What changed in this filing

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Item 1. Financial Statements

2024-01-16 compared with 2023-10-12 · 223 added, 168 removed, 984 unchanged (28% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

August 31, 2023

November 30, 2023

February 28, 2023 *

31 unchanged sentences

15,545,650 shares authorized;

no shares issued and outstanding at August 31, 2023 and February 28, 2023, respectively

no shares issued and outstanding at November 30, 2023 and February 28, 2023, respectively

Series G Convertible Preferred Stock.

$ 0.001 par value;

100,000 shares authorized, no shares issued and outstanding at August 31, 2023 and February 28, 2023, respectively

100,000 shares authorized, no shares issued and outstanding at November 30, 2023 and February 28, 2023, respectively

Series E Preferred Stock, $ 0.001 par value;

18 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

August 31, 2023

August 31, 2022

August 31, 2023

August 31, 2022

November 30, 2023

November 30, 2022

November 30, 2023

November 30, 2022

Cost of Goods Sold

10 unchanged sentences

Gain (loss) on settlement of debt

Total other expense net

Net loss per share - basic

Net loss per share - diluted

Total other income (expense), net

Net income (loss) per share - basic

Net income ( loss) per share - diluted

Weighted average common share outstanding - basic

29 unchanged sentences

( 102,988,805

Issuance of shares, net of $ 68,732 issuance costs

Relative fair value of Series F warrants issued with debt

Relative fair value of warrants issued with debt

Balance at November 30, 2022

5,260,515,892

( 107,074,465

The accompanying notes are an integral part of

20 unchanged sentences

( 121,568,632

Issuance of shares, net of $ 56,320 issuance costs

Relative fair value of Series F warrants issued with debt

Stock based compensation

Balance at November 30, 2023

7,715,143,227

( 125,535,116

Issuance of shares, net of issuance costs

The accompanying notes are an integral part of

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended

August 31, 2023

Six Months Ended

August 31, 2022

Nine Months Ended

November 30, 2023

Nine Months Ended

November 30, 2022

CASH FLOWS USED IN OPERATING ACTIVITIES:

22 unchanged sentences

Purchase of fixed assets

Acquisition of trademarks

Reimbursement of security deposit

Net cash used in investing activities

13 unchanged sentences

Transfer from device parts inventory to revenue earning devices

Shares issued for services

Exchange of warrants for debt

Discount applied to face value of loans

Warrants issued as part of debt

Exercise of warrants

Series F warrants issued as part of debt

Shares issued for services

Series F preferred shares and warrants issued for debt

Cancellation of Series E preferred shares and common shares

34 unchanged sentences

of liabilities that may result from the possible inability of the Company to continue as a going concern.

For the six months ended August 31, 2023, the Company

had negative cash flow from operating activities of $ 6,335,216 .

As of August 31, 2023, the Company has an accumulated deficit of $ 121,568,632 ,

and negative working capital of $ 24,615,965 .

For the nine months ended November 30, 2023, the Company had negative cash

flow from operating activities of $ 9,378,427 .

As of November 30, 2023, the Company has an accumulated deficit of $ 125,535,116 , and negative

working capital of $ 12,944,810 .

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.

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

19 unchanged sentences

been a strong supporter of the Company.

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.

The Company this fiscal quarter through to September 26, 2023 has raised an additional

$ 5.2 million net of issuance costs through the sale of its common shares.

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.

The Company year to date November 30, 2023 has raised an

additional $ 7.5 million net of issuance costs through the sale of its common shares and an additional $ 1.4 million through the

issuance of debt.

The Company has raised an additional $ 1.5 million net of issuance costs through the sale of its common shares

subsequent to quarter end through to reporting date.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

15 unchanged sentences

for a fair presentation of such statements.

The results of operations for the six months ended August 31, 2023 are not necessarily indicative

of the results that may be expected for the entire year.

The results of operations for the nine months ended November 30, 2023 are not necessarily

indicative of the results that may be expected for the entire year.

Use of Estimates

9 unchanged sentences

Loans payable

At August 31, 2023 there were $ 32,200,345 of loans

At November 30, 2023 there were $ 32,473,345 of loans

payable, $ 28,190,506 or 87 % of these loans to companies controlled by one individual.

14 unchanged sentences

There was an allowance of $ 61,000 and

$ 39,000 provided as of August 31, 2023 and February 28, 2023, respectively.

For the three months ended August 31, 2023 , two customers

$ 39,000 provided as of November 30, 2023 and February 28, 2023, respectively.

