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® T.F.R. ENTERPRISES.INC AND SUBSIDIARIES ® NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE C—LINE OF CREDIT The Company had a 52,500.000 line of credit agreement with Frost Bank with a maturity on March I,2017 and interest at lenders prime rate plus 1.25 points.The terms provide for certain mutual covenants between the Company and Frost Bank. Minimum monthly payments are required in the amounts of all accrued interest. The line was secured by assets of the Company, stockholder and a related party. As of December • 31. 2016, the Company had fully drawn the line. The line of credit was extended through September 2017 in which time was not renewed and paid in full. The Company has a S1.000,000 line of credit agreement with Prosperity Bank with a maturity of September 23, 2019 and interest at the greater of 4.75 points prime rate plus .50 points. The terms provide for certain mutual covenants between the Company and Prosperity Bank. Minimum monthly payments are required in the amounts of all accrued interest. The line is secured by the assets of the Company. stockholder, and a related party. As of December 31, 2017, the outstanding balance was SO with 51.000.000 available to borrow. NOTE D—INTERCOMPANY TRANSACTIONS During the year ended December 31, 2017, the Company rented its administrative offices, equipment storage and maintenance facility from Realty and equipment used in the performance of its contracts from Equipment. Rents paid during the year to Realty were $318.850. Rents paid during the near to Equipment were 5448,485. Currently there are no signed leases with either subsidiary.Therefore, no future minimum • lease payments are required. ® During the year ended December 31, 2017, Realty loaned Enterprises S1,474,866. The loan has no stated interest nor any repayment terms. NOTE E—FAIR VALUE MEASUREMENT The generally accepted framework for measuring fair value provides a hierarchy for measuring both financial and nonfinancial assets and liabilities. The fair value of an asset is the price at which the asset could be sold in an orderly transaction between unrelated,knowledgeable,and willing parties able to engage in the transaction.A liability's fair value is defined as the amount that would be paid to transfer the liability to a new obligor in a transaction between such parties, not the amount that would be paid to settle the liability with the creditor. Level I Quoted prices in active markets for identical assets or liabilities. Level 2 Quoted prices in active markets for similar assets or liabilities.quoted prices in markets that are not active,or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the assets or liability that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table sets forth by level,within the fair value hierarchy.the Company's marketable securities at fair value as of December 31. 2017 and 2016. Gross Unrealized Cost Level I Level 2 Level 3 Gain(Loss) Investment in gold coins S 244,184 S - S - S 244,184 S (1.051,658) 13