Devices		4 years
Vehicles		3 years
Leasehold improvements		5 years, the life of the lease

Research and Development

Contingencies

Sales of Future Revenues

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	●	Does the agreement purport, in substance, to be a sale
	●	Does the Company have continuing involvement in the generation of cash flows due the investor
	●	Is the transaction cancellable by either party through payment of a lump sum or other transfer of assets
	●	Is the investors rate of return is implicitly limited by the terms of the agreement
	●	Does the Company’s revenue for a reporting period underlying the agreement have only a minimal impact on the investor’s rate of return
	●	Does the investor have recourse relating to payments due

Revenue Recognition

Income Taxes

Leases

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Distinguishing Liabilities from Equity

Initial Measurement

The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received.

Subsequent Measurement – Financial Instruments Classified as Liabilities

Fair Value of Financial Instruments

ASC Topic 820, Fair Value Measurements and Disclosures (“ASC Topic 820”) provides a framework for measuring fair value in accordance with generally accepted accounting principles.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	●	Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date.

	●	Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

	●	Level 3 – Inputs that are unobservable for the asset or liability.

Measured on a Recurring Basis

The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell:

	Amount at		Fair Value Measurement Using
	Fair Value		Level 1		Level 2		Level 3
May 31, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

February 29, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

Earnings (Loss) per Share

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Recently Issued Accounting Pronouncements

Recently Issued Accounting Standards Adopted

REVENUE FROM CONTRACTS WITH CUSTOMERS

3 Months Ended

May 31, 2024

Revenue from Contract with Customer [Abstract]

REVENUE FROM CONTRACTS WITH CUSTOMERS

4. REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table presents revenues from contracts with customers disaggregated by product/service:

	Three Months Ended May 31, 2024		Three Months Ended May 31, 2023
Device rental activities	$	980,536	$	238,149
Direct sales of goods and services		202,264		147,059
Revenue	$	1,182,800	$	385,208

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

LEASES

3 Months Ended

May 31, 2024

Leases

LEASES

5. LEASES

Below is a summary of our lease assets and liabilities at May 31, 2024 and February 29, 2024.

Leases	Classification	May 31, 2024		February 29, 2024
Assets
Operating	Operating Lease Assets	$	1,105,225	$	1,139,188
Liabilities
Current
Operating	Current Operating Lease Liability	$	231,141	$	237,653
Noncurrent
Operating	Noncurrent Operating Lease Liabilities		864,447		889,360
Total lease liabilities		$	1,095,588	$	1,127,013

Operating lease cost and rent was $62,013 and $62,542 for the three months ended May 31, 2024 and May 31, 2023, respectively.

REVENUE EARNING DEVICES

3 Months Ended

May 31, 2024

Revenue Earning Devices

REVENUE EARNING DEVICES

6. REVENUE EARNING DEVICES

Revenue earning devices consisted of the following:

	May 31, 2024			February 29, 2024
Revenue earning devices	$	4,561,021		$	3,432,846
Less: Accumulated depreciation		(1,209,072	)		(952,844	)
Total	$	3,351,949		$	2,480,002

Depreciation expense was $256,228 and $122,841 for the three months ended May 31, 2024, and 2023 respectively.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

FIXED ASSETS

3 Months Ended

May 31, 2024

Property, Plant and Equipment [Abstract]

FIXED ASSETS

7. FIXED ASSETS

Fixed assets consisted of the following:

	May 31, 2024			February 29, 2024
Automobile	$	74,237		$	74,237
Demo devices		227,395			194,352
Tooling		107,020			107,020
Machinery and equipment		8,825			8,825
Computer equipment		157,448			150,387
Office equipment		15,312			15,312
Furniture and fixtures		21,225			21,225
Warehouse equipment		31,712			19,639
Leasehold improvements		26,956			26,956
Fixed assets gross		670,130			617,953
Less: Accumulated depreciation		(391,199	)		(349,878	)
	$	278,931		$	268,075

Depreciation expense was $41,321 and $45,101 for the three months ended May 31, 2024, and 2023 respectively.

DEFERRED VARIABLE PAYMENT OBLIGATION

3 Months Ended

May 31, 2024

Deferred Variable Payment Obligation

DEFERRED VARIABLE PAYMENT OBLIGATION

8. DEFERRED VARIABLE PAYMENT OBLIGATION

On May 9, 2019 the Company entered into two similar arrangements with two investors:

	(1)	The investor would pay up to $400,000 in exchange for a perpetual 4% rate Payment on the Company’s reported quarterly Revenues. At February 29, 2020, $400,000 has been paid to the Company.

	(2)	The investor would pay up to $50,000 in exchange for a perpetual 1.11% rate Payment on the Company’s reported quarterly Revenues. At February 29, 2020, $50,000 has been paid to the Company.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

On March 1, 2021, the first investor referred to above whose aggregate investment is $1,925,000 revised his agreements as follows:

	1)	The rate payment was reduced from 14.25 % to 9.65 %
	2)	The asset disposition % (see below) was reduced from 31 % to 21%

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

RELATED PARTY TRANSACTIONS

3 Months Ended

May 31, 2024

RELATED PARTY TRANSACTIONS

9. RELATED PARTY TRANSACTIONS

OTHER DEBT – VEHICLE LOAN

3 Months Ended

May 31, 2024

Other Debt Vehicle Loan

OTHER DEBT – VEHICLE LOAN

10. OTHER DEBT – VEHICLE LOAN

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

LOANS PAYABLE

3 Months Ended

May 31, 2024

Debt Disclosure [Abstract]

LOANS PAYABLE

11. LOANS PAYABLE

Loans payable at May 31, 2024 consisted of the following:

