# BLACKSTONE SECURITIES PARTNERS L.P. X-17A-5 (2025-02-28) — Broker-dealer annual report - Company: BLACKSTONE SECURITIES PARTNERS L.P. - Form: X-17A-5 - Filed: 2025-02-28 - Period: 2024-12-31 - Accession: 0000792326-25-000003 - CIK: 792326 - File #: 8-35941 - Type: Broker-dealer - Material weakness: No - Auditor: Deloitte & Touche LLP - Auditor location: New York, NY - Contact: David Payne - Phone: 212-390-2806 - Email: david.payne@blackstone.com - Website: blackstone.com - Signed by: David Payne (Chief Financial Officier) Original filing: https://www.sec.gov/Archives/edgar/data/792326/000079232625000003/2024BSPLPFSPublic.pdf --- {0}------------------------------------------------ ## BLACKSTONE SECURITIES PARTNERS L.P. AND SUBSIDIARIES (SEC I.D. No. 8Ͳ35941) ## CONSOLIDATED STATEMENT OF FINANCIAL CONDITION AS OF DECEMBER 31, 2024 AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM \* \* \* \* \* \* \* Filed pursuant to Rule 17aͲ5(e)(3) Under the Securities Exchange Act of 1934 As a Public Document {1}------------------------------------------------ ### **UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549** OMB Number: 3235Ͳ0123 Expires:EŽǀ. 3Ϭ, 202ϲ Estimated average burden hours per response:12 OMB APPROVAL # **ANNUAL REPORTS FORM XͲ17AͲ5 PART III** SEC FILE NUMBER 8-34951 **FACING PAGE** **Information Required Pursuant to Rules 17aͲ5, 17aͲ12, and 18aͲ7 under the Securities Exchange Act of 1934** FILING FOR THE PERIOD BEGINNING AND ENDING MM/DD/YY MM/DD/YY 01/01/202 12/31/202 #### **A. REGISTRANT IDENTIFICATION** NAME OF FIRM: Blackstone Securities Partners L.P. TYPE OF REGISTRANT (check all applicable boxes): ܆ BrokerͲdealer ܆SecurityͲbased swap dealer ܆Major securityͲbased swap participant ܆ Check here if respondent is also an OTC derivatives dealer ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | 345 Park Avenue | | | | |--------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------|--------------------------------------------| | | (No. and Street) | | | | New York | New York | | 10154 | | (City) | (State) | | (Zip Code) | | PERSON
TO
CONTACT
WITH | REGARD
TO
THIS
FILING | | | | David Payne | 212-390-2806 | David.Payne@Blackstone.com | | | (Name) | (Area Code – Telephone Number) | (Email Address) | | | | B. ACCOUNTANT
IDENTIFICATION | | | | Deloitte & Touche LLP | (Name – if individual, state last, first, and middle name) | | | | 30 Rockefeller Plaza | New York | New York | 10112-0015 | | (Address) | (City) | (State) | (Zip Code) | | 10/20/2003 | | 34 | | | (Date of Registration with PCAOB)(if applicable) | | | (PCAOB Registration Number, if applicable) | | | FOR
OFFICIAL
USE
ONLY | | | | CFR 240.17aͲ5(e)(1)(ii), if applicable. | * Claims for exemption from the requirement that the annual reports be covered by the reports of an independent public
accountant must be supported by a statement of facts and circumstances relied on as the basis of the exemption.See 17 | | | **Persons who are to respond to the collection of information contained in thisform are notrequired to respond unlessthe form displays a currently valid OMB control number.** {2}------------------------------------------------ | David Payne | , swear (or affirm) that, to the best of my knowledge and belief, the | | |---------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------|-------| | | financial report pertaining to the firm of Blackstone Securities Partners L.P. | as of | | December 31 | , 2 024 , is true and correct. I further swear (or affirm) that neither the company nor any | | | and and and the program and the comments of the comments of the comments of the comments of | | | - - - - - - - - - - - - - - - - - - - - - - - - - - {3}------------------------------------------------ ## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Management, General Partner, and Limited Partner of Blackstone Securities Partners L.P. ## Opinion on the Financial Statement We have audited the accompanying consolidated statement of financial condition of Blackstone Securities Partners L.P and subsidiaries (the "Partnership") as of December 31, 2024, and the related notes (collectively referred to as the "financial statement"). In our opinion, the financial statement presents fairly, in all material respects, the financial position of the Partnership as of December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. ## Basis for Opinion The financial statement is the responsibility of the Partnership's management. Our responsibility is to express an opinion on this financial statement based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statement. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statement. We believe that our audit of the financial statement provides a reasonable basis for our opinion. February 28, 2025 We have served as the Partnership's auditor since 1989. {4}------------------------------------------------ #### **CONSOLIDATED STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2024** *(Dollars in Thousands)* ### ASSETS | Cash
