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Business Description and Basis of Presentation [Text Block]

(1)

Background, Basis of Presentation and Liquidity

a)	Background

Ocean Power Technologies, Inc. (the “Company”) was incorporated in

1984

in New Jersey, commenced business operations in

1994

and re-incorporated in Delaware in

2007.

The Company is developing and commercializing its proprietary systems that generate electricity by harnessing the renewable energy of ocean waves. The Company uses proprietary technologies that convert the mechanical energy created by the heaving motion of ocean waves into electricity. The Company has designed and continues to develop the PowerBuoy product line which is based on modular, ocean-going buoys, which the Company has been periodically ocean testing since

1997.

The Company markets its PowerBuoys in the United States and internationally. Since fiscal

2002,

government agencies have accounted for a significant portion of the Company’s revenues. These revenues were largely for the support of product development efforts. The Company’s goal is that an increased portion of its revenues be from the sale or lease of products and maintenance services, as compared to revenue to support its product development efforts. As the Company continues to advance its proprietary technologies, it expects to continue to have a net decrease in cash from operating activities unless and until it achieves positive cash flow from the planned commercialization of products and services.

b)	Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form

-Q and Article

of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The interim operating results are not necessarily indicative of the results for a full year or for any other interim period. Further information on potential factors that could affect the Company's financial results can be found in the Company's Annual Report on Form

-K for the year ended

April

30,

2016

filed with the Securities and Exchange Commission (“SEC”) and elsewhere in this Form

-Q.

c)	Liquidity/Going Concern

The consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company has experienced substantial and recurring losses from operations, which have contributed to an accumulated deficit of

$184.8

million as of

January

31,

2017.

As of

January

31,

2017,

the Company had approximately

$11.1

million in cash on hand. The Company generated revenues of

$0.6

million during each of the

nine

months ended

January

31,

2017

and

2016.

Based on the Company’s cash and cash equivalents and marketable securities as of

January

31,

2017,

the Company believes that it will be able to finance its capital requirements and operations into the quarter ending

January

31,

2018.

The Company will require additional equity and/or debt financing to continue its operations. The Company cannot provide assurances that it will be able to secure additional funding when needed or at all, or, if secured, that such funding would be on favorable terms. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

The consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Management is evaluating different strategies to obtain the required additional funding for future operations. These strategies

may

include, but are not limited to, additional funding from current or new investors, officers and directors; borrowings of debt; a public offering of the Company’s equity or debt securities; partnerships and/or collaborations. There can be no assurance that any of these future-funding efforts will be successful.

In fiscal

2017

and

2016,

the Company has continued to make investments in ongoing product development efforts in anticipation of future growth. The Company’s future results of operations involve significant risks and uncertainties. Factors that could affect the Company’s future operating results and cause actual results to vary materially from expectations include, but are not limited to, risks from lack of available financing and insufficient capital, performance of PowerBuoys, its inability to market and commercialize its PowerBuoys, technology development, scalability of technology and production, dependence on skills of key personnel, concentration of customers and suppliers, deployment risks and laws, regulations and permitting. In order to continue to implement its business strategy, the Company requires additional equity and/or debt financing. The Company closed

three

equity financing arrangements during the

nine

months ended

January

31,

2017.

The Company does not currently have any committed sources of debt or equity financing, and the Company cannot assure that additional equity and/or debt financing will be available to the Company as needed on acceptable terms, or at all. Historically, the Company has raised capital through securities sales in the public capital markets. If sufficient additional financing is not obtained when needed, the Company

may

be required to further curtail or limit operations, product development costs, and/or selling, general and administrative activities in order to reduce its cash expenditures. This could cause the Company to be unable to execute its business plan, take advantage of future opportunities and

may

cause it to scale back, delay or eliminate some or all of its product development activities and/or reduce the scope of or cease its operations.

June

2016,

the Company entered into a securities purchase agreement, which was amended on

June

2016

(as amended, the “Purchase Agreement”) with certain institutional purchasers (the

“June

Purchasers”). Pursuant to the terms of the

June

Purchase Agreement, the Company sold an aggregate of

417,000

shares of Common Stock together with warrants to purchase up to an aggregate of

145,952

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.35

of a share of Common Stock at a combined purchase price of

$4.60.

The net proceeds to the Company from the offering were approximately

$1.7

million, after deducting placement agent fees and estimated offering expenses payable by the Company, but excluding the proceeds, if any, from the exercise of the warrants issued in the offering. The warrants have an exercise price of

$6.08

per share, became exercisable on

December

2016

(“Initial Exercise Date”), and will expire

five

years following the Initial Exercise Date.

July

22,

2016,

the Company entered into the Second Amendment to the Purchase Agreement (the “Second Amended Purchase Agreement”) with certain purchasers (the

“July

Purchasers”). Pursuant to the terms of the Second Amended Purchase Agreement, the Company sold an aggregate of

595,000

shares of Common Stock together with warrants to purchase up to an aggregate of

178,500

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.30

of a share of Common Stock at a combined purchase price of

$6.75.

The net proceeds to the Company from the offering were approximately

$3.6

$9.36

per share. The Warrants will expire on the

fifth

(5th)

anniversary of the initial date of issuance.

October

19,

2016,

the Company sold

2,760,000

shares of common stock at a price of

$2.75

per share, which includes the sale of

360,000

shares of the Company’s common stock sold by the Company pursuant to the exercise, in full, of the over-allotment option by the underwriters in a public offering. The net proceeds to the Company from the offering were approximately

$6.9

million, after deducting placement agent fees and offering expenses payable by the Company.

The sale of additional equity or convertible securities could result in dilution to stockholders. If additional funds are raised through the issuance of debt securities, these securities could have rights senior to those associated with the Company’s Common Stock and could contain covenants that would restrict its operations. Financing

may

not be available in amounts or on terms acceptable to the Company, or at all. If the Company is unable to obtain required financing, it

may

be required to reduce the scope of its operations, including its planned product development and marketing efforts, which could materially and adversely harm its financial condition and operating results. If the Company is unable to secure additional financing, it

may

be forced to cease operations.

Note 2 - Summary of Significant Accounting Policies

9 Months Ended

Jan. 31, 2017

Significant Accounting Policies [Text Block]

(2)

Summary of Significant Accounting Policies

(a) Consolidation

The accompanying consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Participation of stockholders other than the Company in the net assets and in the earnings or losses of a consolidated subsidiary is reflected as a non-controlling interest in the Company's Consolidated Balance Sheets and Statements of Operations, which adjusts the Company's consolidated results of operations to reflect only the Company's share of the earnings or losses of the consolidated subsidiary. As of

January

31,

2017,

there were no non-controlling interests.

September

2015,

the Company re-purchased the non-controlling interest (consisting of

11.8%)

of OPTA for nominal consideration and now has

100%

ownership of OPTA. The Company also periodically evaluates its relationships with other entities to identify whether they are variable interest entities, and to assess whether it is the primary beneficiary of such entities. If the determination is made that the Company is the primary beneficiary, then that entity is included in the consolidated financial statements. As of

January

31,

2017,

there were

such entities.

(b) Use of Estimates

The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Significant items subject to such estimates and assumptions include the recoverability of the carrying amount of property and equipment; fair value of warrant liabilities, valuation allowances for receivables and deferred income tax assets; estimated costs to complete projects; and percentage of completion of customer contracts for purposes of revenue recognition. Actual results could differ from those estimates.