SCHEDULE OF LOANS PAYABLE

									Annual
Date	Maturity		Description			Principal			Interest Rate
July 18, 2016		July 18, 2017	Promissory note	(1	)*	$	3,500			22	%
December 10, 2020		March 1, 2025	Promissory note	(2	)		3,921,168			12	%
December 10, 2020		March 1, 2025	Promissory note	(3	)		2,754,338			12	%
December 10, 2020		December 10, 2024	Promissory note	(4	)		165,605			12	%
December 14, 2020		December 14, 2023	Promissory note	(5	)*		310,375			12	%
December 30, 2020		March 1, 2025	Promissory note	(6	)		350,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(7	)		25,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(8	)		145,000			12	%
January 14, 2021		March 1, 2025	Promissory note	(9	)		550,000			12	%
February 22, 2021		March 1, 2025	Promissory note	(10	)		1,650,000			12	%
March 1, 2021		March 1, 2025	Promissory note	(11	)		6,000,000			12	%
June 8, 2021		June 8, 2025	Promissory note	(12	)		2,750,000			12	%
July 12, 2021		July 26, 2026	Promissory note	(13	)		3,749,360			7	%
September 14, 2021		September 14, 2025	Promissory note	(14	)		1,650,000			12	%
July 28, 2022		March 1, 2025	Promissory note	(15	)		170,000			15	%
August 30, 2022		August 30,2025	Promissory note	(16	)		3,000,000			15	%
September 7, 2022		March 1, 2025	Promissory note	(17	)		400,000			15	%
September 8, 2022		March 1, 2025	Promissory note	(18	)		475,000			15	%
October 13, 2022		March 1, 2025	Promissory note	(19	)		350,000			15	%
October 28, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 9, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 10, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 15, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
January 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
February 6, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 5. 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 20, 23		October 31, 2026	Promissory note	(20	)		400,000			15	%
May 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
October 27, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 30, 2023		April 30, 2025	Purchase Agreement	(21	)		350,000			35	%
March 8, 2024		August 8, 2025	Purchase Agreement	(22	)		350,000			35	%
						$	33,119,346

Less: current portion of loans payable							(17,619,985	)
Less: discount on non-current loans payable							(538,143	)
Non-current loans payable, net of discount						$	14,961,218

Current portion of loans payable						$	17,619,985
Less: discount on current portion of loans payable							(65,629	)
Current portion of loans payable, net of discount						$	17,554,356

*	In default

On March 1, 2024 the Company adjusted the relative fair value unamortized discount on the above notes by $4,175,535 with a corresponding adjustment to accumulated deficit to apply ASU 2020-06.

(1)	This note was transferred from convertible notes payable because in August 2022 it was no longer convertible due to restrictions placed on the lender.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(2)	This promissory note was issued as part of a debt settlement whereby $2,683,357 in convertible notes and associated accrued interest of $1,237,811 totaling $3,921,168 was exchanged for this promissory note of $3,921,168, and a warrant to purchase 450,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a relative fair value of $990,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(3)	This promissory note was issued as part of a debt settlement whereby $1,460,794 in convertible notes and associated accrued interest of $1,593,544 totaling $3,054,338 was exchanged for this promissory note of $3,054,338, and a warrant to purchase 250,000,000 shares at an exercise price of $0.002 per share and a three-year maturity having a relative fair value of $550,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. $300,000 has been repaid during the year ended February 29, 2024. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(4)	This promissory note was issued as part of a debt settlement whereby $103,180 in convertible notes and associated accrued interest of $62,425 totaling $165,605 was exchanged for this promissory note of $165,605, and a warrant to purchase 80,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $176,000.The maturity date was extended from December 10, 2023 to December 10, 2024 on February 29, 2024 and a fee of $22,958 was paid and charged to interest expense.

(5)	This promissory note was issued as part of a debt settlement whereby $235,000 in convertible notes and associated accrued interest of $75,375 totaling $310,375 was exchanged for this promissory note of $310,375, and a warrant to purchase 25,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $182,500.

(6)	The note, with an original principal amount of $350,000, may be pre-payable at any time. The note balance includes an original issue discount of $35,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $271,250. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $271,250 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. On March 1, 2024, the unamortized relative fair value discount of $65,092 was removed with a corresponding adjustment to accumulated deficit. A $8,399 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,515, with an unamortized discount of $6,884 at May 31, 2024.

(7)	This promissory note was issued as part of a debt settlement whereby $9,200 in convertible notes and associated accrued interest of $6,944 totaling $16,144 was exchanged for this promissory note of $25,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(8)	This promissory note was issued as part of a debt settlement whereby $79,500 in convertible notes and associated accrued interest of $28,925 totaling $108,425 was exchanged for this promissory note of $145,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(9)	The note, with an original principal amount of $550,000, may be pre-payable at any time. The note balance includes an original issue discount of $250,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $380,174. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $380,174 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $80,284 was removed with a corresponding adjustment to accumulated deficit. A $10,559 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from January 14, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,936, with an unamortized discount of $8,623 at May 31, 2024.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(10)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 100,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $1,342,857. The discount and warrant are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,342,857 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. The maturity date was extended from February 22, 2022 to February 22, 2024 on February 28, 2022 in exchange for warrants to purchase 50,000,000 at an exercise price of $.0164 and a 3-year term. These warrants have a fair value of $950,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $497,614 was removed with a corresponding adjustment to accumulated deficit. A $55,585 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from February 22, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $9,484, with an unamortized discount of $46,101 at May 31, 2024.

(11)	The unsecured note may be pre-payable at any time. Cash proceeds of $5,400,000 were received. The note balance of $6,000,000 includes an original issue discount of $600,000 and was issued with a warrant to purchase 300,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $4,749,005 using Black-Scholes with assumptions described in note 13. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $4,749,005 with a corresponding adjustment to paid in capital for the relative value of the warrant.. The maturity was extended from March 1, 2022 to March 1, 2024 on February 28, 2022 in exchange for warrants to purchase 150,000,000 shares of common stock at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $2,850,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. This note has been fully amortized. This note was again extended to March 1, 2025.

(12)	The note, with an original principal balance of $2,750,000, may be pre-payable at any time. The note balance includes an original issue discount of $50,000 and was issued with a warrant to purchase 170,000,000 shares at an exercise price of $0.064 per share with a 3-year term and having a relative fair value of $2,035,033. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $2,035,033 with a corresponding adjustment to paid in capital. The maturity date was extended from June 8, 2022 to June 8, 2024 on February 28, 2022 in exchange for warrants to purchase 85,000,000 at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $1,615,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $33,547 was removed with a corresponding adjustment to accumulated deficit. A $4,121 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $100, with an unamortized discount of $4,021 at May 31, 2024. This note was extended to June 8, 2025.

(13)	This loan, with an original principal balance of $4,000,160, was in exchange for 184 Series F preferred shares from a former director. The interest and principal are payable at maturity. The loan is unsecured. For the three and nine months ended November 30, 2023 there were repayments of $27,000 and $81,000 , respectively on the note.

