Quarterly report pursuant to Section 13 or 15(d)

Common Stock, Preferred Stock and Warrants

v3.20.4
Common Stock, Preferred Stock and Warrants
6 Months Ended
Oct. 31, 2020
Stockholders' Equity Note [Abstract]  
Common Stock, Preferred Stock and Warrants

Note 8 - Common Stock

 

Our common stock has a par value of $0.001 per share. We are authorized to issue 500,000,000 shares of common stock. Each share of common stock is entitled to one vote. 

 

Note 9 - Preferred Stock

 

Our Series A Preferred Stock (“Series A Stock”) is convertible to common stock at a ratio of 8.33 shares of common stock for each share of Series A Stock, and votes together with the common stock on an as-converted basis. The Series A Preferred Stock was originally issued under the Securities Exchange Agreement, as further described in Note 1. The Series A Stock was automatically converted into shares of common stock upon the effectiveness of our reverse stock split in August 2019, except for 208,704 shares which were subject to a limitation on the number of shares of common stock that can be held by the holder of those shares of Series A Stock.

 

Our Series B Preferred Stock (“Series B Stock”) is convertible into common stock at a ratio of 0.8334 shares of common stock for each share of Series B Stock held and votes together with the common stock on an as-converted basis. The Series B Preferred Stock was originally issued under the Exchange Agreement, as further described in Note 1. Conversions of Series B Stock into Common Stock are as follows:

 

Date   Series B   Common Stock
July 2019   240,000   200,000
November 2019   60,000   50,000
December 2019   231,022   192,519

  

Note 10 - Warrants

 

In September 2019, we received $152,239 in connection with the exercise of 469,874 warrants which had been issued in May 2019 as part of the Share Exchange Agreement. We also assumed a fully vested, restricted stock unit agreement requiring the issuance of 41,667 shares of common stock in May 2021, as well as a warrant to purchase 5,556 shares of common stock at an exercise price of $60.00 per share. This warrant expires in March 2021.

 

In October 2020, the Company issued five-year warrants to purchase a total of 399,998 shares in connection with the issuance of $600,000 of convertible notes. The warrants have an initial exercise price of $1.50 which may be reduced to (i) a 25% discount of the price per share of Common Stock offered in a future qualified offering and also include a ratchet provision. The warrants were valued at $267,999 using the multinomial lattice model and are considered derivative liabilities under ASC 815-40.

 

The following table presents the assumptions used to estimate the fair values of the warrants:

 

    October 31, 2020
Expected volatility     89-95 %
Expected dividends     0 %
Expected term     4.92-5 Years  
Risk-free interest rate     0.27-0.29 %

 

The following table summarizes the changes in warrants outstanding issued to non-employees of the Company during the six months ended October 31, 2020.

 

   

 

Number of Warrants

 

 

 

Weighted Average Exercise Price

 

 

 

Weighted Average Grant Date Fair Value

 

 

 

Expiration Date (yrs)

 

 

 

Value if Exercised

 

Balance as of April 30, 2020       —         —         —         —       $ —    
Granted       399,998       1.50       0.67       5.00       599,997  
Exercised       —         —         —         —         —    
Cancelled/Expired       —         —         —         —         —    
Outstanding as of October 31, 2020       399,998     $ 1.50     $ 0.67       4.92     $ 599,997