For the three months ended November 30, 2023 , three customers

account for 61 % of total accounts receivable .

For the three months ended August 31, 2022 , four customers account for 54 % of total accounts

For the three months ended November 30, 2022, two customers account for 62 % of total accounts

Device Parts Inventory

9 unchanged sentences

increase in the valuation, such as excess or obsolete inventory, are noted.

As of August 31, 2023 and February 28, 2023 there was a valuation

reserve of $ 195,000 and $ 195,000 , respectively.

As of November 30, 2023 and February 28, 2023 there was a

valuation reserve of $ 195,000 and $ 195,000 , respectively.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

35 unchanged sentences

and amortized over the expected useful life or written off if a product is abandoned.

At August 31, 2023 and February 28, 2023, the Company

At November 30, 2023 and February 28, 2023, the Company

had no deferred development costs.

46 unchanged sentences

Customers for additional information.

For the six months ended August 31, 2023 , two customers accounted for 33 % of total revenue (2022-

For the nine months ended November 30, 2023, four customers accounted for

58 % of total revenue and for the nine months ended November 30, 2022, two customers accounted for 41 % of total revenue.

Income taxes are accounted for under the asset and

99 unchanged sentences

Fair Value Measurement Using

August 31, 2023

November 30, 2023

Incentive compensation plan payable- revaluation of equity awards payable in Series G shares

69 unchanged sentences

with customers disaggregated by product/service:

August 31, 2023

August 31, 2022

August 31, 2023

August 31, 2022

November 30, 2023

November 30, 2022

November 30, 2023

November 30, 2022

Device rental activities

13 unchanged sentences

Below is a summary of our lease assets and liabilities

at August 31, 2023 and February 28, 2023.

at November 30, 2023 and February 28, 2023.

Classification

August 31, 2023

November 30, 2023

February 28, 2023

12 unchanged sentences

and were expensed in general and administrative expenses as incurred.

Rent expense and operating lease cost was $ 62,541

and $ 125,083 for the three and six months ended August 31, 2023, respectively, and $ 63,681 and $ 133,648 for the three and six months ended

August 31, 2022, respectively.

Rent expense and operating lease cost was $ 64,081 and $ 189,164 for the

three and nine months ended November 30, 2023, respectively, and $ 61,005 and $ 194,653 for the three and nine months ended November 30,

2022, respectively.

REVENUE EARNING DEVICES

Revenue earning devices consisted of the following:

August 31, 2023

November 30, 2023

February 28, 2023

1 unchanged sentence

Accumulated depreciation

During the three and six months ended August 31, 2023

During the three and nine months ended November 30,

2023 the Company made total additions to revenue earning devices of $ 521,037 and $ 1,306,501 , respectively, which were transfers from inventory.

During the three and six months ended August 31, 2022 the Company made total additions to revenue earning devices of $ 251,946 and $ 426,047 ,

During the three and nine months ended November 30, 2022 the Company made total additions to revenue earning devices of $ 199,047 and $ 625,094 ,

respectively, which were transfers from inventory.

Depreciation expense was $ 165,370 and $ 429,825 for

the three and six months ended August 31, 2023, respectively, and $ 116,125 and $ 187,539 for the three and six months ended August 31,

the three and nine months ended November 30, 2023, respectively, and $ 54,418 and $ 241,957 for the three and nine months ended November

30, 2022, respectively.

2 unchanged sentences

Fixed assets consisted of the following:

August 31, 2023

November 30, 2023

February 28, 2023

6 unchanged sentences

Accumulated depreciation

During the three months ended August 31, 2023, the

Company made additions of $ 75,057 which were transfers from inventory.

During the six months ended August 31, 2023, the Company made additions

of $ 107,230 of which $ 103,767 were transfers from inventory with remaining additions of $ 3,463 .

During the three months ended August 31,

2022, the Company made additions of $ 139,946 of which $ 20,693 were transfers from inventory with remaining additions of $ 118,983 .

the six months ended August 31, 2022, the Company made additions of $ 233,676 of which $ 26,479 were transfers from inventory with remaining

additions of $ 207,197 .

Depreciation expense was $ 49,427 and $ 94,528 for the

three and six months ended August 31, 2023, respectively, and $ 29,668 and $ 52,249 for the three and six months ended August 31, 2022,

During the three months ended November 30, 2023, the

Company made additions of $ 22,101 , $ 11,661 which were transfers from inventory with remaining additions of $ 10,440 .

