Related Party Transactions

3 Months Ended

Nov. 30, 2020

Related Party Transactions

Related Party Transactions

Note 6.    Related Party Transactions

The Company leases its Chicago area sales office and distribution center located in Glendale Heights, Illinois under an operating lease agreement (the “Glendale Lease”) from the Glen F. Ceiley and Barbara A.Ceiley Revocable Trust (the “Trust”), which is the grantor trust of Glen Ceiley, the Company’s Chief Executive Officer, Chairman of the Board, and majority shareholder. The Glendale Lease is a ten year lease with an initial monthly rental rate of $22,600, which is subject to annual rent increases of approximately 2.5% as set forth in the Glendale Lease. During the three months ended November 30, 2020 and 2019, the Company incurred expense related to the Glendale Lease of approximately $72,000 and $71,000, respectively.

On July 26, 2019, the Company entered into a Commercial Lease Agreement with the Trust (the “Hunter Lease”), for the lease of the Hunter Property, which houses the Company’s new corporate headquarters. The Company completed its move to the new headquarters located at the Hunter Property in March 2020.  The term of the Hunter Lease commenced on September 2, 2019 and ends on August 31, 2029 with an initial monthly rental rate of  $66,300, which is subject to annual rent increases of approximately 2.5% as set forth in the Hunter Lease.  During the three months ended November 30, 2020 and 2019, the Company incurred expense related to the Hunter Lease of approximately $204,000 and $199,000, respectively.