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What changed in Ocean Power Technologies, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Ocean Power Technologies, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+408 added−387 removedSource: 10-K (2024-07-25) vs 10-K (2023-07-28)

Top changes in Ocean Power Technologies, Inc.'s 2024 10-K

408 paragraphs added · 387 removed · 286 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

147 edited+56 added−57 removed73 unchanged
Biggest changeIn October 2020, the Company launched its DaaS offering in support of the U.S. Navy’s Naval Postgraduate School’s Sea, Land, Air, Military Research Initiative (“SLAMR”). We have further expanded our DaaS offering through field demonstration such as ANTX Coastal Trident 2022, as well as contracts with a U.S. government services’ provider for an MDA demonstration off the U.S.
Biggest changeWAM-V’s® can also be outfitted with various equipment for the performance of marine infrastructure surveys, berth clearance surveys, dredging surveys, and mining pit surveys. 1 In October 2020, the Company launched its DaaS offering in support of the U.S. Navy’s Naval Postgraduate School’s (“NPS”) Field Experimentation (formerly Sea, Land, Air, Military Research Initiative).
For example, our solutions can track surface vessel movement for maritime border enforcement and illegal fishing interdiction, provide security for offshore wind farms and oil and gas fields, or provide harbor or port security as well as logistics support.
For example, our solutions can track surface vessel movement for maritime border enforcement and illegal fishing interdiction, provide security for offshore wind farms and oil and gas fields, and provide harbor or port security as well as logistics support.
Additionally, we will continue to develop and enhance our obstacle detection and obstacle avoidance capabilities, further advancing our progress towards full Convention on the International Regulations for Preventing Collisions at Sea (COLREGS) compliance (an international agreement that sets out the rules of the road for ships and other vessels at sea).
Additionally, we will continue to develop and enhance our obstacle detection and obstacle avoidance capabilities, further advancing our progress towards the full Convention on the International Regulations for Preventing Collisions at Sea (COLREGS) compliance (an international agreement that sets out the rules of the road for ships and other vessels at sea).
Our systems can be equipped with a variety of communications equipment, such as 5G, 4G LTE, satellite, VHF, and Wi-Fi, which enables the transmission of data on a frequent or near-continuous basis. We believe that more frequent data communication could enable an end-user to more quickly and proactively make data-driven decisions which could result in economic advantages.
Our systems can be equipped with a variety of communications equipment, such as 5G, 4G LTE, satellite, VHF, and Wi-Fi, which enables the transmission of data on a frequent or continuous basis. We believe that more frequent data communication could enable an end-user to more quickly and proactively make data-driven decisions which could result in economic advantages.
Our PowerBuoy® platforms are designed to operate over extended intervals between required maintenance activities. We believe that our PowerBuoys® will reduce costs over multi-year operations. These cost savings are mostly due to reduced vessel and personnel servicing activities. For short term deployments, our NextGen PB is a cost-efficient means of providing MDA and subsea power solutions.
Our PowerBuoy® platforms are designed to operate over extended intervals between required maintenance activities. We believe that our PowerBuoys® will reduce costs over multi-year operations. These cost savings are mostly due to reduced vessel and personnel servicing activities. For short and long term deployments, our NextGen PB is a cost-efficient means of providing MDA and subsea power solutions.
Furthermore, there is an increasing market demand for providing interim power and control solutions for tiebacks where umbilicals are exhibiting failures. In addition, we believe the survey capability afforded by our WAM-V’s® is perfectly suited to serve a broad range of survey needs of the oil and gas industry often required for permit obtainment.
Furthermore, there is an increasing market demand for providing interim power and control solutions for tiebacks where control and monitoring umbilicals are exhibiting failures. In addition, we believe the survey capability afforded by our WAM-V’s® is perfectly suited to serve a broad range of survey needs of the oil and gas industry often required for permit obtainment.
Our PowerBuoy ® platforms can also act as persistent or short term self-powered solution platforms for payloads, such as our MDA package, which can provide real-time perimeter security, vessel tracking and area surveillance for government defense, fishery protection, and offshore energy applications. ● Considerable life-cycle cost savings over current solutions for many applications.
Our PowerBuoy ® platforms can also act as persistent or short term self-powered solution platforms for payloads, such as our MDA package, which can provide real-time perimeter security, vessel tracking and area surveillance for government defense, fishery protection, and offshore energy applications. 6 ● Considerable life-cycle cost savings over current solutions for many applications.
We believe the sensor suite will be a combination of marine environment tested off-the-shelf components selected to optimize performance and cost. This system could be utilized as a standalone node or in an array, which will provide near real-time information about the marine activity within a customer’s area of interest.
We believe the sensor suite will be a combination of marine environment tested off-the-shelf components selected to optimize performance and cost. 15 This system could be utilized as a standalone node or in an array, which will provide near real-time information about the marine activity within a customer’s area of interest.
The PB3 has maintained operational performance through hurricanes, tropical storms and North Sea winter storms and has been successfully deployed for several clients. The Company maintains access to ocean testing through the use of three permitted test sites in New Jersey that allow us to perform water testing of new PowerBuoy® products and payloads.
The legacy PB3 has maintained operational performance through hurricanes, tropical storms and North Sea winter storms and has been successfully deployed for several clients. The Company maintains access to ocean testing through the use of three permitted test sites in New Jersey that allow us to perform water testing of new PowerBuoy® products and payloads.
In addition, certain technologies that we developed with U.S. federal government funding are subject to certain government rights as described in “Risk Factors - Risks Related to Intellectual Property.” We use trademarks on nearly all our products and believe that having distinctive marks is an important factor in marketing our products.
In addition, certain technologies that we developed with U.S. federal government funding are subject to certain government rights as described in “Risk Factors - Risks Related to Intellectual Property.” 16 We use trademarks on nearly all our products and believe that having distinctive marks is an important factor in marketing our products.
The stable platforms of the WAM-Vs ® allow for a broad range of subsea and surface sensors and assets to be integrated. Flexible interfaces reduce cost through simplified integration and deployment. ● Reduced carbon emission, environmentally benign system design. Our PowerBuoys® emit no carbon during operation.
The stable platforms of the WAM-Vs ® allow for a broad range of subsea and surface sensors and assets to be integrated. Flexible interfaces reduce cost through simplified integration and deployment. 7 ● Reduced carbon emission, environmentally benign system design. Our PowerBuoys® emit no carbon during operation.
Multiple sensors can be used on a single unit based on the comprehensiveness of the needs of our customers. Our MDAS processes data onboard our platforms (i.e., edge computing) and transmits the results to our cloud-based analytics platform via secure Wi-Fi and cellular and satellite communications.
Multiple sensors can be used on a single unit based on the comprehensiveness of the needs of our customers. 2 Our MDAS processes data onboard our platforms (i.e., edge computing) and transmits the results to our cloud-based analytics platform via secure Wi-Fi and cellular and satellite communications.
As both the renewable energy and wave energy industries continue to evolve, we anticipate that wave energy technology and our PowerBuoys® and their deployment will be subject to increased oversight and regulation in accordance with international, national, and local regulations relating to safety, site approval, and environmental protection. 17 Site Approval.
As both the renewable energy and wave energy industries continue to evolve, we anticipate that wave energy technology and our PowerBuoys® and their deployment will be subject to increased oversight and regulation in accordance with international, national and local regulations relating to safety, site approval, and environmental protection. Site Approval.
The operation of the PB3 is controlled by our customized, proprietary control system. The control system uses sensors and an onboard computer to continuously monitor the PB3 subsystems. We believe that this ability to optimize and manage the electric power output of the PB3 is a significant advantage of our technology.
The operation of the legacy PB3 is controlled by our customized, proprietary control system. The control system uses sensors and an onboard computer to continuously monitor the legacy PB3 subsystems. We believe that this ability to optimize and manage the electric power output of the legacy PB3 is a significant advantage of our technology.
We have designed our solutions to have multiple offshore applications that can be used globally by customers. Our WAM-V ® autonomous vehicles are designed for nearshore and offshore deployments as fully or semi-autonomous systems and can operate in force multiplier mode.
We have designed our solutions to have multiple maritime applications that can be used globally by customers. Our WAM-V ® autonomous vehicles are designed for nearshore and offshore deployments as fully or semi-autonomous systems and can operate in force multiplier mode.
We have been actively pursuing additional opportunities to bring in-house skills, capabilities, and solutions that are complementary to our strategy and enable us to scale more quickly. 12 ● Partner with fabrication, deployment and service contractors.
We have been actively pursuing additional opportunities to bring in-house skills, capabilities, and solutions that are complementary to our strategy and enable us to scale more quickly. ● Partner with fabrication, deployment and service contractors.
Because some of our solutions use technology that is not yet fully adopted by customers within our target markets in every case, we expect that the customer decision process will continue to include substantial time educating end-users and stakeholders, which may result in a continued lengthy sales cycle.
Because some of our solutions use technology that is not yet fully adopted by customers within our target markets in every case, we expect that the customer decision process will continue to include substantial time educating end-users and stakeholders, which may result in the continuation of a lengthy sales cycle.
Historically, demonstration projects have been a requisite step towards broad solution deployment and revenues associated with specific applications such as our New Jersey MDAS test array as part of our DaaS solution and to highlight these capabilities. Customers may want their own dedicated demonstration depending on customer needs.
Historically, demonstration projects have been a requisite step towards broad solution deployment and revenue associated with specific applications such as our New Jersey MDAS test array as part of our DaaS solution and to highlight these capabilities. Customers may want their own dedicated demonstration depending on customer needs.
We believe this domestically distributed manufacturing and assembly approach enables us to focus on our core competencies and ensure a cost-effective product by leveraging a larger more established supply base. We continue to seek strategic partnerships regarding servicing of our products and solutions. ● Survey and security market applications.
We believe this domestically distributed manufacturing and assembly approach enables us to focus on our core competencies and ensure a cost-effective product by leveraging a larger more established supply base. We continue to seek strategic partnerships regarding servicing of our products and solutions. 12 ● Expand survey and security market applications.
When combined with our MDAS for applications typically serviced by a manned guard vessel powered by diesel fuel, this can indirectly displace more than 300 tonnes of carbon for every 10 vessel days replaced, or the equivalent of removing more than 125 cars from the road.
When combined with our MDAS for applications typically serviced by a manned guard vessel powered by diesel fuel, this can indirectly displace more than 300 tons of carbon for every 10 vessel days replaced, or the equivalent of removing more than 125 cars from the road.
Our platforms provide stable and reliable power sources in nearshore and remote offshore locations for short and long-term deployments. We believe that our solutions and our existing commercial relationships provide the following competitive advantages in our target markets: ● Numerous applications within multiple major market segments.
Our platforms provide stable and reliable power sources in nearshore and remote maritime locations for short and long-term deployments. We believe that our solutions and our existing commercial relationships provide the following competitive advantages in our target markets: ● Numerous applications within multiple major market segments.
As of April 30, 2023, we have been issued 70 U.S. patents, of which 38 are active, 20 have expired and 12 were abandoned. Outside of the U.S., we have been issued 280 patents across 25 countries with 26 of the active U.S. patents having at least one corresponding issued foreign patent.
As of April 30, 2024, we have been issued 70 U.S. patents, of which 38 are active, 20 have expired and 12 were abandoned. Outside of the U.S., we have been issued 280 patents across 25 countries with 26 of the active U.S. patents having at least one corresponding issued foreign patent.
For shorter term deployments and in nearshore waters, the WAMV might replace the need for a manned vessel entirely. For long term deployments and in offshore waters, the WAM-V® enables material reductions in costs and carbon emissions from traditional large survey vessels. 7 ● Real-time data communications.
For shorter term deployments and in nearshore waters, the WAM-V® might replace the need for a manned vessel entirely. For long term deployments and in offshore waters, the WAM-V® enables material reductions in costs and carbon emissions from traditional large survey vessels. ● Real-time data communications.
Our vehicles can support customized subsea and surface payloads, including other remotely operated or autonomous systems such as aerial drones and ROVs. Multiple applications exist in the hydrographic survey market, across a range of industries including offshore wind and oceanographic monitoring. Our PB3 was designed for longer-term deployment in moderate to high ocean wave climates.
Our vehicles can support customized subsea and surface payloads, including other remotely operated or autonomous systems such as aerial drones and ROVs. Multiple applications exist in the hydrographic survey market, across a range of industries including offshore wind and oceanographic monitoring. Our legacy PB3 was designed for longer-term deployment in moderate to high ocean wave locations.
We have been focused on addressing the energy needs of many of these applications (e.g., ocean observation, underwater vehicle charging), and other offshore applications (e.g., maritime domain awareness, well monitoring and powering subsea equipment control systems).
We have been focused on addressing the energy needs of some of these applications (e.g., ocean observation, underwater vehicle charging), and other offshore applications (e.g., maritime domain awareness, well monitoring and powering subsea equipment control systems).
One of the primary ways we showcase our Company, products, services and expertise is through demonstrations, conferences, and selective use of trade shows. We utilize our database to select conferences and trade shows where we will have the most effective visibility to our potential clients.
One of the primary ways we showcase our Company’s products, services and expertise is through demonstrations, conferences, and selective use of trade shows. We utilize our database to select conferences and trade shows where we will have the most effective visibility to our potential clients.
MAR launched the first WAM-V® in 2007 as a new vehicle class to deliver reliable autonomous surface vehicles to customers that could provide robust, real-time data collection and reporting. MAR also provides RaaS, allowing customers to lease WAM-V® robotics and access information from our WAM-Vs® while we maintain ownership and maintenance and repair responsibilities.
The first WAM-V® was launched in 2007 as a new vehicle class to deliver reliable autonomous surface vehicles to customers that could provide robust, real-time data collection and reporting. Our Autonomous Vehicles business also provides RaaS, allowing customers to lease WAM-V® robotics and access information from our WAM-Vs® while we maintain ownership and maintenance and repair responsibilities.
Each survey vessel day replaced by a WAM-V® can displace over 14 tonnes of carbon. Over a full survey season, this could exceed 1300 tonnes of carbon displacement, the equivalent of more than 500 cars worth of annual emissions.
Each survey vessel day replaced by a WAM-V® can displace over 14 tons of carbon. Over a full survey season, this could exceed 1300 tons of carbon displacement, the equivalent of more than 500 cars worth of annual emissions.
Our Solutions Data as a Service Our DaaS solution is at the forefront of our strategic plan to be a leader in offshore data collection, integration, analytics and real time communication for a variety of important applications.
Our Solutions Data as a Service Our DaaS solution is at the forefront of our strategic goal to be a leader in offshore data collection, integration, analytics and real time communication for a variety of important applications.
Despite our size, the Company views itself as a responsible corporate citizen throughout the execution of its operations, as emphasized by its goal to provide low-carbon power and data solutions for offshore industries, scientific research, and territorial security. It is the Company’s goal that all products have a minimal environmental impact footprint compared to alternative solutions.
The Company views itself as a responsible corporate citizen throughout the execution of its operations, as emphasized by its goal to provide low-carbon power and data solutions for offshore industries, scientific research, and territorial security. It is the Company’s goal that all products have a minimal environmental impact footprint compared to alternative solutions.
Our patent portfolio includes patents and patent applications with claims directed to: ● System design, including buoy, battery chargers, generators, power take off, printed circuit boards, and WEC; ● WEC control systems; ● Wave power and thermal motor power conversion; ● Buoy anchoring and mooring design and power cable connection; ● Wave WEC farm architecture; ● Systems and methods for vehicle charging; and ● WAM-V® technology.