The Company’s contracts are either cost plus or fixed price contracts. Under cost plus contracts, customers are billed for actual expenses incurred plus an agreed-upon fee. Under cost plus contracts, a profit or loss on a project is recognized depending on whether actual costs are more or less than the agreed upon amount.

The Company has

two

types of fixed price contracts, firm fixed price and cost-sharing. Under firm fixed price contracts, the Company receives an agreed-upon amount for providing products and services specified in the contract, a profit or loss is recognized depending on whether actual costs are more or less than the agreed upon amount. Under cost-sharing contracts, the fixed amount agreed upon with the customer is only intended to fund a portion of the costs on a specific project. Under cost sharing contracts, an amount corresponding to the revenue is recorded in cost of revenues, resulting in gross profit on these contracts of

zero.

The Company’s share of the costs is recorded as product development expense.

Generally, revenue under fixed price or cost plus contracts is recognized using the percentage-of-completion method, measured by the ratio of costs incurred to total estimated costs at completion. In certain circumstances, revenue under contracts that have specified milestones or other performance criteria

may

be recognized only when the customer acknowledges that such criteria have been satisfied. If an arrangement involves multiple deliverables, the delivered items are considered separate units of accounting if the items have value on a stand-alone basis. Amounts allocated to each element are based on its objectively determined fair value, such as the sales price for the product or service when it is sold separately or competitor prices for similar products or services.

In addition, recognition of revenue (and the related costs)

may

be deferred for fixed price contracts until contract completion if the Company is unable to reasonably estimate the total costs of the project prior to completion. These contracts are subject to interpretation and management

may

make a judgment as to the amount of revenue earned and recorded. Because the Company has a small number of contracts, revisions to the percentage-of-completion determination, management interpretation or delays in meeting performance and contractual criteria or in completing projects

may

have a significant effect on revenue for the periods involved. Upon anticipating a loss on a contract, the Company recognizes the full amount of the anticipated loss in the current period.

Unbilled receivables represent expenditures on contracts, plus applicable profit margin, not yet billed. Unbilled receivables are normally billed and collected within

one

year. Billings made on contracts are recorded as a reduction of unbilled receivables, and to the extent that such billings and cash collections exceed costs incurred plus applicable profit margin, they are recorded as unearned revenues.

A portion of the Company’s projects have been under cost-sharing contracts.

(d) Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of

three

months or less when purchased to be cash equivalents. The Company invests excess cash in an overnight U.S. government securities repurchase bank account and a money market account. In accordance with the terms of the repurchase agreement, the Company does not take possession of the related securities. The agreement contains provisions to ensure that the market value of the underlying assets remain sufficient to protect the Company in the event of default by the bank by requiring that the underlying securities have a total market value of at least

100%

of the bank’s total obligations under the agreement.

	January 31, 2017		April 30, 2016
	(in thousands)
Checking and savings accounts	$	8,587	$	4,535
Overnight repurchase account		2,523		2,195
	$	11,110	$	6,730

(e) Marketable Securities

Marketable securities with original maturities longer than

three

months but that mature in less than

one

year from the balance sheet date are classified as current assets. Marketable securities that the Company has the intent and ability to hold to maturity are classified as investments held-to-maturity and are reported at amortized cost. The difference between the acquisition cost and face values of held-to-maturity investments is amortized over the remaining term of the investments and added to or subtracted from the acquisition cost and interest income. As of

January

31,

2017

and

April

30,

2016,

all of the Company’s investments were classified as held-to-maturity.

(f) Restricted Cash and Credit Facility

A portion of the Company’s cash is restricted under the terms of

two

security agreements.

One agreement is between the Company and Barclays Bank. Under this agreement, the cash is on deposit at Barclays Bank and serves as security for letters of credit and bank guarantees that are expected to be issued by Barclays Bank on behalf of OPT LTD,

one

of the Company's subsidiaries, under a credit facility established by Barclays Bank for OPT LTD. The credit facility carries a fee of

per annum of the amount of any such obligations issued by Barclays Bank. The credit facility does not have an expiration date, but is cancelable at the discretion of the bank. As of

January

31,

2017,

there was

€0.3

million

($0.3

million) in letters of credit outstanding under this agreement.

The

second

agreement was between the Company and the New Jersey Board of Public Utilities (“NJBPU”). The Company received a

$0.5

million recoverable grant award from the NJBPU, repayable over a

five

-year period beginning in

November

2011.

The agreement also required the Company to annually assign to the NJBPU a certificate of deposit in an amount equal to the outstanding grant balance. As of

January

31,

2017,

the grant was fully repaid and therefore there was no certificate of deposit. See Note

(6)

“Debt” for additional information. Restricted cash includes the following:

	January 31, 2017		April 30, 2016
	(in thousands)
NJBPU agreement	$	-	$	50
Barclay's Bank Agreement		299		250
	$	299	$	300

(g) Foreign Exchange Gains and Losses

The Company has invested in certain certificates of deposit and has maintained cash accounts that are denominated in British pounds sterling, Euros and Australian dollars. These amounts are included in cash, cash equivalents, restricted cash and marketable securities on the accompanying consolidated balance sheets. Such positions

may

result in realized and unrealized foreign exchange gains or losses from exchange rate fluctuations, which are included in foreign exchange gain in the accompanying consolidated statements of operations.

(h) Property and Equipment

Property and equipment is stated at cost, less accumulated depreciation and amortization. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives

(three

seven

years) of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful life of the asset or the remaining lease term. Expenses for maintenance and repairs are charged to operations as incurred. Property and equipment is also reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset

may

not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated future cash flows, then an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.

(i) Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash balances, bank certificates of deposit and trade receivables. The Company invests its excess cash in highly liquid investments (principally, short-term bank deposits, Treasury bills, Treasury notes and money market funds) and does not believe that it is exposed to any significant risks related to its cash accounts, money market funds or certificates of deposit.

The table below shows the percentage of the Company's revenues derived from customers whose revenues accounted for at least

10%

of the Company's consolidated revenues for at least

one

of the periods indicated:

	Three months ended January 31,						Nine months ended January 31,
	2017			2016			2017			2016
Mitsui Engineering & Shipbuilding		56	%		-			83	%		-
U.S. Department of Defense Office of
Naval Research		44	%		-			17	%		-
US Department of Energy		-			100	%		-			33	%
European Union (WavePort project)		-			-			-			67	%
		100	%		100	%		100	%		100	%

The loss of, or a significant reduction in revenues from a current customer could significantly impact the Company's financial position or results of operations. The Company does not require its customers to maintain collateral.

(j) Warrant Liabilities

The Company's warrants to purchase shares of its common stock are classified as warrant liabilities and are recorded at fair value. The warrant liabilities are subject to re-measurement at each balance sheet date and the Company recognizes any change in fair value in its consolidated statements of operations within “(loss) gain on fair value of warrant liabilities”. The Company will continue to adjust the carrying value of the warrants for changes in the estimated fair value until such time as these instruments are exercised or expire. At that time, the liabilities will be reclassified to “additional paid-in capital”, a component of “stockholders' equity” on the consolidated balance sheets.

