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Share-Based Compensation

9 Months Ended

Jan. 31, 2022

Share-based Payment Arrangement [Abstract]

(13) Share-Based Compensation

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 January 31, 2022, the Company has 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 employed by 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 January 31, 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 US Treasury yield curve in effect at the time of grant. The expected life (estimated period of time outstanding) of the stock options granted is estimated using the “simplified” method as permitted by the SEC’s Staff Accounting Bulletin No. 110, Share-Based Payment. Expected volatility is based on the Company’s historical volatility over the expected life of the stock option granted. The Company granted options to acquire 793,850 and 248,876 shares of stock options during the three and nine months ended January 31, 2022 and 2021, respectively. The following assumptions were used to value the awards:

Schedule of Valuation Assumptions

	Nine months ended January 31,
	2022			2021
Risk-free interest rate		1.5	%		6.0	%
Expected dividend yield		—	%		—	%
Expected life (in years)		5.6			5.9
Expected volatility		121.9	%		136.5	%

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

Schedule of Stock Option Activity

	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		(44,332	)	$	1.05
Expired		(1,806	)	$	32.62
Cancelled/forfeited		(121,383	)	$	3.03
Outstanding as of January 31, 2022		1,143,156		$	2.34		9.4
Exercisable as of January 31, 2022		308,481		$	4.59		8.1

As of January 31, 2022, the total intrinsic value of outstanding and exercisable options was approximately $11,560. As of January 31, 2022, approximately 835,000 additional options were unvested, which had an intrinsic value of zero and a weighted average remaining contractual term of 9.9 years. There was approximately $183,000 and $296,000 of total recognized compensation cost related to stock options during each of the nine months ended January 31, 2022 and 2021, respectively. As of January 31, 2022, there was approximately $102,000 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 1.0 year.

The Company’s acquisition of 3Dent (See Note 18) was valued at the fair value of the stock on the acquisition date of $1,451,584 (361,991 shares at $4.01). Since the share restrictions were set to expire on February 1, 2022, within one year of the closing of the acquisition, and lacked marketability, the Company applied a 20% discount to the purchase price making the adjusted fair value $1,161,267. Additionally, as the sellers must be employed for 12 months from the date of acquisition to retain all of their shares, the difference between the calculated fair value and the net assets acquired represents the value of the compensation expense to be recognized over the period of the agreed upon employment.

Fair Value of Purchase	$	1,161,267
Total Acquired Assets	$	(593,571	)
Total Acquired Liabilities	$	117,106
Compensation Expense	$	684,802
Quarterly Compensation Expense	$	171,201

The Company has recognized approximately $171,000 of compensation expense on a quarterly basis for the consideration paid for 12 months from the acquisition date of February 2, 2021. The last of this compensation expense was recognized during the quarter ended January 31, 2022.

Performance Stock Options

In January 2020, the Company issued 81,337 performance-based stock options to two of its executives. There were 40,668 shares that were vested and outstanding, which were set to expire on December 15, 2021, all of which were exercised prior to the expiration date.

In January 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 by the closing share price on January 14, 2022 and January 14, 2023. There were 230,000 shares unvested and outstanding at January 31, 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. A summary of performance stock options under our stock incentive plans is detailed in the following table.

Schedule of Stock Option Activity

	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	)	$	1.05
Cancelled/forfeited		(220,766	)	$	2.58
Outstanding as of January 31, 2022		230,023		$	2.26		9.1
Exercisable as of January 31, 2022		—					0.0

As of January 31, 2022, the total intrinsic value of both outstanding and exercisable options was approximately zero. As of January 31, 2022, approximately 230,000 options were unvested, which had an intrinsic value of zero and a weighted average remaining contractual term of 9.1 years. There was approximately $123,000 and $43,000 of total recognized compensation cost related to stock options during each of the nine months ended January 31, 2022 and 2021, respectively. As of January 31, 2022, there was approximately $242,000 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 1.1 years.

Restricted Stock

Compensation expense for non-vested 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 nine months ended January 31, 2022 and 2021, the Company granted 777,764 and 10,000 shares, respectively, that were subject to service-based vesting requirements.

A summary of non-vested 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		777,764		$	1.42
Vested		(10,000	)	$	2.93
Cancelled/forfeited		—		$	—
Issued and unvested at January 31, 2022		777,764		$	1.42

There was approximately $43,000 and $12,000 of total recognized compensation cost related to restricted stock for the nine months ended January 31, 2022 and 2021, respectively. As of January 31, 2022, there is approximately $54,000 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 approximately 1.4 years.

In December 2019, the Company granted 51,547 shares to an employee, subject to service-based vesting requirements, that were outside the Company stock incentive plans. There was approximately zero and $30,000 of total recognized compensation cost related to this award for the three months ended January 31, 2022 and 2021, respectively. As of January 31, 2022, there was no unrecognized compensation cost remaining related to this award.