Our patent portfolio includes patents and patent applications with claims directed to ● System design, including buoy, battery chargers, generators, power take off, printed circuit boards, and WEC; ● WEC control systems; ● Wave power and thermal motor power conversion; ● Buoy anchoring and mooring design and power cable connection; ● Wave WEC farm architecture; ● Systems and methods for vehicle charging; ● WAM-V® technology; and ● Buoy based cellular networks.
Additionally, we are also attracting interest targeted toward subsea applications, using proprietary sensor payloads for environmental monitoring and subsea intelligence. We believe that our buoys and WAM-Vs® are uniquely able to deliver these services either as a standalone solution or in combination with other systems.
Further, we are attracting interest targeted toward subsea applications, using proprietary sensor payloads for environmental monitoring and subsea intelligence. We believe that our buoys and WAM-Vs® are uniquely able to deliver these services either as a standalone solution or in combination with other systems.
These groups often require a power and communications solution in remote offshore locations. Additionally, the increased interest in protecting marine habitats offers opportunities to collaborate with governments and NGOs to monitor marine sanctuaries. Offshore Wind and Other Markets Opportunities also exist in other markets such as supporting offshore wind farm development and aquaculture.
These groups often require a power and communications solution in remote offshore locations. Additionally, the increased interest in protecting marine habitats offers opportunities to collaborate with governments and NGOs to monitor marine sanctuaries. Offshore Wind and Other Markets Opportunities also exist in other markets such as supporting offshore wind farm development and aquaculture. According to the U.S.
The Company expects to benefit from the growing RaaS trend, providing greater visibility into predicting revenue and planning supply for demand, while providing our customers with flexibility and a lower barrier to entry. Power as a Service PaaS solutions deliver value to customers by utilizing our managed power platforms.
The Company expects to benefit from the growing RaaS trend, providing greater visibility into predicting revenue and planning supply for demand, while providing our customers with flexibility and a lower cost of entry. Power as a Service PaaS solutions deliver value to customers by utilizing our managed power platforms.
In order to achieve success in ongoing efforts to commercialize our products, we must expand our customer base and obtain commercial contracts to lease or sell our solutions and services to customers. Our potential customer base for our solutions includes various public and private entities, and agencies that require remote offshore power.
In order to achieve success in ongoing commercialization efforts, we must expand our customer base and obtain commercial contracts to lease or sell our solutions and services to customers. Our potential customer base for our solutions includes various public and private entities, and agencies that require remote offshore power.
The prototype of the solar and wind PowerBuoy ® has been tested off the coast of New Jersey and was used during the MDAS demonstration for ANTX during fiscal 2023. We believe this product addresses a broader spectrum of customer deployment needs, including low-wave and nearshore environments, with the potential for greater product integration within each customer project.
The prototype of the solar and wind PowerBuoy® and the prototype of the MOSWEC PowerBuoys ® has been tested off the coast of New Jersey and the solar and wind system was used during the MDAS demonstration for ANTX during fiscal 2023. 4 We believe this product addresses a broader spectrum of customer deployment needs, including low-wave and nearshore environments, with the potential for greater product integration within each customer project.
In April 2023 we entered into a lease for a new facility in Richmond, CA, providing improved resources for research and development activity as well as surge manufacturing and on water testing capability. Human Capital The Company believes that its future success is dependent in part on its continued ability to attract, hire and retain qualified personnel.
In April 2023, we entered into a lease for a new facility in Richmond, CA, providing improved resources as well as surge manufacturing and on water testing capability. 17 Human Capital The Company believes that its future success is dependent in part on its continued ability to attract, hire and retain qualified personnel.
Control systems’ development will continue to provide additional features based on feedback from existing customers as well as our gained experience in our RaaS offering.
Control systems’ development will continue to provide additional features based on feedback from existing customers as well as the experience gained from our RaaS offering.
The WEC technology in the NextGenPB is based on our ongoing Mass on Spring Wave Energy Converter (MOSWEC) development which has the advantages of smaller size, lower cost, environmentally sealed design, and increased energy generation capability.
The WEC technology in the NextGen PB is based on our ongoing Mass on Spring Wave Energy Converter (MOSWEC) development which has the advantages of smaller size, lower cost, environmentally sealed design, and increased energy generation capability.
We believe these relationships have helped position us within the public and private sectors for future commercial opportunities, which enhance our market visibility and attractiveness to our prospective customers. 8 ● Access to domestic supply chain. Our strategy is to utilize domestic supply chain sources, when available, to improve operations and collaboration with our supply partners.
We believe these relationships have helped position us within the public and private sectors for future commercial opportunities, which enhance our market visibility and attractiveness to our prospective customers. ● Access to domestic supply chain. Our strategy is to utilize domestic supply chain sources, which are generally available, to improve operations and collaboration with our supply partners.
The control system uses sensors and an onboard computer to continuously monitor the subsystems. The NextGen PB is designed to be able to operate over a broad range of temperature and ocean wave conditions. It has a 40kW-hour battery system which can be expanded up to 120 kW-hour energy .
The control system uses sensors and an onboard computer to continuously monitor the subsystems. The NextGen PB is designed to be able to operate over a broad range of temperature and ocean wave conditions. It has a 50kW-hour battery system which can be expanded up to 100 kW-hour energy.
We have the ability to support aquaculture and gather information on ocean currents, water quality, wind and other weather metrics, and map shorelines or subsurface areas. We also offer 24/7 monitoring solutions that can provide meaningful real time information, and long-term data collection and analytics for sophisticated applications across many industries and scientific applications.
We have the ability to support aquaculture and gather information on ocean currents, water quality, wind and other weather metrics, provide photography, and map shorelines or subsurface bathymetry, objects and activity. We also offer 24/7 monitoring solutions that can provide meaningful real time information, and long-term data collection and analytics for sophisticated applications across many industries and scientific applications.
We have registered our PowerBuoy ® , PB-Vue ® , PowerTower ® , Making Waves in Power ® , Talk on Water ® , and WAM-V ® trademarks in the United States. Trademark ownership is generally of indefinite duration when marks are properly maintained in commercial use.
We have registered our PowerBuoy ® , PB-Vue ® , PowerTower ® , Making Waves in Power ® , Talk on Water ® , and WAM-V ® trademarks in the U.S. Trademark ownership is generally of indefinite duration when marks are properly maintained in commercial use.
All vessel video, radar, and track data are securely stored in our cloud, or the customer’s cloud, environment and is accessible for as long as required by the customer for further analysis and reference. In May 2022, the Company launched the first commercially ready MDAS on a test buoy off the coast of New Jersey.
All vessel video, radar, and track data is securely stored in our cloud, or the customer’s cloud environment and is accessible for as long as required by the customer for further analysis and reference. The Company launched the first commercially ready MDAS on a test buoy off the coast of New Jersey in September 2021.
We also work closely with our third-party partners that provide us with, among other things, software, controls, sensors, integration services, and marine installation services. Our solutions are based on proprietary technologies that enable autonomous, zero or low carbon emitting, and cost-effective data collection, analysis, transportation and communication.
The Company also works closely with our third-party partners that provide us with, among other things, software, controls, sensors, integration services, and marine installation services. Our solutions are based on proprietary technologies that enable autonomous, zero or low carbon emitting, and cost-effective data collection, analysis, transportation and communication.
The system includes our proprietary integration of sensors, hardware and software, supported by cloud infrastructure as well as having a web-based user interface that displays camera, radar, AIS and live chart data. We have successfully demonstrated the system multiple times for potential customers, including a showcase in San Diego Bay at the U.S.
The system includes our proprietary integration of sensors, hardware and software, supported by cloud infrastructure as well as having a web-based user interface that displays camera, radar, AIS and live chart data. During the first half of calendar 2024 we successfully demonstrated the system multiple times for potential customers, including a showcase in San Diego Bay at the U.S.
For the fiscal years ended April 30, 2023 and 2022 Company had two and four customers whose revenues accounted for at least 10% of the Company’s consolidated revenues, respectively. These revenues accounted for approximately 32% and 49% of the Company’s total revenue for the respective periods.
For the fiscal years ended April 30, 2024 and 2023, the Company had four and two customers whose revenue accounted for at least 10% of the Company’s consolidated revenue, respectively. These revenues accounted for approximately 52% and 32% of the Company’s total revenue for the respective periods.
Today, WAM-Vs® operates in 11 countries for commercial, military and scientific uses. Our WAM-Vs® exist in three primary sizes of 8, 16, and 22 feet, however, many of the design components are common across the sizes, allowing for integration of different payloads and adaptation of the payload platforms for larger equipment.
Today, WAM-Vs® operate in ten countries for commercial, military defense and scientific uses. Our WAM-Vs® exist in three primary sizes of 8, 16, and 22 feet. However, many of the design components are common across the sizes, allowing for integration of different payloads and adaptation of the payload platforms for larger equipment.
A substantial portion of our revenues is recognized using the input method used to measure completion over time of customer contracts, and changes in estimates from time to time may have a significant effect on revenue and backlog. Our backlog is also typically subject to large variations from time to time due to the timing of new awards.
A substantial portion of our revenue is recognized using the input method which measures completion over time of customer contracts, and changes in estimates from time to time may have a significant effect on revenue and backlog. Our backlog is also typically subject to large variations from time to time due to the timing of new awards.
Competition We expect to compete with other providers in the DaaS, RaaS, PaaS, and Strategic Consulting industries. Our Data as a Service solution competes with other data acquisition companies in a variety of industries, from sensor and measurement equipment providers to other providers of autonomous vehicles.
Competition We expect to compete with other providers in the DaaS, RaaS, and PaaS industries. Our DaaS solution competes with other data acquisition companies in a variety of industries, from sensor and measurement equipment providers to other providers of autonomous vehicles.
During fiscal 2024, we have plans to continue to attend and present at various demonstrations, conferences, and trade shows in the U.S., Europe, and Asia. Additionally, we seek to enter strategic relationships to develop application solutions with commercial and military sensor and equipment manufacturers.
During fiscal 2025, we have plans to continue to attend and present at various demonstrations, conferences, and trade shows in the U.S., Europe, and the Middle East. Additionally, we seek to enter strategic relationships to develop application solutions with commercial and military sensor and equipment manufacturers.
While we are marketing our products and services globally, we have focused on several key markets and applications, including U.S. and foreign defense and security applications with our MDAS offering; subsea power for oil and gas; and the hydrographic survey market with regard to our WAM-Vs®.
While we are marketing our products and services globally, we have focused on several key markets and applications, including U.S. and foreign defense and security applications with our MDAS offering; and the hydrographic survey market with regard to our WAM-Vs®.
We believe our DaaS, RaaS and PaaS solutions, together with our platforms, are well suited to enable unmanned, autonomous (non-grid connected) offshore applications, such as topside and subsea surveillance and communications, surveying, subsea equipment monitoring, early warning systems platform, subsea power and buffering, and weather and climate data collection.
We believe our DaaS, RaaS and PaaS solutions, together with our platforms, are well suited to enable unmanned, autonomous (non-grid connected) offshore applications, such as intelligence, surveillance, and reconnaissance (ISR), mine counter measure operations, topside and subsea surveillance and communications, surveying, subsea equipment monitoring, early warning systems platform, subsea power and buffering, and weather and climate data collection.
BUSINESS Overview Our solutions focus on four major service areas: Data as a Service (“DaaS”), which includes data collected by our Wave Adaptive Modular Vessel (WAM-V®) autonomous vehicles or our PowerBuoy® product lines; Robotics as a Service (“RaaS”), which provides a lower cost subscription model for our customers to access use of our WAM-V’s®; Power as a Service (“PaaS”), which includes our PowerBuoy® and subsea battery products; and our Strategic Consulting Services.
BUSINESS Overview Our solutions focus on three major service areas: Data as a Service (“DaaS”), which includes data collected by our Wave Adaptive Modular Vessel (WAM-V®) autonomous vehicles or our PowerBuoy® PB product lines; Robotics as a Service (“RaaS”), which provides a lower cost subscription model for our customers to access use of our WAM-V’s®; and Power as a Service (“PaaS”), which includes our PowerBuoy® products.
It is our belief that experience gained through full scale in-ocean deployments, coupled with other types of factory and laboratory testing, and our resulting understanding of risks and failure modes provides us with an advantage compared to potential wave energy competitors. 13 Competition for the WAM-V ® product line and RaaS solution includes companies which market solutions as autonomous surface vehicles (“ASVs”) and unmanned surface vehicles (“USVs”).
It is our belief that experience gained through full scale in-ocean deployments, coupled with other types of factory and laboratory testing, and our resulting understanding of risks and failure modes provides us with an advantage compared to potential wave energy competitors. Competition for the WAM-V ® product line and RaaS solution includes companies which market solutions as ASVs and USVs.
The subsea battery has been pressure-tested to its design depth at the Deep Ocean Test Facility in Annapolis, Maryland. We sea trial every WAM-V either in the Bay Area or near our New Jersey location.
The subsea battery has been pressure-tested to its design depth at the Deep Ocean Test Facility in Annapolis, Maryland. We sea trial every WAM-V either in the Bay Area or near our New Jersey locations prior to customer delivery and acceptance.
The Company’s product & services align with this goal by offering a means to mitigate IUU fishing, collecting ocean data to support climate science research, and removing carbon emitting energy sources from our oceans.
OPT’s products and services align with this goal by offering a means to mitigate IUU fishing, collecting ocean data to support climate science, and removing carbon emitting energy sources from our oceans.
We continue to develop and commercialize our proprietary power platforms that generate electricity primarily by harnessing the renewable energy of ocean waves. We continue to offer our commercial PB3 and are adding solar power options to our next generation PowerBuoy® (the “NextGen PB”) and have the option of adding small wind turbines to supplement power generation.
We continue to commercialize our proprietary power platforms that generate electricity primarily by harnessing the renewable energy of ocean waves. In addition to offering our commercial legacy PB3, we have added solar power options to our next generation PowerBuoy® (the “NextGen PB”) and have the option of adding small wind turbines to supplement power generation.
We further believe that our PB3 does not present significant risks to marine life, nor does it emit pollutants, and therefore has minimal environmental impact. Our electric WAM-Vs ® primary source of energy is from batteries, thus enabling zero emission operations.
We further believe that our PowerBuoys ® do not present significant risks to marine life, nor do they emit pollutants, and therefore have minimal environmental impact. Our electric WAM-Vs ® primary source of energy is from batteries, thus enabling zero emission operations.
Our WAM-Vs ® are designed to operate in a broad range of oceanic conditions and regions. On-location maintenance is designed into the WAM-Vs ® . Our PB3 is designed to be durable, with a three-year interval between required maintenance activities.
Our WAM-Vs ® are designed to operate in a broad range of oceanic conditions and regions. In the field maintenance is designed into the WAM-Vs ® . Our legacy PB3 and Next Generation PowerBuoy ® are designed to be durable, with a three-year interval between required maintenance activities.
We continue to develop our PowerBuoy® and WAM-V® products for use in offshore power, data acquisition, and real-time data communications applications, and in order to achieve this goal, we are pursuing the following business objectives: ● Integrated turn-key solutions, purchases or leases.
We continue to refine NextGen PB and WAM-V® products for use in offshore power, data acquisition, and real-time data communications applications, and to achieve this goal, we are pursuing the following business objectives: ● Provide integrated turn-key solutions, purchases or leases.
Buoys enabled with our MDAS provide actionable intelligence from 24/7/365 radar and AIS vessel tracking (including “dark vessels”), automatic notifications and vessel warnings, real-time visual and Infra-Red video surveillance, with an integrated command and control user interface.
Department of Defense program), both above and below sea surface. Buoys enabled with our MDAS provide actionable intelligence from 24/7/365 radar and AIS vessel tracking (including “dark vessels”), automatic notifications and vessel warnings, real-time visual and Infra-Red video surveillance, with an integrated command and control user interface.
Research and Development MDAS Expanding on our experience with our own initial prototype Marine Surveillance Solutions (“MSS”) system, we intend for the development of the next generation MDAS, which will combine radar, marine AIS and camera data with a custom developed command and control system to provide actionable information for our end users.
Product and Solution Development MDAS Expanding on our experience with our own initial prototype Marine Surveillance Solutions (“MSS”) system, we intend to continuously look for ways to further enhance and develop the next generation MDAS, which will combine radar, marine AIS and camera data with a custom developed command and control system to provide actionable information for our end users.
This model provides a lower cost entry point for our customers to access our products, provides a try before buying opportunity, and allows our customers increased access during their peak seasons.
This model provides a lower cost entry point for our customers to access our products, provides a try before buying opportunity, and allows our customers increased access during periods of increased need.
The platform was designed with a flexible architecture that allows the Company to integrate new sensor technologies and third-party analytics capabilities and share MDAS data with customers and partners. 15 We also maintain an active dialogue with several offshore specialists and marine operations partners in the North Sea and North America to support our deployment, maintenance, and recovery operations and projects.
The platform was designed with a flexible architecture that allows the Company to integrate new sensor technologies and third-party analytics capabilities and share MDAS data with customers and partners. We also keep in contact with several offshore specialists and marine operations partners globally to support our deployment, maintenance, and recovery operations and projects.
The NextGen PB is intended to provide a stable energy platform for our MDAS solution, and for agile deployment of subsea power applications, such as a surface communications hub for electric remotely operated vehicles (“eROV”) and autonomous underwater vehicles (“AUV”) used for underwater inspections and short-term maintenance, and subsea equipment monitoring and control.
The NextGen PB is intended to provide a stable energy platform for our MDAS solution, and for agile deployment of other intelligence gathering surface and subsea sensors, subsea power applications, such as a surface communications hub for electric remotely operated vehicles (“eROV”) and autonomous underwater vehicles used for mine counter measures, unexploded ordinance disposal, subsea acoustic monitoring, underwater inspections and short-term maintenance, and subsea equipment monitoring and control.
Also, geopolitical developments such as the need for countries to protect their exclusive economic zones from illegal fishing activities and protect natural resources on the seabed are accelerating the adoption of solutions or technologies that collect, transmit, and synthesize data to provide actionable intelligence and decision-advantage to clients.
In addition, the need to protect exclusive economic zones from illegal fishing activities and protect natural resources on the seabed are accelerating the adoption of solutions or technologies that collect, transmit, and synthesize data to provide actionable intelligence and decision-advantage to clients.
To integrate our solutions and add roaming as an option or enhancement to our MDAS, we are advancing developments to further integrate MDAS into the WAM-V® platform and develop additional autonomy capabilities. ● Focus sales efforts on key global markets in the U.S., Europe, Canada, Asia and Australia.
To integrate our solutions and add roaming as an option or enhancement to our MDAS, we are advancing developments to further integrate MDAS into the WAM-V® platform and develop additional autonomy capabilities. ● Focus sales efforts on key global markets in the U.S., Middle East, Latin America, and Sub Saharan Africa.
Backlog As of April 30, 2023, the Company’s backlog was $4.0 million. As of April 30, 2022, the backlog was $0.6 million. Our backlog can include unfilled firm orders for our products and services from commercial or governmental customers.
Backlog As of April 30, 2024, the Company’s backlog was $4.9 million. As of April 30, 2023, the backlog was $4.0 million. Our backlog only includes unfilled firm orders for our products and services from commercial or governmental customers.
On June 2, 2021, the Company achieved ISO 45001 certification from Bureau Veritas (BV) for a 3-year term for its New Jersey location. During fiscal 2024, we plan to expand this certification to include our new Richmond, CA facility and our Houston, TX facility. ISO 45001 is an international occupation health and safety certification.
On May 31, 2024 the Company again achieved ISO 45001 certification from BV for another 3-year term for its New Jersey location. During fiscal 2025, we plan to expand this certification to include our new Richmond, CA facility. ISO 45001 is an international occupation health and safety certification.
During fiscal 2023, we began the development of the NextGen PowerBuoy®, which will incorporate lessons learned and customer feedback from various deployments of the PB3, prototype buoys, and test buoys to optimize power generation through hybridization of renewable energy sources and lower installed cost of the system.
During fiscal 2024, we completed the commercial development of our NextGen PB, which incorporates lessons learned and customer feedback from various deployments of the legacy PB3, prototype buoys, and test buoys to optimize power generation through hybridization of renewable energy sources and lower installed cost of the system.
In the unlikely event that water comes into contract with live batteries, wireless remote operation allows for the immediate discharge of energy to mitigate the risk of electrolysis that could create an explosive mixture of hydrogen and oxygen within the buoy.
Our batteries contain no toxic or rare earth metals and have a minimal risk of fires or explosions. In the unlikely event that water comes into contract with live batteries, wireless remote operation allows for the immediate discharge of energy to mitigate the risk of electrolysis that could create an explosive mixture of hydrogen and oxygen within the buoy.
Our Power as a Service solution competes with other offshore autonomous power sources, primarily consisting of subsea batteries, solar and fossil-fuel power sources, where many of the providers are substantially larger than us and may have access to greater financial resources.
Our PaaS solution competes with other offshore autonomous power sources, primarily consisting of subsea batteries, solar and fossil-fuel power sources, where many of the providers are substantially larger than us and may have access to greater financial resources. Incumbent sources of offshore power may also represent established and reliable power sources and may have already gained customer acceptance.
In the U.S. specifically, IUU fishing is considered a major maritime threat by the DHS. 9 Offshore Oil and Gas We believe the offshore oil and gas industry is undergoing a significant transformation as it continues to invest in new technologies that enable carbon reduction, cost savings, and the electrification and digitization of operations.
Offshore Oil and Gas We believe the offshore oil and gas industry is undergoing a significant transformation as it continues to invest in new technologies that enable carbon reduction, cost savings, and the electrification and digitization of operations.
We believe that our autonomous MDAS solution, which can be combined with mobile assets such as our WAM-V® or satellite imagery, can deliver substantial economic impact to governments over incumbent solutions in securing remote fisheries and MPAs.
We believe that our autonomous MDAS solution, which can be combined with mobile assets such as our WAM-V® or satellite imagery, can deliver substantial economic impact to governments over incumbent solutions in securing remote fisheries and MPAs. In the U.S. specifically, IUU fishing is considered a major maritime threat by the DHS.
WAM-V® stability produces excellent sonar data quality in higher sea conditions than comparably sized vessels and can be used as a force multiplier to existing manned assets or as the sole deployment tool. WAM-V’s® can be outfitted with various sonar solutions depending on requirements and identify any underwater obstacles or hazards.
WAM-V® stability produces excellent sonar data quality in higher sea conditions than comparably sized vessels and can be used as a force multiplier to existing manned assets or as the sole deployment tool.
This strategy was further enhanced by our acquisition of MAR in November 2021. The majority of the Company’s potential customers are in areas of defense and security, hydrographic survey, oil and gas, offshore wind, offshore and coastal communication networks, and MDA, including mitigation of IUU fishing, where the end use may be both domestic and abroad.
The majority of the Company’s potential customers are in areas of defense and security, hydrographic survey, offshore wind, offshore and coastal communication networks, and MDA, including mitigation of IUU fishing, where the end use may be both domestic and abroad.
Often, rules and regulations specific to autonomous, unmanned, and/or unmanned surface vehicles do not exist or are not explicitly defined. We advise our customers to always follow the rules and regulations as they apply in the jurisdiction in which they are operating. The renewable energy industry has also been subject to increasing regulation.
We advise our customers to always follow the rules and regulations as they apply in the jurisdiction in which they are operating. The renewable energy industry has also been subject to increasing regulation.
We also provide offshore engineering, consulting, and design services for offshore wind, drilling contractors, defense contractors, construction yards, engineering firms, and oil and gas, wave energy, and marine construction and service companies including design review, forensic investigation, and expert witness services. Business Strategy During fiscal 2023, we continued to advance our marketing programs, products, and solutions.
We also provide offshore engineering, consulting, and design services for offshore wind, drilling contractors, defense contractors, construction yards, engineering firms, and oil and gas, wave energy, and marine construction and service companies including design review, forensic investigation, and expert witness services.
The stations will also enable enhanced maritime domain awareness capabilities. We have also designed our systems to work with other assets being provided into larger projects and programs. ● Flexible electrical, mechanical and communication interfaces for sensors.
These stations will enable our WAM-Vs to charge up using our renewable power generators thus materially increase autonomous mission duration. The stations will also enable enhanced maritime domain awareness capabilities. We have also designed our systems to work with other assets being provided into larger projects and programs. ● Flexible electrical, mechanical and communication interfaces for sensors.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWhile our Board of Directors and management team strive to maintain constructive, ongoing communications with the Company’s shareholders, including activist shareholders, and welcome all views and ideas that have the potential to enhance value for all shareholders, activist campaigns that contest, or conflict with, our strategic direction could have an adverse effect on us because: (i) responding to actions by activist shareholders can disrupt our business, be costly and time-consuming, and divert the attention of our Board and management away from their regular duties and the pursuit of our business strategies, which could adversely affect our results of operations and financial condition; (ii) perceived uncertainties as to our future direction as a result of changes to composition of our Board of Directors may lead to the perception of a change in the direction of the business, instability, or lack of continuity which may be exploited by our competitors, cause concern to our current or potential customers, may result in the loss of potential business opportunities and make it more difficult to attract and retain qualified personnel and business partners, and may affect our relationships with vendors, customers, and other third parties; (iii) actions by activist shareholders could cause significant fluctuations in our stock price based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business; and (iv) if individuals are elected to our Board of Directors with a specific agenda, it may adversely affect our ability to effectively implement our business strategy and create additional value for our shareholders. 34 If securities or industry analysts fail to cover us, or do not publish research or publish unfavorable or inaccurate research about our business, our stock price and trading volume could decline.
Biggest changeAny activist campaign against OPT that contests, conflicts with, or seeks to change, our board composition, leadership, strategic direction, or business mix could have an adverse effect on us because: (i) responding to actions by activist shareholders could disrupt our operations, be costly or time-consuming, or divert the attention of our board of directors and senior management from their regular duties, which could adversely affect our results of operations or financial condition; (ii) perceived uncertainties, including as a result of possible changes to the composition of our board, as to our future direction may lead to the perception of a change in the direction of the business or lack of continuity, any of which may be exploited by our competitors, cause concern to our customers and/or employees and result in the loss of potential business opportunities, or make it more difficult to attract and retain qualified personnel and business partners, and may affect our relationships with vendors, customers and other third parties; (iii) these types of actions could cause significant fluctuations in our share price based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business; and (iv) if individuals are elected to our board of directors with a specific agenda, it may adversely affect our ability to effectively implement our business strategy and create additional value for our shareholders.
Our principal targeted markets include offshore oil and gas, defense and security, science and research, marine charter, and offshore wind. In our targeted markets, which are highly competitive, we compete against incumbent power and maritime domain awareness solutions already being utilized by our customers and potential customers.
Our principal targeted markets include defense and security, offshore oil and gas, science and research, marine charter, and offshore wind. In our targeted markets, which are highly competitive, we compete against incumbent power and maritime domain awareness solutions already being utilized by our customers and potential customers.
Climate change regulation continues to evolve, and it is not possible to accurately estimate either a timetable for implementation or our future compliance costs relating to implementation. 31 A portion of products we acquire from our suppliers are manufactured in foreign countries, making the price and availability of these products subject to international trade risks and other international conditions.
Climate change regulation continues to evolve, and it is not possible to accurately estimate either a timetable for implementation or our future compliance costs relating to implementation. A portion of products we acquire from our suppliers are manufactured in foreign countries, making the price and availability of these products subject to international trade risks and other international conditions.
Certain weather events could increase in frequency or severity requiring potential design changes or limiting the windows available for offshore operations. Our autonomous vessels could cause other types of damage, including collisions with other vessels, property of others, or even swimmers or other persons or property utilizing a body of water where the WAM-V® is operating.
Certain weather events could increase in frequency or severity requiring potential design changes or limiting the windows available for offshore operations. 27 Our autonomous vessels could cause other types of damage, including collisions with other vessels, property of others, or even swimmers or other persons or property utilizing a body of water where the WAM-V® is operating.
There can be no assurance that we will receive such additional funding. In addition, strategic relationships may not be successful, and we may be unable to sell and market our products to these companies, their affiliates and customers in the future, or growth opportunities may not materialize. 27 We have limited manufacturing, deployment, and internal software development experience.
There can be no assurance that we will receive such additional funding. In addition, strategic relationships may not be successful, and we may be unable to sell and market our products to these companies, their affiliates and customers in the future, or growth opportunities may not materialize. We have limited manufacturing, deployment and internal software development experience.
Accordingly, we have incurred and may continue to incur substantial legal expenses, judgments and/or settlements relating to pending and future litigation and our management’s time and attention may be diverted from the operation of our business, which could materially and adversely affect the Company. 32 We may become the target of securities litigation, which is costly and time-consuming to defend.
Accordingly, we have incurred and may continue to incur substantial legal expenses, judgments and/or settlements relating to pending and future litigation and our management’s time and attention may be diverted from the operation of our business, which could materially and adversely affect the Company. We may become the target of securities litigation, which is costly and time-consuming to defend.
In addition, actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, our third-party vendors and counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems, which could adversely affect our business, financial condition, results of operations and liquidity. 21 Although we assess our banking relationships as we believe necessary or appropriate, our access to funding sources and other credit arrangements in amounts adequate to finance or capitalize our respective current and projected future business operations could be significantly impaired by factors that affect us, the financial institutions with which we have arrangements directly, or the financial services industry or economy in general.
In addition, actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, our third-party vendors and counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems, which could adversely affect our business, financial condition, results of operations and liquidity. 20 Although we assess our banking relationships as we believe necessary or appropriate, our access to funding sources and other credit arrangements in amounts adequate to finance or capitalize our respective current and projected future business operations could be significantly impaired by factors that affect us, the financial institutions with which we have arrangements directly, or the financial services industry or economy in general.
Even if we do achieve commercialization of our products and services and become profitable, we may not be able to achieve or, if achieved, sustain profitability on a quarterly or annual basis. 20 We may not be able to raise sufficient capital to continue to operate our business. Historically, we have funded our business operations through sales of equity securities.
Even if we do achieve commercialization of our products and services and become profitable, we may not be able to achieve or, if achieved, sustain profitability on a quarterly or annual basis. We may not be able to raise sufficient capital to continue to operate our business. Historically, we have funded our business operations through sales of equity securities.