During the nine months

ended November 30, 2023, the Company made additions of $ 129,331 of which $ 115,428 were transfers from inventory with remaining additions

of $ 13,903 .

During the three months ended November 30, 2022, the Company made additions of $ 31,365 of which $ 19,961 were transfers from

inventory with remaining additions of $ 11,404 .

During the nine months ended November 30, 2022, the Company made additions of $ 265,041

of which $ 47,440 were transfers from inventory with remaining additions of $ 217,601 .

Depreciation expense was $ 50,393 and $ 144,921 for

the three and nine months ended November 30, 2023, respectively, and $ 38,437 and $ 90,686 for the three and nine months ended November

30, 2022, respectively.

73 unchanged sentences

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.

of August 31, 2023, the Company has accrued $ 667,634 in Payments of which $ 431,719 are in arrears.

As of February 28, 2023, the Company

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 November 30, 2023, the Company

has accrued $ 764,702 in Payments of which $ 497,149 are in arrears.

As of February 28, 2023, the Company has accrued $ 542,177 in Payments

of which $ 325,600 are in arrears.

No notices have been sent to the Company.

15 unchanged sentences

of this, the Company has determined that the agreements constitute debt agreements.

As of August 31, 2023, and February 28, 2023, the

As of November 30, 2023, and February 28, 2023, 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 and six months ended August

For both the three months and nine months ended November

30, 2023 and year ended February 28, 2023, 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 August 31, 2023 and February 28, 2023.

The balance remains $ 2,525,000 at both November 30, 2023 and February 28, 2023.

RELATED PARTY TRANSACTIONS

For both the three months ended August 31, 2023 and

August 31, 2022 , the Company had no repayments of net advances from its loan payable-related party At August 31, 2023, the loan payable-related

party was $ 260,746 and $ 206,516 at February 28, 2023.

Included in the balance due to the related party at August 31, 2023 is $ 172,265

of deferred salary and interest, $ 145,500 of which bears interest at 12 %.

At February 28, 2023, included in the balance due to the related

party is $ 108,000 of deferred salary with $ 108,000 bearing interest at 12 %.

The accrued interest included in loan at August 31, 2023 and

February 28, 2023 was $ 23,515 and $ 15,660 respectively.

For both the three months ended November 30, 2023

and November 30, 2022 , the Company had no repayments of net advances from its loan payable-related party At November 30, 2023, the loan

payable-related party was $ 299,286 and $ 206,516 at February 28, 2023.

Included in the balance due to the related party at November 30,

2023 is $ 222,754 of deferred salary and interest, $ 183,625 of which bears interest at 12 %.

At February 28, 2023, included in the balance

due to the related party is $ 108,000 of deferred salary with $ 108,000 bearing interest at 12 %.

The accrued interest included in loan at

November 30, 2023 and February 28, 2023 was $ 28,267 and $ 15,660 respectively.

Pursuant to the amended Employment Agreement with

its Chief Executive Officer, for the three months and six ended August 31, 2023, the Company accrued $ 62,000 (2022-$ 63,000 ) and $ 125,000

its Chief Executive Officer, for the three months and nine ended November 30, 2023, the Company accrued $ 62,000 (2022-$ 138,000 ) and $ 187,000

(2022-$ 362,500 ) of incentive compensation plan payable with a corresponding recognition of stock based compensation due to the expectation

2 unchanged sentences

$ 1,000 per share.

At August 31, 2023 and February 28, 2023 there was $ 1,104,000 and $ 979,000 of incentive compensation payable.

During the three months ended August 31, 2023 and

At November 30, 2023 and February 28, 2023 there was $ 1,166,000 and $ 979,000 of incentive compensation payable.

During the three months ended November 30, 2023 and

2022, the Company was charged $ 526,723 and $ 794,460 , respectively for fees for research and development from a company partially owned

by a principal shareholder.

During the six months ended August 31, 2023 and 2022,

the Company was charged $ 1,659,275 and $ 1,959,129 , respectively for fees for research and development from a company partially owned by

a principal shareholder.

During the nine months ended November 30, 2023 and

2022, the Company was charged $ 2,185,998 and $ 2,735,589 , respectively for fees for research and development from a company partially owned

by a principal shareholder.

