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Share-Based Compensation Plans
 12 Months Ended
Apr. 30, 2022
Share-Based Payment Arrangement [Abstract]  
Share-Based Compensation Plans

(14) Share-Based Compensation Plans

 

In 2015, upon approval by the Company’s shareholders, the Company’s 2015 Omnibus Incentive Plan (the “2015 Plan”) became effective. A total of 1,332,036 shares were authorized for issuance under the 2015 Omnibus Incentive Plan, including shares available for awards under the 2006 Stock Incentive Plan remaining at the time that plan terminated, or that were subject to awards under the 2006 Stock Incentive Plan that thereafter terminated by reason of expiration, forfeiture, cancellation or otherwise. If any award under the 2006 Stock Incentive Plan or 2015 Plan expires, is cancelled, terminates unexercised or is forfeited, those shares become again available for grant under the 2015 Plan. The 2015 Plan will terminate ten years after its effective date, in October 2025, but is subject to earlier termination as provided in the 2015 Plan. As of April 30, 2022, the Company had 696,627 shares available for future issuance under the 2015 Plan which reflects adjustments made for the departure of our former CEO as well as other departures.

 

 

On January 18, 2018, the Company’s Board of Directors adopted the Company’s Employment Inducement Incentive Award Plan (the “2018 Inducement Plan”) pursuant to which the Company reserved 25,000 shares of common stock for issuance under the Inducement Plan. In accordance with Rule 711(a) of the NYSE American Company Guide, awards under the Inducement Plan may only be made to individuals not previously employees of the Company (or following such individuals’ bona fide period of non-employment with the Company), as an inducement material to the individuals’ entry into employment with the Company. An award is any right to receive the Company’s common stock pursuant to the 2018 Inducement Plan, consisting of a performance share award, restricted stock award, a restricted stock unit award or a stock payment award. As of April 30, 2022, there were 11,487 shares available for grant under the 2018 Inducement Plan. On February 9, 2022 the 2018 Inducement Plan was amended to increase the authorized shares by 250,000 to 275,000.

 

Stock Options

 

The Company estimates the fair value of each stock option award granted with service-based vesting requirements, using the Black-Scholes option pricing model, assuming no dividends, and using the weighted average valuation assumptions noted in the following table. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The expected life (estimated period of time outstanding) of the stock options granted was estimated using the “simplified” method as permitted by the SEC’s Staff Accounting Bulletin No. 110, Share-Based Payment. Expected volatility was based on the Company’s historical volatility over the expected life of the stock option granted. There were 793,850 and 248,876 shares granted for the periods ended April 30, 2022 and 2021, respectively.

 

   Twelve months ended April 30, 
   2022   2021 
Risk-free interest rate   1.5%   0.6%
Expected dividend yield   0.0%   0.0%
Expected life (in years)   5.5    5.5 - 5.8 
Expected volatility   121.9%   136.5%

 

The above assumptions were used to determine the weighted average per share fair value of $1.11 and $2.63 for stock options granted during the fiscal years ended April 30, 2022 and 2021, respectively.

 

  

Shares

Underlying

Options

  

Weighted

Average

Exercise

Price

  

Weighted

Average

Remaining

Contractual

Term

(In Years)

 
Outstanding as of April 30, 2021   516,827   $3.89    9.0 
Granted   793,850   $1.43      
Exercised   (45,332)  $1.05      
Cancelled/forfeited   (153,183)  $2.86      
Expired   (1,806)  $32.62      
Outstanding as of April 30, 2022   1,110,356   $2.34    9.2 
Exercisable as of April 30, 2022   297,504   $4.65    7.8 

 

As of April 30, 2022 and 2021, the total intrinsic value for both outstanding and exercisable options was approximately zero and $0.3 million respectively. As of April 30, 2022, approximately 813,000 additional options were unvested, which had an intrinsic value of zero and a weighted average remaining contractual term of 9.7 years. There was approximately $0.3 million and $0.4 million of total recognized compensation cost related to stock options during each of the twelve months ended April 30, 2022 and 2021, respectively. As of April 30, 2022, there was approximately $0.8 million of total unrecognized compensation cost related to non-vested stock options granted under the plans. This cost is expected to be recognized over a weighted-average period of 2.5 years.

 

 

Performance Stock Options

 

In January of 2020, the Company issued 81,337 performance-based stock options to two of its executives. There were 40,666 shares vested and outstanding, which were set to expire on December 15, 2021, all of which were exercised prior to the expiration date.

 

In January of 2021, the Company issued 344,723 performance-based stock options to employees and executives. The awards vest over 2 years provided there is positive total shareholder return (e.g. share price increase) as measured to the closing share price on January 14, 2022 and January 14, 2023. There were 343,456 shares unvested and outstanding for the year ended April 30, 2022. None of the shares granted to our former President and CEO under this issuance vested prior to June 18, 2021, his last day of employment. These unvested shares are included in the Cancelled/forfeited figure in the table below.

 

The Company determined these awards contain a market-based condition and estimated the fair value using the Monte Carlo simulation model with the following assumptions:

 

   Twelve months ended April 30, 
   2022   2021 
Risk-free interest rate   N/A    1.2%
Expected dividend yield   N/A    0.0%
Expected life (in years)   N/A    10.0 
Expected volatility   N/A    76.0%- 136.5%

 

The above assumptions were used to determine the weighted average per share fair value of $2.09 for performance stock options granted during the year ended April 30, 2021.

 

A summary of performance stock options under our stock incentive plans is detailed in the following table.

 

  

Shares

Underlying

Options

  

Weighted

Average

Exercise

Price

  

Weighted

Average

Remaining

Contractual

Term

(In Years)

 
Outstanding as of April 30, 2021   424,790   $2.57    9.5 
Granted   66,667   $0.62      
Exercised   (40,668)  $1      
Cancelled/forfeited   (240,667)  $2.61      
Outstanding as of April 30, 2022   210,122   $2.20    8.8 
Exercisable as of April 30, 2022   —   $—      

 

As of April 30, 2022 and 2021, the total intrinsic value of outstanding and exercisable performance stock options was approximately zero and $0.1 million respectively. As of April 30, 2022, approximately 210,000 additional options were unvested, which had an intrinsic value of $29,000 and a weighted average remaining contractual term of 8.8 years. There was approximately $0.1 million and $0.1 million of total recognized compensation cost related to performance stock options during each of the twelve months ended April 30, 2022 and 2021, respectively. As of April 30, 2022, there was approximately $0.2 million of total unrecognized compensation cost related to non-vested stock options granted under the plans. This cost is expected to be recognized over a weighted-average period of 0.9 years.

 

 

Restricted Stock

 

Compensation expense for unvested restricted stock is generally recorded based on its market value on the date of grant and recognized ratably over the associated service and performance period. During the year ended April 30, 2022 and 2021, the Company granted 827,764 and 10,000 shares, respectively, subject to service-based vesting requirements.

 

A summary of unvested restricted stock under our stock incentive plans is as follows:

 

  

Number

of Shares

  

Weighted

Average Price
per Share

 
Issued and unvested at April 30, 2021   10,000   $2.93 
Granted   827,764   $1.41 
Vested   (10,000)  $2.93 
Cancelled/forfeited   —   $— 
Issued and unvested at April 30, 2022   827,764   $1.41 

 

There was approximately $242,000 and $49,000 of total recognized compensation cost related to restricted stock for the years ended April 30, 2022 and 2021, respectively. As of April 30, 2022, there was $0.9 million of unrecognized compensation cost remaining related to unvested restricted stock granted under our plans. This cost is expected to be recognized over a weighted-average period of 1.9 years.