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Benefit Plans | 6 Months Ended
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Apr. 30, 2023
Benefit Plans |
Benefit Plans | Note 16. Benefit Plans We have stockholder approved equity incentive plans, a stockholder approved Employee Stock Purchase Plan and an employee tax-deferred savings plan which are described in more detail below. 2018 Omnibus Incentive Plan The Company’s 2018 Omnibus Incentive Plan (as amended and restated from time to time, the “2018 Incentive Plan”) authorizes grants of stock options, stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), performance shares, performance units and incentive awards to employees, directors, consultants and advisors. Stock options, RSAs, RSUs and SARs have restrictions as to transferability. Stock option exercise prices are fixed by the Company’s Board of Directors but shall not be less than the fair market value of our common stock on the date of the grant. SARs may be granted in conjunction with stock options. Of the 12,333,333 shares of the Company’s common stock authorized to be issued under the 2018 Incentive Plan as of April 30, 2023, 3,517,296 remained available for grant as of April 30, 2023. Of the shares remaining available for grant, the Company had reserved, for potential future grant, up to 2,036,257 performance stock units if maximum performance is achieved. See Note 18. “Subsequent Events” for information regarding the recent amendment to the 2018 Incentive Plan to increase the number of shares authorized to be issued under the 2018 Incentive Plan. Long-Term Incentive Plans The Company’s Board of Directors periodically approves Long Term Incentive Plans which include performance-based awards tied to the Company’s common stock price as well as time-vesting awards. None of the awards granted as part of Long-Term Incentive Plans include any dividend equivalent or other stockholder rights. To the extent the awards are earned, they may be settled in shares or cash of an equivalent value at the Company’s option. Fiscal Year 2023 Long Term Incentive Plan: On December 5, 2022, the Company’s Board of Directors approved a Long-Term Incentive Plan for fiscal year 2023 (the “FY 2023 LTI Plan”) as a sub-plan consisting of awards made under the 2018 Incentive Plan. The participants in the FY 2023 LTI Plan are members of senior management. The FY 2023 LTI Plan consists of two award components:
| 1) | Relative Total Shareholder Return (“TSR”) Performance Share Units (“PSU”). The PSUs granted during the six months ended April 30, 2023 will be earned over the performance period ending on October 31, 2025, but will remain subject to a continued service-based vesting requirement until the third anniversary of the date of grant. The performance measure for the relative TSR PSUs is the TSR of the Company relative to the TSR of the Russell 2000 from November 1, 2022 through October 31, 2025. The Compensation Committee established the performance assessment criteria for the relative TSR PSUs as the TSR of the Company relative to the TSR of the Russell 2000, with the award calibration being 100% plus or minus 0.5 x the difference between the Company’s TSR and the Russell 2000 Index composite TSR. The award is capped at 200% of the target number of PSUs, and the award is further capped at 100% of the target number of PSUs if the Company’s absolute TSR over the performance period is negative. The Company’s TSR is calculated by subtracting the Company’s beginning stock price (defined as the average closing price of the Company’s common stock over the 60 consecutive trading days ending on October 31, 2022) from the ending stock price (defined as the average closing price of the Company’s common stock over the 60 consecutive trading days ending on October 31, 2025), adding any dividends during the period, and then dividing the result by the Company’s beginning stock price. Given that the performance period is still open, the Company has reserved shares equal to 200% of the target number of PSUs, subject to performance during the remaining performance period as well as vesting based on continued service until December 5, 2025 (the third anniversary of the grant date).
| 2) | Time-vesting RSUs. The time-vesting RSUs granted during the six months ended April 30, 2023 will vest at a rate of one-third of the total number of RSUs on each of the first three anniversaries of the date of grant.
Other Equity Incentive Plans The Company’s 2006 and 2010 Equity Incentive Plans remain in effect only to the extent of awards outstanding under the plans as of April 30, 2023. Share-Based Compensation Share-based compensation was reflected in the Consolidated Statements of Operations and Comprehensive Loss as follows (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended April 30, | ​ | Six Months Ended April 30,
​ |  | 2023 |  | 2022 | ​ | 2023 |  | 2022
Cost of revenues | ​ | $ | 413 | ​ | $ | 185 | ​ | $ | 747 | ​ | $ | 338
Administrative and selling expense | ​ | ​ | 2,320 | ​ | ​ | 1,350 | ​ | ​ | 4,262 | ​ | ​ | 2,528
Research and development expense | ​ | ​ | 363 | ​ | ​ | 106 | ​ | ​ | 659 | ​ | ​ | 184
​ | ​ | $ | 3,096 | ​ | $ | 1,641 | ​ | $ | 5,668 | ​ | $ | 3,050
​ Restricted Stock Units Including Performance Share Units The following table summarizes our RSU activity for the six months ended April 30, 2023:
​ | ​ | ​ | ​ | ​ | ​ | ​
Restricted Stock Units |  | ​ | Shares |  | Weighted-Average Fair Value
Outstanding as of October 31, 2022 | ​ | ​ | 2,520,881 | ​ | $ | 7.93
Granted - PSUs | ​ | ​ | 1,124,953 | ​ | ​ | 5.50
Granted - time-vesting RSUs | ​ | ​ | 3,781,370 | ​ | ​ | 3.41
Vested | ​ | ​ | (261,059) | ​ | ​ | 7.03
Forfeited | ​ | ​ | (64,056) | ​ | ​ | 7.55
Outstanding as of January 31, 2023 | ​ | ​ | 7,102,089 | ​ | $ | 5.18
Granted - time-vesting RSUs | ​ | ​ | 64,550 | ​ | ​ | 3.29
Vested | ​ | ​ | (84,669) | ​ | ​ | 5.96
Forfeited | ​ | ​ | (42,000) | ​ | ​ | 3.65
Outstanding as of April 30, 2023 | ​ | ​ | 7,039,970 | ​ | $ | 5.16
​ On December 5, 2022, 2,249,890 RSUs were awarded to senior management under the FY 2023 LTI Plan, which included 1,124,953 PSUs and 1,124,937 time-based vesting RSUs. The PSUs were valued based on a Monte-Carlo Simulation, and the estimated fair value of the relative TSR PSUs was $5.50 per share. The PSUs and time-based vesting RSUs are expensed over the three-year service period. In addition to the awards granted to senior management, during the six months ended April 30, 2023, the Board of Directors also granted a total of 2,720,983 time-based vesting RSUs to certain salaried employees to promote ownership of the Company’s equity and retention. The time-based vesting RSUs granted during the six months ended April 30, 2023 vest at a rate of one-third of the total number of RSUs granted on each of the first three anniversaries of the date of grant. PSUs are issued assuming participants achieve 100% target performance. The Company also reserves additional shares assuming the maximum performance targets are met.

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