If we violate or fail to comply with these permits and approvals, we could be fined or otherwise sanctioned by regulators. In the event we are unable to satisfy regulatory requirements relating to internal control over financial reporting, or if our internal controls are not effective, our business and financial results may suffer.
If we violate or fail to comply with these permits and approvals, we could be fined or otherwise sanctioned by regulators. In the event we are unable to satisfy regulatory requirements relating to internal control over financial reporting, or if our internal controls are not effective, our business, reputation and financial results may suffer.
In addition, we may offer to lease our products, sell power generated by our products or sell data gathered by sensors on our products. Even if customers purchase or lease our products, they may not enter into service contracts with us. We may not be able to negotiate service or other contracts that provide us with any additional profit opportunities.
In addition, we may offer to lease our products, sell power generated by our products or sell data gathered by sensors on our products. Even if customers purchase or lease our products, they may not enter into service contracts with us. We may not be able to negotiate services or other contracts that provide us with any additional profit opportunities.
Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources. Our contracts with governmental entities could negatively affect our intellectual property rights, and our ability to commercialize our products could be impaired.
Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources. 30 Our contracts with governmental entities could negatively affect our intellectual property rights, and our ability to commercialize our products could be impaired.
We may not be successful in our efforts to establish additional strategic relationships or other alternative arrangements. The terms of any additional strategic relationships or other arrangements that we establish may not be favorable to us. Furthermore, even if we can find, negotiate and enter into these relationships, such arrangements may be conditional upon our receipt of additional funding.
We may not be successful in our efforts to establish additional strategic relationships or other alternative arrangements. The terms of any additional strategic relationships or other arrangements that we establish may not be favorable to us. Furthermore, even if we can find, negotiate and enter these relationships, such arrangements may be conditional upon our receipt of additional funding.
In addition to infringement claims against us, we may become a party to other types of patents or trademark litigation and other proceedings, including proceedings declared by the U.S. Patent and Trademark Office and proceedings in the European Patent Office, regarding intellectual property rights with respect to our products and technology.
In addition to infringement claims against us, we may become a party to other types of patent or trademark litigation and other proceedings, including proceedings declared by the U.S. Patent and Trademark Office and proceedings in the European Patent Office, regarding intellectual property rights with respect to our products and technology.
In this event, the market price of our common stock could decline, and your investment could be lost. Risks Related to Our Financial Condition We have a history of operating losses and may not achieve or maintain profitability and positive cash flow.
In this event, the market price of our common stock could decline, and your investment could be lost. 19 Risks Related to Our Financial Condition We have a history of operating losses and may not achieve or maintain profitability and positive cash flow.
We have invested a significant portion of our time and financial resources since our inception in the development of our PowerBuoys® but have not yet achieved successful large scale or profitable commercialization of our PowerBuoys ® . We have also added the WAM-V ® product line, but we have not achieved profitability of this product line.
We have invested a significant portion of our time and financial resources since our inception in the development of our PowerBuoys® but have not yet achieved successful large scale or profitable commercialization of our PowerBuoys ® . We have also added the WAM-V ® product line, but we have not achieved profitability with this product line.
Our targeted markets are subject to their own inherent risks, and if those risks should materialize, then our business, financial condition and results of operations could be adversely affected. 24 We market and plan to market our services and products in multiple international regions.
Our targeted markets are subject to their own inherent risks, and if those risks should materialize, then our business, financial condition and results of operations could be adversely affected. We market and plan to market our services and products in multiple international regions.
Department of Defense (“DoD”), we will have to meet their framework for establishing cyber security standards and best practices, what they call Cybersecurity Maturity Model Certification (“CMMC”) at various levels as we grow our business with DoD.
Department of Defense (“DoD”), we will have to meet their framework for establishing cyber security standards and best practices, what they call Cybersecurity Maturity Model Certification at various levels as we grow our business with DoD.
If we cannot do so, we may be unable to expand our business and become profitable or do so in time to meet the needs of our customers. Problems with the quality or performance of our products would adversely affect our business, financial condition, and results of operations.
If we cannot do so, we may be unable to expand our business and become profitable or do so in time to meet the needs of our customers. 28 Problems with the quality or performance of our products would adversely affect our business, financial condition and results of operations.
If we are unable to increase our internal software development and manufacturing capacity in a cost-effective manner, our business may be materially harmed. We manufacture key components of our products, while outsourcing the manufacturing for other components of our products.
If we are unable to increase our software development and manufacturing capacity in a cost-effective manner, our business may be materially harmed. We manufacture key components of our products, while outsourcing the manufacturing for other components of our products.
Our pending and future patent applications may not be issued as patents or, if issued, may not be issued in a form that will be advantageous to us.
Our pending and future patent applications may not be issue as patents or, if issued, may not be issued in a form that will be advantageous to us.
There is no assurance that we will be able to fully utilize the NOL and we may be required to record an additional valuation allowance related to the amount of the NOL that may not be realized, which could impact our result of operations. As noted, we believe that these NOL carryforwards are a valuable asset for us.
There is no assurance that we will be able to fully utilize the NOL and we may be required to record an additional valuation allowance related to the amount of the NOL that may not be realized, which could impact our results of operations. As noted, we believe that these NOL carryforwards are a valuable asset for us.
Our future success depends on our ability to significantly increase both our manufacturing capacity and production and service throughput in a cost-effective and efficient manner, and to manage multiple vendors with several orders on specific deadlines. In order to meet our growth objectives, we will need to increase our engineering, contract management, and manufacturing staff.
Our future success depends on our ability to significantly increase both our manufacturing capacity and production and service throughput in a cost-effective and efficient manner, and to manage multiple vendors with several orders that have specific deadlines. In order to meet our growth objectives, we will need to increase our engineering, contract management, and manufacturing staff.
For example, in June 2023, our Board of Directors adopted a Section 382 Tax Benefits Preservation Plan in an effort to diminish the risk that the Company’s ability to utilize its net operating loss carryovers to reduce potential future federal income tax obligations may become substantially limited.
In June 2023, our Board of Directors adopted a Section 382 Tax Benefits Preservation Plan in an effort to diminish the risk that the Company’s ability to utilize its net operating loss carryovers to reduce potential future federal income tax obligations may become substantially limited.
Generally, these types of relationships obligate a party to provide certain services or perform certain tasks in connection with the relationship with the alliance partner, and we are generally responsible for paying the costs we incur relating to such services or tasks. These relationships generally are not expected to provide us with any revenues or sources of financing.
Generally, these types of relationships obligate a party to provide certain services or perform certain tasks in connection with the relationship with the alliance partner, and we are generally responsible for paying the costs we incur relating to such services or tasks. These relationships generally are not expected to provide us with any revenue or sources of financing.
A third party that acquires 4.9% or more of our common stock could suffer substantial dilution of its ownership interest under the terms of the Tax Benefits Preservation Plan through the issuance of common stock or common stock equivalents to all stockholders other than the acquiring person.
A third party that acquires 4.9% or more of our common stock could suffer substantial dilution of its ownership interest under the terms of the Tax Benefits Preservation Plan through the issuance of common stock or common stock equivalents to all shareholders other than the acquiring person.
For more information on our legal proceedings, see Item 3 “Legal Proceedings” of this Annual Report and Note 16 “Commitments and Contingencies - Litigation” in the accompanying consolidated financial statements for the fiscal year ended April 30, 2023.
For more information on our legal proceedings, see Item 3 “Legal Proceedings” of this Annual Report and Note 16 “Commitments and Contingencies - Litigation” in the accompanying consolidated financial statements for the fiscal year ended April 30, 2024.
Our targeted markets are competitive and highly complex. We compete against incumbent solutions already being utilized by our customers and potential customers. If we are unable to compete effectively, we may be unable to increase our revenues and achieve or maintain profitability.
Our targeted markets are competitive and highly complex. We compete against incumbent solutions already being utilized by our customers and potential customers. If we are unable to compete effectively, we may be unable to increase our revenue and achieve or maintain profitability.
To the extent that outstanding stock options or warrants have been or may be exercised or other shares issued, current shareholders and future investors who have purchased our common stock will experience further dilution.
To the extent that outstanding stock options, warrants or restricted stock units have been or may be exercised or other shares issued, current shareholders and future investors who have purchased our common stock will experience further dilution.
We may sell shares or other securities in any other offering at a price per share that is less than the price per share paid by existing investors, and investors purchasing shares or other securities in the future could have rights superior to existing shareholders. In addition, we have a significant number of stock options and warrants outstanding.
We may sell shares or other securities in any other offering at a price per share that is less than the price per share paid by existing investors, and investors purchasing shares or other securities in the future could have rights superior to existing shareholders. In addition, we have a significant number of stock options and restricted stock units outstanding.
These agreements may be breached, and we may not have adequate remedies for any such breach. In addition, our trade secrets may otherwise become known or be independently developed by competitors. Foreign laws may not afford us sufficient protections for our intellectual property, and we may not be able to obtain patent protection outside of the United States.
These agreements may be breached, and we may not have adequate remedies for any such breach. In addition, our trade secrets may otherwise become known or be independently developed by competitors. Foreign laws may not afford us sufficient protections for our intellectual property, and we may not be able to obtain patent protection outside of the U.S.
Even if wave energy and maritime domain awareness technology achieve broad commercial acceptance, our products, including our MDAS offering, PowerBuoys® and WAM-V ® autonomous surface vessels may not prove to be commercially viable technologies.
Even if wave energy and maritime domain awareness technology achieve broad commercial acceptance, our products, including our MDAS offering, NextGen PB and Legacy PB and WAM-V ® autonomous surface vessels may not prove to be commercially viable technologies.
A percentage of our revenues have historically been generated outside the U.S. and can be denominated in foreign currencies of our customers. Changes in exchange rates between foreign currencies and the U.S. dollar could affect our revenues and cost of revenues and could result in exchange losses.
A percentage of our revenue has historically been generated outside the U.S. and can be denominated in foreign currencies of our customers. Changes in exchange rates between foreign currencies and the U.S. dollar could affect our revenue and cost of revenue and could result in exchange losses.
Our manufacturing operations, particularly some of the activities undertaken by our third-party suppliers and manufacturers, involve the controlled use of hazardous materials. These include batteries for the PB3 and WAM-V ® , and various lubricants and oils.
Our manufacturing operations, particularly some of the activities undertaken by our third-party suppliers and manufacturers, involve the controlled use of hazardous materials. These include batteries, various lubricants and oils.
As we seek to manufacture, market, sell and deploy our PowerBuoys® and WAM-Vs ® in greater quantities, we may encounter unforeseen hurdles that would limit the commercial viability of these products, including unanticipated manufacturing, deployment, operating, maintenance, and other costs. We may also encounter technical obstacles to deploying, operating, and maintaining PowerBuoys®, WAM-Vs ® , or other products.
As we seek to manufacture, market, sell and deploy our PowerBuoys® and WAM-Vs ® in greater quantities, we may encounter unforeseen hurdles that would limit the commercial viability of these products, including unanticipated manufacturing, deployment, operating, maintenance and other costs.
Various privacy and security laws require us to protect sensitive and confidential information from disclosure. In addition, we are bound by our customers and other contracts, as well as our own business practices, to protect confidential and proprietary information (whether it be ours or a third party’s information entrusted to us) from disclosure.
In addition, we are bound by our customers and other contracts, as well as our own business practices, to protect confidential and proprietary information (whether it be ours or a third party’s information entrusted to us) from disclosure.
Our financial condition and results of operations may be materially and adversely affected if: ● Product improvements are not completed on a timely basis; ● New products are not introduced on a timely basis or do not achieve sufficient market penetration; ● There are cost overruns or delays in R&D efforts; or ● New products experience reliability or quality problems, or otherwise do not meet customer preferences or requirements.
Our financial condition and results of operations may be materially and adversely affected if: ● Product improvements are not completed on a timely basis; ● New products are not introduced on a timely basis or do not achieve sufficient market penetration; or ● New products experience reliability or quality problems, or otherwise do not meet customer preferences or requirements.
If we lose key personnel, or do not hire or retain other personnel for key positions, this could have a material adverse effect on our business, financial condition, results of operations or cash flows. If we are unable to effectively manage our growth, this could adversely affect our business and operations.
If we lose key personnel, or do not hire or retain other personnel for key positions, this could have a material adverse effect on our business, financial condition, results of operations or cash flows.
An ownership change occurs when our “five-percent shareholders” (as defined in Section 382 of the Code) collectively increase their ownership in OPT by more than 50 percentage points (by value) over a rolling three-year period. Additionally, various states have similar limitations on the use of state NOLs following an ownership change.
An ownership change occurs when our “five-percent shareholders” (as defined in Section 382 of the Code) collectively increase their ownership in OPT by more than 50 percentage points (by value) over a rolling three-year period.
Failure of our information systems or those of third parties or breaches of data security could cause significant harm to our business. Our systems and processes involve the storage and transmission of proprietary information and sensitive or confidential data, including personal information of employees, and possibly customers and others. In addition, we rely on information systems controlled by third parties.
Our systems and processes involve the storage and transmission of proprietary information and sensitive or confidential data, including personal information of employees, and possibly customers and others. In addition, we rely on information systems controlled by third parties.
If an ownership change occurs, the amount of the taxable income for any post-change year that may be offset by a pre-change loss is subject to an annual limitation that is cumulative to the extent it is not all utilized in a year.
Additionally, various states have similar limitations on the use of state NOLs following an ownership change. 26 If an ownership change occurs, the amount of the taxable income for any post-change year that may be offset by a pre-change loss is subject to an annual limitation that is cumulative to the extent it is not all utilized in a year.
We have incurred net losses since we began operations in 1994, including net losses of $26.3 million and $18.9 million in fiscal 2023 and 2022, respectively. As of April 30, 2023, we had an accumulated deficit of $280.1 million.
We have incurred net losses since we began operations in 1994, including net losses of $27.5 million and $26.3 million in fiscal 2024 and 2023, respectively. As of April 30, 2024, we had an accumulated deficit of $307.6 million.
We may not be able to develop and implement policies and strategies that will be effective in each location where we do business, which in turn could adversely affect our business, financial condition, and results of operations. The current economic environment, particularly the macroeconomic pressures in certain European countries, may increase these risks.
We may not be able to develop and implement policies and strategies that will be effective in each location where we do business, which in turn could adversely affect our business, financial condition and results of operations.
If we fail to maintain the adequacy of our internal controls, including any failure to implement new or improved controls, or if we experience difficulties in their implementation, our business and operating results could be harmed, we could fail to meet our reporting obligations, and there could also be a material adverse effect on our stock price.
If we fail to maintain the adequacy of our internal controls, including any failure to implement new or improved controls, or if we experience difficulties in their implementation, our business and operating results could be harmed, we could fail to meet our reporting obligations, and there could also be a material adverse effect on our stock price. 31 Environmental and other regulation of our business, including potential climate change regulation, could adversely impact us by increasing our production cost or restricting our ability to deliver products to our customers.
Any litigation is costly, and time consuming to defend and may distract our management from the daily operations of our business. We may be the subject of additional future litigation, which could have a material adverse effect on our business, financial condition, results of operations or cash flows.
We may be the subject of additional future litigation, which could have a material adverse effect on our business, financial condition, results of operations or cash flows.
Revenues from customers who are based outside of the U.S. accounted for 88% of our revenues in fiscal 2023 and 84% of our revenues in fiscal 2022.
Revenue from customers who are based outside of the U.S. accounted for 4% of our revenue in fiscal 2024 and 12% of our revenue in fiscal 2023.
