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De La Hoz Builders, Inc. Notes to Financial Statements Note 6: LONG-TERM DEBT (Continued) Year Ending December 31, 2021 $ 43,990 2022 10,153 2023 2,854 Total $ 56,997 The net book value of the two vehicles pledged for the loans is $14,655, which are included in machinery and equipment. Note 7: CONTINGENCIES The Company is contingently Liable to a surety company under a general indemnity agreement. The Company agrees to indemnify the surety for any payments made on contracts of suretyship, guaranty or indemnity. The Company believes that all contingent liabilities will be satisfied by their performance on the specific bonded contracts. In March 2020, the World Health Organization made the assessment that the outbreak of a navel coronavirus (COVID-19) can be characterized as a pandemic which has continued into the next fiscal year. As a result, uncertainties have arisen that may have a significant negative impact on the operating activities and results of the Organization. The occurrence and extent of such an impact will depend on future developments, including: (i) the duration and spread of the virus, (ii) government quarantine measures, (iii) voluntary and precautionary restrictions on travel or meetings, (iv) the effects on the financial markets, and (v) the effects on the economy overall, all of which are uncertain. Note 8: BACKLOG Backlog represents the amount of revenue the Company expects to realize from uncompleted contracts in progress at yearend in addition to signed purchase orders for future work. Backlog for the Company was approximately $1,355,898 at December 31, 2020. Note 9: RELATED PARTY During 2018, the Company entered into a related party note with the shareholders. There is no stated interest rate and it is payable upon demand, and due in full lune 2022. (See Note 7) -11-