(k) Net Loss per Common Share

Basic and diluted net loss per share for all periods presented is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Due to the Company's net losses, potentially dilutive securities, consisting of outstanding stock options and non-vested performance-based shares, were excluded from the diluted loss per share calculation due to their anti-dilutive effect.

In computing diluted net loss per share, options to purchase shares of common stock, warrants on common stock and non-vested restricted stock issued to employees and non-employee directors, totaling

680,429

for the

three

and

nine

months ended

January

31,

2017

and

154,537

for the

three

and

nine

months ended

January

31,

2016,

were excluded from each of the computations as the effect would be anti-dilutive due to the Company's losses.

(l) Recently Issued Accounting Standards

May

2014,

the Financial Accounting Standards Board (“FASB”) issued ASU No.

2014

09,

“Revenue from Contracts with Customers”. This guidance requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance also requires an entity to disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Qualitative and quantitative information is required about:

	●	Contracts with customers—including revenue and impairments recognized, disaggregation of revenue and information about contract balances and performance obligations (including the transaction price allocated to the remaining performance obligations).
	●	Significant judgments and changes in judgments—determining the timing of satisfaction of performance obligations (over time or at a point in time), and determining the transaction price and amounts allocated to performance obligations.
	●	Certain assets—assets recognized from the costs to obtain or fulfill a contract.

August

2015,

the FASB issued updated guidance deferring the effective date of the revenue recognition standard. In

March

and

April

2016,

the FASB issued additional updated guidance, which clarifies certain aspects of the ASU and the related implementation guidance issued by the FASB-IASB Joint Transition Resource Group for Revenue Recognition. This guidance is effective for the Company for annual reporting periods beginning after

December

15,

2017.

The Company is currently evaluating the impact that this guidance will have on its results of operations, financial position and cash flows.

August

2014,

the FASB issued ASU

2014

15,

“Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, which describes how an entity should assess its ability to meet obligations and sets rules for how this information should be disclosed in the financial statements. The standard provides accounting guidance that will be used along with existing auditing standards. The new standard applies to all entities for the

first

annual period ending after

December

15,

2016,

and interim periods thereafter. Early application is permitted. The Company is evaluating the effect ASU

2014

will have on its consolidated financial statements and disclosures and have not yet determined the effect of the standard on its ongoing financial reporting at this time. See Note

(1)

“Background, Basis of Presentation and Liquidity” for discussion on the Company’s ability to continue as a going concern.

January

2016,

the FASB issued ASU No.

2016

01,

“Recognition and Measurement of Financial Assets and Financial Liabilities”, which makes limited amendments to the guidance in U.S. GAAP on the classification and measurement of financial instruments. The update significantly revises an entity's accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. It also amends certain disclosure requirements associated with the fair value of financial instruments. The update will take effect for public companies for fiscal years beginning after

December

15,

2017,

including interim periods within those fiscal years. The Company will evaluate the effect of ASU

2016

for future periods as applicable.

February

2016,

the FASB issued ASU No.

2016

02,

“Leases (Topic

842)”.

The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than

months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU

2016

is effective for annual periods beginning after

December

15,

2018,

including interim periods within those annual periods, with early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and has not yet determined the effect of the standard on its ongoing financial reporting at this time.

March

2016,

the FASB issued ASU No.

2016

09,

“Compensation - Stock Compensation (Topic

718)”,

or ASU No.

2016

09.

The amendments of ASU No.

2016

were issued as part of the FASB's Simplification initiative focused on improving areas of GAAP for which cost and complexity

may

be reduced while maintaining or improving the usefulness of information disclosed within the financial statements. The amendments focused on simplification specifically with regard to share-based payment transactions, including income tax consequences, classification of awards as equity or liabilities and classification on the statement of cash flows. The guidance in ASU No.

2016

is effective for fiscal years beginning after

December

15,

2016,

and interim periods within those annual periods. Early adoption is permitted. The Company will evaluate the effect of ASU

2016

for future periods as applicable.

June

2016,

the FASB issued ASU

2016

13,

“Financial Instruments - Credit Losses (Topic

326):

Measurement of Credit Losses on Financial Instruments”. The standard provides for a new impairment model which requires measurement and recognition of expected credit losses for most financial assets held. The ASU is effective for public companies for annual periods, and interim periods within those annual periods, beginning after

December

15,

2019.

The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and believes the standard will have no impact on its ongoing financial reporting at this time.

August

2016,

the FASB issued ASU

2016

15,

“Statement of Cash Flows (Topic

230):

Classification of Certain Cash Receipts and Cash Payments”, providing additional guidance on

eight

specific cash flow classification issues. The goal of the ASU is to reduce diversity in practice of classifying certain items. The amendments in the ASU are effective for

fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years and early adoption is permitted. The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and has determined the standard will have no impact on its ongoing financial reporting at this time.

November

2016,

the FASB issued ASU

2016

18,

“Statement of Cash Flows (Topic

230):

Restricted Cash”, providing additional guidance on specific restricted cash flow classification on the cash flow statement. Cash flow should include restricted cash in total cash, and an entity is required to provide a disclosure indicating the reconciliation of all cash accounts. The amendments in the ASU are effective for

fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years and early adoption is permitted. The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and believes the effect of the standard on its ongoing financial reporting will not have a material impact.

Note 3 - Marketable Securities

9 Months Ended

Jan. 31, 2017

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

(3)

Marketable Securities

Marketable securities with initial maturities greater than

three

months but that mature within

one

year from the balance sheet date are classified as current assets and are summarized as follows:

	January 31, 2017		April 30, 2016
	(in thousands)
Certificate of Deposit	$	25	$	75

The entire disclosure for investments in certain debt and equity securities.

+ References + Details

Note 4 - Balance Sheet Detail

9 Months Ended

Jan. 31, 2017

Supplemental Balance Sheet Disclosures [Text Block]

(4)

Balance Sheet Detail

Accrued expenses	January 31, 2017		April 30, 2016
	(in thousands)
Project costs (a)	$	1,239	$	818
Contract loss reserve		199		199
Employee incentive payments		463		688
Accrued salary and benefits		593		456
Legal and accounting fees		329		240
Other		298		274
	$	3,121	$	2,675

(a)

Project costs at

January

31,

2017

include accruals of

$0.8

million and

$0.5

million for the disposition of the legacy Reedsport project anchors and site remediation for the legacy

PB40

projects, respectively. The Reedsport project is anticipated to be completed by the end of the

first

quarter of fiscal

2018.

The

PB40

project is weather dependant and therefore it is not possible to predict a specific end date.

Note 5 - Related Party Transactions	9 Months Ended
Note 5 - Related Party Transactions	Jan. 31, 2017
Notes to Financial Statements
Related Party Transactions Disclosure [Text Block]	(5) Related Party Transactions In April 2014, the Company entered into an Executive Transition Agreement with George W. Taylor, who was formerly employed by the Company as Executive Vice Chairman and served on the Company’s Board of Directors prior to that date. Under this agreement, Dr. Taylor received fifteen months of consulting fees at a monthly rate of $20 thousand (this period terminated on July 18, 2015). During the nine months ended January 31, 2016 the Company recorded $53 thousand in expense relating to this agreement, which was recorded in selling, general and administrative expense in the unaudited consolidated statements of operations. There were no such amounts recorded during the three and nine months ended January 31, 2017.