OTHER DEBT – VEHICLE LOAN

17 unchanged sentences

The remaining total balances of the amounts owed on the vehicle loans were $ 38,522 and $ 38,522

as of August 31, 2023 and February 28, 2023, respectively, of which all were classified as current.

as of November 30, 2023 and February 28, 2023, respectively, of which all were classified as current.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

1 unchanged sentence

LOANS PAYABLE

Loans payable at August 31, 2023 consisted of the

Loans payable at November 30, 2023 consisted of the

Interest Rate

3 unchanged sentences

December 10, 2020

December 10, 2023

March 1, 2025

Promissory note

December 10, 2020

December 10, 2023

March 1, 2025

Promissory note

6 unchanged sentences

December 30, 2020

December 30, 2023

March 1, 2025

Promissory note

January 1, 2021

January 1, 2024

March 1, 2025

Promissory note

January 1, 2021

January 1, 2024

March 1, 2025

Promissory note

January 14, 2021

January 14, 2024

March 1, 2025

Promissory note

February 22, 20 21

February 22, 2024

March 1, 2025

Promissory note

10 unchanged sentences

July 28, 2022

July 28, 2023

March 1, 2025

Promissory note

3 unchanged sentences

September 7, 2022

September 7, 2023

March 1, 2025

Promissory note

September 8, 2022

September 8, 2023

March 1, 2025

Promissory note

October 13, 2022

October 13, 2023

March 1, 2025

Promissory note

21 unchanged sentences

Promissory note

May 11, 20 23

October 31, 2026

Promissory note

October 27, 2023

October 31, 2026

Promissory note

November 30, 2023

October 31, 2025

Purchase Agreement

current portion of loans payable

4 unchanged sentences

Current portion of loans payable, net of discount

Funds received December 1 , 2023, after reporting period.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

1 unchanged sentence

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

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.

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.

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 $ .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.

$ 100,000 and $ 300,000 has been repaid the three and nine months ended November 30, 2023.

The balance at November 30,2023 is now $ 2,754,338 .

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.

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 .

4 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 52,756 and $ 92,660 , respectively, with an unamortized discount of $ 100,855 at August 31, 2023.

For the three and nine months ended November 30, 2023, 2023, the Company recorded amortization expense of $ 12,878 and $ 105,538 , respectively, with an unamortized discount of $ 31,106 at November 30, 2023.

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.

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.

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.

The note, with an original principal amount of $ 550,000 , may be pre-payable at any time.

2 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 62,143 and $ 113,188 respectively, with an unamortized discount of $ 126,148 at August 31, 2023.

For the three and nine months ended November 30, 2023, 2023, the Company recorded amortization expense of $ 16,718 and $ 129,906 respectively, with an unamortized discount of $ 50,493 at November 30, 2023.

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.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The note, with an original principal balance of $ 1,650,000 , may be pre-payable at any time.

4 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 220,757 and $ 379,821 respectively, with an unamortized discount of $ 732,440 at August 31, 2023.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 82,499 and $ 462,320 respectively, with an unamortized discount of $ 426,061 at November 30, 2023.

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.

The unsecured note may be pre-payable at any time.

12 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 175,789 and $ 330,699 respectively, with an unamortized discount of $ 463,519 at August 31, 2023.

For the three and nine months ended November 30, 2023, 2023, the Company recorded amortization expense of $ 199,482 and $ 530,181 respectively, with an unamortized discount of $ 264,037 at November 30, 2023.

This loan, with an original principal balance of $ 4,000,160 , was in exchange for 184 Series F preferred shares from a former director.

1 unchanged sentence

The loan is unsecured.

For the three and six months ended August 31, 2023 there were repayments of $ 27,000 and $ 54,000 .

For the three and nine months ended November 30, 2023 there were repayments of $ 27,000 and $ 81,000 .

respectively on the note.

2 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 115,344 and $ 202,274 respectively, with an unamortized discount of $ 1,27,501 at August 31, 2023.

For the three and nine months ended November 30, 2023, 2023, the Company recorded amortization expense of $ 146,393 and $ 348,667 respectively, with an unamortized discount of $ 865,764 at November 30, 2023.

Original $ 170,000 note may be pre-payable at any time.

2 unchanged sentences

Secured by a general security charging all of RAD’s present and after-acquired property.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 3,739 and $ 9,026 respectively, with an unamortized discount of $ 0 at August 31, 2023.

This loan has been fully repaid.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 0 and $ 9,026 respectively, with an unamortized discount of $ 0 at November 30, 2023.

This loan is in default.

No notices have been sent by lender.

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.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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.

1 unchanged sentence

Principal and interest due at maturity.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 4,736 and $ 9,293 respectively, with an unamortized discount of $ 21,576 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 4,923 and $ 14,216 respectively, with an unamortized discount of $ 16,552 at November 30, 2023.

