9. Commitments

12 Months Ended

Jun. 30, 2015

Notes

9. Commitments

9.                     COMMITMENTS

The Company is renting 45,000 square feet of office and warehouse facilities on a monthly lease arrangement. Rent expense for the years ended June 30, 2015, and 2014, was $137,581 and $139,140, respectively. Deferred rent of $8,800 was recorded as of June 30, 2014, due to an initial rent holiday and rent escalations related to the lease. As of June 30, 2015, the Company is currently on a month to month lease arrangement.

On November 15, 2013, the Company entered into a service agreement with an outside marketing consulting group in which the outside marketing development group provides the Company with consulting services to assist in enhancing the value of the Company’s current products and facilitate change and innovation for existing and new products branded by the Company. The agreement provides regular monthly payments in addition to non-qualified stock options. The stock options vest monthly through October 31, 2014, and are recognized on a monthly basis. An amendment to this agreement was entered into on May 1, 2015. The amendment expands services to include outsourced CFO services. The amendment includes a monthly billing agreement and does not provide any stock options. The amendment extends the contract through December 31, 2016.

Future minimum payments are $192,000 for the year ended June 30, 2016.