Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)

The number of shares outstanding of the registrant’s common stock as of November 14, 20178, 2018 was 36,130,195.49,813,000.

This quarterly report on Form 10-Q (this “Report”) contains statements that are considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and its rules and regulations (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, and its rules and regulations (the “Exchange Act”). These forward-looking statements include, but are not limited to, statements about the plans, objectives, expectations, and intentions of Glowpoint, Inc. (“Glowpoint,” “we,” “us,”Glowpoint” or “we” or “us” or the “Company”). All statements other than statements of current or historical fact contained in this Report, including statements regarding Glowpoint’s future financial position, business strategy, budgets, projected costs, and plans and objectives of management for future operations, are forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” and similar expressions, as they relate to Glowpoint, are intended to identify forward-looking statements. These statements are based on Glowpoint’s current plans, and Glowpoint’s actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. Any or all of the forward-looking statements in this Report may turn out to be inaccurate. Glowpoint has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy, and financial needs. The forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks, uncertainties, and assumptions. There are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including our plans, objectives, expectations and intentions and other factors that are discussed under the section entitled “Risk Factors,” as well as“Part I. Item 1A. Risk Factors” and in our consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2016 as filed with the SEC with2017, each included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017 filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2017.7, 2018, under the section entitled “Part II. Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 filed with the SEC on August 9, 2018, as well as under “Part II. Item 1A. Risk Factors” in this Report. Glowpoint undertakes no obligation to publicly revise these forward-looking statements to reflect events occurring after the date hereof. All subsequent written and oral forward-looking statements attributable to Glowpoint or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained in this Report. Forward-looking statements in this Report include, among other things: our ability to meet commercial commitments; our expectations and estimates relating to customer attrition, sales cycles, future revenues, expenses and cash flows; the statusevolution of our largest customer;customer solutions and our service platforms; our anticipated capital expenditures; our ability to service debt obligations and fund operations; our ability to renegotiate existing financial covenants under our senior loan agreement; expectations regarding adjustments to our cost of revenue and other operating expenses; our ability to raise capital through sales of additional equity or debt securities and/or loans from financial institutions;securities; our ability to continue as a going concern; and adequacy of our internal controls. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, those summarized below:

The condensed consolidated financial statements include the accounts of Glowpoint and our 100%-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation.

The Company's fiscal year ends on December 31 of each calendar year. The accompanying interim condensed consolidated financial statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year ended December 31, 2016.2017. In the opinion of the Company's management, these interim condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position, results of operations and cash flows for the periods presented. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.

The results of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.

The significant accounting policies used in preparation of these condensed consolidated financial statements are disclosed in our 2016 10-K, and there have been no changes to the Company's significant accounting policies during the nine months ended September 30, 2017.

As of September 30, 2017,2018, we had $1,439,000$2,578,000 of cash, and working capital of $696,000. Our cash balance as of September 30, 2017 includes restricted cash of $18,000 (as discussed in Note 6).$3,355,000 and no debt. For the nine months ended September 30, 2017,2018, we generatedincurred a net incomeloss of $5,846,000 and$4,444,000, used $609,000 of net cash fromin operating activities, of $1,073,000. A substantialand experienced continued declines in revenue. During the nine months ended September 30, 2018 and the year ended December 31, 2017, a significant portion of our cash flow from operations hashad been dedicated to the payment of interest on our formerthen-existing indebtedness, thereby reducing our ability to use our cash flow to fund our operations, capital expenditures and investments in sales and marketing. For the nine months ended September 30,