Original $ 400,000 note may be pre-payable at any time.

2 unchanged sentences

Secured by a general security charging all of RAD’s present and after-acquired property.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 15,479 and $ 27,821 respectively, with an unamortized discount of $ 0 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 0 and $ 27,821 respectively, with an unamortized discount of $ 0 at November 30, 2023.

This loan is in default.

No notices have been sent by lender.

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.

Original $ 475,000 note may be pre-payable at any time.

2 unchanged sentences

Secured by a general security charging all of RAD’s present and after-acquired property.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 17,799 and $ 36,729 respectively, with an unamortized discount of $ 0 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 0 and $ 36,729 respectively, with an unamortized discount of $ 0 at November 30, 2023.

This loan is in default.

No notices have been sent by lender.

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.

Original $ 350,000 note may be pre-payable at any time.

2 unchanged sentences

Secured by a general security charging all of the Company’s s present and after-acquired property.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 13,295 and $ 25,585 respectively, with an unamortized discount of $ 7,325 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 13,295 and $ 25,585 respectively, with an unamortized discount of $ 0 at November 30, 2023.

This loan is in default.

No notices have been sent by lender.

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.

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

5 unchanged sentences

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,472 and $ 4,338 respectively, with an unamortized discount of $ 343,685 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 3,274 and $ 7,613 respectively, with an unamortized discount of $ 340,411 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,438 and $ 4,276 respectively, with an unamortized discount of $ 344,162 at August 31, 2023.

For the three and nine months ended November 30, 2023, 2023, the Company recorded amortization expense of $ 3,234 and $ 7,510 respectively, with an unamortized discount of $ 340,929 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,233 and $ 3,900 respectively, with an unamortized discount of $ 346,981 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 2,991 and $ 6,891 respectively, with an unamortized discount of $ 343,990 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,489 and $ 4,370 respectively, with an unamortized discount of $ 343,445 at August 31, 2023.

For the three nine months ended November 30, 2023, the Company recorded amortization expense of $ 3,295 and $ 7,665 respectively, with an unamortized discount of $ 340,151 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,541 and $ 4,565 respectively, with an unamortized discount of $ 342,724 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 3,355 and $ 7,821 respectively, with an unamortized discount of $ 339,368 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,436 and $ 4,272 respectively, with an unamortized discount of $ 344,154 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 3,231 and $ 7,503 respectively, with an unamortized discount of $ 340,923 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,523 and $ 3,274 respectively, with an unamortized discount of $ 342,971 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 3,335 and $ 6,608 respectively, with an unamortized discount of $ 339,637 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 2,010 and $ 2,206 respectively, with an unamortized discount of $ 350,013 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 2,723 and $ 4,930 respectively, with an unamortized discount of $ 347,290 at November 30, 2023.

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.

For the three and six months ended August 31, 2023, the Company recorded amortization expense of $ 0 and $ 0 respectively, with an unamortized discount of $ 398,983 at August 31, 2023.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 0 and $ 0 respectively, with an unamortized discount of $ 398,983 at November 30, 2023.

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.

For the three and nine months ended November 30, 2023, the Company recorded amortization expense of $ 2,044 and $ 2,044 respectively, with an unamortized discount of $ 309,715 at November 30, 2023.

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.

As the proceeds were received on December 1, 2023 , this loan will be recorded next quarter.

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.

9 unchanged sentences

Forfeited and cancelled

Outstanding at August 31, 2023

During the six months ended August 31, 2023, as part

of debt issuance the Company issued 183 Series F Preferred Warrants to a lender for a relative fair value of $ 947,447 .

(see Note 11)

Outstanding at November 30, 2023

During the nine months ended November 30, 2023, as

part of debt issuance the Company issued 244 Series F Preferred Warrants to a lender for a relative fair value of $ 1,209,206 .

Summary of Common Stock Activity

1 unchanged sentence

7,225,000,000 to 10,000,000,000 on August 30, 2023.

For the three months ended August 31, 2023, the Company

For the three months ended November 30, 2023, the

Company issued 675,336,434 common shares with gross proceeds of $ 1,468,477 and net proceeds of $ 1,412,158 after issuance costs of $ 56,320 .

For the nine months ended November 30, 2023, the Company

issued 1,859,901,628 common shares with gross proceeds of 7,841,466 and net proceeds of $ 7,527,190 after issuance costs of $ 314,276 .

the six months ended August 31, 2023, the Company issued 1,184,565,194 common shares with gross proceeds of $ 6,372,989 and net proceeds

of $ 6,115,032 after issuance costs of $ 257,956 .

