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Leases

12 Months Ended

Apr. 30, 2023

(9) Leases

Lessor Information

As of April 30, 2023, the Company had three WAM-V’s leased to customers which have been classified as operating leases per accounting guidance contained within Accounting Standards Codification (“ASC”) Topic 842, “Leases”. The remaining term on these operating leases is less than 2 years.

Lessee Information

Right-of-use asset and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. When the implicit rate of the lease is not provided or cannot be determined, the Company uses the incremental borrowing rate based on the information available at the effective date to determine the present value of future payments. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise those options. The renewal options have not been included in the lease term as they are not reasonably certain of exercise. The Company’s operating leases consist of leases for office facilities and warehouse space. Lease expense for minimum lease payments is recognized on a straight- line basis over the lease term and consists of interest on the lease liability and the amortization of the right of use asset.

The Company has a lease for its facility located in Monroe Township, New Jersey that is used as warehouse/production space and the Company’s principal offices and corporate headquarters. The lease includes an initial lease term of seven years which is set to expire in November of 2024, and contains an option to extend the lease for another five years. The lease is classified as an operating lease and is included in right-of-use assets, right-of-use liabilities- current and right-of-use liabilities- long-term on the Company’s Consolidated Balance Sheets.

The Company also signed a new lease in January 2023 located in Houston, Texas for office space for our local employees. The lease term is for 1 year and is set to expire in January of 2024. ASC 842 allows a company an accounting policy election to recognize lease payments within the Consolidated Statement of Operations on a straight-line basis if the lease term is equal to or less than 12 months and not recognize a right-of use asset and lease liability. The accounting policy election is made on the commencement date of the lease. The Company has chosen this election for the Houston lease and classified it as a short-term lease.

The Company also has a lease with the University of California Berkeley in Richmond, California that was assumed as part of the MAR acquisition. The lease is currently a month-to-month lease in accordance with the lease agreement. In accordance with ASC 842, since the remaining lease term at the time of the acquisition of MAR was less than 12 months, the lease was not recognized as a right-of-use asset.

The Company also signed a new lease located in Richmond California for a new office space for MAR which commenced in April of 2023 and will continue for 62 months. The lease is classified as an operating lease and is included in right-of-use assets, right-of-use liabilities- current and right-of-use liabilities- long-term on the Company’s Consolidated Balance Sheets.

Variable lease expenses, if any, are recorded as incurred. The operating lease expense in the Consolidated Statement of Operations was $0.4 million and $0.4 million for the fiscal year ended April 30, 2023 and 2022, respectively.

The components of lease expense in the Consolidated Statement of Operations for the fiscal year ended April 30, 2023 and 2022 was as follows:

Schedule of Operating Lease Costs

	2023		2022
	Fiscal year ended April 30,
	2023		2022
Operating lease cost	$	382	$	368
Short-term lease cost		44		35
Total lease cost	$	426	$	403

Information related to the Company’s right-of use assets and lease liabilities as of April 30, 2023 is as follows:

	April 30, 2023
	(in thousands)

Operating lease:
Operating right-of-use assets, net	$	1,751

Right-of-use liabilities- current		529
Right-of-use liabilities- long term		1,311
Total lease liabilities	$	1,840

Weighted average remaining lease term- operating leases		4.14 years
Weighted average discount rate- operating leases		8.5	%

Total remaining lease payments under the Company’s operating leases are as follows:

	April 30, 2023
	(in thousands)

2024	$	701
2025		494
2026		318
2027		325
Thereafter		362
Total future minimum lease payments		2,200
Less imputed interest		(360	)
Total	$	1,840