As further describedOur capital requirements continue to depend on numerous factors, including the timing and amount of revenue, the expense to deliver our services, expense for sales and marketing, expense for research and development, capital improvements, the amount of shares repurchased under the Company’s stock repurchase program, the cost involved in Item 2, Resultsprotecting our intellectual property rights, and expenses required to successfully pursue and execute the proposed business combination with SharedLabs, Inc., on the terms announced or otherwise, or any other merger and acquisition and/or business development initiatives. The Company believes that, based on our current projection of Operations,revenue, expenses, capital expenditures and cash flows, it has sufficient resources to fund its operations for at least the next twelve months following the filing of this Report. However, there is no assurance the Company anticipates continued declineswill be able to accomplish this during this period or in its revenue, which is expected to result inthe future following such period. The Company anticipates reduced cash flow from operations. The Company currently expectsoperations and increased levels of capital expenditures in 2018 as compared to use some or all of the net proceeds of the Series B Offering2017, and we believe additional capital may be required to fund investments in product development and sales and marketing expenses and capital expenditures to develop new service offeringsas a means to reverse the Company’sour negative revenue trends. Given the Company’s plans to increase operating expenses and capital expenditures following the closing of the Series B Offering, the Company will seek to amend certain financial covenants for fiscal years 2018 and 2019 in the Western Alliance Bank Loan Agreement. AlthoughWhile we expect to agree on amended covenantscontinue to adjust our cost of revenue and other operating expenses to partially offset the impact of revenue declines associated with Western Alliance Bank, there canour legacy services, we believe additional capital may be no assurance thatnecessary to fund our obligations. In the event we will successfulneed access to capital to fund operations or provide growth capital, we would likely need to raise capital in doing so.one or more equity offerings. There can be no assurance that we will be successful in developing new service offerings and reversing our revenue trends. There can be no assurance that our existing cash resources and the net proceeds of the Series B Offering will be adequate to fund our operations, projected capital expenditures and debt service obligations. Therefore, the Company may raise capital in one or more offerings in the future. The holders of the Series B convertible preferred stock have the right to approve certain financings. There can be no assurance the holders of the Series B convertible preferred stock will approve such financings, that we will succeed in raising necessary capital or that any such offering will be on terms acceptable to the Company. If we cannotare unable to raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company. The factors discussed above raiselead investor of the Series C Preferred Stock (the “Lead Investor”) has certain rights to approve future financings. In addition, as previously disclosed, on July 5, 2018, we received a letter (the “Deficiency Letter”) from the NYSE American stating that we were not in compliance with the continued listing standards as set forth in Section 1003(f)(v) of the NYSE American Company Guide (the “Company Guide”). Specifically, the Deficiency Letter informed us that the NYSE American has determined that shares of our common stock have been selling for a low price per share for a substantial doubt asperiod of time and, pursuant to Section 1003(f)(v) of the Company Guide, the continued listing of our common stock on the NYSE American is predicated on us effecting a reverse stock split of our common stock or otherwise demonstrating sustained price improvement within a reasonable period of time, which the NYSE American determined to be no later than January 5, 2019. We intend to regain compliance with the listing standards set forth in the Company Guide on the timeline established by the NYSE American by undertaking a measure or measures that are for the best interests of the Company and its shareholders. There is, however, no assurance that the Lead Investor will provide the required approvals, that any such measures will be successful or that the NYSE American will deem us to be in compliance, any of which may affect our ability to continue asraise capital, refinance indebtedness or borrow additional funds on terms we deem advisable, or at all. Failure to obtain financing, or obtaining financing on unfavorable terms, could result in a going concern. The accompanying condensed consolidated financial statements do not include any adjustments that might result from these uncertainties.decrease in our stock price, would have a material adverse effect on future operating prospects, and could require us to significantly reduce operations.

The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350-40 “Intangible – Goodwill and Other – Internal-Use SoftwareSoftware.”. Capitalized software costs are included in Property“Property and Equipmentequipment, net” on our condensed consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. For the three and nine months ended September 30, 2018, we capitalized $89,000 and $265,000, respectively, of internal-use software costs and we amortized $82,000 and $299,000, respectively, of these costs. For the three and nine months ended September 30, 2017, we capitalized $32,000 and $90,000, respectively, of internal-use software costs and we amortized $160,000 and $480,000, respectively, of these costs. For the three and nine months ended September 30, 2016, we capitalized $89,000 and $248,000, respectively, and we amortized $145,000 and $475,000, respectively, of these costs. During the three and nine months ended September 30, 2018 and 2017, we recorded impairment losses of $232,000 related to capitalized software. During the three and nine months ended September 30, 2016, we recorded $0 and $25,000, respectively, ofno impairment losses related to capitalized software no longer in service.software.