In addition for the three and six months ended the Company issued 6,500,000 shares with

a fair value of $ 44,460 as payment for services of $ 83,200 .

A gain on settlement of debt of $ 38,640 has been recorded.

The Company also

issued 12,100,000 previously recorded as issuable shares pursuant to agreements.

addition the Company issued 6,500,000 shares with a fair value of $ 44,460 as payment for services of $ 83,200 .

A gain on settlement of

debt of $ 38,640 has been recorded.

The Company also issued 12,100,000 previously recorded as issuable shares pursuant to agreements.

The table below represent the common shares issued,

issuable and outstanding at August 31, 2023 and February 28, 2023:

issuable and outstanding at November 30, 2023 and February 28, 2023:

Common shares

August 31, 2023

November 30, 2023

February 28, 2023

5 unchanged sentences

Summary of Common Stock Warrant Activity

For the three months and six months ended August 31,

2023 and August 31, 2022, the Company recorded a total of $ 50,713 and $ 0 , and $ 103,434 and $ 0 respectively, to stock-based compensation

for options and warrants with a corresponding adjustment to additional paid-in capital.

For the three months and nine months ended November 30, 2023 and November

30, 2022, the Company recorded a total of $ 47,462 and $ 0 , and $ 150,896 and $ 0 respectively, to stock-based compensation for options and

warrants with a corresponding adjustment to additional paid-in capital.

Summary of Common Stock Warrant Activity

4 unchanged sentences

Forfeited and cancelled

Outstanding at August 31, 2023

Outstanding at November 30, 2023

ARTIFICIAL INTELLIGENCE TECHNOLOGY SOLUTIONS INC.

25 unchanged sentences

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

lease agreement for a 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 .

8 unchanged sentences

The Company paid a security deposit of $ 1,500 .

The Company’s leases are accounted for as operating

Rent expense and operating lease cost are recorded over the lease terms on a straight-line basis.

Rent expense and operating lease

cost was $ 62,541 and $ 125,083 for the three and six months ended August 31, 2023, respectively, and $ 63,681 and $ 133,648 for the three

and six months ended August 31, 2022, respectively.

The Company’s leases are accounted for as operating leases.

expense and operating lease cost are recorded over the lease terms on a straight-line basis.

Rent expense and operating lease cost was

$ 64,081 and $ 189,164 for the three and nine months ended November 30, 2023, respectively, and $ 61,005 and $ 194,653 for the three and nine

months ended November 30, respectively.

Summary of rent expense and operating lease cost are recorded over the lease terms on a straight-line basis.

Maturity of Lease Liabilities

August 31, 2024

August 31, 2025

August 31, 2026

August 31, 2027

August 31, 2028

August 31, 2029 and after

November 30, 2024

November 30, 2025

November 30, 2026

November 30, 2027

November 30, 2028

November 30, 2029 and after

Total lease payments

6 unchanged sentences

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

Net income (loss) available to common shareholders

1 unchanged sentence

interest expense on convertible debt

amortization of debt discount

Add (less) loss (gain) on settlement of debt

16 unchanged sentences

Net income (loss) per share – diluted

The anti-dilutive shares of common stock equivalents

for the three and six months ended August 31, 2023 and 2022 were as follows:

The anti-dilutive shares of common stock equivalents for the three and

nine months ended November 30, 2023 and 2022 were as follows:

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

Convertible notes and accrued interest

8 unchanged sentences

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 August 31, 2023 and 2022 the dilutive effects would be as follows:

Had these Series F preferred shares been convertible at November 30, 2023 and 2022 the dilutive effects would be as follows:

Series F Preferred shares been convertible the dilutive effects would be as follows:

For the Three and Six Months Ended

August 31, 2023

August 31, 2022

For the Three and Nine Months Ended

November 30, 2023

November 30, 2022

Convertible Series F Preferred Shares

1 unchanged sentence

SUBSEQUENT EVENTS

Subsequent to August 31, 2023 through to October 12,

— The Company issued 120,905,263 common

shares pursuant to a share purchase agreement for gross proceeds of $ 377,224 , issuance costs of $ 8,569 and net proceeds of $ 368,655 .

Subsequent to November 30, 2023 through to January

— The Company issued 639,550 common shares

pursuant to a share purchase agreement for gross proceeds of $ 1,523,258 , issuance costs of $ 62,980 and net proceeds of $ 1,460,278 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements