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I CROWDERGULF, LLC NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016 1 3. NOTES RECEIVABLE I At December 31, 2017 and 2016, the Company had outstanding notes receivable due from subcontractors of $408,367 and $198,037, respectively. These notes bear interest ranging from 0% to 6% with principal maturities due through 2018. At December 31, 2017 and 2016, the Company had a note receivable from a��oje t M ag p Bent Firm of approximately $279,000. The note receivable is for funds provided on\ rofect mere the I Company is a subcontractor, to be used for payroll, equipment purchases supplies gar d-ft4el. There are no formal terms of repayment, but the Company anticipates the balanc to be collected in full. U 4. RESTRICTED CASH For the years ended December 31, 2017 and 2016, cash of $4.72 338 an $324,804, respectively, is restricted by the workers' compensation insurance—Eon p n for payments of workers' compensation insurance claims. 5. PROFIT SHARING PLAN The Company maintains a profit sharing plan covenng eertain qualified employees in accordance with the provisions of Section 401(k) of fie InternaI\Revenue Code. Under the plan, employees may elect to defer a portion of their salaty,�s itjet to I t/ernal Revenue Service limits. The Company may make a discretionary match and a1s a discretionary contribution. Contributions to the plan were approximately $71,000 and '.50000 .eears ended December 31, 2017 and 2016, respectively. I6. MEMBERS' CAPITAL In 2016, CrowderGul#,Ste-had\two classes of members' capital - Preferred and Common Interests. The reest had nho'voting rights and received an 8% annual return of the Preferred the Preferredmember's capita�ccoun. This preferred return was to be treated as a distributive share of profits. After the f8%I preferr\ed return, all distributions, profits and losses of the Company were allocated to Common\Interest members based on their respective percentage interests and capital accounts. Oplq_eom ion mom r bers shared in losses. Gulf Equipment Corporation owned 100% of the PFeferred Interests. In September 2016, Gulf Equipment Corporation's preferred interest was redeemed`foor $8,688,868. Co rnonlri)terests are divided into voting and non-voting classes. The voting interest represents I 2%of I Common Interests and is owned in equal amounts by the two previous individual members. The remaining 98% of Common Interests is non-voting and is owned in equal amounts by two limited liability entities at 21% each and in equal amounts by the two previous individual members at 28% each. These limited liability entities are ultimately owned by trusts established for the benefit of individuals related to the holders of voting Common Interests. I 10