Note 6 – Related Party Transactions

Management Agreement

Upon completion of the Company’s initial public offering on July 1, 2016, the Company and the Advisor entered into an amended and restated management agreement (the “Management Agreement”). Certain material terms of the Management Agreement are summarized in the section titled “Business — Our Advisor and our Management Agreement,” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 9, 2020. As discussed in Note 11-”Subsequent Events,” on July 9, 2020 , the Company completed a management internalization transaction (the “Internalization”) by acquiring all the outstanding shares of capital stock of the parent company of our Advisor for a purchase price of $17.6 million, after working capital adjustments.

Management Fees and Accrued Management Fees

The Company’s management fee to the Advisor is calculated in accordance with the terms of the Management Agreement which requires an annual base management fee equal to 1.5% of our stockholders’ equity (as defined in the Management Agreement). For the three and six months ended June 30, 2020, management fees of $2,021 and $4,024, respectively, were incurred and expensed by the Company. For the three and six months ended June 30, 2019, management fees of $1,584 and $2,918, respectively, were incurred and expensed by the Company. Accrued management fees due to the Advisor were $2,021 and $1,727 as of June 30, 2020 and December 31, 2019, respectively. No incentive management fee was incurred by the Company during the three and six months ended June 30, 2020 or 2019.

Related Party Balances

A rollforward of the due from related parties and due to related party balance, net, as of June 30, 2020 is as follows:

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