(14)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 250,000,000 shares at an exercise price of $0.037 per share with a 3-year term and having a relative fair value of $1,284,783, The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,284,783 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $572,549 was removed with a corresponding adjustment to accumulated deficit. A $66,846 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $5,627, with an unamortized discount of $61,219 at May 31, 2024. This note was extended to September 14, 2025.

(15)	Original $170,000 note may be pre-payable at any time. The note balance includes an original issue discount of $20,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from July 28, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(16)	A warrant holder exchanged 955,000,000 warrants for a promissory note of $3,000,000, bearing interest at 15% with a two year maturity. The fair value of the warrants was determined to be $2,960,500 with a corresponding adjustment to paid-in capital and a debt discount of $39,500 which will be amortized over the term of the loan. Principal and interest due at maturity. On March 1, 2024, the unamortized relative fair value discount of $11,535 was removed with a corresponding adjustment to accumulated deficit. This note has been fully amortized. This note was extended to August 30, 2025.

(17)	Original $400,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 7, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(18)	Original $475,000 note may be pre-payable at any time. The note balance includes an original issue discount of $75,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 8, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(19)	Original $350,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of the Company’s s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from October 13, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(20)	On October 28, 2022 the Company entered into an loan facility with a lender for up to $4,000,000 including an original issue discount of $500,000. In exchange the Company will issue one series F Preferred Share, extended 329 series F warrants with a March 1, 2026 maturity to a new October 31, 2033 maturity, and issue up to 10 tranches with each tranche of $400,000, with cash proceeds of $350,000 an original issue discount of $50,000, October 31, 2026 maturity, and 61 Series F warrants with a October 31, 2033 maturity. Secured by a general security charging all of the Company’s present and after-acquired property. At February 29, 2024 the Company has issued all 10 tranches totaling $ 4,000,000 as follows:

	October 28, 2022, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants and 1 Series F Preferred Share having a relative fair value of $299,399. On March 1, 2024, the unamortized relative fair value discount of $286,775 was removed with a corresponding adjustment to accumulated deficit. A $47,892 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $610, with an unamortized discount of $47,282 at May 31, 2024.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(20)	April 5, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $296,245. On March 1, 2024, the unamortized relative fair value discount of $286,821 was removed with a corresponding adjustment to accumulated deficit. A $48,409 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $830, with an unamortized discount of $47,579 at May 31, 2024. April 20, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $302,219. On March 1, 2024, the unamortized relative fair value discount of $294,824 was removed with a corresponding adjustment to accumulated deficit. A $48,777 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $702, with an unamortized discount of $48,075 at May 31, 2024. May 11, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $348,983. On March 1, 2024, the unamortized relative fair value discount of $348,831 was removed with a corresponding adjustment to accumulated deficit. A $49,978 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $81, with an unamortized discount of $49,897 at May 31, 2024. October 27 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $261,759. On March 1, 2024, the unamortized relative fair value discount of $254,487 was removed with a corresponding adjustment to accumulated deficit. A $48,611 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,287, with an unamortized discount of $47,324 at May 31, 2024.

(21)	On November 30, 2023 , the Company entered into an agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on April 30,2024 through to April 30, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after-acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment. The Company has missed the April and May 2024 payments and is in discussions with lender to remedy this. No notices have been sent.

(22)	On March 8, 2024 , the Company entered into another agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on August 8, 2024 through to August 80, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after- acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

STOCKHOLDERS’ EQUITY (DEFICIT)

3 Months Ended

May 31, 2024

Equity [Abstract]

STOCKHOLDERS’ EQUITY (DEFICIT)

12. STOCKHOLDERS’ EQUITY (DEFICIT)

Summary or Preferred Stock Activity

Series B Convertible, Redeemable Preferred Stock (Temporary Equity)

At May 31, 2024 there remains 215 Series B Convertible Redeemable Preferred Shares having a value of $ $257,712 in Temporary Equity.

Summary of Preferred Stock Warrant Activity

	Number of Series F Preferred Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		939	$	1.00		9.50
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		939	$	1.00		9.40

Summary of Common Stock Activity

For the three months ended May 31, 2024, the Company issued 1,080,166,425 common shares with gross proceeds of 2,789,639 and net proceeds of $2,682,593 after issuance costs of $116,046.

Summary of Common Stock Warrant Activity

	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		300,595,661	$	0.003		1.00
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		300,595,661	$	0.003		0.75

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Summary of Common Stock Option Activity -Employee Stock Options

SUMMARY OF COMMON STOCK OPTION ACTIVITY

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		188,667,035		$	0.02		4.10
Issued		—			—		—
Exercised		—			—		—
Forfeited, extinguished and cancelled		(3,011,029	)	$	0.02		(4.60	)
Outstanding at May 31, 2024		185,656,006		$	0.02		4.00

COMMITMENTS AND CONTINGENCIES

3 Months Ended

May 31, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

Litigation

Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions.

The related legal costs are expensed as incurred.

Operating Lease

Maturity of Lease Liabilities	Operating Leases
May 31, 2025	$	231,141
2025	$	231,141
May 31, 2026		225,348
2026		225,348
May 31, 2027		219,418
2027		219,418
May 31, 2028		207,557
2028		207,557
May 31, 2029		207,558
2029		207,558
May 31, 2030 and after		397,820
2030 and after		397,820
Total lease payments		1,488,842
Less: Interest		(393,254	)
Present value of lease liabilities	$	1,095,588

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

EARNINGS (LOSS) PER SHARE

3 Months Ended

May 31, 2024

Earnings Per Share [Abstract]

EARNINGS (LOSS) PER SHARE

14. EARNINGS (LOSS) PER SHARE

The net income (loss) per common share amounts were determined as follows:

	May 31, 2024			May 31, 2023
	For the Three Months Ended
	May 31, 2024			May 31, 2023
Numerator:
Net income (loss) available to common shareholders	$	(4,194,359	)	$	(4,555,193	)

Effect of common stock equivalents
Add: interest expense on convertible debt		—			—
Net income (loss) adjusted for common stock equivalents		(4,194,359	)		(4,555,193	)

Denominator:
Weighted average shares – basic		9,882,118,105			5,964,709,322

Net income (loss) per share – basic	$	(0.00	)	$	(0.00	)

Denominator:
Weighted average shares – diluted		9,882,118,105			5,964,709,322

Net income (loss) per share – diluted	$	(0.00	)	$	(0.00	)

The anti-dilutive shares of common stock equivalents for the three months ended May 31, 2024 and 2023 were as follows:

	May 31, 2024		May 31, 2023^*
	For the Three Months Ended
	May 31, 2024		May 31, 2023*
Convertible Series F Preferred Shares		35,600,264,971		—
Convertible Redeemable Series B Preferred Shares		59,933,023		—
Stock options and warrants		486,251,667		396,917,451
Total		36,146,449,661		396,917,451

	May 31, 2024		May 31, 2023
	For the Three Months Ended
	May 31, 2024		May 31, 2023
Convertible Series F Preferred Shares		—		21,147,364,222
Anti-dilutive shares of common stock		—		21,147,364,222

SUBSEQUENT EVENTS

3 Months Ended

May 31, 2024

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

15. SUBSEQUENT EVENTS

ACCOUNTING POLICIES (Policies)

3 Months Ended

May 31, 2024

Accounting Policies [Abstract]

Basis of Presentation and Consolidation

Basis of Presentation and Consolidation

Use of Estimates

Use of Estimates

Reclassifications

Reclassifications

Concentrations

Concentrations

Loans payable

Cash

Cash

Accounts Receivable

Accounts Receivable

Device Parts Inventory

Device Parts Inventory

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Revenue Earning Devices

Revenue Earning Devices

Fixed Assets

Fixed Assets

Computer equipment and software		2 or 3 years
Office equipment		4 years
Manufacturing equipment		7 years
Warehouse equipment		5 years
Tooling		2 years
Demo Devices		4 years
Vehicles		3 years
Leasehold improvements		5 years, the life of the lease

Research and Development

Research and Development

Contingencies

Contingencies

Sales of Future Revenues

Sales of Future Revenues

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	●	Does the agreement purport, in substance, to be a sale
	●	Does the Company have continuing involvement in the generation of cash flows due the investor
	●	Is the transaction cancellable by either party through payment of a lump sum or other transfer of assets
	●	Is the investors rate of return is implicitly limited by the terms of the agreement
	●	Does the Company’s revenue for a reporting period underlying the agreement have only a minimal impact on the investor’s rate of return
	●	Does the investor have recourse relating to payments due

Revenue Recognition

Revenue Recognition

Income Taxes

Income Taxes

Leases

Leases

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Distinguishing Liabilities from Equity

Distinguishing Liabilities from Equity

Initial Measurement

The Company records its financial instruments classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received.

Subsequent Measurement – Financial Instruments Classified as Liabilities

Fair Value of Financial Instruments

Fair Value of Financial Instruments

ASC Topic 820, Fair Value Measurements and Disclosures (“ASC Topic 820”) provides a framework for measuring fair value in accordance with generally accepted accounting principles.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	●	Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date.

	●	Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

	●	Level 3 – Inputs that are unobservable for the asset or liability.

Measured on a Recurring Basis

The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell:

	Amount at		Fair Value Measurement Using
	Fair Value		Level 1		Level 2		Level 3
May 31, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

February 29, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

Earnings (Loss) per Share

Earnings (Loss) per Share

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

Recently Issued Accounting Standards Adopted

ACCOUNTING POLICIES (Tables)

3 Months Ended

May 31, 2024

Accounting Policies [Abstract]

SCHEDULE OF FIXED ASSETS STATED AT COST

Computer equipment and software		2 or 3 years
Office equipment		4 years
Manufacturing equipment		7 years
Warehouse equipment		5 years
Tooling		2 years
Demo Devices		4 years
Vehicles		3 years
Leasehold improvements		5 years, the life of the lease

SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE

The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell:

	Amount at		Fair Value Measurement Using
	Fair Value		Level 1		Level 2		Level 3
May 31, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

February 29, 2024
Liabilities
Incentive compensation plan payable- revaluation of equity awards payable in Series G shares	$	2,500,000	$	—	$	—	$	2,500,000

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)

3 Months Ended

May 31, 2024

Revenue from Contract with Customer [Abstract]

SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS

The following table presents revenues from contracts with customers disaggregated by product/service:

	Three Months Ended May 31, 2024		Three Months Ended May 31, 2023
Device rental activities	$	980,536	$	238,149
Direct sales of goods and services		202,264		147,059
Revenue	$	1,182,800	$	385,208

LEASES (Tables)

3 Months Ended

May 31, 2024

Leases

SCHEDULE OF LEASE ASSETS AND LIABILITIES

Below is a summary of our lease assets and liabilities at May 31, 2024 and February 29, 2024.

Leases	Classification	May 31, 2024		February 29, 2024
Assets
Operating	Operating Lease Assets	$	1,105,225	$	1,139,188
Liabilities
Current
Operating	Current Operating Lease Liability	$	231,141	$	237,653
Noncurrent
Operating	Noncurrent Operating Lease Liabilities		864,447		889,360
Total lease liabilities		$	1,095,588	$	1,127,013

REVENUE EARNING DEVICES (Tables)

3 Months Ended

May 31, 2024

Revenue Earning Devices

SCHEDULE OF REVENUE EARNING DEVICES

Revenue earning devices consisted of the following:

	May 31, 2024			February 29, 2024
Revenue earning devices	$	4,561,021		$	3,432,846
Less: Accumulated depreciation		(1,209,072	)		(952,844	)
Total	$	3,351,949		$	2,480,002

FIXED ASSETS (Tables)

3 Months Ended

May 31, 2024

Property, Plant and Equipment [Abstract]

SCHEDULE OF FIXED ASSETS

Fixed assets consisted of the following:

	May 31, 2024			February 29, 2024
Automobile	$	74,237		$	74,237
Demo devices		227,395			194,352
Tooling		107,020			107,020
Machinery and equipment		8,825			8,825
Computer equipment		157,448			150,387
Office equipment		15,312			15,312
Furniture and fixtures		21,225			21,225
Warehouse equipment		31,712			19,639
Leasehold improvements		26,956			26,956
Fixed assets gross		670,130			617,953
Less: Accumulated depreciation		(391,199	)		(349,878	)
	$	278,931		$	268,075

LOANS PAYABLE (Tables)

3 Months Ended

May 31, 2024

Debt Disclosure [Abstract]

SCHEDULE OF LOANS PAYABLE

Loans payable at May 31, 2024 consisted of the following:

SCHEDULE OF LOANS PAYABLE

									Annual
Date	Maturity		Description			Principal			Interest Rate
July 18, 2016		July 18, 2017	Promissory note	(1	)*	$	3,500			22	%
December 10, 2020		March 1, 2025	Promissory note	(2	)		3,921,168			12	%
December 10, 2020		March 1, 2025	Promissory note	(3	)		2,754,338			12	%
December 10, 2020		December 10, 2024	Promissory note	(4	)		165,605			12	%
December 14, 2020		December 14, 2023	Promissory note	(5	)*		310,375			12	%
December 30, 2020		March 1, 2025	Promissory note	(6	)		350,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(7	)		25,000			12	%
January 1, 2021		March 1, 2025	Promissory note	(8	)		145,000			12	%
January 14, 2021		March 1, 2025	Promissory note	(9	)		550,000			12	%
February 22, 2021		March 1, 2025	Promissory note	(10	)		1,650,000			12	%
March 1, 2021		March 1, 2025	Promissory note	(11	)		6,000,000			12	%
June 8, 2021		June 8, 2025	Promissory note	(12	)		2,750,000			12	%
July 12, 2021		July 26, 2026	Promissory note	(13	)		3,749,360			7	%
September 14, 2021		September 14, 2025	Promissory note	(14	)		1,650,000			12	%
July 28, 2022		March 1, 2025	Promissory note	(15	)		170,000			15	%
August 30, 2022		August 30,2025	Promissory note	(16	)		3,000,000			15	%
September 7, 2022		March 1, 2025	Promissory note	(17	)		400,000			15	%
September 8, 2022		March 1, 2025	Promissory note	(18	)		475,000			15	%
October 13, 2022		March 1, 2025	Promissory note	(19	)		350,000			15	%
October 28, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 9, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 10, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 15, 2022		October 31, 2026	Promissory note	(20	)		400,000			15	%
January 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
February 6, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 5. 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
April 20, 23		October 31, 2026	Promissory note	(20	)		400,000			15	%
May 11, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
October 27, 2023		October 31, 2026	Promissory note	(20	)		400,000			15	%
November 30, 2023		April 30, 2025	Purchase Agreement	(21	)		350,000			35	%
March 8, 2024		August 8, 2025	Purchase Agreement	(22	)		350,000			35	%
						$	33,119,346

Less: current portion of loans payable							(17,619,985	)
Less: discount on non-current loans payable							(538,143	)
Non-current loans payable, net of discount						$	14,961,218

Current portion of loans payable						$	17,619,985
Less: discount on current portion of loans payable							(65,629	)
Current portion of loans payable, net of discount						$	17,554,356

*	In default

On March 1, 2024 the Company adjusted the relative fair value unamortized discount on the above notes by $4,175,535 with a corresponding adjustment to accumulated deficit to apply ASU 2020-06.

(1)	This note was transferred from convertible notes payable because in August 2022 it was no longer convertible due to restrictions placed on the lender.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(2)	This promissory note was issued as part of a debt settlement whereby $2,683,357 in convertible notes and associated accrued interest of $1,237,811 totaling $3,921,168 was exchanged for this promissory note of $3,921,168, and a warrant to purchase 450,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a relative fair value of $990,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(3)	This promissory note was issued as part of a debt settlement whereby $1,460,794 in convertible notes and associated accrued interest of $1,593,544 totaling $3,054,338 was exchanged for this promissory note of $3,054,338, and a warrant to purchase 250,000,000 shares at an exercise price of $0.002 per share and a three-year maturity having a relative fair value of $550,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. $300,000 has been repaid during the year ended February 29, 2024. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same.

(4)	This promissory note was issued as part of a debt settlement whereby $103,180 in convertible notes and associated accrued interest of $62,425 totaling $165,605 was exchanged for this promissory note of $165,605, and a warrant to purchase 80,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $176,000.The maturity date was extended from December 10, 2023 to December 10, 2024 on February 29, 2024 and a fee of $22,958 was paid and charged to interest expense.

(5)	This promissory note was issued as part of a debt settlement whereby $235,000 in convertible notes and associated accrued interest of $75,375 totaling $310,375 was exchanged for this promissory note of $310,375, and a warrant to purchase 25,000,000 shares at an exercise price of $.002 per share and a three-year maturity having a fair value of $182,500.

(6)	The note, with an original principal amount of $350,000, may be pre-payable at any time. The note balance includes an original issue discount of $35,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $271,250. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $271,250 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. On March 1, 2024, the unamortized relative fair value discount of $65,092 was removed with a corresponding adjustment to accumulated deficit. A $8,399 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from December 10, 2023 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,515, with an unamortized discount of $6,884 at May 31, 2024.

(7)	This promissory note was issued as part of a debt settlement whereby $9,200 in convertible notes and associated accrued interest of $6,944 totaling $16,144 was exchanged for this promissory note of $25,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(8)	This promissory note was issued as part of a debt settlement whereby $79,500 in convertible notes and associated accrued interest of $28,925 totaling $108,425 was exchanged for this promissory note of $145,000. This note is secured by a general security charging all of the Company’s present and after-acquired property. On November 28, 2023, the parties extended the maturity date from January 1, 2024 to March 1, 2025 with all other terms and conditions remaining the same.

(9)	The note, with an original principal amount of $550,000, may be pre-payable at any time. The note balance includes an original issue discount of $250,000 and was issued with a warrant to purchase 50,000,000 shares at an exercise price of $0.025 per share with a 3-year term and having a relative fair value of $380,174. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $380,174 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $80,284 was removed with a corresponding adjustment to accumulated deficit. A $10,559 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from January 14, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,936, with an unamortized discount of $8,623 at May 31, 2024.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(10)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 100,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $1,342,857. The discount and warrant are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,342,857 with a corresponding adjustment to paid in capital for the relative fair value of the warrant. The maturity date was extended from February 22, 2022 to February 22, 2024 on February 28, 2022 in exchange for warrants to purchase 50,000,000 at an exercise price of $.0164 and a 3-year term. These warrants have a fair value of $950,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $497,614 was removed with a corresponding adjustment to accumulated deficit. A $55,585 unamortized discount remained. On November 28, 2023, the parties extended the maturity date from February 22, 2024 to March 1, 2025 with all other terms and conditions remaining the same. For the three months ended May 31, 2024, the Company recorded amortization expense of $9,484, with an unamortized discount of $46,101 at May 31, 2024.