The trading market for our common stock is influenced by the research and reports that industry or securities analysts may publish about us, our business, or our industry from time to time.
Currently we do not have significant analyst coverage, however, the trading market for our common stock could be influenced by the research and reports that industry or securities analysts may publish about us, our business, or our industry from time to time.
Changes in either patent laws or in interpretations of patent laws in the U.S. and other countries may diminish the value of our intellectual property or narrow the scope of our patent protection, which could in turn adversely affect our business, financial condition, and results of operations.
Changes in either patent laws or in interpretations of patent laws in the U.S. and other countries may diminish the value of our intellectual property or narrow the scope of our patent protection, which could in turn adversely affect our business, financial condition and results of operations. 29 If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology and products could be adversely affected, which could in turn adversely affect our business, financial condition and results of operations.
To the extent that we issue new securities or raise additional capital through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our shareholders or result in downward pressure on the price of our common stock.
To the extent that we issue new securities or raise additional capital through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our shareholders or result in downward pressure on the price of our common stock. 33 Historically, our stock price has been volatile, and this is likely to continue; purchasers of our common stock could incur substantial losses as a result.
Therefore, we cannot assure you that our costs of complying with current and future environmental and health and safety laws, and any liabilities arising from past or future releases of, or exposure to, hazardous substances will not adversely affect our business, financial condition, or results of operations.
Therefore, we cannot assure you that our costs of complying with current and future environmental and health and safety laws, and any liabilities arising from past or future releases of, or exposure to, hazardous substances will not adversely affect our business, financial condition or results of operations. 32 Risks Related to Litigation Litigation is costly and time-consuming to defend, and if decided against us, could require us to pay substantial judgments or settlements.
Moreover, there has been a broad range of proposed and promulgated state, national and international regulation aimed at reducing the effects of climate change. In the U.S., there is a significant possibility that some form of regulation will be enacted at the federal level to address the effects of climate change.
In the U.S., there is a significant possibility that some form of regulation will be enacted at the federal level to address the effects of climate change.
In addition, competition may arise from other companies manufacturing similar products, developing different products that produce energy more efficiently than our products, or developing autonomous vehicles that perform better or have other characteristics that customers prefer, could make our products less attractive or render them obsolete.
In addition, if the cost associated with these development efforts exceeds our projections, our results of operations could be materially and adversely affected. 24 In addition, competition may arise from other companies manufacturing similar products, developing different products that produce energy more efficiently than our products, or developing autonomous vehicles that perform better or have other characteristics that customers prefer, could make our products less attractive or render them obsolete.
We cannot be certain that we will be able to attract, retain and motivate such employees. The loss of the services of one or more of these employees could have a material adverse effect on our business. There is a risk that we will not be able to retain or replace these key employees.
Our success depends on the skills, experience and efforts of our management and other key product development, manufacturing, and sales and marketing employees. We cannot be certain that we will be able to attract, retain and motivate such employees. The loss of the services of one or more of these employees could have a material adverse effect on our business.
Moreover, any widespread product failures could adversely affect our business, financial condition, and results of operations. We must continually improve existing services and products, design and sell new products, and invest in research and development in order to compete effectively.
Moreover, any widespread product failures could adversely affect our business, financial condition and results of operations. We must continually improve existing services and products, design and sell new products and improve reliability in order to compete effectively. The markets for our services and products are characterized by rapid technological change, evolving industry standards and continuous improvements of products.
In addition, these provisions could delay or frustrate the removal of incumbent directors and could make more difficult a merger, tender offer or proxy contest involving us, or impede an attempt to acquire a significant or controlling interest in us, even if such events might be beneficial to us and our stockholders. 26 Risks Related to Product Development and Commercialization We have only manufactured a limited number of PowerBuoys®, and to date we have not produced these products in any significant quantity for commercial production.
In addition, these provisions could delay or frustrate the removal of incumbent directors and could make more difficult a merger, tender offer or proxy contest involving us, or impede an attempt to acquire a significant or controlling interest in us, even if such events might be beneficial to us and our shareholders.
If we are unable to manage our international operations effectively, our business, financial condition and results of operations could be adversely affected. We market and plan to market our services and products in multiple global regions, including parts of North and South America, Europe, and Asia, and we are therefore subject to risks associated with having international operations.
We market and plan to market our services and products in multiple global regions, including parts of North and South America, Europe, Sub-Saharan Africa, Middle East, and Asia, and we are therefore subject to risks associated with having international operations.
New product development and commercialization efforts, including efforts to enter markets or product categories in which we have limited, or no prior experience have inherent risks.
Due to constant changes in our markets, our future success depends on our ability to develop new technologies, products, processes and product applications. New product development and commercialization efforts, including efforts to enter markets or product categories in which we have limited, or no prior experience, have inherent risks.
If new product development and commercialization efforts are not successful, our financial results could be adversely affected. 28 Product and technological developments are accomplished primarily through internally funded R&D projects.
If new product development and commercialization efforts are not successful, our financial results could be adversely affected.
Risks Related to Litigation Litigation is costly and time-consuming to defend, and if decided against us, could require us to pay substantial judgments or settlements. We may be the subject of future securities or other litigation, which could adversely affect our company, our business, and our liquidity.
We may be the subject of future securities or other litigation, which could adversely affect our company, our business and our liquidity. Any litigation is costly, and time consuming to defend and may distract our management from the daily operations of our business.
These products do not have a sufficient operating history to accurately predict how they will perform over their estimated useful life. To date, we have only manufactured a limited number of PowerBuoys®. As a result, our products may not have a sufficient operating history to confirm how they will perform over their estimated useful life.
Risks Related to Product Development and Commercialization We have only manufactured a limited number of PowerBuoys®, and to date we have not produced these products in any significant quantity for commercial production. These products do not have a sufficient operating history to accurately predict how they will perform over their estimated useful life.
We cannot predict the timing or scale of these various macroeconomic conditions, but they could have a material adverse effect on our business, results of operations and financial condition. COVID-19 has, and could continue to, adversely affect the Company’s business, financial condition, and results of operations.
We cannot predict the timing or scale of these various macroeconomic conditions, but they could have a material adverse effect on our business, results of operations and financial condition. Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults, or non-performance by financial institutions, could adversely affect our business, financial condition, or results of operations.
Third parties could bring claims against us that would cause us to incur substantial expenses and, if successfully asserted against us, could cause us to pay substantial damages.
Third parties may own or control these patents, patent applications or trademarks in the U.S. and abroad. Third parties could bring claims against us that would cause us to incur substantial expenses and, if successfully asserted against us, could cause us to pay substantial damages.
If we are unable to manage our intellectual property rights, our business and operating results may be seriously harmed. 29 If we infringe or are alleged to have infringed upon intellectual property rights of third parties, our business, financial condition, and results of operations could be adversely affected.
If we infringe or are alleged to have infringed upon intellectual property rights of third parties, our business, financial condition and results of operations could be adversely affected. Our products or use of our trademarks may infringe, or be claimed to infringe, upon patents, patent applications or trademarks under which we do not hold licenses or other rights.
Funding from government contracts may also limit when and how we can deploy our technology developed under those contracts.
Funding from government contracts may also limit when and how we can deploy our technology developed under those contracts. Foreign governments with which we contract to provide funding for our research and development may seek similar rights.
Implementation of our business plans will be highly dependent upon our ability to hire and retain senior executives as well as talented staff in various fields of expertise. We made several changes to our senior management team in fiscal 2023.
There is a risk that we will not be able to retain or replace these key employees. Implementation of our business plans will be highly dependent upon our ability to hire and retain senior executives as well as talented staff in various fields of expertise.
Historically, our stock price has been volatile, and this is likely to continue; purchasers of our common stock could incur substantial losses as a result. Historically, the market price of our common stock has fluctuated significantly, and we expect that this will continue.
Historically, the market price of our common stock has fluctuated significantly, and we expect that this will continue. Purchasers of our common stock could incur substantial losses relating to their investment in our stock as a result. Also, the stock market, particularly microcap stocks, experiences volatility that has often been unrelated or disproportionate to the operating performance of particular companies.
The market price for our common stock may be influenced by many factors, including the items identified within these Risk Factors and the other information included within this annual report. 33 Provisions in our corporate charter documents and under Delaware law may delay or prevent attempts by our shareholders to change our management or our Board of Directors and hinder efforts to acquire a controlling interest in us.
Provisions in our corporate charter documents and under Delaware law may delay or prevent attempts by our shareholders to change our management or our Board of Directors and hinder efforts to acquire a controlling interest in us.
Should the financing we require to sustain our working capital needs be unavailable or prohibitively expensive when we require it, our business, operating results, financial condition, and prospects could be materially and adversely affected. Our business could be affected by macroeconomic risks. The Company’s operations and performance depend significantly on global and regional economic conditions.
Should the financing we require to sustain our working capital needs be unavailable or prohibitively expensive when we require it, our business, operating results, financial condition and prospects could be materially and adversely affected. There are doubts about our ability to continue as a going concern.
If demand for our solutions and products fails to develop sufficiently, it is unlikely that we will be able to grow our business or generate sufficient revenues. 22 In addition, if we are not successful in commercializing our new solutions and products, or are significantly delayed in doing so, our business, financial condition and results of operations will be adversely affected.
In addition, if we are not successful in commercializing our new solutions and products, or are significantly delayed in doing so, our business, financial condition and results of operations will be adversely affected. If we are unable to attract and retain management and other qualified personnel, we may not be able to achieve our business objectives.
Any one of these outcomes could have an adverse effect on our business, financial condition, and results of operations. 23 Failure by third parties to supply or manufacture components of our products or to deploy our systems timely or properly could adversely affect our business, financial condition, and results of operations.
Failure by third parties to supply or manufacture components of our products or to deploy our systems timely or properly could adversely affect our business, financial condition, and results of operation. We have been, and expect to continue to be, highly dependent on third parties to supply or manufacture components for our products, including for pre-fabrication elements.
These accounts are in non-interest-bearing and interest-bearing operating accounts and may, from time to time, exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. If such banking institutions were to fail, we could lose all or a portion of those amounts held more than such insurance limitations.
If such banking institutions were to fail, we could lose all or a portion of those amounts held more than such insurance limitations.
For fiscal 2024 and beyond, our plan is to build out an internal software development team and bring in-house certain core aspects of our software solutions. We may be unable to hire appropriate internal resources to enable us to meet the software development needs of our products and solutions.
We may be unable to hire appropriate outsourced resources to enable us to meet the software development needs of our products and solutions.
Foreign governments with which we contract to provide funding for our research and development may seek similar rights. 30 Risks Related to Regulatory and Compliance Matters If we are unable to obtain all necessary regulatory permits and approvals, it is possible that we will not be able to implement our planned projects or business plan.
Risks Related to Regulatory and Compliance Matters If we are unable to obtain all necessary regulatory permits and approvals, it is possible that we will not be able to implement our planned projects or business plan. Offshore deployment of our products is heavily regulated. Each of our deployments is subject to multiple permitting and approval requirements.
Offshore deployment of our products is heavily regulated. Each of our deployments is subject to multiple permitting and approval requirements. We and our customers are dependent on state, federal and regional government agencies for such permits and approvals.
We and our customers are dependent on state, federal and regional government agencies for such permits and approvals.
If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology and products could be adversely affected, which could in turn adversely affect our business, financial condition, and results of operations.
If we are unable to manage our international operations effectively, our business, financial condition and results of operations could be adversely affected.
We may also have limited legal recourse in the event we encounter patent or trademark infringement.
We may also have limited legal recourse in the event we encounter patent or trademark infringement. If we are unable to manage our intellectual property rights, our business and operating results may be seriously harmed.
For example, some of our manufacturers have experienced staffing shortages due to COVID-19 and its variants as well as other factors, and this has delayed delivery times for our products from time to time. Specifically, we have concerns about the delivery of semiconductors and specialty metals, which are necessary to produce our products.
Specifically, we have concerns about the delivery of semiconductors and specialty metals, which are necessary to produce our products, as well as our ability to find vendors for pre-fabrication elements of our products.
The scope of our operations to date has been limited, and we do not have experience operating on the scale that we believe may be necessary to achieve profitable operations. We added two acquisitions over the last two fiscal years, adding operations in Texas and California to our existing operations in New Jersey, without significantly increasing our support staff.
If we are unable to effectively manage our growth, this could adversely affect our business and operations. The scope of our operations to date has been limited, and we do not have experience operating on the scale that we believe may be necessary to achieve profitable operations.
In addition, the need for substantial numbers of our employees to work remotely, such as due to the COVID-19 pandemic, could create additional data security risks. 25 Cyber-security breaches of our systems and information technology could adversely impact our ability to operate or meet contractual obligations. We utilize, develop, install, and maintain a number of information technology systems.
Cyber-security breaches of our systems and information technology could adversely impact our ability to operate or meet contractual obligations. We utilize, develop, install and maintain a number of information technology systems. Various privacy and security laws require us to protect sensitive and confidential information from disclosure.
While we believe that this is sufficient to fund our operations for the foreseeable future, we do not know whether we will be able to secure additional funding if needed in the future or, if secured, whether the terms will be favorable to us or our investors.
We have raised approximately $0.5 million during fiscal 2024, and had an unrestricted cash balance of $3.2 million as of April 30, 2024. We do not know whether we will be able to secure additional funding if needed in the future or, if secured, whether the terms will be favorable to us or our investors.
Our technology may not yet have demonstrated that our engineering and test results can be duplicated in volume or in commercial production.
To date, we have only manufactured a limited number of PowerBuoys®. As a result, our products may not have a sufficient operating history to confirm how they will perform over their estimated useful life. Our technology may not yet have demonstrated that our engineering and test results can be duplicated in volume or in commercial production.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAdditionally, we have begun leasing a property located in Richmond, California where we will occupy approximately 11,500 square feet under a lease expiring on June 18, 2028. We are currently in the process of moving our California operations to this location and intend to vacate the site at the University of California Berkeley during fiscal 2024.
Biggest changeAdditionally, we have a property located on the University of California Berkeley in Berkeley, California, where we occupy 1,220 square feet under a lease which is currently operating month-to-month. Additionally, we have begun leasing a property located in Richmond, California where we will occupy approximately 11,500 square feet under a lease expiring on June 18, 2028.
ITEM 2. PROPERTIES Our corporate headquarters are currently located in Monroe Township, New Jersey, where we occupy approximately 56,000 square feet under a lease expiring on October 31, 2024. We use this facility for administration, research and development, as well as assembly and testing of our products.
ITEM 2. PROPERTIES Our headquarters are currently located in Monroe Township, New Jersey, where we occupy approximately 56,000 square feet under a lease expiring on April 30, 2026. We use this facility for administration, research and development, as well as manufacturing, assembly and testing of our products.
Finally, we have a property located in Houston, Texas, under a lease expiring on January 31, 2024. We use this facility for our consulting services personnel. We believe that our facilities are sufficient for our current needs and are in good condition in all material respects.
We believe that our facilities are sufficient for our current needs and are in good condition in all material respects.
Removed
Additionally, we have a property located on the University of California Berkeley in Berkeley, California, where we occupy 1,220 square feet under a lease which is currently operating month-to-month . We use this facility primarily for administration, engineering, and manufacturing of our products.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn connection with the tax audit, the Spanish tax inspector challenged the Company’s recognition of grant funds received in 2011 to 2014 from the European Commission in connection with the Company’s Waveport project.