and
cash
equivalents | \$
132,474 | |--------------------------------------------------------------|-----------------| | Accounts
receivable | 10,662 | | Due
from
affiliates | 2,785,997 | | Other
assets | 49,179 | | TOTAL
ASSETS | \$2,978,312 | | | | | LIABILITIES
AND
PARTNERS'
CAPITAL | | | LIABILITIES | | | Due
to
affiliates | \$1,497,837 | | Due
to
limited
partners | 21,116 | | Accrued
compensation
and
benefits |
22,358 | | Accounts
payable,
accrued
expenses
and
other |
145,747 | | Total
liabilities | 1,687,058 | | PARTNERS'
CAPITAL | | | General
Partner | 2,948 | | Limited
Partner | 1,286,783 | | NonͲcontrolling
interests
in
consolidated
entity |
1,523 | | Total
partners'
capital |
1,291,254 | | TOTAL
LIABILITIES
AND
PARTNERS'
CAPITAL | \$
2,978,312 | |

| | See notes to the consolidated financial statements {5}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* #### **1. ORGANIZATION AND NATURE OF OPERATIONS** Blackstone Securities Partners L.P. ("BSP" or the "Partnership"), a Delaware limited partnership, was formed on September 27, 1988 for the purpose of engaging in the investment banking advisory business specializing in financial and strategic advisory services, restructuring and reorganization advisory services, and underwriting activities, including underwriting on debt offerings, initial public offerings and secondary equity offerings. The term of the Partnership shall continue until December 31, 2038 unless earlier dissolved and terminated in accordance with the amended and restated agreement of Limited Partnership dated November 30, 1988 (the "Partnership Agreement"). BSP is a registered broker dealer and issubject to certain regulations of the United States Securities and Exchange Commission ("SEC") and the Financial Industry Regulatory Authority, Inc. ("FINRA"). Blackstone Group Holdings L.P. ("BGH"), a holding partnership established for certain entities of Blackstone Inc. and its subsidiaries ("Blackstone") engaged in the financial services business, is the 99.9% limited partner of BSP. The Partnership is treated as a partnership for US federal income tax purposes. Blackstone Advisory Services L.L.C. ("BAS LLC") is the 0.1% general partner of BSP. Both entities are whollyͲowned subsidiaries of Blackstone Holdings I L.P., which is a subsidiary of Blackstone. BSP is the sole member of Blackstone Intermediary Holdco L.L.C. ("Holdco"), a holding company established for certain Blackstone entities engaged in the financial services business. Holdco holds the rights, titles, and interests in certain affiliated registered investment advisors and general partner entities, which provide investment management services to limited partners for private equity funds, real estate funds, funds of hedge funds and creditͲoriented funds. #### **2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### *Basis of Presentation* The accompanying consolidated financial statements of BSP have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). #### *Use of Estimates* The preparation of the Partnership's consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Management believes that estimates utilized in the preparation of the consolidated financial statements are prudent and reasonable. Actual results could differ materially from the estimates included in the consolidated financial statements. #### *Consolidation* The Partnership consolidates all entities it controls through a majority voting interest. The consolidated financial statements of the Partnership include Holdco and its subsidiaries. All intercompany transactions and balances are eliminated in consolidation. As of January 1, 2024, the Partnership consolidated certain affiliated advisors (Blackstone Credit Systematic Strategies LLC, Blackstone Strategic Capital Advisors L.L.C., Blackstone Property Advisors L.P. and Blackstone Alternative Investment Advisors LLC) and their subsidiaries moving from affiliates of the Partnership to subsidiaries. #### *Segment Reporting* The Partnership operates in a single operating and reportable segment which is consistent with how the Chief Financial Officer, who is the chief operating decision maker ("CODM"), reviews the business's financial performance. The CODM {6}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* allocates resources and makes operating decisions primarily based on the Partnership's net income and the significant expenses regularly provided to the CODM are those presented on the Consolidated Statement of Income. ### *Affiliates* The Partnership considers Blackstone and its Founder, senior managing directors, employees, the Blackstone Funds and the Portfolio Companies to be affiliates. Blackstone Funds refer to the funds and other vehicles that are managed by Blackstone. Portfolio Companies refer to the Blackstone Funds' investments, including majorityͲowned and controlled investments. ### *Cash and Cash Equivalents* The Partnership has defined Cash and cash equivalents as cash, including demand funds and money market funds, and shortͲ term, highly liquid investments with original maturities of three months or less. At times, cash and cash equivalents may exceed U.S. federally insured limits for individual accounts and expose the Company to credit risk.The Partnership believes the risk of loss is not significant. Cash equivalents are primarily classified as Level I as they are valued using quoted prices that are available in active markets for identical financial instruments as of the reporting date. #### *Accounts Receivable and Due from Affiliates* Accounts Receivable and Due from Affiliatesis comprised of management and incentive feesreceivable from limited partners, receivables from managed investment vehicles and portfolio companies, and placement and advisory fees receivables. Accounts Receivable are assessed periodically for collectability. As of January 1, 2024, the opening balance for Accounts receivable was \$22.1M, inclusive of \$0.5M relating to consolidation of affiliated advisors, effective January 1, 2024. ### *Foreign Currency* The Partnership's balances that are denominated in foreign currencies are translated into U.S. Dollars at the exchange rate prevailing at the reporting date. #### *Revenue Recognition* Revenues primarily consist of Management and advisory fees, Incentive fees and Other income. *Management and advisory fees, net* – Accrued but unpaid Management and advisory fees, net of management fee reductions and management fee offsets, as of the reporting date, are included in Accounts receivable or Due from affiliates in the Consolidated Statement of Financial Condition. *Incentive fees –*Accrued but unpaid Incentive fees charged directly to investors in Blackstone Funds as of the reporting date and are recorded within Due from affiliates in the Consolidated Statement of Financial Condition. *Due to limited partners* – Amounts due to limited partners represent fee reductions to be provided to limited partners on future management fee invoices. Generally, any amounts still remaining when the fund terminates will be payable to the limited partners. #### *Compensation and Benefits* Cash settled equityͲbased awards and awards settled in a variable number of shares are classified as liabilities and are remeasured at the end of each reporting period. #### *NonͲControlling Interests in Consolidated Entity* NonͲcontrolling interests in consolidated entity represent the component of partners' capital in a consolidated entity held by nonͲconsolidated entities. As of December 31, 2024, Blackstone Holdings II L.P. and Stoneco IV Corporation, affiliated nonͲ consolidated entities, held a 1.499% interest in Blackstone Alternative Asset Management L.P., a consolidated entity. {7}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* #### *Income Taxes* The Partnership is not subject to federal, state, or local income tax, other than unincorporated business tax. The individual partners are responsible for such taxes based on their allocable share of the Partnership's taxable income. Income taxes are provided for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax bases of assets and liabilities, resulting in all pretax amounts being appropriately tax effected in the period, irrespective of which tax return year items will be reflected. Deferred income taxes reflect the net tax effects of temporary differences between the financial reporting and tax bases of assets and liabilities. These temporary differences result in taxable or deductible amounts in future years and are measured using the tax rates and laws that will be in effect when such differences are expected to reverse. Valuation allowances are established to reduce the deferred tax assets to the amount that is more likely than not to be realized. Deferred tax assets are separately stated, and deferred tax liabilities are included in Accounts payable, accrued expenses, and other liabilities in the consolidated financial statements. The Partnership recognizes tax positions in the consolidated financial statements when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement. A liability is established for differences between positions taken in the return and amounts recognized in the consolidated financial statements. #### *Leases* The Partnership determines if an arrangement is a lease at inception of the arrangement. The Partnership primarily enters into operating leases, as the lessee, for office space. RightͲofͲUse ("ROU") assets and operating lease liabilities are included in Other Assets and Accounts payable, accrued expenses and other, respectively, on the Consolidated Statement of Financial Condition. ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The Partnership determines the present value of the lease payments using an incremental borrowing rate based on information available at the inception date. Leases may include options to extend or terminate the lease which are included in the ROU assets and operating lease liability when they are reasonably certain of exercise. Minimum lease payments for leases with an initial term of twelve months or less are not recorded on the Consolidated Statement of Financial Condition. #### **3. RELATED PARTY TRANSACTIONS** Blackstone Administrative Services Partnership L.P. ("BASP"), an affiliate of the Partnership, provides the Partnership and its affiliates with various office facilities, administrative and operational support services at cost ("Indirect Expenses"). Additionally, BASP pays, on behalf of the Partnership, expenses that can be attributed specifically to the Partnership ("Direct Expenses").The Partnership reimburses BASP for its share of all Direct and Indirect Expense amounts paid on its behalf. Blackstone Holdings Finance Co, L.L.C. ("FinCo"), an affiliate of the Partnership, provides cash managementservicesto Holdco and its subsidiaries. This arrangement generates amounts due to Holdco from FinCo, which are reflected in Due from affiliates. FinCo also makes certain payments on behalf of the Partnership which are reflected in Due to affiliates. The Partnership settles Due from and Due to affiliates balances periodically. Certain fees earned by Holdco are received from Blackstone Funds and Portfolio Companies, which are reflected in Due from Affiliates. There are certain reimbursements to Blackstone Funds for placement fees and other fees and expenses that are reflected in Due to Affiliates. Certain expenses charged to Holdco are allocated to other entities which are not consolidated under the Partnership. These allocations are reflected in Due from Affiliates. {8}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* #### *Receivables and Payables* Amounts due to and from affiliates consist of receivables and payables transacted in the ordinary course of business as described above. As of December 31, 2024, the amounts due to and from affiliates are as follows: | Due from Affiliates | | |---------------------------------------------------|-----------------| | Due from Portfolio Companies and Blackstone Funds | \$
1,984,284 | | Due from FinCo | 635,850 | | Due from NonͲConsolidated Entities |
158,416 | | Due from BASP | 7,447 | | | \$2,785,997 | | | | | Due to BASP | \$926,752 | | Due to FinCo | 257,392 | | Due to NonͲConsolidated Entities |
241,899 | | Due to Portfolio Companies and Blackstone Funds |
71,794 | | | \$1,497,837 | #### **4. INCOME TAXES** The Partnership became a regarded entity for U.S. federal income tax and as such, subject to unincorporated business tax beginning in 2023.Prior to 2023, as the Partnership was disregarded from its parent company, it was not a taxpaying entity in any jurisdiction. The Partnership has recorded an unrecognized tax benefit of \$0.5 million and accrued interest expense of \$1.1 million at December 31, 2024. No penalties relating to unrecognized tax benefits have been recognized for the year ended December 31, 2024. The Partnership believes the liability established for unrecognized tax benefits is adequate in relation to the potential for additional assessments. It is reasonably possible that changes in the balance of unrecognized tax benefits may occur within the next 12 months; however, it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax benefits and the impact on the Partnership's effective tax rate over the next 12 months. The Partnership files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Partnership is generally subject to examination by federal and NYC tax authorities. As of December 31, 2024, the major jurisdictions and earliest tax years that remain subject to examinations are 2021 for U.S. Federal and 2009 for New York City. #### **5. CONCENTRATION OF CREDIT RISK** The Partnership is subject to concentrations of credit risk with respect to its accounts receivable. There is no material specific concentration as of December 31, 2024. #### **6. PARTNERS' CAPITAL** During the year ended December 31, 2024, the Partnership distributed partners' capital to Blackstone in the amount of \$2,807.2 million. {9}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* #### **7. NET CAPITAL REQUIREMENTS** As a registered brokerͲdealer, the Partnership files an unconsolidated FOCUS Report and is subject to the SEC Uniform Net Capital Rule (Rule 15c3Ͳ1) under the Securities Exchange Act of 1934. Rule 15c3Ͳ1 requires the maintenance of minimum net capital, as defined, which shall be the greater of \$0.1 million or 6а% of aggregate indebtedness, as deĮned, and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. At December 31, 2024, the Partnership's ratio of aggregate indebtedness to net capital was 0.041 to 1 and its net capital of \$113.3 million was \$113.0 million in excess of the minimum regulatory requirement. The Partnership does not carry customer accounts and does not otherwise hold funds or securities for, or owe money or securities to, customers and accordingly is exempt from the Customer Protection Rule (Rule 15c3Ͳ3). #### **8. DEFINED CONTRIBUTION PLAN** Blackstone provides a 401(k) plan (the "Plan") to eligible employeesin the United States. Some 401(k) participants, as defined by the Plan, may receive an employer match as pretax annual compensation up to a maximum of \$5 thousand per calendar year. The Blackstone Group 401(k) Administrative Committee is the administrator of the Plan and Fidelity is the Trustee for the Plan. #### **9. COMMITMENTS AND CONTINGENCIES** #### *Litigation* The Partnership may from time to time be involved in litigation and claims incidental to the conduct of its business. The Partnership's businesses are also subject to extensive regulation, which may result in regulatory proceedings against the Partnership. The Partnership accrues a liability for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. Although there can be no assurance of the outcome of such legal actions, based on information known by management, Blackstone does not have any unaccrued liability related to any current legal proceeding or claim that would individually or in the aggregate materially affect its results of operations, financial position or cash flows. In December 2017, eight pension plan members of the Kentucky Retirement System ("KRS") filed a derivative lawsuit on behalf of KRS in Franklin County Circuit Court in Kentucky (the "Mayberry Action"). Plaintiffs alleged breaches of fiduciary duty and other violations of Kentucky law in connection with KRS'sinvestment in three hedge funds of funds, including a fund managed by Blackstone Alternative Asset Management L.P. ("BLP"). The suit named more than 30 defendants, including, among others, The Blackstone Group L.P. (now Blackstone Inc.); BLP; Stephen A. Schwarzman, as Chairman and CEO of Blackstone; and J. Tomilson Hill, as thenͲCEO of BLP (collectively, the "Blackstone Defendants"). In July 2020, the Kentucky Supreme Court directed the Circuit Court to dismiss the action for lack of standing. In July 2020, the Kentucky Attorney General (the "AG") filed its own action asserting substantially identical claims against largely the same defendants {the "July 2020 Action"). In May 2024, the Court denied the Blackstone Defendants' and most other defendants' motions to dismiss the July 2020 Action. Defendants again moved to dismiss in June 2024 after the AG amended its complaint and added breach of contract claims against the fund manager defendants. Those motions are pending. In August 2022, KRS was ordered to disclose a 2021 report it commissioned to investigate the investment activities underlying the lawsuit. The report "did not find any violations of fiduciary duty or illegal activity by (BLP)," and quotes communications by KRS staff during the period of the investment recognizing that BLP was exceeding KRS's returns benchmark, providing KRS with "far fewer negative months than any liquid market comparable," and that BLP "(h)as killed it." {10}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* In January 2021, certain former plaintiffs in the Mayberry Action filed a separate action ("Taylor I") against the Blackstone Defendants and other defendants in the Mayberry Action, asserting substantially similar allegations as the AG's July 2020 action did, butstyled as a direct class action. Taylor I wasremoved to the U.S. District Court forthe Eastern District of Kentucky and stayed pending the outcome of the AG's July 2020 action. In August 2021, a group of KRS membersͲincluding those that filed Taylor IͲfiled an action in Franklin County Circuit Court ("Taylor II") substantially similar to Taylor I, against the Blackstone Defendants, other defendants named in the Mayberry Action, and other KRS officials. The Court denied most defendants' motions to dismiss this action in May 2024. Defendants subsequently filed appeals, including a crossͲappeal by the Blackstone Defendants, which is currently pending. Additionally, the Blackstone Defendants and the other fund manager defendants filed a petition for a writ of prohibition. On November 12, 2024, the Kentucky Court of Appeals denied defendants' writ of prohibition, and defendants subsequently appealed to the Kentucky Supreme Court. Taylor II is stayed pending review of these appeals and crossͲappeals. In April 2021, the AG filed an action (the "Declaratory Judgment Action") against BLP and the other fund manager defendants from the Mayberry Action in Franklin County Circuit Court, seeking a declaration that certain provisions in the subscription agreements with KRS violate the Kentucky Constitution. In August 2024, the Kentucky Supreme Court granted BLP's motion for discretionary review of the Circuit Court's grant of summary judgment to the AG. The appeal is pending. In July 2021, BLP filed a breachͲofͲcontract action against defendants affiliated with KRS, alleging that the Mayberry Action and the Declaratory Judgment Action breach the parties' subscription agreements and seeking damages. In February 2024, the Kentucky Supreme Court granted BLP's motion for discretionary review of the Circuit Court's dismissal on ripeness grounds. The appeal is fully briefed and pending. On January 3, 2025, Blackstone and several other defendants entered into a settlement agreement with KRS and the Commonwealth of Kentucky to, subject to approval by the Franklin County Circuit Court and certain requirements, resolve all claims against these defendants in the AG's actions, resolve BLP's breachͲofͲcontract claims, and bar all claims against the Blackstone Defendantsin Taylor I and Taylor II without any admission of wrongdoing. The settlement includes an \$82.5 million cash settlement divided among several defendants, of which Blackstone's portion is expected to be covered by insurance. On January 8, 2025, the settling parties moved for court approval of the settlement. Taylor II plaintiffs objected and requested, in part, that the court refer their matter to mediation. On February 14, 2025, the court ordered the Taylor II partiesto conduct a mediation by March 14, 2025 and scheduled an approval hearing for the defendants' settlement with KRS and the Commonwealth to follow on March 26, 2025. Our financial results for the year ended December 31, 2024 include an accrual for the estimated liability related to this matter. In October 2022, as part of a sweep of private equity and other investment advisory firms, the SEC sent us a request for information relating to the retention of certain types of electronic business communications, including text messages, that may be required to be preserved under certain SEC rules. In January 2025, we entered into a settlement agreement with the SEC to resolve this matter and accrued a civil monetary penalty of \$8 million. #### *Indemnification* In the normal course of business, the Partnership enters into contracts that contain a variety of indemnifications. The Partnership's maximum exposure under these arrangements is not known. However, the Partnership has not previously incurred material losses pursuant to these contracts and expects the risk of any material loss to be remote. {11}------------------------------------------------ ## **NOTES TO CONSOLIDATED FINANCIAL STATEMENTSͲCONTINUED AS OF THE YEAR ENDED DECEMBER 31, 2024** *(Dollars in Thousands, Except Unit and Per Unit Data, and Except Where Noted)* #### **10. SUBSEQUENT EVENTS** The Partnership has evaluated the impact of all subsequent events from December 31, 2024, through February 28, 2025, the date the consolidated financial statements were issued, and has determined there were no subsequent events requiring recognition or disclosure in the consolidated financial statements, except as noted in Note 9. \* \* \* \* \* \* \* Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.