(11)	The unsecured note may be pre-payable at any time. Cash proceeds of $5,400,000 were received. The note balance of $6,000,000 includes an original issue discount of $600,000 and was issued with a warrant to purchase 300,000,000 shares at an exercise price of $0.135 per share with a 3-year term and having a relative fair value of $4,749,005 using Black-Scholes with assumptions described in note 13. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $4,749,005 with a corresponding adjustment to paid in capital for the relative value of the warrant.. The maturity was extended from March 1, 2022 to March 1, 2024 on February 28, 2022 in exchange for warrants to purchase 150,000,000 shares of common stock at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $2,850,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. This note has been fully amortized. This note was again extended to March 1, 2025.

(12)	The note, with an original principal balance of $2,750,000, may be pre-payable at any time. The note balance includes an original issue discount of $50,000 and was issued with a warrant to purchase 170,000,000 shares at an exercise price of $0.064 per share with a 3-year term and having a relative fair value of $2,035,033. The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $2,035,033 with a corresponding adjustment to paid in capital. The maturity date was extended from June 8, 2022 to June 8, 2024 on February 28, 2022 in exchange for warrants to purchase 85,000,000 at an exercise price of $.0164 and a 3 year term. These warrants have a fair value of $1,615,000 recorded as interest expense with a corresponding adjustment to paid in capital recorded in the year ended February 28, 2022. On March 1, 2024, the unamortized relative fair value discount of $33,547 was removed with a corresponding adjustment to accumulated deficit. A $4,121 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $100, with an unamortized discount of $4,021 at May 31, 2024. This note was extended to June 8, 2025.

(13)	This loan, with an original principal balance of $4,000,160, was in exchange for 184 Series F preferred shares from a former director. The interest and principal are payable at maturity. The loan is unsecured. For the three and nine months ended November 30, 2023 there were repayments of $27,000 and $81,000 , respectively on the note.

(14)	The note, with an original principal balance of $1,650,000, may be pre-payable at any time. The note balance includes an original issue discount of $150,000 and was issued with a warrant to purchase 250,000,000 shares at an exercise price of $0.037 per share with a 3-year term and having a relative fair value of $1,284,783, The discounts are being amortized over the term of the loan. After allocating these charges to debt and equity according to their respective values, a debt discount of $1,284,783 with a corresponding adjustment to paid in capital. On March 1, 2024, the unamortized relative fair value discount of $572,549 was removed with a corresponding adjustment to accumulated deficit. A $66,846 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $5,627, with an unamortized discount of $61,219 at May 31, 2024. This note was extended to September 14, 2025.

(15)	Original $170,000 note may be pre-payable at any time. The note balance includes an original issue discount of $20,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from July 28, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(16)	A warrant holder exchanged 955,000,000 warrants for a promissory note of $3,000,000, bearing interest at 15% with a two year maturity. The fair value of the warrants was determined to be $2,960,500 with a corresponding adjustment to paid-in capital and a debt discount of $39,500 which will be amortized over the term of the loan. Principal and interest due at maturity. On March 1, 2024, the unamortized relative fair value discount of $11,535 was removed with a corresponding adjustment to accumulated deficit. This note has been fully amortized. This note was extended to August 30, 2025.

(17)	Original $400,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 7, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(18)	Original $475,000 note may be pre-payable at any time. The note balance includes an original issue discount of $75,000. Principal and interest due at maturity. Secured by a general security charging all of RAD’s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from September 8, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(19)	Original $350,000 note may be pre-payable at any time. The note balance includes an original issue discount of $50,000. Principal and interest due at maturity. Secured by a general security charging all of the Company’s s present and after-acquired property. On November 29, 2023, the parties extended the maturity date from October 13, 2023 to March 1, 2025 with all other terms and conditions remaining the same. This note has been fully amortized.

(20)	On October 28, 2022 the Company entered into an loan facility with a lender for up to $4,000,000 including an original issue discount of $500,000. In exchange the Company will issue one series F Preferred Share, extended 329 series F warrants with a March 1, 2026 maturity to a new October 31, 2033 maturity, and issue up to 10 tranches with each tranche of $400,000, with cash proceeds of $350,000 an original issue discount of $50,000, October 31, 2026 maturity, and 61 Series F warrants with a October 31, 2033 maturity. Secured by a general security charging all of the Company’s present and after-acquired property. At February 29, 2024 the Company has issued all 10 tranches totaling $ 4,000,000 as follows:

	October 28, 2022, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants and 1 Series F Preferred Share having a relative fair value of $299,399. On March 1, 2024, the unamortized relative fair value discount of $286,775 was removed with a corresponding adjustment to accumulated deficit. A $47,892 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $610, with an unamortized discount of $47,282 at May 31, 2024.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(20)	April 5, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $296,245. On March 1, 2024, the unamortized relative fair value discount of $286,821 was removed with a corresponding adjustment to accumulated deficit. A $48,409 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $830, with an unamortized discount of $47,579 at May 31, 2024. April 20, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $302,219. On March 1, 2024, the unamortized relative fair value discount of $294,824 was removed with a corresponding adjustment to accumulated deficit. A $48,777 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $702, with an unamortized discount of $48,075 at May 31, 2024. May 11, 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $348,983. On March 1, 2024, the unamortized relative fair value discount of $348,831 was removed with a corresponding adjustment to accumulated deficit. A $49,978 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $81, with an unamortized discount of $49,897 at May 31, 2024. October 27 2023, $400,000 loan, original issue discount of $50,000, 61 Series F Preferred Share warrants having a relative fair value of $261,759. On March 1, 2024, the unamortized relative fair value discount of $254,487 was removed with a corresponding adjustment to accumulated deficit. A $48,611 unamortized discount remained. For the three months ended May 31, 2024, the Company recorded amortization expense of $1,287, with an unamortized discount of $47,324 at May 31, 2024.

(21)	On November 30, 2023 , the Company entered into an agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on April 30,2024 through to April 30, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after-acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment. The Company has missed the April and May 2024 payments and is in discussions with lender to remedy this. No notices have been sent.