Accrued expenses and other liabilities consisted of the following (in thousands):

Debt consisted of the following (in thousands):

On January 26, 2018, the Company and Super G entered into a payoff letter that terminated the Super G Loan Agreement and the Super G Warrant in exchange for total cash payments from the Company of $1,269,000 (the “Super G Payoff”). The total obligations to Super G at the time of the Super G Payoff was $1,434,000, including principal, accrued and remaining interest due over the term of the Super G Loan, and the Super G Warrant Liability. Therefore, the Company recorded a gain on extinguishment of the debt of $165,000, which is recorded in “Interest and Other Expense, Net” on our Condensed Consolidated Statements of Operations. In connection with the Super G Payoff, the related warrant liability and corresponding debt discount were eliminated during the nine months ended September 30, 2017. The warrant liability is revalued on each balance sheet date until such instrument is exercised or expires, with any changes in the fair value between reporting periods recorded as other income or expense. During the three and nine months ended 2018. As of September 30, 2017,2018, there wasare no changeoutstanding obligations related to the fair value of the warrant liability. The Company estimates the fair value of this liability using an option pricing model that is based on the individual characteristics of the warrant on the valuation date, which includes assumptions for expected volatility, expected life and risk-free interest rate, as well as the present value of the minimum cash payment component of the instrument. Changes in the assumptions used could have a material impact on the resulting fair value. The primary input affecting the value of the warrant liability is the Company’s stock price. Generally, increases (decreases) in the fair value of the underlying stock would result in a corresponding increase (decrease) in the fair value of the warrant liability.Super G Loan.

The total debt discount on the Western Alliance Bank A/R Revolver and Super G Loan was $335,000,$339,000, comprised of $170,000$174,000 of debt issuance costs and $165,000 related to the warrants issued.Super G Warrant. This debt discount iswas being amortized to interest expense using the effective interest method over the term of the debt. During the three and nine months ended September 30, 2017,2018, the Company amortized $28,000$0 and $269,000 of the debt discount, to interest expense. The unamortized debt discount as of September 30, 2017 is $308,000.

Our Certificate of Incorporation authorizes us to issue up to 5,000,000 shares of preferred stock. As of September 30, 2017,2018, there were: (i) 100 shares of Perpetual Series B-1 Preferred Stock authorized and no shares issued or outstanding; (ii) 7,500 shares of Series A-2 Convertible Preferred Stock authorized and 32 shares issued and outstanding (the “Series A-2 Preferred Stock”); (iii) 2,800 shares of 0% Series B Convertible Preferred Stock (the “Series B Preferred Stock”) authorized and 375 shares issued and outstanding; (iv) 1,750 shares of Series C Preferred Stock authorized and 775 shares issued and outstanding; (v) 4,000 shares of Series D Convertible Preferred Stock authorized and no shares issued or outstanding. In connection with theoutstanding; and (vi) 100 shares of Perpetual Series B Offering, 2,800 shares of Series B convertible preferred stock werePreferred Stock authorized and no shares issued as of October 24, 2017.or outstanding.

Each share of Series A-2 Preferred Stock has a stated value of $7,500 per share (the “A-2 Stated Value”), a liquidation preference equal to the A-2 Stated Value, and is convertible at the holder’s election into Common Stockcommon stock at a conversion price per share of $2.9835$2.16 as of September 30, 2017.2018. Therefore, each share of Series A-2 Preferred Stock is convertible into 2,5143,472 shares of Common Stockcommon stock as of September 30, 2017.2018. The conversion price is subject to adjustment upon the occurrence of certain events set forth in our Certificate of Incorporation. During the nine months ended September 30, 2017, there were no adjustments to2018, the conversion price. The Series BC Offering completed in October 2017 resulted in an adjustment to the Series A-2 Preferred Stock conversion price from $2.40 to $2.40$2.16 per share.share, resulting in a beneficial conversion amount of $24,000 which has been recorded in additional paid-in capital.