EQUITY

3 Months Ended

Sep. 30, 2025

NOTE 8. EQUITY

Common Stock Issued

Common stock issued to Employees as Compensation

During the three months ended September 30, 2025, the Company issued 10,500 unrestricted shares of common stock to an employee as compensation and recorded share-based compensation expense of approximately $0.01 million in sales and marketing expenses in the condensed consolidated statement of operations.

During the three months ended September 30, 2024, the Company issued 8,000 unrestricted shares of common stock to an employee as compensation and recorded share-based compensation expense of approximately $0.01 million in sales and marketing expenses in the condensed consolidated statement of operations.

Warrants

In connection with the July 2021 IPO, the November 2021 Securities Purchase Agreement (“SPA”) and the December 2024 SPA, the Company issued warrants, which are exercisable into Company common shares on a one-for-one basis, as detailed below. The warrants are not publicly traded.

The remaining outstanding warrants as of September 30, 2025 are:

SCHEDULE OF WARRANTS OUTSTANDING

	Warrants Outstanding		Exercise Price		Expiration Date

July 2021 IPO		87,500	$	7.00	June 2026
November 2021 SPA		481,000	$	1.75	November 2026
November 2021 SPA		169,000	$	1.75	May 2027
Total		737,500

Employee Stock-Based Compensation

Stock Option issuance to Executives

In February 2023, pursuant to the Equity Incentive Plan, the Company granted certain executive officers 2.20 million stock options as a long-term incentive. The options have an exercise price of $7.00 per share. 0.22 million of these options vest ratably over four years (“Initial Options”). The remainder (“Target Options”) vest in fixed amounts based on achieving various revenue or common stock prices within seven years of grant date. Given the Company’s current stock price and revenue, the Company views the achievement of the milestones that would trigger vesting of the Target Options as remote.

Equity Incentive Plan

The Company’s 2016 Equity Incentive Plan (the “Plan”), as amended, has approximately 13.17 million common shares reserved for issuance. As of September 30, 2025, there were approximately 7.34 million shares available for issuance under the Plan. The shares available are after the granting of 1.98 million shares of executive Target Options.

The Company recognizes compensation expense relating to awards ratably over the requisite period, which is generally the vesting period.

Stock options have been recorded at their fair value. The Black-Scholes option-pricing model assumptions used to value the issuance of stock options under the Plan for the specific periods below are noted in the following table:


	For the Three Months Ended September 30,
	2025			2024
Weighted average expected terms (in years)		6.0			6.0
Weighted average expected volatility		129.6	%		99.5	%
Weighted average risk-free interest rate		4.0	%		4.4	%
Expected dividend yield		0.0	%		0.0	%

The grant date fair value for options granted during the three months ended September 30, 2025 and 2024 was approximately $0.17 million and $0.10 million, respectively.

The following is a summary of the Company’s stock option activity for the three months ended September 30, 2025 and 2024, excluding the executive Target Options:

SUMMARY OF STOCK OPTION ACTIVITY

				Weighted Average
						Remaining
				Exercise		Contractual		Intrinsic
	Options			Price		Term (Yrs)		Value
Outstanding at July 1, 2025		2,766,206		$	3.37		5.6	$	-
Options Granted		125,000			2.31		9.9		-
Options Exercised		-			-		0.0		-
Options Forfeited / Cancelled		(72,804	)		3.15		7.0		-
Outstanding at September 30, 2025		2,818,402		$	3.33		5.5	$	35,000
Exercisable at September 30, 2025		1,917,257		$	3.55		4.5	$	13,694

The above table excludes executive Target Options: 1,980,000 granted, $7.00 exercise price, 7.4 remaining term in years, no intrinsic value. Vesting of these is considered remote.

				Weighted Average
						Remaining
				Exercise		Contractual		Intrinsic
	Options			Price		Term (Yrs)		Value
Outstanding at July 1, 2024		3,643,880		$	3.95		6.5	$	-
Options Granted		147,000			2.50		9.8		-
Options Exercised		-			-		0.0		-
Options Forfeited / Cancelled		(276,488	)		4.15		8.5		-
Outstanding at September 30, 2024		3,514,392		$	3.88		6.2	$	-
Exercisable at September 30, 2024		1,979,073		$	4.03		4.9	$	-

The above table excludes executive Target Options: 1,980,000 granted, $7.00 exercise price, 8.4 remaining term in years, no intrinsic value. Vesting of these is considered remote.

The intrinsic value of stock options activity for the three months ended September 30, 2025 and 2024 was computed using a fair market value (fiscal year to date VWAP – volume weighted average price) of the common stock of $1.52 per share and $0.84 per share, respectively.

The intrinsic value of stock options outstanding and exercisable as of September 30, 2025 and 2024 was computed using NASDAQ market closing prices of the common stock of $1.64 per share and $0.76 per share, respectively.

The Company’s stock option-based expense for the three months ended September 30, 2025 and 2024 consisted of the following:

SCHEDULE OF STOCK OPTION BASED EXPENSE


	For the Three Months Ended
	September 30
	2025		2024
Stock option-based expense:
Research and development expenses	$	35,112	$	139,190
General and administrative expenses		84,683		113,008
Sales and marketing expenses		13,340		94,068
Board option expense		102,235		12,460
Total	$	235,370	$	358,726
Stock option-based expense	$	235,370	$	358,726

There is no expense included for the executive officers’ Target Options.

As of September 30, 2025 total unrecognized compensation expense to employees, board members and vendors related to stock options was approximately $1.0 million (excluding executive Target Options of $8.08 million, which vesting and expense is considered remote) and is expected to be recognized over a weighted average period of 1.58 years (which excludes the executive Target Options).

- Definition

The entire disclosure for equity.

+ References

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+ Details

Glimpse Group, Inc. 10-Q