Commitments and Contingencies Lector85 Investment On August 15, 2019, we entered into an agreement to make a preferred equity investment of up to $9.9 million in Lector85, a multifamily community in Ybor City, Florida (the Lector85 Investment). In connection with our investment we entered a joint venture agreement with Milhaus, LLC (Milhaus), the sponsor of the development. Milhaus intends to use the Lector85 Investment, along with a $34.0 million construction loan and equity of $9.3 million to fund the total development costs of $53.3 million for a 4-story, 254 -unit urban-style apartment community that will include over 11,000 square feet of retail. The Lector85 Investment is expected to be drawn upon in stages as needed throughout the construction of the Project. As of September 30, 2019, Milhaus had not drawn on the Lector85 Investment. Pursuant to the terms of the joint venture agreement, the Lector85 Investment has an annual preferred return of 13% that will be reduced to 10% annually upon the later to occur of (i) the stabilization of the development project, or (ii) the one-year anniversary of the receipt of all temporary certificate of occupancies for the development project, subject to certain financial covenants being satisfied. The investment has a special preferred return of $200,000 to be paid upon redemption and provides a minimum cumulative return upon redemption, sale or similar transaction of 35% . Subject to one twelve -month extension option, the redemption date is no earlier than two years after the receipt of all temporary certificate of occupancies for the development project (the Redemption Lockout Date) but no later than the earlier of (i) the payment in full of the construction loan, if the loan is repaid after the Redemption Lockout Date, or (ii) the construction loan maturity date, if the loan is not refinanced prior to the Redemption Lockout Date. Litigation As of September 30, 2019, we were not subject to any material litigation nor were we aware of any material litigation threatened against us. Distribution Reinvestment Plan We have adopted a distribution reinvestment plan whereby stockholders may elect to have us apply their dividends and other distributions to the purchase of additional shares of common stock. Participants in the plan will acquire common stock at the per share price effective on the date of purchase (initially $10.00 ). Share Repurchase Program We have a share repurchase program whereby, on a quarterly basis, stockholders may request that we repurchase all or any portion of their shares. We may choose to repurchase all, some or none of the shares that have been requested to be repurchased at our discretion, subject to limitations in the share repurchase plan. The total amount of aggregate repurchases shares will be limited to 5% of the weighted average number of shares of common stock outstanding during the prior calendar year. In addition, during any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year. Except for Exceptional Repurchases (as defined in the share repurchase program), the repurchase price is subject to the following discounts, depending on how long a redeeming stockholder has held each share: Share Purchase Anniversary Repurchase Price as a Percentage of Estimated Value (1) Less than 1 year No repurchase allowed 1 year - 2 years 85 % 3 years - 4 years 90 % 5 years and thereafter 95 % A stockholders death or complete disability, less than 2 years 95 % A stockholders death or complete disability, 2 years or more 100 % (1) For the purposes of the share repurchase program, the estimated value per share will initially be equal to the purchase price per share at which the original purchaser or purchasers of the shares bought its shares from us, and the purchase price per share will be adjusted to reflect any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares outstanding. We plan to establish an estimated net asset value (NAV) per share of its common stock based on valuations of its assets and liabilities no later than May 17, 2021 and annually thereafter. Upon our establishment of an estimated NAV per share, the estimated NAV per share will be the estimated value per share pursuant to the share repurchase program. No shares were redeemed during the three and nine months ended September 30, 2019 and 2018. Our board of directors may, in its sole discretion, amend, suspend or terminate our share repurchase program for any reason upon 15 days notice to our stockholders.