Biggest changeSpain Income Tax Audit The Company underwent an income tax audit in Spain for the period from 2011 to 2014, when our Spanish branch was closed. In connection with the tax audit, the Spanish tax inspector challenged the Company’s recognition of grant funds received in 2011 to 2014 from the European Commission in connection with the Company’s Waveport project.
As of April 30, 2023, the Company had no reserve related to this audit. The Company has appealed the decision of the Tribunal tax assessment to the Spanish National Court. The Company expects a ruling on the appeal prior to the end of fiscal 2024. Item 4. MINE SAFETY DISCLOSURES None. 36 PART II
As of April 30, 2024, the Company had no reserve related to this audit. The Company has appealed the decision of the Tribunal tax assessment to the Spanish National Court. The Company expects a ruling on the appeal prior to the end of fiscal 2025. Item 4. MINE SAFETY DISCLOSURES None. 36 PART II
Removed
ITEM 3. LEGAL PROCEEDINGS Employment Litigation On June 10, 2014, the Company terminated Charles Dunleavy as its Chief Executive Officer for cause and removed him from the Board of Directors. In 2018, Mr.
Added
LEGAL PROCEEDINGS On June 16, 2023, Paragon Technologies, Inc., a Delaware corporation that is a shareholder of the Company (“Paragon”), informed the Company that Paragon was planning a proxy contest against the Company and intended to nominate candidates for election to the Company Board of Directors (the “OPT Board”) at the Company’s 2023 Annual Meeting (the “2023 Annual Meeting”).
Removed
Dunleavy filed a demand for arbitration against the Company before the American Arbitration Association in New Jersey, claiming, among other things, that the Company breached its employment agreement with Mr. Dunleavy. The arbitration panel ultimately awarded Mr.
Added
Subsequently, Paragon disclosed its intention to replace a majority of the six-member OPT Board with initially five purported nominees, including three members of the Paragon Board of Directors, and, thereby, seek control of the Company. In furtherance of Paragon’s threatened agenda, Paragon brought three litigation matters against the Company in the Delaware Court of Chancery. (a) (Del.
Removed
Dunleavy compensatory damages in the amount of $438,254.54 for the breach of contract claim, plus additional attorneys’ fees, costs and prejudgment interest for a total award of $1,223,963.14. The Company paid this amount on May 26, 2021 and the matter is now closed.
Added
Code §220 Complaint) On July 27, 2023, Paragon filed a complaint in the Court of Chancery of the State of Delaware against the Company seeking to compel the inspection of certain books and records of the Company pursuant to 8 Del. Code § 220.
Removed
On June 10, 2014, the Company terminated Charles Dunleavy as its Chief Executive Officer for cause and removed him from the Board of Directors. Legal proceedings commenced in 2018 and an arbitration panel awarded Mr. Dunleavy a total amount of $1,2 million.
Added
On January 31, 2024, the Court issued a ruling for the Company to deliver certain books and records to Paragon, and the books and records that were subject to the Court’s final order were produced to Paragon on April 8, 2024.
Removed
The Company paid this amount on May 26, 2021 and the matter was closed. 35 Spain Income Tax Audit The Company underwent an income tax audit in Spain for the period from 2011 to 2014, when our Spanish branch was closed.
Added
No additional activity has occurred. 35 (b) Breach of Fiduciary Duties Complaint) On October 10, 2023, Paragon filed an additional complaint in the Court of Chancery of the State of Delaware against the Company, and the members of its Board of Directors, claiming certain breaches of their fiduciary duties.
Added
The complaint sought only injunctive relief against the Company, and not monetary damages, and therefore the financial exposure derived therein was limited to applicable legal fee and costs at that stage, which was material to FY 24. On November 2, 2023, Paragon sought leave to amend its complaint to add additional claims.
Added
The Court granted this motion for leave to amend, provided that the Court would not delay the hearing on the matters raised in the initial complaint, which was set for November 28, 2023.
Added
This hearing on the initial complaint was held and on November 30, 2023, the Court ruled in favor of the Company and denied Paragon’s motion for injunctive relief. The status of the in the amended complaint is still pending.
Added
On February 28, 2024, the Company successfully finalized its 2023 annual meeting of stockholders in spite of Paragon’s repeated attempts to contest the meeting. On July 10, 2024, the Company requested Paragon’s counsel to dismiss this litigation, given there has been no activity for 6 months. We are awaiting a response. (c) l (Del.
Added
Code §225 Complaint) On April 11, 2024, Paragon filed an action in the Delaware Court of Chancery against the Company, and the members of its Board of Directors, challenging the results of the 2023 Annual Meeting (concluded on February 28, 2024), alleging that a quorum was not present for the meeting.
Added
On May 7, 2024, the Company filed its answer, including that the Final Report of the Inspector of Election (which Paragon selected) confirmed that a quorum was present.
Added
On June 20, 2024, Paragon filed a Motion to Dismiss the case “without prejudice.” On June 28, 2024, the Company responded to Paragon’s Motion to Dismiss, claiming that the case should be dismissed: (a) “with prejudice”; or (b) “without prejudice,” but in such event Paragon should reimburse OPT’s fees and costs for defending the case.
Added
As clearly evidenced by the above, Paragon has filed three lawsuits against the OPT Board and the Company in an effort to seek control of the Company, without following appropriate governance standards and without offering fair value to the stockholders.
Added
In addition, Sham Gad, the CEO of Paragon has also maintained in public that the nature of Paragon’s proposed investment in the Company was “non-dilutive.” To that point, on April 24, 2024, Paragon made the following “non-dilutive $3MM preferred stock” offer to the Company: “...The preferred would have the option to be convertible to common stock, at $0.05 a share, or 25% of the 30-day average trading price, whichever is higher...”.
Added
After the Board correctly rejected the $3MM preferred stock offer, on June 7, 2024, Paragon issued a press release that proclaimed its offer was non-dilutive.
Added
In fact, Paragon’s offer was highly dilutive because the offer stipulated that the proposed OPT preferred stock to be issued to Paragon would be convertible to OPT common stock at a 75% discount to the fair market value of the common stock.
Added
The Paragon offer thus essentially amounted to a change in control of the Company at 25% of its fair market value. In order to defend the best interests of the Company’s shareholders against Paragon’s lawsuits and public statements, the Company has spent approximately $3.9 million in fees and costs.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeShares that are forfeited under the 2006 Stock Incentive Plan on or after October 22, 2015, will become available for issuance under the 2015 Omnibus Incentive Plan. The equity compensation plan that has not been approved by our shareholders is our 2018 Employee Inducement Incentive Award Plan.
Biggest changeShares that are forfeited under the 2006 Stock Incentive Plan on or after October 22, 2015, will become available for issuance under the 2015 Omnibus Incentive Plan. The equity compensation plan that has not been approved by our shareholders is our 2018 Employee Inducement Incentive Award Plan. Unregistered Sales of Equity Securities and Use of Proceeds Not Applicable.
Transfer Agent Information Our transfer agent is Computershare Trust Company, N.A. Computershare is located at 250 Royal Street, Canton, MA 02021-1011. Its contact information is: United States and Canada: (800) 662 - 7232, International (781) 575–4238, and its website is located at www.computershare.com .
Transfer Agent Information Our transfer agent is Computershare Trust Company, N.A. Computershare is located at 250 Royal Street, Canton, MA 02021-1011. Its contact information is: U.S. and Canada: (800) 662 - 7232, International (781) 575–4238, and its website is located at www.computershare.com.
As of July 28, 2023, there were 131 holders of record for shares of our common stock. Since a portion of our common stock is held in “street” or nominee name, we are unable to determine the exact number of beneficial holders.
As of July 22, 2024, there were 119 holders of record for shares of our common stock. Since a portion of our common stock is held in “street” or nominee name, we are unable to determine the exact number of beneficial holders.
Purchases of Equity Securities by the Issuer There were no purchases of equity securities by the Company for the year ended April 30, 2023. 37 Equity Compensation Plan Information The following table sets forth the indicated information as of April 30, 2023, with respect to our equity compensation plans: Plan Category Number of Shares to be Issued Upon Exercise of Outstanding Options and Restricted Stock Weighted-Average Exercise Price of Outstanding Options Number of Shares Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Shares Reflected in First Column) Equity compensation plans approved by shareholders: Stock Options 1,595,852 $ 1.70 221,446 (1) Restricted Stock Units 1,935,994 N/A Equity compensation plans not approved by shareholders: Stock Options — — — Restricted Stock Units 50,000 N/A 161,487 (2) (1) Consists of shares of our common stock available for issuance under the 2015 Omnibus Incentive Plan.
Purchases of Equity Securities by the Issuer There were no purchases of equity securities by the Company for the year ended April 30, 2024. 37 Equity Compensation Plan Information The following table sets forth the indicated information as of April 30, 2024, with respect to our equity compensation plans: Plan Category Number of Shares to be Issued Upon Exercise of Outstanding Options and Restricted Stock Weighted-Average Exercise Price of Outstanding Options Number of Shares Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Shares Reflected in First Column) Equity compensation plans approved by shareholders: Stock Options 734,543 $ 2.12 — (1) Restricted Stock Units 5,124,529 N/A Equity compensation plans not approved by shareholders: Stock Options — — — Restricted Stock Units — N/A 161,487 (2) (1) Consists of shares of our common stock available for issuance under the 2015 Omnibus Incentive Plan.
Removed
Unregistered Sales of Equity Securities and Use of Proceeds Not Applicable. 38 ITEM 6. [ Reserved]

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. Selected Financial Data 39 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 39 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 46 Item 8. Financial Statements and Supplementary Data 46 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 46 Item 9A. Controls and Procedures 46
Biggest changeItem 6. Selected Financial Data 38 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 38 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 48 Item 8. Financial Statements and Supplementary Data 48 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 48 Item 9A. Controls and Procedures 48

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

46 edited+29 added−22 removed17 unchanged
Biggest changeOur future capital requirements will depend on several factors, including but not limited to: ● our ability to develop, market and commercialize our products, and achieve and sustain profitability; ● our continued development of our proprietary technologies, and expected continued use of cash from operating activities unless or until we achieve positive cash flow from the commercialization of our products and services; ● our ability to obtain additional funding, as and if needed, which will be subject to several factors, including market conditions, and our operating performance; ● our history of operating losses, which we expect to continue for at least the short term and possibly longer; ● our ability to manage and mitigate risks associated with our internal cyber security protocols and protection of the data we collect and distribute; ● our ability to protect our intellectual property portfolio ● the impact of inflation related to the U.S. dollar on our business, operations, customers, suppliers and manufacturers and personnel; ● our ability to meet product development, manufacturing and customer delivery deadlines may be impacted by disruptions to our supply chain, primarily related to labor shortages and manufacturing and transportation delays both here in the U.S. and abroad; ● our acquisitions and our ability to integrate them into our operations which may be unsuccessful or expose us to unforeseen liabilities, and may use significant resources; ● our estimates regarding future expenses, revenues, and capital requirements; ● our ability to identify and penetrate markets for our products, services, and solutions; ● our ability to effectively respond to competition in our targeted markets ● our ability to establish relationships with our existing and future strategic partners which may not be successful; ● our ability to maintain the listing of our common stock on the NYSE American; ● the reliability of our technology, products and solutions; ● our ability to increase or more efficiently utilize the power available from our PowerBuoy® product line: ● changes in current legislation, regulations and economic conditions that affect the demand for, or restrict the use of our products; ● our ability to hire and retain key personnel, including senior management, to achieve our business objectives; and ● our ability to establish and maintain commercial profit margins.
Biggest changeOur future capital requirements will depend on several factors, including but not limited to: ● Our ability to improve, market and commercialize our products, and achieve and sustain profitability; ● our continued improvement of our proprietary technologies, and expected continued use of cash from operating activities unless or until we achieve positive cash flow from the commercialization of our products and services; ● our ability to obtain additional funding, as and if needed, which will be subject to several factors, including market conditions, and our operating performance; ● our history of operating losses, which we expect to continue for at least the short term and possibly longer; ● our ability to manage challenges and expenses associated with communications and disputes with activist shareholders, including litigation; ● our ability to manage and mitigate risks associated with our internal cyber security protocols and protection of the data we collect and distribute; ● our ability to protect our intellectual property portfolio; ● the impact of inflation related to the U.S. dollar on our business, operations, customers, suppliers, manufacturers, and personnel; 45 ● our ability to meet product enhancement, manufacturing and customer delivery deadlines and the potential impact due to disruptions to our supply chain or our ability to identify vendors that can assist with the prefabrication elements of our products, as a result of, among other things, staff shortages, order delays, and increased pricing from vendors and manufacturers; ● our estimates regarding future expenses, revenue, and capital requirements; ● our ability to identify and penetrate markets for our products, services, and solutions; ● our ability to effectively respond to competition in our targeted markets; ● our ability to establish relationships with our existing and future strategic partners which may not be successful; ● our ability to maintain the listing of our common stock on the NYSE American; ● the reliability of our technology, products and solutions; ● our ability to increase or more efficiently utilize the synergies available from our product lines: ● changes in current legislation, regulations and economic conditions that affect the demand for, or restrict the use of our products; ● our ability to expand markets across geographic boundaries; ● our ability to be successful with Federal government work which is complex due to various statutes and regulations applicable to doing business with the Federal government; ● our ability to be successful doing business internationally which requires strict compliance with applicable import, export, ITAR, anti-bribery and related statutes and regulations; ● the current geopolitical world uncertainty, including Russia’s invasion of Ukraine, the Israel/Palestine conflict and recent attacks on merchant ships in the Red Sea; ● our ability to hire and retain key personnel, including senior management, to achieve our business objectives; and ● our ability to establish and maintain commercial profit margin Any or all of our forward-looking statements in this report may turn out to be inaccurate.
The selection of the method to measure progress towards completion requires judgment and is based on the nature of the services to be provided. For the Company, the input method using costs incurred or labor hours best represents the measure of progress against the performance obligations incorporated within the contractual agreements.
The selection of the method to measure progress towards completion requires judgment and is based on the nature of the services to be provided. For the Company, the input method using costs or labor hours incurred best represents the measure of progress against the performance obligations incorporated within the contractual agreements.
The Company’s revenue also includes revenue from certain contracts which do not fall within the scope of ASC 606, but under the ASC 842. At inception of a contract for those classified under ASC 842, the Company classifies leases as either operating or financing in accordance with the authoritative accounting guidance contained within ASC Topic 842, “Leases”.
The Company’s revenue also includes revenue from certain contracts which do not fall within the scope of ASC 606, but under the scope of ASC 842. At inception of a contract for those classified under ASC 842, the Company classifies leases as either operating or financing in accordance with the authoritative accounting guidance contained within ASC Topic 842, “Leases”.
If we are unable to obtain required financing when needed, we may be required to reduce the scope of our operations, including our planned product development and marketing efforts, which could materially and adversely affect our financial condition and operating results. If we are unable to secure additional financing, we may be forced to cease our operations.
If we are unable to obtain required financing when needed, we may be required to reduce the scope of our operations, including our planned incremental product development and marketing efforts, which could materially and adversely affect our financial condition and operating results. If we are unable to secure additional financing, we may be forced to cease our operations.
The cumulative effect of revisions to revenue, estimated costs to complete contracts, including penalties, change orders, claims, anticipated losses, and others are recorded in the accounting period in which the events indicating a loss are known and the loss can be reasonably estimated. These loss projects are re-assessed for each subsequent reporting period until the project is complete.
