COMMITMENTS, CONTINGENCIES AND RELATED PARTY TRANSACTIONS

12 Months Ended

Jun. 30, 2019

COMMITMENTS, CONTINGENCIES AND RELATED PARTY TRANSACTIONS

COMMITMENTS, CONTINGENCIES AND RELATED PARTY TRANSACTIONS

NOTE 8        COMMITMENTS, CONTINGENCIES AND RELATED PARTY TRANSACTIONS

Dye Candy Company leases its office and manufacturing facility, located at 1307 South 59th, St. Joseph, Missouri, from an entity that is partially owned by the son of the Chief Executive Officer of the Company. The lease term is from February 1, 2005 through March 31, 2025, with an option to extend for an additional term of five years, and currently requires payments of $6,500 per month. At the end of the first five years, the base rent may be increased an amount not greater than 30%, at the sole discretion of lessor and for each additional term of five years. Rental expense was $78,000 for each year ended June 30, 2019 and 2018. The amounts are included in cost of sales.

Future minimum lease payments under this lease are as follows:

Year Ending June 30,	Amount
2020	$	78,000
2021		78,000
2022		78,000
2023		78,000
2024		78,000
Thereafter		58,500
	$	448,500

As of June 30, 2019, the Company had raw materials purchase commitments with five vendors totaling approximately $216,900.