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De La Hoz Builders, Inc.. <br />Notes to Financial Statements <br />Note 10: COLLABORATIVE ARRANGEMENT <br />The Company has a 60/40 SBA approved collaborative arrangement with another company. The <br />other company is responsible for assisting in putting together proposals, project management and <br />administrative services. The Company directs and supervises the activities of the other company as <br />well as performs overall management, project management and administration and the <br />construction. For the year ended December 31, 2020, $4,070,083 of the contract revenues, <br />$3,191,165 cost of revenues earned, and all the professional services expenses relate to this <br />collaborative arrangement with the other company. There was $4,890 in accounts payable to the <br />other company at December 31, 2020. <br />Note 11: SUBSEQUENT EVENT <br />On January 22, 2021, the Company signed a Paycheck Protection Program ("PPP") Promissory (Vote <br />with a bank in the amount of $110,128. The PPP is part of the U.S. federal government's CARES Act, <br />designed to assist small businesses in paying employee wages and other critical expenses. This note <br />is interest free for 10 months from the date of funding, followed by consecutive monthly payments <br />of principal and interest at 1% per annum, with the principal component of each such payment <br />based upon the level amortization of principal over a 5 year period from the date of the loan, and a <br />final payment equal to the balance of unpaid principal plus accrued and unpaid interest, due on the <br />date 60 months after the date of the loan. The loan provides for forgiveness if the proceeds are <br />used for payroll, utilities, rent and lease payme:its over the 8 week period after the date of the loan, <br />with a limit of 25% for use on non -payroll expenses. The Company anticipates that the vast majority <br />of the loan will be forgiven. <br />-12- <br />