(22)	On March 8, 2024 , the Company entered into another agreement where the lender will buy pay the Company $350,000 in exchange for thirteen future monthly payments of $36,750 commencing on August 8, 2024 through to August 80, 2025 totaling $477,750. The effective interest rate is 35% per annum. Secured by a general security charging all of RAD’s present and after- acquired property. Default rate of 15% per annum calculated daily on any missed monthly payment

STOCKHOLDERS’ EQUITY (DEFICIT) (Tables)

3 Months Ended

May 31, 2024

Equity [Abstract]

SUMMARY OF PREFERRED STOCK WARRANT ACTIVITY

Summary of Preferred Stock Warrant Activity

	Number of Series F Preferred Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		939	$	1.00		9.50
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		939	$	1.00		9.40

SUMMARY OF COMMON STOCK WARRANT ACTIVITY

	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		300,595,661	$	0.003		1.00
Issued		—		—		—
Exercised		—		—		—
Forfeited and cancelled		—		—		—
Outstanding at May 31, 2024		300,595,661	$	0.003		0.75

SUMMARY OF COMMON STOCK OPTION ACTIVITY

Summary of Common Stock Option Activity -Employee Stock Options

SUMMARY OF COMMON STOCK OPTION ACTIVITY

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Years
Outstanding at March 1, 2024		188,667,035		$	0.02		4.10
Issued		—			—		—
Exercised		—			—		—
Forfeited, extinguished and cancelled		(3,011,029	)	$	0.02		(4.60	)
Outstanding at May 31, 2024		185,656,006		$	0.02		4.00

COMMITMENTS AND CONTINGENCIES (Tables)

3 Months Ended

May 31, 2024

Commitments and Contingencies Disclosure [Abstract]

SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES

Maturity of Lease Liabilities	Operating Leases
May 31, 2025	$	231,141
2025	$	231,141
May 31, 2026		225,348
2026		225,348
May 31, 2027		219,418
2027		219,418
May 31, 2028		207,557
2028		207,557
May 31, 2029		207,558
2029		207,558
May 31, 2030 and after		397,820
2030 and after		397,820
Total lease payments		1,488,842
Less: Interest		(393,254	)
Present value of lease liabilities	$	1,095,588

EARNINGS (LOSS) PER SHARE (Tables)

3 Months Ended

May 31, 2024

Earnings Per Share [Abstract]

SCHEDULE OF NET INCOME (LOSS) PER COMMON SHARE

The net income (loss) per common share amounts were determined as follows:

	May 31, 2024			May 31, 2023
	For the Three Months Ended
	May 31, 2024			May 31, 2023
Numerator:
Net income (loss) available to common shareholders	$	(4,194,359	)	$	(4,555,193	)

Effect of common stock equivalents
Add: interest expense on convertible debt		—			—
Net income (loss) adjusted for common stock equivalents		(4,194,359	)		(4,555,193	)

Denominator:
Weighted average shares – basic		9,882,118,105			5,964,709,322

Net income (loss) per share – basic	$	(0.00	)	$	(0.00	)

Denominator:
Weighted average shares – diluted		9,882,118,105			5,964,709,322

Net income (loss) per share – diluted	$	(0.00	)	$	(0.00	)

SCHEDULE OF ANTI-DILUTIVE SHARES OF COMMON STOCK EQUIVALENTS

The anti-dilutive shares of common stock equivalents for the three months ended May 31, 2024 and 2023 were as follows:

	May 31, 2024		May 31, 2023^*
	For the Three Months Ended
	May 31, 2024		May 31, 2023*
Convertible Series F Preferred Shares		35,600,264,971		—
Convertible Redeemable Series B Preferred Shares		59,933,023		—
Stock options and warrants		486,251,667		396,917,451
Total		36,146,449,661		396,917,451

	May 31, 2024		May 31, 2023
	For the Three Months Ended
	May 31, 2024		May 31, 2023
Convertible Series F Preferred Shares		—		21,147,364,222
Anti-dilutive shares of common stock		—		21,147,364,222

GENERAL INFORMATION (Details Narrative) - shares	Aug. 28, 2017	May 31, 2024	Feb. 29, 2024	Jul. 25, 2017
Restructuring Cost and Reserve [Line Items]
Common stock, issued		10,318,917,383	9,238,750,958
Robotic Assistance Devices LLC [Member]
Restructuring Cost and Reserve [Line Items]
Common stock, issued				10,000
Robotic Assistance Devices LLC [Member] \| Series E Preferred Stock [Member]
Restructuring Cost and Reserve [Line Items]
Number of shares isuued under acquisition	3,350,000
Robotic Assistance Devices LLC [Member] \| Series F Preferred Stock [Member]
Restructuring Cost and Reserve [Line Items]
Number of shares isuued under acquisition	2,450

GOING CONCERN (Details Narrative) - USD ($)

1 Months Ended

3 Months Ended

Mar. 31, 2023

May 31, 2024

May 31, 2023

Mar. 01, 2024

Feb. 29, 2024

^[1]

Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]

Cash flow from operating activities

$ 3,045,831

$ 2,991,003

Accumulated deficit

141,361,177

$ (4,175,535)

$ 132,962,427

Working capital

(25,655,546)

Purchase of common stock

116,046

$ 81,285

Common stock net of discount

16,000,000

Common Stock [Member]

Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]

Purchase of common stock

$ 116,046

Common Stock [Member] | Equity Financing Agreement [Member]

Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]

Purchase of common stock

$ 30,000,000

[1]	Derived from audited information

SCHEDULE OF FIXED ASSETS STATED AT COST (Details)	May 31, 2024
Minimum [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	2 years
Maximum [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	5 years
Computer Equipment [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	2 years
Computer Equipment [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	3 years
Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	4 years
Manufacturing Equipment [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	7 years
Warehouse Equipment [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	5 years
Tooling [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	2 years
Demo Devices [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	4 years
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	3 years
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Fixed assets, useful life	5 years

SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE (Details) - USD ($)	May 31, 2024	Feb. 29, 2024
Platform Operator, Crypto Asset [Line Items]
Incentive compensation plan payable revaluation of equity awards payable in Series G shares	$ 2,500,000	$ 2,500,000
Fair Value, Inputs, Level 1 [Member]
Platform Operator, Crypto Asset [Line Items]
Incentive compensation plan payable revaluation of equity awards payable in Series G shares
Fair Value, Inputs, Level 2 [Member]
Platform Operator, Crypto Asset [Line Items]
Incentive compensation plan payable revaluation of equity awards payable in Series G shares
Fair Value, Inputs, Level 3 [Member]
Platform Operator, Crypto Asset [Line Items]
Incentive compensation plan payable revaluation of equity awards payable in Series G shares	$ 2,500,000	$ 2,500,000

ACCOUNTING POLICIES (Details Narrative) - USD ($)