The cumulative effect of revisions to revenue, estimated costs to complete contracts, including penalties, change orders, claims, anticipated losses, and others are recorded in the accounting period in which the events indicating a loss are known and the loss can be reasonably estimated. These loss projections are re-assessed for each subsequent reporting period until the project is complete.
Our estimates of variable consideration and determination of whether to include such amounts in the transaction price are based largely on our assessment of legal enforceability, performance, and any other information (historical, current, and forecasted) that is reasonably available to us. There was no variable consideration as of April 30, 2023 or 2022.
Our estimates of variable consideration and determination of whether to include such amounts in the transaction price are based largely on our assessment of legal enforceability, performance, and any other information (historical, current, and forecasted) that is reasonably available to us. There was no variable consideration as of April 30, 2024 or 2023.
A substantial portion of our revenues is recognized using the input method used to measure completion over time of customer contracts, and changes in estimates from time to time may have a significant effect on revenue and backlog. Our backlog is also typically subject to large variations from time to time due to the timing of new awards.
A portion of our revenue is recognized using the input method used to measure completion over time of customer contracts, and changes in estimates from time to time may have a significant effect on revenue and backlog. Our backlog is also typically subject to large variations from time to time due to the timing of new awards.
Income tax benefit Income tax benefit reflects the sale by the Company of New Jersey State net operating losses and research development credits under the New Jersey Economic Development Authority Tax Transfer programs, resulting in $0.3 million and $1.8 million of tax benefit related to the fiscal year ended April 30, 2023 and 2022, respectively.
Income tax benefit Income tax benefit reflects the sale by the Company of New Jersey State net operating losses and research development credits under the New Jersey Economic Development Authority Tax Transfer programs, resulting in $1.3 million and $0.3 million of tax benefit related to the fiscal year ended April 30, 2024 and 2023, respectively.
Business Update Regarding Macroeconomic Condition Adverse macroeconomic conditions, including inflation, slower growth or recession, policy changes, higher interest rates, and currency fluctuations may have a negative impact on our business. These adverse conditions could impact the spending budgets of our customers, and therefore could adversely affect the sales of our products and services.
Business Update Regarding Macroeconomic Condition Adverse macroeconomic conditions, including inflation, political instability, regional conflicts, slower growth or recession, policy changes, higher interest rates, and currency fluctuations may have a negative impact on our business. These adverse conditions could impact the spending budgets of our customers, and therefore could adversely affect the sales of our products and services.
We believe the following accounting policies require significant judgment and estimates by us in the preparation of our consolidated financial statements. Revenue recognition The Company accounts for revenue in accordance with Accounting Standards Codification 606 (ASC 606) for contracts with customers and Accounting Standards Codification 842 (ASC 842) for leasing arrangements.
We believe the following accounting policy requires significant judgment and estimates by us in the preparation of our consolidated financial statements. Revenue recognition The Company accounts for revenue in accordance with Accounting Standards Codification 606 (ASC 606) for contracts with customers and Accounting Standards Codification 842 (ASC 842) for leasing arrangements.
We also work closely with our third-party partners that provide us with, among other things, software, controls, sensors, integration services, and marine installation services. Our solutions are based on proprietary technologies that enable autonomous, zero or low carbon emitting, and cost-effective data collection, analysis, transportation and communication.
The Company also works closely with our third-party partners that provide us with, among other things, software, controls, sensors, integration services, and marine installation services. Our solutions are based on proprietary technologies that enable autonomous, zero or low carbon emitting, and cost-effective data collection, analysis, transportation and communication.
The Company’s share of the costs is recorded as product development expense. The Company reports its disaggregation of revenue by contract type since this method best represents the Company’s business. For the fiscal years ended April 30, 2023 and 2022, the majority of the Company’s contracts were classified as firm fixed-price.
The Company’s share of the costs is recorded as product development expense. The Company reports its disaggregation of revenue by contract type since this method best represents the Company’s business. For the fiscal years ended April 30, 2024 and 2023, the majority of the Company’s contracts were classified as firm fixed-price and the balance were cost-sharing.
We offer our products and services to a wide range of customers, including those in government and offshore energy, oil and gas, construction, wind power and other industries. We are involved in the entire life cycle of product development, from product design through manufacturing, testing, deployment, maintenance and upgrades, while working closely with partners across our supply chain.
The Company offers our products and services to a wide range of customers, including those in government and offshore energy, oil and gas, construction, wind power and other industries. The Company is involved in the entire life cycle of product development, from product design through manufacturing, testing, deployment, maintenance and upgrades, while working closely with partners across our supply chain.
A good or service is transferred when or as the customer obtains control. The evaluation of whether control of each performance obligation is transferred at a point in time or over time is made at contract inception. Input measures such as costs incurred are utilized to assess progress against specific contractual performance obligations for the Company’s services.
The evaluation of whether control of each performance obligation is transferred at a point in time or over time is made at contract inception. Input measures such as costs incurred are utilized to assess progress against specific contractual performance obligations for the Company’s services.
The Company recognizes revenue from operating lease arrangements generally on a straight-line basis over the lease term, or as agreed upon in-use days are utilized, which is presented in Revenue in the Consolidated Statement of Operations. The Company also enters into lease arrangements for its PowerBuoys ® and Wave Adaptive Modular Vessels (“WAM-V®”) with certain customers.
The Company recognizes revenue from operating lease arrangements generally on a straight-line basis over the lease term, or as agreed upon in-use days are utilized, which is presented in Revenue in the Consolidated Statement of Operations. The Company also enters into lease arrangements for its PowerBuoys® and WAM-V® with certain customers.
The Company is in the process of winding down its Australian subsidiary, which is expected to be completed during fiscal 2024. The unrealized gains or losses resulting from foreign currency balances translation are included in Accumulated Other Comprehensive Loss within Shareholders’ Equity. Foreign currency transaction gains and losses are recognized within our Consolidated Statements of Operations.
The Company began the process of winding down its UK subsidiary during fiscal 2024 and expects this to be completed during fiscal 2025. The unrealized gains or losses resulting from foreign currency balances translation are included in Accumulated Other Comprehensive Loss within Shareholders’ Equity. Foreign currency transaction gains and losses are recognized within our Consolidated Statements of Operations.
Such revisions could occur at any time and the effects may be material. During the fiscal year ended April 30, 2023 the Company recognized approximately $1.0 million in revenue related to performance obligations satisfied at a point in time and approximately $1.7 million in revenue related to performance obligation satisfied over-time.
Such revisions could occur at any time and the effects may be material. During the fiscal year ended April 30, 2024 the Company recognized approximately $3.6 million in revenue related to performance obligations satisfied at a point in time and approximately $1.9 million in revenue related to performance obligations satisfied over time.
Variable consideration is included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur once the uncertainty associated with the variable consideration is resolved.
Variable consideration can also arise from modifications to the scope of services. Variable consideration is included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur once the uncertainty associated with the variable consideration is resolved.
The sale of additional equity under new facilities could result in dilution to our shareholders. If additional funds are raised through the issuance of debt securities or preferred stock, these securities could have rights senior to those associated with our common stock and could contain covenants that would restrict our operations.
If additional funds are raised through the issuance of debt securities or preferred stock, these securities could have rights senior to those associated with our common stock and could contain covenants that would restrict our operations.
Our product development costs relate primarily to our efforts to increase the power output and reliability of our PowerBuoy® system, and to the development of new products, product applications and complementary technologies. We expense all our engineering and product development costs as incurred.
Our product enhancement costs relate primarily to our efforts to increase the power output and reliability of our PowerBuoy® system and other products, to enhance and optimize data monitoring and controls systems, and the development of new products, product applications and complementary technologies. We expense all of these costs as incurred.
The Company has obtained equity financing through its ATM Agreement and the Aspire Capital financing, but the Company cannot be certain that additional equity and/or debt financing will be available to the Company as needed on acceptable terms, or at all.
The Company cannot be certain that additional equity and/or debt financing will be available to the Company as needed on acceptable terms, or at all.
Net cash used in operating activities During the fiscal year ended April 30, 2023, net cash flows used in operating activities was $21.7 million, an increase of $0.4 million compared to net cash used in operating activities during the fiscal year ended April 30, 2022.
Net cash used in operating activities During the fiscal year ended April 30, 2024, net cash flows used in operating activities was $29.8 million, an increase of $8.1 million compared to net cash used in operating activities during the fiscal year ended April 30, 2023.
Also included are professional fees, salaries and other personnel-related costs for employees and consultants engaged in sales and marketing and costs for executive, accounting and administrative personnel, and other general corporate expenses.
Selling, general and administrative costs Our selling, general and administrative costs consist primarily of professional fees, salaries and other personnel-related costs for employees and consultants engaged in sales and marketing of our products, and costs for executive, accounting and administrative personnel, professional fees and other general corporate expenses.
Additionally, in the prior year, the Company acquired MAR using cash of $4.4 million. Net cash (used in)/provided by financing activities Net cash used by financing activities during the fiscal year ended April 30, 2023 was approximately $14,000 compared to net cash provided by financing activities during the fiscal year ended April 30, 2022 of $87,000.
Net cash provided by financing activities Net cash provided by financing activities during the fiscal year ended April 30, 2024 was approximately $469,000 compared to net cash used in financing activities during the fiscal year ended April 30, 2023 of $14,000.
If any of our contracts were to be terminated, our backlog would be reduced by the expected value of the remaining terms of such contract. The amount of contract backlog is not necessarily indicative of future revenue because modifications to or terminations of present contracts and production delays can provide additional revenue or reduce anticipated revenue.
The amount of contract backlog is not necessarily indicative of future revenue because modifications to or terminations of present contracts and production delays can provide additional revenue or reduce anticipated revenue.
Interest income, net Interest income, net consists of interest received on cash and cash equivalents, investments in money market accounts and short-term investments and is net of interest expense paid on certain obligations to third parties.
The increase of $3.9 million is primarily due to expenses related to the activist shareholder activities noted above. Interest income, net Interest income, net consists of interest received on cash and cash equivalents, investments in money market accounts and short-term investments and is net of interest expense paid on certain obligations to third parties.
The previous year amounts related to an adjustment to an earn out liability related to the acquisition of 3Dent. Operating Expenses Our operating expenses include both product development costs as well as administrative costs, including the costs of products, materials and outside services used in our product development and unfunded research activities.
Operating Expenses Our operating expenses include both product development costs (substantially completed during fiscal year 2024) as well as administrative costs, including the costs of products, materials and outside services used in our product development and unfunded research activities.
Results of Operations This section should be read in conjunction with the discussion below under “Liquidity and Capital Resources.” Fiscal Years Ended April 30, 2023 and 2022 The following table contains selected Consolidated Statements of Operations information, which serves as the basis of the discussion of our results of operations for the fiscal years ended April 30, 2023 and 2022: Fiscal years ended April 30, 2023 2022 (in thousands) Revenues $ 2,732 $ 1,759 Cost of revenues 2,496 1,860 Gross profit (loss) 236 (101 ) Change in fair value of consideration 1,112 (60 ) Other operating expenses 28,340 21,512 Total operating expenses 29,452 21,452 Operating loss (29,216 ) (21,553 ) Interest income, net 902 124 Other income, employee retention credit 1,251 — Other income, proceeds from insurance claim 458 — Gain on extinguishment of PPP loan — 890 Loss on liquidation of subsidiary — (157 ) Foreign exchange gain/(loss) 1 (1 ) Loss before income taxes (26,604 ) (20,697 ) Income tax benefit 278 1,823 Net loss $ (26,326 ) $ (18,874 ) Revenues Revenues for the fiscal years ended April 30, 2023 and 2022 were approximately $2.7 million and $1.8 million, respectively, representing an increase of approximately $1.0 million, or 55%, from 2022.
Fiscal Years Ended April 30, 2024 and 2023 The following table contains selected Consolidated Statements of Operations information, which serves as the basis of the discussion of our results of operations for the fiscal years ended April 30, 2024 and 2023: Fiscal years ended April 30, 2024 2023 (in thousands) Revenue $ 5,525 $ 2,732 Cost of revenue 2,699 2,496 Gross (loss) profit 2,826 236 Change in fair value of contingent consideration (72 ) 1,112 Other operating expenses 32,229 28,340 Total operating expenses 32,157 29,452 Operating loss (29,331 ) (29,216 ) Interest income, net 800 902 Other income, employee retention credit — 1,251 Other income, proceeds from insurance claim — 458 Other income 2 — Loss on disposition of assets (210 ) — Foreign exchange gain 2 1 Loss before income taxes (28,737 ) (26,604 ) Income tax benefit 1,254 278 Net loss $ (27,483 ) $ (26,326 ) Revenue Revenue for the fiscal years ended April 30, 2024 and 2023 were approximately $5.5 million and $2.7 million, respectively, representing an increase of approximately $2.8 million, or 102%, from 2023.
Liquidity Outlook Since our inception, the cash flows from customer revenues have not been sufficient to fund our operations and provide the capital resources for our business.
Effect of exchange rates on cash and cash equivalents The effect of exchange rates on cash and cash equivalents was not material during fiscal 2024 or fiscal 2023. Liquidity Outlook Since our inception, the cash flows from customer revenue have not been sufficient to fund our operations and provide the capital resources for our business.
The Company presents shipping and handling costs, that occur after control of the promised goods or services transfer to the customer, as fulfillment costs in costs of goods sold and regular shipping and handling activities charged to operating expenses. 40 The Company recognizes revenue when or as it satisfies a performance obligation by transferring a good or service to a customer, either (1) at a point in time or (2) over time.
The Company presents shipping and handling costs, that occur after control of the promised goods or services transfer to the customer, as fulfillment costs in costs of goods sold and regular shipping and handling activities charged to operating expenses.
Other income Other income for the fiscal year ended April 30, 2023 and 2022 was $1.7 million and zero, respectively. The amount in the current year relates to employee retention credits applied for previously filed payroll tax returns with the Internal Revenue Service of $1.2 million and proceeds received for an insurance claim of $0.5 million.
The amount in the prior year relates to employee retention credits applied for previously filed payroll tax returns with the Internal Revenue Service and proceeds received for an insurance claim. Foreign exchange gain/(loss) Foreign exchange gain was approximately $2,000 for fiscal year 2024 as compared to a foreign exchange gain of $1,000 for fiscal year 2023.
The change was primarily the result of the Company using cash to purchase short-term, held to maturity investments during fiscal 2022. During fiscal 2023 many of those purchases of investments made during fiscal 2022 matured, resulting in cash inflows at maturity, which were then used to fund operating expenses.
During fiscal 2024 many investments made during fiscal 2023 matured, resulting in cash inflows at maturity, which were then used to fund operating expenses.
Total cash, cash equivalents, restricted cash, and short-term investments was $34.9 million as of April 30, 2023, compared to $57.7 million as of April 30, 2022. Interest income, net was approximately $0.9 million and $0.1 million for fiscal 2023 and 2022, respectively, and reflects the rising interest rate environment experienced during fiscal 2023.
Interest income, net was approximately $0.8 million and $0.9 million for fiscal 2024 and 2023, respectively, and reflects the decreased balance of our short term investments throughout the year, offset by rising interest rate environment experienced during fiscal 2024. Other income Other income for the fiscal year ended April 30, 2024 and 2023 was zero and $1.7 million, respectively.