Note 6 - Debt	9 Months Ended
Note 6 - Debt	Jan. 31, 2017
Notes to Financial Statements
Debt Disclosure [Text Block]	(6) Debt The Company was awarded a recoverable grant totaling $0.5 million between April 2009 and June 2010 from the NJBPU under the Renewable Energy Business Venture Assistance Program. Under the terms of this agreement, the amount to be repaid is a fixed monthly amount of principal only, repayable over a five -year period beginning in November 2011. The terms also required the Company to annually assign to the NJBPU a certificate of deposit in an amount equal to the outstanding grant balance. As of April 30, 2016 the Company had $50 thousand outstanding and the respective $50 thousand certificate of deposit was recorded within “Other current assets” on the balance sheet. As of January 31, 2017, the grant was fully repaid, and therefore, there is no balance outstanding and no respective certificate of deposit assigned to restricted cash. See Note 2(f). “Summary of Significant Accounting Policies - Restricted Cash and Credit Facility” for more information regarding the certificate of deposit.

Note 7 - Deferred Credits Payable	9 Months Ended
Note 7 - Deferred Credits Payable	Jan. 31, 2017
Notes to Financial Statements
Customer Advances and Deposits Disclosure [Text Block]	(7) Deferred Credits Payable During the year ended April 30, 2001, in connection with the sale of common stock to an investor, the Company received $0.6 million from the investor in exchange for an option to purchase up to 500,000 metric tons of carbon emissions credits generated by the Company during the years 2008 through 2012, at a 30% discount from the then-prevailing market rate. If the Company received emission credits under applicable laws and failed to sell to the investor the credits up to the full amount of emission credits covered by the option, the investor was entitled to liquidated damages equal to 30% of the aggregate market value of the shortfall in emission credits (subject to a limit on the market price of emission credits). Under the terms of the agreement, if the Company did not become entitled under applicable laws to the full amount of emission credits covered by the option by December 31, 2012, the Company was obligated to return the option fee of $0.6 million, less the aggregate discount on any emission credits sold to the investor prior to such date. In December 2012, the Company and the investor agreed to extend the period for the sale of emission credits until December 31, 2017. As of January 31, 2017, the Company has not generated any emissions credits eligible for purchase under the agreement. The $0.6 million is reflected on the balance sheet within “Deferred credits payable current” and “Deferred credits payable non-current” as of January 31, 2017 and April 30, 2016, respectively.

Note 8 - Warrants

9 Months Ended

Jan. 31, 2017

Warrant Disclosure [Text Block]

(8)

Warrants

June

2016,

the Company entered into a securities purchase agreement, which was amended on

June

2016

(as amended, the

“June

Purchase Agreement”) with certain institutional purchasers (the

“June

Purchasers”). Pursuant to the terms of the

June

Purchase Agreement, the Company sold an aggregate of

417,000

shares of Common Stock together with warrants to purchase up to an aggregate of

145,952

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.35

of a share of Common Stock at a combined purchase price of

$4.60.

The warrants have an exercise price of

$6.08

per share, became exercisable on

December

2016

(“Initial Exercise Date”), and will expire

five

years following the Initial Exercise Date.

July

22,

2016,

the Company entered into a Second Amendment to the Purchase Agreement (the “Second Amended Purchase Agreement”) with certain institutional purchasers (the

“July

Purchasers”). Pursuant to the terms of the Second Amended Purchase Agreement, the Company sold an aggregate of

595,000

shares of Common Stock together with warrants to purchase up to an aggregate of

178,500

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.30

of a share of Common Stock at a combined purchase price of

$6.75.

The Warrants were exercisable immediately at an exercise price of

$9.36

per share. The Warrants will expire on the

fifth

(5th)

anniversary of the initial date of issuance.

The warrants contain a feature whereby they could require the transfer of assets and therefore are classified as a liability in accordance with ASC

480.

As such, the warrants with a value of

$0.7

million at

January

31,

2017

are reflected within “warrant liabilities” in the unaudited consolidated balance sheets. There were

such amounts at

April

30,

2016.

An unrealized loss and unrealized gain of

$0.1

million and

$1.2

million, respectively, were included within “(Loss) gain on fair value of warrant liabilities” in the consolidated statements of operations for the

three

and

nine

months ended

January

31,

2017,

respectively. There were

unrealized gains or losses during the

three

and

nine

months ended

January

31,

2016.

The Company determined the fair value using the Black-Scholes option pricing model with the following assumptions:

	January 31, 2017
Dividend rate		0.0%
Risk-free rate		1.9%
Expected life (years)	4.5	-	4.9
Expected volatility	129.0%	-	138.2%

Note 9 - Share-based Compensation

9 Months Ended

Jan. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

(9)

Stock-Based Compensation

The aggregate stock-based compensation expense related to all stock-based transactions recorded in the consolidated statements of operations was approximately

$1.0

million and

$0.3

million during the

nine

months ended

January

31,

2017

and

2016,

respectively.

(a) Stock Options

Valuation Assumptions for Options Granted during the

nine

months ended

January

31,

2017

and

2016

The fair value of each stock option granted, for both service-based and performance-based vesting requirements during the

nine

months ended

January

31,

2017,

was estimated at the date of grant using the Black-Scholes option pricing model, assuming no dividends, and using the weighted average valuation assumptions noted in the following table. The risk-free rate is based on the US Treasury yield curve in effect at the time of grant. The expected life (estimated period of time outstanding) of the stock options granted was estimated using the "simplified" method as permitted by the SEC's Staff Accounting Bulletin No.

110,

Share-Based Payment.

Expected volatility was based on the Company’s historical volatility during the

nine

months ended

January

31,

2017.

The below assumptions were used to determine the weighted average per share fair value of

$1.89

and

$4.05

for stock options granted during the

nine

months ended

January

31,

2017

and

2016,

respectively.

	Nine months ended January 31,
	2017			2016
Risk-free interest rate		1.3	%		1.6	%
Expected dividend yield		0.0	%		0.0	%
Expected life (in years)		5.50			5.5
Expected volatility		96.2	%		85.7	%

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

						Weighted
						Average
				Weighted		Remaining
	Shares			Average		Contractual
	Underlying			Exercise		Term
	Options			Price		(In Years)
Outstanding as of April 30, 2016		89,303		$	42.90		3.6
Forfeited		(987	)	$	46.45
Exercised		-		$	-
Granted		171,749		$	2.12
Outstanding as of January 31, 2017		260,065		$	15.96		7.2
Exercisable as of January 31, 2017		157,066		$	24.44		5.6

As of

January

31,

2017,

the total intrinsic value of outstanding and exercisable options was approximately

$107

thousand and

$95

thousand, respectively. As of

January

31,

2017,

approximately

101,392

additional options are expected to vest in the future with an intrinsic value of approximately

$10

thousand and a weighted average remaining contractual term of

9.6

years. There was approximately

$0.2

million and

$0.1

million of total recognized compensation cost related to stock options during the

nine

months ended

January

31,

2017

and

2016,

respectively. As of

January

31,

2017,

there was approximately

$0.2

million of total unrecognized compensation cost related to non-vested stock options granted under the plans. This cost is expected to be recognized over a weighted-average period of

0.8

years. The Company typically issues newly authorized but unissued shares to satisfy option exercises under these plans.