3 Months Ended

12 Months Ended

May 31, 2024

May 31, 2023

Feb. 29, 2024

Mar. 01, 2024

Allowance for doubtful accounts receivable

Loans payable

$ 33,119,346

$ 32,796,345

81,000

68,000

Inventory valuation reserves

$ 1,169,000

959,000

Depreciation life

48 months

Deferred development costs

$ 0

Description of deferred tax assets and liabilities

The Company’s gross deferred tax assets were revalued based on the reduction in the federal statutory tax rate from 35% to 21%

Accumulated deficit

$ (141,361,177)

(132,962,427)

^[1]

$ 4,175,535

Minimum [Member]

Estimated useful lives

2 years

Maximum [Member]

Estimated useful lives

5 years

Two Customer [Member]

Percentage of revenue

65.00%

Three Customer [Member]

Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customer [Member]

Percentage of revenue

57.00%

Percentage of accounts receivable

57.00%

51.00%

Controller [Member]

Operating Lease, Liability, Current

Loans additions

$ 28,890,506

$ 28,540,506

Loans percentage

87.00%

[1]	Derived from audited information

SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
Revenue from Contract with Customer [Abstract]
Device rental activities	$ 980,536	$ 238,149
Direct sales of goods and services	202,264	147,059
Revenue	$ 1,182,800	$ 385,208

SCHEDULE OF LEASE ASSETS AND LIABILITIES (Details) - USD ($)

May 31, 2024

Feb. 29, 2024

Leases

Operating lease assets

$ 1,105,225

$ 1,139,188

231,141

237,653

^[1]

Operating Lease, Liability, Noncurrent

864,447

889,360

^[1]

Operating Lease, Liability

$ 1,095,588

$ 1,127,013

[1]	Derived from audited information

LEASES (Details Narrative) - USD ($)	3 Months Ended
LEASES (Details Narrative) - USD ($)	May 31, 2024	May 31, 2023
Leases
Weighted average remaining lease term	12 months
Rent	$ 62,013	$ 62,542

SCHEDULE OF REVENUE EARNING DEVICES (Details) - USD ($)	May 31, 2024	Feb. 29, 2024
Revenue Earning Devices
Revenue earning devices	$ 4,561,021	$ 3,432,846
Less: Accumulated depreciation	(1,209,072)	(952,844)
Total	$ 3,351,949	$ 2,480,002

REVENUE EARNING DEVICES (Details Narrative) - USD ($)	3 Months Ended
REVENUE EARNING DEVICES (Details Narrative) - USD ($)	May 31, 2024	May 31, 2023
Restructuring Cost and Reserve [Line Items]
Depreciation expense	$ 297,549	$ 167,942
Robotic Assistance Devices LLC [Member]
Restructuring Cost and Reserve [Line Items]
Revenue earning	1,128,175
Iinventory transfers		444,412
Depreciation expense	$ 256,228	$ 122,841

SCHEDULE OF FIXED ASSETS (Details) - USD ($)

May 31, 2024

Feb. 29, 2024

Less: Accumulated depreciation

$ 670,130

$ 617,953

(391,199)

(349,878)

Fixed assets, net of accumulated depreciation

278,931

268,075

^[1]

Automobiles [Member]

74,237

Demo Devices [Member]

Tools, Dies and Molds [Member]

227,395

194,352

Machinery and Equipment [Member]

107,020

Computer Equipment [Member]

8,825

Office Equipment [Member]

157,448

150,387

Furniture and Fixtures [Member]

15,312

Warehouse Equipment [Member]

21,225

Leasehold Improvements [Member]

31,712

19,639

$ 26,956

[1]	Derived from audited information

FIXED ASSETS (Details Narrative) - Robotic Assistance Devices LLC [Member] - USD ($)	3 Months Ended
	May 31, 2024	May 31, 2023
Restructuring Cost and Reserve [Line Items]
Additions to fixed assets	$ 52,177	$ 32,173
Assets transfers from inventory	33,045	28,710
Remaining additions to fixed assets	19,132	3,463
Depreciation expense	$ 41,321	$ 45,101

DEFERRED VARIABLE PAYMENT OBLIGATION (Details Narrative) - USD ($)

3 Months Ended

12 Months Ended

Mar. 01, 2021

Aug. 27, 2020

Jul. 01, 2020

Apr. 22, 2020

Feb. 29, 2020

Dec. 30, 2019

Nov. 18, 2019

May 09, 2019

Feb. 01, 2019

May 31, 2024

May 31, 2021

Feb. 29, 2024

May 31, 2020

Series F Preferred Stock [Member]

$ 33,119,346

Accrued payment

1,096,700

$ 904,377

Default on payments

604,811

542,176

Aggregate investment

$ 1,925,000

Total payment obligation

2,525,000

^[1]

Payment receive

$ 0

Shares issued

Warrants issued

367

Investors [Member]

$ 900,000

Debt instrument, date of first required payment

9.00%

Feb. 29, 2020

$ 900,000

Investor One [Member]

400,000

$ 400,000

4.00%

Investor Two [Member]

50,000

$ 50,000

1.11%

Investor [Member]

$ 800,000

$ 100,000

14.25%

2.75%

1.00%

2.25%

Description of variable payments terms

$ 1,925,000

109,000

$ 225,000

Description of disposition price

The FMV cannot exceed 43.77% of the share disposition price defined as the total price the third party paid for the shares plus the total value of all future Payments. As of March 1, 2021 as a result of the amendment with the first investor noted below. This aggregate asset disposition % was reduced from 43.77 % to 33.77%

the FMV of all future Payments in one lump payment. The FMV cannot exceed 30% of the share disposition price defined as the total price the third party paid for the shares plus the total value of all future Payments

Advance amount

$ 116,000

Investor received advanced

$ 50,000

Investor [Member] | Series F Preferred Stock [Member]

Warrants term

5 years

Exercise price

$ 1.00

Warrants exercised

Fair value of warrants

$ 33,015,214

Investor [Member] | Maximum [Member]

Percentage of total asset disposition price

14.25%

31.00%

Investor [Member] | Minimum [Member]

Percentage of total asset disposition price

9.65%

21.00%

Investor [Member] | Agreement [Member]

Investor [Member] | Agreement One [Member]

$ 900,000

Investor [Member] | Agreement Two [Member]

225,000

Description of variable payments terms

$ 800,000

Investor Five [Member]

If the Payments would deplete RAD’s available cash by more than 20%, the payment may be deferred. The investor had agreed to pay $100,000 per month over an 8 month period with the first payment due July 2020 and the final payment no later than February 28, 2021. As at August 31, 2020 the investor had fully funded the $800,000 commitment

Investor Six [Member]