Since we conduct our business in U.S. dollars and our functional currency is the U.S. dollar, our main foreign exchange exposure, if any, results from changes in the exchange rate between the U.S. dollar and transactions settled in foreign currencies. In addition to U.S. dollars, we maintain cash accounts that are denominated in British pounds sterling.
Since we conduct our business in U.S. dollars and our functional currency is the U.S. dollar, our main foreign exchange exposure, if any, results from changes in the exchange rate between the U.S. dollar and transactions settled in foreign currencies. 42 The Company completed the process of winding down its Australian subsidiary during fiscal 2024.
This increase is mainly driven by increased net operating losses, partially offset by increases in accrued expenses, contingent consideration liability, and contract liabilities. Net cash provided by/(used in) investing activities Net cash provided by investing activities was approximately $20.5 million for fiscal year 2023 versus net cash used in investing activities of approximately $54.0 million for fiscal year 2022.
This increase is mainly driven by increased inventory purchases to satisfy backlog and pipeline of $3.2 million, increased contract liabilities of $2.3 million, increased accrued expenses of $1.8 million, as well as increased net operating losses of $1.2 million. 44 Net cash provided by investing activities Net cash provided by investing activities was approximately $25.5 million for fiscal year 2024 versus net cash provided by investing activities of approximately $20.5 million for fiscal year 2023.
In the lease arrangement, the customer may be provided with an option to extend the lease term or purchase the leased buoy or WAM-V® at some point during and/or at the end of the lease term.
In the lease arrangement, the customer may be provided with an option to extend the lease term or purchase the leased buoy or WAM-V® at some point during and/or at the end of the lease term. 41 Financial Operations Overview As of the years ended April 30, 2024 and 2023, the Company had four and two customers, respectively, whose revenue accounted for at least 10% of the Company’s consolidated revenue.
The Company determines the standalone selling price based upon the facts and circumstances of each obligated good or service. When no observable standalone selling price is available, the standalone selling price is generally estimated based upon the Company’s forecast of the total cost to satisfy the performance obligation plus an appropriate profit margin.
When no observable standalone selling price is available, the standalone selling price is generally estimated based upon the Company’s forecast of the total cost to satisfy the performance obligation plus an appropriate profit margin. 40 The nature of the Company’s contracts may give rise to several types of variable consideration, including unpriced change orders, liquidated damages and penalties.
Backlog As of April 30, 2023, the Company’s backlog was $4.0 million. As of April 30, 2022, backlog was $0.6 million. Our backlog can include unfilled firm orders for our products and services from commercial or governmental customers.
Backlog As of April 30, 2024 and 2023, the Company’s backlog was $4.9 million and $4.0 million, respectively. Our backlog includes unfilled firm orders for our products and services from commercial or governmental customers. If any of our contracts were to be terminated, our backlog would be reduced by the expected value of the remaining terms of such contract.
The decrease in net cash provided by financing activities during the fiscal year ended April 30, 2023 was due to the Company’s receipt of $90,000 of proceeds from stock option exercises in the prior year.
The increase in net cash provided by financing activities during the fiscal year ended April 30, 2024 was due to the proceeds received through issuance of stock under our At the Market offering.
As of April 30, 2023, the cash, cash equivalents, restricted cash, and short-term investments balance was $34.9 million, and we expect to fund our business with this amount and, to a limited extent, with our revenues until we generate sufficient cash flow to internally fund our business.
Total cash, cash equivalents, restricted cash, and short-term investments was $3.3 million as of April 30, 2024, compared to $34.9 million as of April 30, 2023.
References to fiscal 2023 are to the fiscal year ended April 30, 2023. Business Overview We provide ocean data collection and reporting, marine power, offshore communications, and Maritime Domain Awareness System (“MDA” or “MDAS”) products, integrated solutions, and consulting services.
The Company achieves this through our proprietary, state-of-the-art technologies that are at the core of our clean and renewable energy platforms, autonomous systems, solutions and services. The Company provides ocean data collection and reporting, marine power, offshore communications, and Maritime Domain Awareness System (“MDA” or “MDAS”) products, integrated solutions, and consulting services.
For the two-year period ended April 30, 2023 our aggregate revenues were $4.5 million, our aggregate net losses were $45.2 million and our aggregate net cash used in operating activities was $43.0 million. 44 We expect to devote substantial resources to continue our development efforts for our products and to expand our sales, marketing and manufacturing programs associated with the continued commercialization of our products.
Such adjustments could be material. We expect to devote substantial resources to continue our enhancement efforts for our products and to expand our sales, marketing and manufacturing programs associated with the continued commercialization of our products.
Operating expenses during the fiscal year ended April 30, 2023 were $28.3 million as compared to $21.5 million for fiscal year 2022.
Also included are professional fees, salaries and other personnel-related costs for employees and consultants engaged in sales and marketing and costs for executive, accounting and administrative personnel, and other general corporate expenses. Operating expenses during the fiscal year ended April 30, 2024 were $32.2 million as compared to $28.3 million for fiscal year 2023.
Capital Raises At the Market Offering Agreements On November 20, 2020, the Company entered into an At-the-Market Offering Agreement (“ATM”) with AGP (the “2020 ATM Facility”) pursuant to which the Company could issue and sell, from time to time, shares of the Company’s common stock having an aggregate offering price of up to $100.0 million.
On March 21, 2024, the Company entered into an At-the-Market Offering Agreement with AGP with an aggregate offering price of up to $7,000,000 (the “2023 ATM Facility”).
The $1.0 million increase in revenues for the full year was mainly attributable to increases from sales and/or leases of USV products of $1.2 million partially offset by decreases in consulting services of $0.1 million and other revenue of $0.1 million. 42 Cost of revenues Our cost of revenues consists primarily of direct labor, subcontracts, incurred material, lab and manufacturing overhead expenses, such as engineering expense, equipment depreciation and maintenance and facility related expenses, and includes the cost of equipment to customize the PowerBuoy® and WAM-V®.
The following table shows the percentage of our revenue by geographical location of our customers for fiscal 2024 and 2023: Fiscal year ended April 30, Customer Location 2024 2023 North America & South America 96 % 88 % Europe 4 % 3 % Asia and Australia — % 9 % Total 100 % 100 % Cost of revenue Our cost of revenue consists primarily of subcontracts, incurred material, labor and manufacturing overhead expenses, such as engineering expense, equipment depreciation, maintenance, and facility related expenses, and includes the cost of equipment to customize the PowerBuoy®, WAM-V® and our other products supplied by third-party suppliers.
Financial Operations Overview As of the years ended April 30, 2023 and 2022, the Company had two and four customers, respectively, whose revenues accounted for at least 10% of the Company’s consolidated revenues. These revenues accounted for approximately 32% and 49% of the Company’s total revenues for the respective periods. We currently focus our sales and marketing efforts globally.
These customers accounted for approximately 52% and 32% of the Company’s total revenue for the respective periods. We currently focus our sales efforts in key global markets in North America, South America, Europe and Asia.
Removed
We will continue to monitor these conditions, and, if necessary, adjust our operations in response to these conditions.
Added
References to fiscal 2024 are to the fiscal year ended April 30, 2024. 38 Business Overview Our mission is to provide intelligent maritime solutions and services that enable more secure and more productive utilization of our oceans and waterways, provide clean energy power services, and offer sophisticated surface and subsea maritime domain awareness solutions.
Removed
The Company’s common stock was sold at prevailing market prices at the time of sale. Subsequently, on January 10, 2022, a prospectus supplement was filed that allowed the Company to sell an additional $25.0 million of common stock up to a total of $75.0 million under the 2020 ATM Facility.
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In April 2024 the Company announced Merrows, a groundbreaking consolidated solution offering for comprehensive ocean surveillance. Merrows encompasses the collection and transmission of data relating to all aspects of, on, under, adjacent to, or bordering on a sea, ocean, or other navigable waterway.
Removed
As of April 30, 2023, an aggregate of $50.0 million remained available under this facility. The 2020 ATM Facility was terminated by the Company effective June 2, 2023.
Added
OPT’s approach to addressing this challenge involves the deployment of sophisticated Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance, and Reconnaissance (C5ISR) systems. These systems are integrated within OPT’s roaming technologies, such as the Wave Adaptive Modular Vessel (WAM-V), and resident technologies, like the PowerBuoys ® (PB), to offer an unparalleled level of surveillance and data analysis capability.
Removed
The Company anticipates establishing a new ATM facility during fiscal 2024. 39 Equity Line Common Stock Purchase Agreements On September 18, 2020, the Company entered into a common stock purchase agreement with Aspire Capital which provided that, subject to certain terms, conditions and limitations, Aspire Capital was committed to purchase up to an aggregate of $12.5 million shares of the Company’s common stock over a 30-month period subject to a limit of 19.99% of the outstanding common stock on the date of the agreement if the price did not exceed a specified price in the agreement.
Added
We will continue to monitor these conditions, and, if necessary, adjust our operations in response to these conditions such as scaling back, changing direction, or pausing certain planned expenditures. Capital Raises On November 20, 2020, the Company entered into an At-the-Market Offering Agreement with Alliance Global Partners (AGP) (the “2020 ATM Facility”).
Removed
The number of shares the Company could issue within the 19.99% limit was 3,722,251 shares without shareholder approval. Shareholder approval was received at the Company’s annual meeting of shareholders on December 23, 2020 for the sale of 9,864,706 additional shares of common stock which exceeded the 19.99% limit of the outstanding common stock on the date of the agreement.
Added
The 2020 ATM Facility was terminated by the Company effective June 2, 2023. On August 7, 2023, the Company entered into a Controlled Equity Offering Sales Agreement (the “2023 ATM”) with Cantor Fitzgerald & Co. (“Cantor”), as sales agent, which was terminated effective December 2, 2023.
Removed
Through April 30, 2023, the Company had sold an aggregate of 3,722,251 shares of common stock with an aggregate market value of $11.8 million at an average price of $3.17 per share pursuant to this common stock purchase agreement. The Aspire Capital agreement automatically terminated on March 18, 2023, the maturity date of the equity line of credit.
Added
As of April 30, 2024, the Company had received proceeds of approximately $0.5 million under the 2023 ATM Facility. 39 The sale of additional equity under new facilities could result in dilution to our shareholders.
Removed
The nature of the Company’s contracts may give rise to several types of variable consideration, including unpriced change orders, liquidated damages and penalties. Variable consideration can also arise from modifications to the scope of services.
Added
The Company determines the standalone selling price based upon the facts and circumstances of each obligated good or service.
Removed
The following table shows the percentage of our revenues by geographical location of our customers for fiscal 2023 and 2022: Fiscal years ended April 30, Customer Location 2023 2022 North America 88 % 84 % South America 3 % 9 % Europe — % 1 % Asia and Australia 9 % 6 % Total 100 % 100 % Foreign exchange gain /loss We transact business in various countries and have exposure to fluctuations in foreign currency exchange rates.
Added
The Company recognizes revenue when or as it satisfies a performance obligation by transferring a good or service to a customer, either (1) at a point in time or (2) over time. A good or service is transferred when or as the customer obtains control.
Removed
These foreign denominated accounts had a balance of zero as of April 30, 2023 and $28,000 as of April 30, 2022, compared to our total cash, cash equivalents, short term investments, and restricted cash balances of $34.9 million as of April 30, 2023 and $57.7 million as of April 30, 2022. 41 In addition, should we desire to, a portion of our operations can be conducted through our subsidiary in the United Kingdom, the functional currency of which is the British pound sterling.
Added
Cost of revenue also includes PowerBuoy® and other product system delivery and deployment expenses and may include losses recorded at the time a loss is forecasted to be incurred on a contract.
Removed
This subsidiary has foreign exchange exposure that results from changes in the exchange rate between their functional currency and other foreign currencies in which they conduct business. For the fiscal years ended April 30, 2023 and April 30, 2022 there has been little to no activity other than regulatory and tax filings.
Added
Operating Expenses Engineering and product enhancement costs Our engineering and product enhancement costs consist of salaries and other personnel-related costs and the costs of products, materials and outside services used in our product enhancement and unfunded research activities.
Removed
Cost of revenues also includes PowerBuoy® and WAM-V® system delivery and deployment expenses and may include anticipated losses anticipated at completion on certain contracts. Cost of revenues for the fiscal years ended April 30, 2023 and 2022 were approximately $2.5 million and $1.9 million, respectively.
Added
Interest income, net Interest income, net consists of interest received on cash, cash equivalents, and short term investments and interest paid on certain obligations to third parties as well as amortization expense related to the premiums on the purchase of short term investments.
Removed
Change in fair value of contingent consideration The change in fair value of contingent consideration for the fiscal year ended April 30, 2023 was $1.1 million reflecting an adjustment of the contingent consideration liability based on actual bookings and forecasted bookings, as further defined in the purchase and sale agreement as it related to the MAR acquisition.
Added
Foreign exchange gain (loss) We transact business in various countries and have exposure to fluctuations in foreign currency exchange rates.
Removed
The increase of $6.8 million, or 32%, is due to increased strategic spending on payroll related items of $3.8 million due to investments made towards headcount in our autonomous vehicle business, bonuses and key leadership hires in Sales, Operations and Engineering; higher spending on product development of $2.5 million, an increase of $0.5 for G&A items related to increased production and headcount.
Added
Results of Operations This section should be read in conjunction with the discussion below under “Liquidity Outlook”.
Removed
Gain on Extinguishment of PPP Loan The Company filed its loan forgiveness application for the PPP loan at the end of February 2021 asking for 100% forgiveness of the loan.
Added
The $2.8 million increase in revenue for the full year was mainly attributable to increases from sales and/or leases of USV products of $1.7 million and buoy products of $1.5 million, partially offset by decreases in consulting and other revenue of $0.4 million. 43 Change in fair value of contingent consideration The change in fair value of contingent consideration for the fiscal year ended April 30, 2024, and 2023 was a loss of $0.1 million and a gain of $1.1 million respectively.
Removed
In June 2021, the Company was informed that its application was approved, the loan was fully forgiven, and the Company recognized a gain on extinguishment of PPP loan of $0.9 million in its Consolidated Statement of Operations for the fiscal year ended April 30, 2022. 43 Foreign exchange gain/(loss) Foreign exchange gain was approximately $1,000 for fiscal year 2023 as compared to a foreign exchange loss of $1,000 for fiscal year 2022.
Added
This reflects the remeasurement of fair value upon the completion of the second and first earn out period as defined in the purchase and sale agreement related to the MAR acquisition.
Removed
Effect of exchange rates on cash and cash equivalents The effect of exchange rates on cash and cash equivalents was approximately zero in fiscal year 2023, and an increase of $32,000 for fiscal year 2022, respectively. The effect of exchange rates on cash and cash equivalents results primarily from gains or losses on foreign denominated cash and cash equivalents.
Added
For the two-year period ended April 30, 2024 our aggregate revenue was $8.3 million, our aggregate net losses were $53.8 million and our aggregate net cash used in operating activities was $51.5 million. Subsequent to fiscal year end 2024 and through the date of filing management obtained additional capital financing of approximately $6.2 million under the 2023 ATM Facility.
Removed
Our business is capital intensive, and up through fiscal 2023, we have been funding our business principally through sales of our securities.
Added
The Company’s current cash balance may not be sufficient to fund its planned expenditures through twelve months from the filing date of the Form 10-K. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

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