The Company is externally advised and has no direct employees. All of the Company’s executive officers are executive officers, or on the board of managers, of the Advisor. In connection with services provided to the Company, affiliates are entitled to the following fees:

Dealer Manager — Through the termination of the Offering in October 2018, the Dealer Manager received a combined selling commission and dealer manager fee of up to 8.5% of the sale price for each Class A share and up to 4.75% of the sale price for each Class T share sold in the Primary Offering, all or a portion of which could be reallowed to participating broker dealers. In addition, for Class T shares sold in the Primary Offering, the Dealer Manager could choose the respective amounts of the commission and dealer manager fee, provided that the selling commission did not exceed 3.0% of the gross proceeds from the completed sale of such Class T shares.

The Company paid a distribution and stockholder servicing fee, subject to certain underwriting compensation limits, with respect to the Class T and Class I shares sold in the Primary Offering in an annual amount equal to 1% and 0.50%, respectively, of the then-current gross offering price per Class T or Class I share.

The Company recorded the annual distribution and stockholder servicing fees as a reduction to capital in excess of par value and measured the related liability in an amount equal to the maximum fees owed in relation to the Class T and Class I shares on the shares’ issuance date. The liability was relieved over time, as the fees were paid to the Dealer Manager. In connection with the close of the Offering effective October 1, 2018, certain underwriting compensation limits were met and, effective October 31, 2018, each Class T and Class I share automatically converted into a Class A share pursuant to the terms of the Company’s charter. The Class T and Class I shares converted into Class A shares on a one-for-one basis because the then-current estimated net asset value (“NAV”) per share of $10.06 was the same for all share classes. Effective October 31, 2018, Class T and Class I shares were no longer subject to class specific expenses upon conversion into Class A shares. The Company’s obligation to pay the remaining distribution and stockholder servicing fees liability of approximately $1.4 million to the Dealer Manager ceased effective October 31, 2018 upon the conversion of the Class T and Class I shares into Class A Shares.

CNL Capital Markets, LLC — The Company will pay CNL Capital Markets, LLC, an affiliate of CNL, an annual fee payable monthly based on the average number of total investor accounts that are open during the term of the capital markets service agreement pursuant to which certain administrative services are provided to the Company. These services may include, but are not limited to, the facilitation and coordination of the transfer agent’s activities, client services and administrative call center activities, financial advisor administrative correspondence services, material distribution services and various reporting and troubleshooting activities.

Advisor — Pursuant to the Company’s advisory agreement, dated as of March 2, 2016, the Company paid the Advisor asset management fees in an amount equal to 0.80% per annum of average invested assets (“AUM Fee”). In March 2019, the Company’s advisory agreement was amended and restated to eliminate acquisition fees and dispositions fees as well as to reduce the AUM Fee to 0.40% per annum of average invested assets. The reduced AUM Fee is further subject and subordinate to an agreed upon hurdle relating to the total operating expenses (as described in the amended and restated advisory agreement) of the Company, though to the extent any portion of the AUM Fee is not paid as a result of total operating expenses exceeding the prescribed limits, it may be recovered by the Advisor if certain Company performance thresholds are subsequently met. The Company’s board of directors approved renewing the amended and restated advisory agreement through March 2020.

The Advisor, its affiliates and related parties also are entitled to reimbursement of certain operating expenses in connection with their provision of services to the Company, including personnel costs, subject to the limitation that the Company will not reimburse the Advisor for any amount by which operating expenses exceed the greater of 2% of its average invested assets or 25% of its net income in any four consecutive fiscal quarters (“Expense Year”) unless approved by the independent directors. For the Expense Year ended March 31, 2019, the Company’s total operating expenses were in excess of this limitation by approximately $28,000. As of March 31, 2019, the Company had received cumulative approvals from its independent directors for total operating expenses in excess of this limitation of approximately $0.9 million. The Company’s independent directors determined that the higher relationship of operating expenses to average invested assets was justified based on unattained capital raise expectations, which limited the number of investments, and the cost of operating a public company.

For each of the three months ended March 31, 2019 and 2018, the Company paid cash distributions of approximately $38,000 to the Advisor related to the Class A common stock held by the Advisor. In addition, for the three months ended March 31, 2018, the Company issued stock dividends of approximately 7,400 shares to the Advisor. There were no stock dividends for the three months ended March 31, 2019 as the Company discontinued its stock dividends in October 2018.

Pursuant to an expense support arrangement, the Advisor agreed to accept payment in restricted stock in lieu of cash for services rendered, in the event that the Company does not achieve established distribution coverage targets (“Expense Support Agreement”). In exchange for services rendered and in consideration of the expense support provided under this arrangement, the Company issued, following each determination date, a number of shares of restricted stock equal to the quotient of the expense support amount provided by the Advisor for the preceding year divided by the board of directors’ most recent determination of NAV per share of the Class A common shares on the terms and conditions and subject to the restrictions set forth in the Expense Support Agreement. The restricted stock is subordinated and forfeited to the extent that shareholders do not receive a Priority Return on their Invested Capital (as such terms are defined in the Company’s prospectus), excluding for the purposes of calculating this threshold any shares of restricted stock owned by the Advisor. In March 2019, the Company’s board of directors and the Advisor agreed to terminate the Expense Support Agreement effective April 1, 2019.

The following fees for services rendered have been or are expected to be settled in the form of restricted stock pursuant to the Expense Support Agreement for the three months ended March 31, 2019 and 2018 and cumulatively as of March 31, 2019:

	Three Months Ended March 31,				As of March 31,
	2019		2018		2019
Fees for services rendered:
Asset management fees	$	99,417	$	70,800	$	578,171
Advisor personnel expenses ⁽¹⁾		127,950		126,629		1,058,676
Total fees for services rendered	$	227,367	$	197,429	$	1,636,847
Then-current NAV	$	9.92	$	10.06	$	9.92
Restricted stock shares ⁽²⁾		22,920		19,625		164,210
Cash distributions on restricted stock ⁽³⁾	$	8,113	$	—	$	32,452

FOOTNOTES:

⁽¹⁾

Amounts consist of personnel and related overhead costs of the Advisor or its affiliates (which, in general, are those expenses relating to the Company’s administration on an on-going basis) that are reimbursable by the Company.

⁽²⁾

Represents restricted stock shares issued or expected to be issued to the Advisor as of March 31, 2019 pursuant to the Expense Support Agreement. No fair value was assigned to the restricted stock shares as the shares do not vest until a liquidity event is consummated and certain market conditions are achieved. In addition, the restricted stock shares will be treated as unissued for financial reporting purposes until the vesting criteria are met.

⁽³⁾

The cash distributions on Restricted Stock shares issued have been recognized as compensation expense as declared and included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

The fees payable through the termination of the Offering in October 2018 to the Dealer Manager for the three months ended March 31, 2019 and 2018, and related amounts unpaid as of March 31, 2019 and December 31, 2018 are as follows:

	Three Months Ended				Unpaid amounts as of ⁽¹⁾
	March 31,				March 31,		December 31,
	2019		2018		2019		2018
Selling commissions ⁽²⁾	$	—	$	131,841	$	—	$	—
Dealer manager fees ⁽²⁾	―			165,756	―		―
Distribution and stockholder servicing fees ⁽²⁾	―			293,378	―		―
	$	—	$	590,975	$	—	$	—

The expenses incurred by and reimbursable to the Company’s related parties, including amounts included in income from discontinued operations, for the three months ended March 31, 2019 and 2018, and related amounts unpaid as of March 31, 2019 and December 31, 2018 are as follows:

	Three Months Ended				Unpaid amounts as of⁽¹⁾
	March 31,				March 31,		December 31,
	2019		2018		2019		2018
Reimbursable expenses:
Operating expenses ⁽³⁾	$	230,823	$	274,844	$	129,278	$	85,902
Acquisition fees and expenses	―			901	―		―
		230,823		275,745		129,278		85,902
Asset management fees ⁽⁴⁾		99,417		70,800	―		―
	$	330,240	$	346,545	$	129,278	$	85,902

FOOTNOTES:

⁽¹⁾

Amounts are recorded as due to related parties in the accompanying condensed consolidated balance sheets.

⁽²⁾

Amounts are recorded as stock issuance and offering costs in the accompanying condensed consolidated statements of stockholders’ equity.

⁽³⁾

Amounts are recorded as general and administrative expenses in the accompanying condensed consolidated statements of operations unless such amounts represent prepaid expenses, which are capitalized in the accompanying condensed consolidated balance sheets. For each of the three months ended March 31, 2019 and 2018, approximately $0.1 million of personnel expenses of affiliates of the Advisor have been or are expected to be settled in accordance with the terms of the Expense Support Agreement and as such our general and administrative expenses were reduced by approximately $0.1 million for each of the three months ended March 31, 2019 and 2018.

⁽⁴⁾

For each of the three months ended March 31, 2019 and 2018, the Company incurred asset management fees of approximately $0.1 million, all of which have been or are expected to be settled in accordance with the terms of the Expense Support Agreement and as such asset management fees were reduced by approximately $0.1 million.