COMMITMENTS AND CONTINGENCIES

12 Months Ended

Jun. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 13. COMMITMENTS AND CONTINGENCIES

Lease Costs

The Company made cash payments for all operating leases for the years ended June 30, 2024 and 2023, of approximately $0.58 million and $0.60 million, respectively, which were included in cash flows from operating activities within the consolidated statements of cash flows. As of June 30, 2024, the Company’s operating leases have a weighted average remaining lease term of 1.13 years and weighted average discount rate of 8.43%.

The total rent expense for all operating leases for the years ended June 30, 2024 and 2023, was approximately $0.46 million and $0.54 million, respectively, with short-term leases making up an immaterial portion of such expenses.

Lease Commitments

The Company has various operating leases for its offices. These existing leases have remaining lease terms ranging from approximately 1 to 3 years. Certain lease agreements contain options to renew, with renewal terms that generally extend the lease terms by 1 to 3 years for each option. The Company determined that none of its current leases are reasonably certain to renew.

THE GLIMPSE GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2024 AND 2023

Future approximate undiscounted lease payments for the Company’s operating lease liabilities and a reconciliation of these payments to its operating lease liabilities at June 30, 2024 are as follows:

Years Ended June 30,
2025	$	400,000
2026		192,000
Total future minimum lease commitments, including short-term leases		592,000
Less: future minimum lease payments of short -term leases		(15,000	)
Less: imputed interest		(33,000	)
Present value of future minimum lease payments, excluding short term leases	$	544,000
Current portion of operating lease liabilities	$	365,000
Non-current portion of operating lease liabilities		179,000
Total operating lease liability	$	544,000

Contingent Consideration for Acquisitions

Contingent consideration for acquisitions, consists of the following as of June 30, 2024 and, 2023 respectively (see Note 6):

	As of June 30,		As of June 30,
	2024		2023
S5D, current portion	$	-	$	1,908,800
BLI, current portion		1,431,761		2,957,700
XRT		35,714		254,291
Subtotal current portion		1,467,475		5,120,791
S5D, net of current portion		-		1,251,700
BLI, net of current portion		1,413,696		3,253,300
Total contingent consideration for acquisitions	$	2,881,171	$	9,625,791

Employee Bonus

During this fiscal year, a certain employee met the revenue threshold to earn a bonus payout and this was included in accrued non cash performance bonus in the consolidated balance sheet at June 30, 2023. This bonus was paid in February 2024 entirely in the form of Company common stock with a fair value of approximately $0.36 million. For the years ended June 30, 2024 and June 30, 2023, the fair value of this potential bonus decreased approximately zero and $0.55 million, respectively, due to a decrease in the Company’s common stock price between the measurement dates. This gain is included in sales and marketing expenses on the consolidated statement of operations.

Potential Future Distributions Upon Divestiture or Sale

In some instances, upon a divestiture or sale of a subsidiary company or capital raise into subsidiary company, the Company is contractually obligated to distribute a portion of the net proceeds or capital raise to the senior management team of the divested subsidiary company.