(b) Restricted Stock

Compensation expense for non-restricted stock is generally recorded based on its market value on the date of grant and recognized ratably over the associated service and performance period. During the

nine

months ended

January

31,

2017,

the Company granted

223,662

shares subject to service-based vesting requirements and

shares subject to performance-based vesting requirements. The achievement or vesting requirement of the performance-based grants is tied to the Company’s total shareholder return (“TSR”) relative to the total shareholder return of

three

alternative energy Exchange Traded Funds as measured over a specific performance period. No vesting of the relevant shares will occur in instances where the Company’s TSR for the relevant period is below

80%

of the peer group. However, additional opportunities to vest some or all of a portion of the shares in a subsequent period

may

occur. Compensation expense for these awards with market-based vesting is calculated based on the estimated fair value as of the grant date utilizing a Monte Carlo simulation model and is recognized over the service period on a straight-line basis.

January

2016,

the Board of Directors authorized a modification to certain outstanding restricted stock grants, which converted certain grants with performance-based grants to service-based grants. The modification of the restricted stock grants did not have a material impact on the Company’s statement of operations during the

nine

months ended

January

31,

2017.

Restricted stock issued and unvested as of

January

31,

2017

included

4,000

shares of unvested restricted stock subjected to performance-based vesting requirements.

A summary of non-vested restricted stock under our stock incentive plans is as follows:

				Weighted
	Number			Average Price per
	of Shares			Share

Issued and unvested at April 30, 2016		40,008		$	6.70
Granted		223,662		$	3.94
Forfeited		(28,266	)	$	3.98
Vested		(139,492	)	$	4.70
Issued and unvested at January 31, 2017		95,912		$	3.99

There was approximately

$0.8

million and

$0.2

million of total recognized compensation cost related to restricted stock for the

nine

months ended

January

31,

2017

and

2016,

respectively. As of

January

31,

2017,

there was approximately

$0.2

million of total unrecognized compensation cost related to unvested restricted stock granted under our plans. This cost is expected to be recognized over a weighted average period of

0.4

years.

(c)Treasury Stock

During the

nine

months ended

January

31,

2017

and

2016,

39,882

and

1,839

shares, respectively, of common stock were purchased by the Company from employees to pay taxes related to the vesting of restricted stock.

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details

Note 10 - Fair Value Measurements

9 Months Ended

Jan. 31, 2017

Fair Value Disclosures [Text Block]

(10)

Fair Value Measurements

The Company measures and reports certain financial and non-financial assets and liabilities on a fair value basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). GAAP specifies a

three

-level hierarchy that is used when measuring and disclosing fair value. The fair value hierarchy gives the highest priority to quoted prices available in active markets (i.e., observable inputs) and the lowest priority to data lacking transparency (i.e., unobservable inputs). An instrument’s categorization within the fair value hierarchy is based on the lowest level of significant input to its valuation. The following is a description of the

three

hierarchy levels.

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Active markets are considered to be those in which transactions for the assets or liabilities occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2	Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in inactive markets.

Level 3	Unobservable inputs are not corroborated by market data. This category is comprised of financial and non-financial assets and liabilities whose fair value is estimated based on internally developed models or methodologies using significant inputs that are generally less readily observable from objective sources.

Transfers into or out of any hierarchy level are recognized at the end of the reporting period in which the transfers occurred. There were no transfers between any levels during the

three

and

nine

months ended

January

31,

2017

and

2016.

The following information is provided to help readers gain an understanding of the relationship between amounts reported in the accompanying consolidated financial statements and the related market or fair value. The disclosures include financial instruments and derivative financial instruments, other than investment in affiliates.

Following are descriptions of the valuation methodologies used to measure material assets and liabilities at fair value and details of the valuation models, key inputs to those models and significant assumptions utilized.

Warrant Liabilities

The fair value of the Company's warrant liabilities (refer to Note

recorded in the Company's financial statements is determined using the Black-Scholes option pricing model and the quoted price of the Company's common stock in an active market, volatility and expected life, is a Level

measurement. Volatility is based on the actual market activity of the Company's stock. The expected life is based on the remaining contractual term of the warrants and the risk free interest rate is based on the implied yield available on U.S. Treasury Securities with a maturity equivalent to the warrants' expected life.

The following table presents financial assets and liabilities measured at fair value on a recurring basis as of

January

31,

2017.

	Total Carrying Value in Consolidated Balance Sheet		Quoted prices in active markets for identical assts or liabilities (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
As of January 31, 2017:	(in thousands)
Warrant liabilities	$	653	$	-	$	-	$	653

The changes in the value of the warrant liabilities during the

nine

months ended

January

31,

2017

were as follows.

Fair value – April 30, 2016	$	-
Issuance		1,814
Transfers		-
Change in fair value		(1,161	)
Fair value – January 31, 2017	$	653

There were

re-measured assets or liabilities at fair value on a non-recurring basis during the

nine

months ended

January

31,

2017

and

2016,

respectively.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Note 11 - Commitments and Contingencies	9 Months Ended
Note 11 - Commitments and Contingencies	Jan. 31, 2017
Notes to Financial Statements
Commitments and Contingencies Disclosure [Text Block]	(11) Commitments and Contingencies (a) Litigation Shareholder Litigation and Demands The Company and its former Chief Executive Officer Charles Dunleavy were named as defendants in consolidated securities class action lawsuits that were pending in the United States District Court for the District of New Jersey captioned In Re: Ocean Power Technologies, Inc. Securities Litigation, Civil Action No. 14 - 3799 (FLW) (LHG). On May 5, 2016, the parties entered into a Stipulation and Agreement of Class Settlement (“Stipulation”) in which they agreed to a settlement of the consolidated securities class action lawsuits, subject to Court approval. The Stipulation provides, among other things, for a settlement payment by or on behalf of the Company of $3.0 million in cash, of which the Company would pay $0.5 million and the Company’s insurer would pay $2.5 million, and the issuance by the Company of 380,000 shares (valued at $0.6 million on the date the Stipulation was signed by the parties) of its Common Stock to the class members. In connection with the settlement, the parties have agreed to execute mutually agreeable releases. The amounts agreed in the Stipulation, including the amount to be contributed by our insurance carrier, were reflected in the Company’s Consolidated Financial Statements as of April 30, 2016. In July 2016, the Company paid the $0.5 million portion of the settlement and the remaining balance of $2.5 million was paid by the Company’s insurer in August 2016. On November 14, 2016, the Court held its previously scheduled Settlement Hearing to consider whether to grant final approval of the settlement, and on November 15, 2016, the Court issued its Final Judgment approving the settlement and dismissing the proceeding with prejudice. The 380,000 shares of common stock were issued on November 22, 2016. The time to file an appeal from the Final Judgment has expired without any appeal being filed. The Company and certain of its current and former directors and officers are defendants in a derivative lawsuit filed on March 18, 2015 in the United States District Court for the District of New Jersey captioned Labare v. Dunleavy, et. al., Case No. 3:15 -cv- 01980 -FLW-LHG. The derivative complaint alleges claims for breach of fiduciary duty, abuse of control, gross mismanagement and unjust enrichment relating to the now terminated agreement between Victorian Wave Partners Pty. Ltd. (VWP) and the Australian Renewable Energy Agency (ARENA) for the development of a wave power station. The derivative complaint seeks unspecified monetary damages and other relief. On July 10, 2015, a second derivative lawsuit, captioned Rywolt v. Dunleavy, et al., Case No. 3:15 -cv- 05469, was filed by another shareholder against the same defendants in the United States District Court for the District of New Jersey alleging similar claims for breach of fiduciary duty, gross mismanagement, abuse of control, and unjust enrichment relating to the now terminated agreement between VWP and ARENA. The Rywolt complaint also seeks unspecified monetary damages and other relief. On April 21, 2016, a third derivative lawsuit, captioned LaCalamito v. Dunleavy, et al., Case No. 3:16 -cv- 02249, was filed by another shareholder against certain current and former directors and officers of the Company in the United States District Court for the District of New Jersey alleging similar claims for breach of fiduciary duty relating to the now terminated agreement between VWP and ARENA. The LaCalamito complaint seeks unspecified monetary damages and other relief. On June 9, 2016, a fourth derivative lawsuit, captioned Pucillo v. Dunleavy, et al., was filed by another shareholder against certain current and former directors and officers of the Company in the United States District Court for the District of New Jersey alleging similar claims for breach of fiduciary duty, unjust enrichment, and abuse of control relating to the now terminated agreement between VWP and ARENA. The Pucillo complaint seeks unspecified monetary damages and other relief. On October 25, 2016, the Court approved and entered a Stipulation and Order that, among other things, (i) consolidated the four derivative actions; (ii) identified plaintiff Pucillo as the lead plaintiff in the consolidated actions; and (iii) stayed the consolidated actions pending the settlement hearing scheduled for November 14, 2016 in the securities class action and further order of the Court. Defendants have not responded to the consolidated derivative actions because the actions remain stayed pending further order from the Court. The Company and certain of its current directors are defendants in a lawsuit filed by an alleged shareholder in the Superior Court of New Jersey, Mercer County Chancery Division on January 25, 2016, captioned Stern v. Ocean Power Technologies, Inc., et al., Civil Action No. C- 5 - 16. The complaint alleges that certain provisions of the Company’s Certificate of Incorporation and By-laws providing that the Company’s directors may be removed only for cause and only by an affirmative vote of at least 75% of the votes which all the stockholders would be entitled to cast in any annual election of directors are invalid under Section 141(k) of the Delaware General Corporation Law. The Complaint asserts a breach of fiduciary claim against the director defendants and a declaratory judgment claim against all defendants seeking, among other things, to invalidate the current provisions and declare that the Company’s directors may be removed and replaced without cause and by a simple majority vote. The Complaint seeks declaratory and injunctive relief as well as unspecified costs and attorneys’ fees. By Unanimous Written Consent dated June 17, 2016, the Company’s Board of Directors amended the Company’s By-laws to delete the “only for cause” requirement, thereby allowing for removal of directors with or without cause by the Company’s stockholders. In addition, the Board proposed, subject to approval by the Company’s stockholders at the next annual general meeting of stockholders, a similar amendment to the director removal provision in the Company’s Certificate of Incorporation. On June 22, 2016, the parties to the lawsuit submitted a Stipulation and Proposed Order Staying Proceedings that (1) stays the case pending the stockholder vote on the proposed amendment to the Company’s Certificate of Incorporation; (2) provides for dismissal of the action with prejudice if the stockholders approve the amendment, subject to plaintiff’s right to make a fee application to the court and defendants’ right to oppose any such application; and (3) provides for the stay to be lifted and the action to resume, without waiver of any parties’ rights, if the stockholders do not approve the amendment. The Court approved the Stipulation on June 30, 2016. On September 2, 2016, the Company filed a definitive proxy statement with the SEC which includes this proposal. At the annual shareholder meeting on October 21, 2016, the proposal was not approved because an insufficient number of votes were cast to satisfy the requirement that the proposal be approved by the holders of at least 75% of the outstanding shares of common stock entitled to vote at the meeting. However, stockholders approved an amendment to the Company’s Certificate of Incorporation to add a provision which requires that any provision of the Certificate of Incorporation that is contrary to a requirement of the Delaware General Corporate Law shall be read in conformity with the applicable requirement of the Delaware General Corporate Law . The parties have agreed that the case shall remain stayed until further steps, if any, can be agreed to and taken as needed. Employment Litigation On June 10, 2014, the Company announced that it had terminated Charles Dunleavy as its Chief Executive Officer and as an employee of the Company for cause, effective June 9, 2014, and that Mr. Dunleavy had also been removed from his position as Chairman of the Board of Directors. On June 17, 2014, Mr. Dunleavy wrote to the Company stating that he had retained counsel to represent him in connection with an alleged wrongful termination of his employment. On July 28, 2014, Mr. Dunleavy resigned from the Board and the boards of directors of the Company's subsidiaries. The Company and Mr. Dunleavy have agreed to suspend his alleged employment claims pending resolution of the shareholder litigation, and have since agreed to continue to the suspension pending resolution of the derivatives litigation. Except for the Stipulation noted previously, we have not established any provision for losses relating to these claims and pending litigation. Due to the stages of these proceedings, and considering the inherent uncertainty of these claims and litigation, at this time we are not able to predict or reasonably estimate whether we have any possible loss exposure or the ultimate outcome of these claims. (b) Regulatory Matters SEC Investigation On February 4, 2015, the Company received a subpoena from the SEC requesting information related to the VWP Project. The Company has provided information to the SEC in response to that subpoena. As part of the same investigation, on July 12, 2016, the SEC issued a second subpoena requesting information related to the Company’s April 4, 2014 public offering. The Company has provided information to the SEC in response to that subpoena. The SEC investigation is ongoing and the Company continues to cooperate with the SEC in its investigation. We are unable to predict what action, if any, might be taken by the SEC or its staff as a result of this investigation or what impact, if any, the cost of responding to the SEC’s investigation or its ultimate outcome might have on our financial position, results of operations or liquidity. We have not established any provision for losses relating to this matter. Spain IVA (sales tax) In June 2012, the Company received notice that the Spanish tax authorities are inquiring into its 2010 IVA (value-added tax) filing for which the Company benefitted from the offset of approximately $0.3 million of input tax. The Company believes that the inquiry will find that the tax credit was properly claimed and, therefore, no liability has been recorded. The Company issued two letters of credit totaling €0.3 million ($0.3 million) at the request of the Spanish tax authorities. Separately, as of January 31, 2017 the Company has received $0.2 million from the Spanish tax authorities as a result of the conclusion of the inquiry. In addition, during February 2017, the Spanish tax authorities approved of the release of the two outstanding letters of credit. Spain Income Tax Audit We are currently undergoing an income tax audit in Spain for the period from 2008 to 2014, when our Spanish branch was closed. The branch reported net operating losses for each of the years reported. We have not established any provision for losses related to this matter.

