EQUITY

6 Months Ended

Dec. 31, 2024

Equity [Abstract]

EQUITY

NOTE 10. EQUITY

Securities Purchase Agreements (“SPA”)

SPA 2024

On December 23, 2024, the Company completed a SPA with an institutional investor selling 1,990,000 shares of common stock at $2.65 per share and prefunded warrants to purchase up to 760,000 shares of common stock at $2.649 per warrant (which is convertible to one share of common stock on a one for one basis). The prefunded warrants have an exercise price of $0.001 per share of common stock, are immediately exercisable and may be exercised at any time until exercised in full (see Note 13).

The Company realized total net proceeds (after underwriting and professional fees) of $6.79 million from the SPA 2024.

THE GLIMPSE GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SPA 2023

On October 2023, the Company completed a SPA with certain institutional investors selling 1,885,715 shares of common stock for approximately $3.30 million (at $1.75 per share). The Company realized net proceeds (after underwriting, professional fees and listing expenses) of $2.97 million.

Simultaneously, the exercise price on warrants to purchase 750,000 shares of common stock originally issued pursuant to a SPA entered into in November 2021 were repriced from $14.63 per share to $1.75 per share.

Common Stock Issued

Exercise of Warrants

On December 19, 2024, an institutional investor exercised warrants (issued in connection with a November 2021 SPA) convertible into 100,000 shares of common stock. The Company realized proceeds of $0.18 million ($1.75 per share).

Common stock issued to Employees as Compensation

During the six months ended December 31, 2024, the Company issued 16,000 unrestricted shares of common stock to an employee as compensation and recorded share-based compensation of approximately $0.01 million in sales and marketing expenses on the condensed consolidated statement of operations.

During the six months ended December 31, 2023, the Company issued approximately 61,000 unrestricted shares of common stock to various employees as compensation and recorded share-based compensation of approximately $0.21 million in general and administrative and sales and marketing expenses on the condensed consolidated statement of operations.

Common stock issued to Vendors

During the six months ended December 31, 2023, the Company issued approximately 29,000 unrestricted shares of common stock to various vendors for services performed and recorded share-based compensation of approximately $0.07 million, primarily in sales and marketing expenses on the condensed consolidated statement of operations.

Common stock issued for Exercise of Stock Options

During the six months ended December 31, 2024, the Company issued approximately 8,000 shares of common stock in cashless transactions upon exercise of the respective option grants and realized cash proceeds of zero.

During the six months ended December 31, 2023, the Company issued approximately 9,000 shares of common stock in cashless transactions upon exercise of the respective option grants and realized cash proceeds of zero.

Common stock issued to satisfy Contingent Acquisition Obligations

During the six months ended December 31, 2024, the Company issued approximately 36,000 unrestricted shares of common stock, with a fair value of approximately $0.13 million, to satisfy a contingent acquisition obligation for the achievement of a revenue performance milestone by XR Terra.

Warrants

In connection with the July 2021 IPO, the November 2021 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 GLIMPSE GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The only warrants exercised since issuance are 100,000 warrants from the November 2021 SPA exercised in December 2024.

The remaining outstanding warrants as of December 31, 2024 are (see Note 13):

	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
December 2024 SPA		760,000	$	0.001	None
Total		1,497,500

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 12.2 million common shares reserved for issuance. As of December 31, 2024, there were approximately 6.1 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 December 31,						For the Six Months Ended December 31,
	2024			2023			2024			2023
Weighted average expected terms (in years)		6.0			5.0			6.0			6.5
Weighted average expected volatility		81.5	%		101.3	%		87.4	%		97.8	%
Weighted average risk-free interest rate		3.6	%		4.1	%		3.8	%		4.6	%
Expected dividend yield		0.0	%		0.0	%		0.0	%		0.0	%

The grant date fair value for options granted during the six months ended December 31, 2024 and 2023 was approximately $0.11 million and $0.41 million, respectively.

THE GLIMPSE GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following is a summary of the Company’s stock option activity for the six months ended December 31, 2024 and 2023, excluding the executive Target Options:

				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		196,301			2.50		9.6		-
Options Exercised		(35,600	)		2.50		2.3		-
Options Forfeited / Cancelled		(760,304	)		4.54		7.5		2,886
Outstanding at December 31, 2024		3,044,277		$	3.73		5.9	$	528,944
Exercisable at December 31, 2024		1,751,773		$	3.93		4.6	$	252,829

The above table excludes executive Target Options: 1,980,000 granted, $7.00 exercise price, 8.12 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, 2023		6,128,381		$	4.84		7.0	$	1,676,966
Options Granted		259,847			2.57		9.7		-
Options Exercised		(25,000	)		2.00		2.9		5,474
Options Forfeited / Cancelled		(1,662,564	)		4.76		6.5		2,515
Outstanding at December 31, 2023		4,700,664		$	4.77		6.8	$	-
Exercisable at December 31, 2023		2,903,668		$	4.19		5.4	$	-

The above table excludes executive Target Options: 2,100,000 granted (includes 120,000 attributable to an executive who resigned in July 2024), $7.00 exercise price, 9.1 remaining term in years, no intrinsic value. Vesting of these is considered remote.

The intrinsic value of stock options at December 31, 2024 and 2023 was computed using a fair market value of the common stock of $2.47 per share and $1.13 per share, respectively.

The Company’s stock option-based expense for the three months ended December 31, 2024 and 2023 consisted of the following:

	For the Three Months Ended					For the Six Months Ended
	December 31					December 31
	2024			2023		2024		2023
Stock option-based expense :
Research and development expenses	$	(17,580	)	$	177,728	$	121,610	$	448,857
General and administrative expenses		108,835			75,817		221,843		173,543
Sales and marketing expenses		(27,533	)		134,223		66,535		287,647
Board option expense		12,459			69,174		24,919		143,275
Total	$	76,182		$	456,942	$	434,908	$	1,053,322

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

At December 31, 2024 total unrecognized compensation expense to employees, board members and vendors related to stock options was approximately $1.39 million (excluding executive Target Options vested value of $8.53 million, which vesting is considered remote) and is expected to be recognized over a weighted average period of 1.70 years (which excludes the executive Target Options).

THE GLIMPSE GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS