| Summary of Management Fees, Incentive Fees and Associated Credits and Administration Fees |
The following table summarizes related-party fees paid or accrued for and reflected in our accompanying condensed consolidated financial statements (dollars in thousands):
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For the Three Months Ended September 30, |
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For the Nine Months Ended September 30, |
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2019 |
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2018 |
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2019 |
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2018 |
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Base management fee(1)(2)
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$ |
862 |
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$ |
690 |
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(3) |
$ |
2,741 |
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$ |
2,102 |
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(3) |
Capital gains fee(1)(2)
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— |
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778 |
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— |
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778 |
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Credits from non-contractual, unconditional, and irrevocable waiver granted by Adviser’s board of directors(2)
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— |
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(796 |
) |
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(1,542 |
) |
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(970 |
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Total fees to our Adviser, net |
$ |
862 |
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$ |
672 |
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$ |
1,199 |
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$ |
1,910 |
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Administration fee(1)(2)
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$ |
311 |
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$ |
387 |
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(4) |
$ |
866 |
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$ |
935 |
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(4) |
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Selling Commissions and Dealer-Manager Fees(1)(5)
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$ |
1,657 |
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$ |
890 |
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$ |
4,781 |
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$ |
940 |
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Financing fees(1)(6)
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160 |
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57 |
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188 |
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59 |
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Total fees to Gladstone Securities |
$ |
1,817 |
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$ |
947 |
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$ |
4,969 |
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$ |
999 |
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(1) |
Pursuant to the agreements with the respective related-party entities, as discussed above. |
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(2) |
Reflected as a line item on our accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. |
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(3) |
Includes the allocation of approximately $15,000 and $176,000 of the total accumulated costs incurred by our Adviser as a result of the crops harvested and sold on the farm operated by Land Advisers during the three and nine months ended September 30, 2018, respectively, as further described above under “TRS Expense Sharing Agreement.”
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(4) |
Includes the portion of administration fee that was allocated to Land Advisers (approximately $18,000 and $48,000 for the three and nine months ended September 30, 2018, respectively), as further described above under “TRS Administration Fee Allocation.”
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(5) |
Included within Additional paid-in capital on the accompanying Condensed Consolidated Balance Sheets. Through September 30, 2019, Gladstone Securities has remitted approximately 93.9% of these fees to unrelated third-parties involved in the offering (including participating broker-dealers and wholesalers).
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(6) |
Included within Notes and bonds payable, net on the Condensed Consolidated Balance Sheets and amortized into Interest expense on the Condensed Consolidated Statements of Operations and Comprehensive Income. Through September 30, 2019, the total amount of financing fees paid to Gladstone Securities represented approximately 0.14% of the total financings secured during since the Financing Arrangement Agreement has been in place.
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| Details of Amounts Due to Related Parties on Our Accompanying Condensed Consolidated Balance Sheets |
Amounts due to related parties on our accompanying Condensed Consolidated Balance Sheets as of September 30, 2019, and December 31, 2018, were as follows (dollars in thousands):
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September 30, 2019 |
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December 31, 2018 |
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Due from Gladstone Securities(1)
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$ |
38 |
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$ |
20 |
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Base management fee |
862 |
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736 |
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Capital gains fee(2)
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— |
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(150 |
) |
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Credits to fees(3)
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— |
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(44 |
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Other(4)
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21 |
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63 |
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Total due to Adviser |
883 |
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605 |
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Administration fee |
311 |
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340 |
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(5) |
Total due to Administrator |
311 |
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340 |
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Total due to related parties(6)
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$ |
1,194 |
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$ |
945 |
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(1) |
Other amounts due from Gladstone Securities generally represent costs for certain sales, promotional, or marketing services related to the offering of the Series B Preferred Stock paid for by us on behalf of Gladstone Securities. As of September 30, 2019 and December 31, 2018, such amounts are included within Other assets, net on our accompanying Condensed Consolidated Balance Sheets.
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(2) |
The credit to the capital gains fee as of December 31, 2018, was a result of capital losses recorded in connection with dispositions of certain real estate assets during year ended December 31, 2018, which resulted in a reduction of the capital gains fee accrued for earlier in fiscal year 2018.
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(3) |
The credits received from our Adviser during the three months ended September 30, 2019, and December 31, 2018, were granted as non-contractual, unconditional, and irrevocable waivers to be applied as credits against the base management fee.
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(4) |
Other amounts due to or from our Adviser primarily relate to miscellaneous general and administrative expenses either paid by our Adviser on our behalf or by us on our Adviser’s behalf. The balance owed to our Adviser as of December 31, 2018, includes premium payments for certain insurance policies made by our Adviser on our behalf.
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(5) |
Includes approximately $9,000 owed by Land Advisers to our Administrator as of December 31, 2018, in accordance with the TRS Administration Fee Allocation, as discussed above.
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(6) |
Reflected as a line item on our accompanying Condensed Consolidated Balance Sheets. |
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