Note 12 - Income Taxes	9 Months Ended
Note 12 - Income Taxes	Jan. 31, 2017
Notes to Financial Statements
Income Tax Disclosure [Text Block]	(12) Income Taxes During the three and nine months ended January 31, 2017, the Company recorded an income tax benefit of $0.7 million, representing the proceeds from the sale of $7.8 million of New Jersey net operating loss carryforwards and research and development tax credits. During the three and nine months ended January 31, 2016, the Company recorded an income tax benefit of $1.7 million representing the proceeds from the sale of $19.7 million of New Jersey net operating loss carryforwards and research and development tax credits. Other than as a result of the sale of New Jersey net operating loss carryforwards, the Company did not recognize any consolidated income tax benefit (expense) during the three and nine month periods ended January 31, 2017 and 2016. During the three and nine months ended January 31, 2017, the Company had no material changes in uncertain tax positions.

Note 13 - Operating Segments and Geographic Information	9 Months Ended
Note 13 - Operating Segments and Geographic Information	Jan. 31, 2017
Notes to Financial Statements
Segment Reporting Disclosure [Text Block]	(13) Operating Segments and Geographic Information The Company's business consists of one segment as this represents management's view of the Company's operations. The Company operates on a worldwide basis with one operating company in the US and operating subsidiaries in the UK and in Australia. Revenues and expenses are generally attributed to the operating unit that bills the customers. During the three and nine months ended January 31, 2017 and 2016, the Company’s primary business operations were in North America.

Basis of Accounting, Policy [Policy Text Block]

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Significant Accounting Policies (Policies)

9 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

b)	Basis of Presentation

-Q and Article

-K for the year ended

April

30,

2016

filed with the Securities and Exchange Commission (“SEC”) and elsewhere in this Form

-Q.

Liquidity, Policy [Policy Text Block]

c)	Liquidity/Going Concern

$184.8

million as of

January

31,

2017.

As of

January

31,

2017,

the Company had approximately

$11.1

million in cash on hand. The Company generated revenues of

$0.6

million during each of the

nine

months ended

January

31,

2017

and

2016.

Based on the Company’s cash and cash equivalents and marketable securities as of

January

31,

2017,

the Company believes that it will be able to finance its capital requirements and operations into the quarter ending

January

31,

2018.

Management is evaluating different strategies to obtain the required additional funding for future operations. These strategies

may

In fiscal

2017

and

2016,

three

equity financing arrangements during the

nine

months ended

January

31,

2017.

may

cause it to scale back, delay or eliminate some or all of its product development activities and/or reduce the scope of or cease its operations.

June

2016,

the Company entered into a securities purchase agreement, which was amended on

June

2016

(as amended, the “Purchase Agreement”) with certain institutional purchasers (the

“June

Purchasers”). Pursuant to the terms of the

June

Purchase Agreement, the Company sold an aggregate of

417,000

shares of Common Stock together with warrants to purchase up to an aggregate of

145,952

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.35

of a share of Common Stock at a combined purchase price of

$4.60.

The net proceeds to the Company from the offering were approximately

$1.7

$6.08

per share, became exercisable on

December

2016

(“Initial Exercise Date”), and will expire

five

years following the Initial Exercise Date.

July

22,

2016,

the Company entered into the Second Amendment to the Purchase Agreement (the “Second Amended Purchase Agreement”) with certain purchasers (the

“July

Purchasers”). Pursuant to the terms of the Second Amended Purchase Agreement, the Company sold an aggregate of

595,000

shares of Common Stock together with warrants to purchase up to an aggregate of

178,500

shares of Common Stock. Each share of Common Stock was sold together with a warrant to purchase

0.30

of a share of Common Stock at a combined purchase price of

$6.75.

The net proceeds to the Company from the offering were approximately

$3.6

$9.36

per share. The Warrants will expire on the

fifth

(5th)

anniversary of the initial date of issuance.

October

19,

2016,

the Company sold

2,760,000

shares of common stock at a price of

$2.75

per share, which includes the sale of

360,000

$6.9

million, after deducting placement agent fees and offering expenses payable by the Company.

may

not be available in amounts or on terms acceptable to the Company, or at all. If the Company is unable to obtain required financing, it

may

be forced to cease operations.

Consolidation, Policy [Policy Text Block]

(a) Consolidation

January

31,

2017,

there were no non-controlling interests.

September

2015,

the Company re-purchased the non-controlling interest (consisting of

11.8%)

of OPTA for nominal consideration and now has

100%

January

31,

2017,

there were no such entities.

Use of Estimates, Policy [Policy Text Block]

(b) Use of Estimates

Revenue Recognition, Policy [Policy Text Block]

The Company has

two

zero.

The Company’s share of the costs is recorded as product development expense.

may

In addition, recognition of revenue (and the related costs)

may

have a significant effect on revenue for the periods involved. Upon anticipating a loss on a contract, the Company recognizes the full amount of the anticipated loss in the current period.

Unbilled receivables represent expenditures on contracts, plus applicable profit margin, not yet billed. Unbilled receivables are normally billed and collected within

one

A portion of the Company’s projects have been under cost-sharing contracts.

Cash and Cash Equivalents, Policy [Policy Text Block]

(d) Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of

three

100%

of the bank’s total obligations under the agreement.

	January 31, 2017		April 30, 2016
	(in thousands)
Checking and savings accounts	$	8,587	$	4,535
Overnight repurchase account		2,523		2,195
	$	11,110	$	6,730

Marketable Securities, Policy [Policy Text Block]

(e) Marketable Securities

Marketable securities with original maturities longer than

three

months but that mature in less than

one

January

31,

2017

and

April

30,

2016,

all of the Company’s investments were classified as held-to-maturity.

Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block]

(f) Restricted Cash and Credit Facility

A portion of the Company’s cash is restricted under the terms of

two

security agreements.

one

of the Company's subsidiaries, under a credit facility established by Barclays Bank for OPT LTD. The credit facility carries a fee of

per annum of the amount of any such obligations issued by Barclays Bank. The credit facility does not have an expiration date, but is cancelable at the discretion of the bank. As of

January

31,

2017,

there was

€0.3

million

($0.3

million) in letters of credit outstanding under this agreement.

The

second

agreement was between the Company and the New Jersey Board of Public Utilities (“NJBPU”). The Company received a

$0.5

million recoverable grant award from the NJBPU, repayable over a

five

-year period beginning in

November

2011.

The agreement also required the Company to annually assign to the NJBPU a certificate of deposit in an amount equal to the outstanding grant balance. As of

January

31,

2017,

the grant was fully repaid and therefore there was no certificate of deposit. See Note

(6)

“Debt” for additional information. Restricted cash includes the following:

	January 31, 2017		April 30, 2016
	(in thousands)
NJBPU agreement	$	-	$	50
Barclay's Bank Agreement		299		250
	$	299	$	300

Foreign Currency Transactions and Translations Policy [Policy Text Block]

(g) Foreign Exchange Gains and Losses

may

Property, Plant and Equipment, Policy [Policy Text Block]

(h) Property and Equipment

Property and equipment is stated at cost, less accumulated depreciation and amortization. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives

(three

seven

may

Concentration Risk, Credit Risk, Policy [Policy Text Block]

(i) Concentration of Credit Risk

The table below shows the percentage of the Company's revenues derived from customers whose revenues accounted for at least

10%

of the Company's consolidated revenues for at least

one

of the periods indicated:

	Three months ended January 31,						Nine months ended January 31,
	2017			2016			2017			2016
Mitsui Engineering & Shipbuilding		56	%		-			83	%		-
U.S. Department of Defense Office of
Naval Research		44	%		-			17	%		-
US Department of Energy		-			100	%		-			33	%
European Union (WavePort project)		-			-			-			67	%
		100	%		100	%		100	%		100	%

Warrant Liability, Policy [Policy Text Block]

(j) Warrant Liabilities

Earnings Per Share, Policy [Policy Text Block]

(k) Net Loss per Common Share

In computing diluted net loss per share, options to purchase shares of common stock, warrants on common stock and non-vested restricted stock issued to employees and non-employee directors, totaling

680,429

for the

three

and

nine

months ended

January

31,

2017

and

154,537

for the

three

and

nine

months ended

January

31,

2016,

were excluded from each of the computations as the effect would be anti-dilutive due to the Company's losses.

New Accounting Pronouncements, Policy [Policy Text Block]

(l) Recently Issued Accounting Standards

May

2014,

the Financial Accounting Standards Board (“FASB”) issued ASU No.

2014

09,

	●	Contracts with customers—including revenue and impairments recognized, disaggregation of revenue and information about contract balances and performance obligations (including the transaction price allocated to the remaining performance obligations).
	●	Significant judgments and changes in judgments—determining the timing of satisfaction of performance obligations (over time or at a point in time), and determining the transaction price and amounts allocated to performance obligations.
	●	Certain assets—assets recognized from the costs to obtain or fulfill a contract.

August

2015,

the FASB issued updated guidance deferring the effective date of the revenue recognition standard. In

March

and

April

2016,

December

15,

2017.

The Company is currently evaluating the impact that this guidance will have on its results of operations, financial position and cash flows.

August

2014,

the FASB issued ASU

2014

15,

first

annual period ending after

December

15,

2016,

and interim periods thereafter. Early application is permitted. The Company is evaluating the effect ASU

2014

will have on its consolidated financial statements and disclosures and have not yet determined the effect of the standard on its ongoing financial reporting at this time. See Note

(1)

“Background, Basis of Presentation and Liquidity” for discussion on the Company’s ability to continue as a going concern.

January

2016,

the FASB issued ASU No.

2016

01,

December

15,

2017,

including interim periods within those fiscal years. The Company will evaluate the effect of ASU

2016

for future periods as applicable.

February

2016,

the FASB issued ASU No.

2016

02,

“Leases (Topic

842)”.

The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than

months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU

2016

is effective for annual periods beginning after

December

15,

2018,

2016

will have on its consolidated financial statements and disclosures and has not yet determined the effect of the standard on its ongoing financial reporting at this time.

March

2016,

the FASB issued ASU No.

2016

09,

“Compensation - Stock Compensation (Topic

718)”,

or ASU No.

2016

09.

The amendments of ASU No.

2016

were issued as part of the FASB's Simplification initiative focused on improving areas of GAAP for which cost and complexity

may

2016

is effective for fiscal years beginning after

December

15,

2016,

and interim periods within those annual periods. Early adoption is permitted. The Company will evaluate the effect of ASU

2016

for future periods as applicable.

June

2016,

the FASB issued ASU

2016

13,

“Financial Instruments - Credit Losses (Topic

326):

December

15,

2019.

The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and believes the standard will have no impact on its ongoing financial reporting at this time.

August

2016,

the FASB issued ASU

2016

15,

“Statement of Cash Flows (Topic

230):

Classification of Certain Cash Receipts and Cash Payments”, providing additional guidance on

eight

specific cash flow classification issues. The goal of the ASU is to reduce diversity in practice of classifying certain items. The amendments in the ASU are effective for

fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years and early adoption is permitted. The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and has determined the standard will have no impact on its ongoing financial reporting at this time.

November

2016,

the FASB issued ASU

2016

18,

“Statement of Cash Flows (Topic

230):

fiscal years beginning after

December

15,

2017,

and interim periods within those fiscal years and early adoption is permitted. The Company is evaluating the effect ASU

2016

will have on its consolidated financial statements and disclosures and believes the effect of the standard on its ongoing financial reporting will not have a material impact.

Note 2 - Summary of Significant Accounting Policies (Tables)

9 Months Ended

Jan. 31, 2017

Schedule of Cash and Cash Equivalents [Table Text Block]

	January 31, 2017		April 30, 2016
	(in thousands)
Checking and savings accounts	$	8,587	$	4,535
Overnight repurchase account		2,523		2,195
	$	11,110	$	6,730

Schedule of Restricted Cash and Cash Equivalents [Table Text Block]

	January 31, 2017		April 30, 2016
	(in thousands)
NJBPU agreement	$	-	$	50
Barclay's Bank Agreement		299		250
	$	299	$	300

Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block]

	Three months ended January 31,						Nine months ended January 31,
	2017			2016			2017			2016
Mitsui Engineering & Shipbuilding		56	%		-			83	%		-
U.S. Department of Defense Office of
Naval Research		44	%		-			17	%		-
US Department of Energy		-			100	%		-			33	%
European Union (WavePort project)		-			-			-			67	%
		100	%		100	%		100	%		100	%

Note 3 - Marketable Securities (Tables)

9 Months Ended

Jan. 31, 2017

Current [Member]

Marketable Securities [Table Text Block]

	January 31, 2017		April 30, 2016
	(in thousands)
Certificate of Deposit	$	25	$	75

Note 4 - Balance Sheet Detail (Tables)

9 Months Ended

Jan. 31, 2017

Schedule of Other Assets and Other Liabilities [Table Text Block]

Accrued expenses	January 31, 2017		April 30, 2016
	(in thousands)
Project costs (a)	$	1,239	$	818
Contract loss reserve		199		199
Employee incentive payments		463		688
Accrued salary and benefits		593		456
Legal and accounting fees		329		240
Other		298		274
	$	3,121	$	2,675

Note 8 - Warrants (Tables)

9 Months Ended

Jan. 31, 2017

Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block]

	January 31, 2017
Dividend rate		0.0%
Risk-free rate		1.9%
Expected life (years)	4.5	-	4.9
Expected volatility	129.0%	-	138.2%

Note 9 - Share-based Compensation (Tables)

9 Months Ended

Jan. 31, 2017

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

	Nine months ended January 31,
	2017			2016
Risk-free interest rate		1.3	%		1.6	%
Expected dividend yield		0.0	%		0.0	%
Expected life (in years)		5.50			5.5
Expected volatility		96.2	%		85.7	%

Schedule of Share-based Compensation, Activity [Table Text Block]

						Weighted
						Average
				Weighted		Remaining
	Shares			Average		Contractual
	Underlying			Exercise		Term
	Options			Price		(In Years)
Outstanding as of April 30, 2016		89,303		$	42.90		3.6
Forfeited		(987	)	$	46.45
Exercised		-		$	-
Granted		171,749		$	2.12
Outstanding as of January 31, 2017		260,065		$	15.96		7.2
Exercisable as of January 31, 2017		157,066		$	24.44		5.6

Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]

				Weighted
	Number			Average Price per
	of Shares			Share

Issued and unvested at April 30, 2016		40,008		$	6.70
Granted		223,662		$	3.94
Forfeited		(28,266	)	$	3.98
Vested		(139,492	)	$	4.70
Issued and unvested at January 31, 2017		95,912		$	3.99

Note 10 - Fair Value Measurements (Tables)

9 Months Ended

Jan. 31, 2017