# SKYSTONE SECURITIES, LLC X-17A-5 (2021-02-22) — Broker-dealer annual report - Company: SKYSTONE SECURITIES, LLC - Form: X-17A-5 - Filed: 2021-02-22 - Period: 2020-12-31 - Accession: 0001292134-21-000001 - CIK: 1292134 - File #: 8-66529 - Material weakness: No - Auditor: Turner, Stone & Company, L.L.P. - Auditor location: Dallas, TX - Contact: Rosser Newton - Phone: 214-661-7761 - Signed by: Rosser Newton (Managing Member) Original filing: https://www.sec.gov/Archives/edgar/data/1292134/000129213421000001/2020auditreportskystone-.pdf --- {0}------------------------------------------------ UNITEDSTATES **SECURITIESANDEXCHANGECOMMISSION Washington, D.C. 20549** OMB APPROVAL OMB Number: 3235-0123 Expires: October 31, 2023 Estimated average burden # hours per response 12.00 **ANNUAL AUDITED REPORT FORM X-17A-5 PART III** | SEC RLE NUMBER | |----------------| | s-66529 | **FACING PAGE of Brokers and Dealers Pursuant to Section 17 of the Information Required** | Securities | and
Act
of
1934
Exchange | Thereunder
17a-5
Rule | | | | |------------------------------------------------------------|-----------------------------------------------------------|-----------------------------|------------------------------------|--|--| | FOR THE PERIOD BEGINNING
REPORT | 01/01/2020
AND ENDING
MM/DD/YY | | 12/31/2020 | | | | | | | MM/DD/YY | | | | A. | IDENTIFICATION
REGISTRANT | | | | | | Securities,
LLC
BROKER-DEALER:Skystone
OF
NAME | | | OFFICIAL USE ONLY | | | | PLACE OF
ADDRESS
OF PRINCIPAL | not use P.O.
BUSINESS:
(Do | Box No.) | FIRM I.D.
NO. | | | | Street,
3710
Rawlings | 1000
Suite | | | | | | | (No and Street) | | | | | | Dallas | TX | | 75219 | | | | (City ) | (State) | | (Zip Code) | | | | NAME
AND TELEPHONE
NUMBER OF
Rosser Newton | PERSON TO
CONTACT | IN REGARD
TO THIS | REPORT
214-661-7761 | | | | | | | ( Area Code -
Telephone Number) | | | | B.
AC | COUNTANT
IDENTIFICATION | | | | | | INDEPENDENT | | | | | | | PUBLIC ACCOUNTANT
Turner,
Stone
&
Company, | whose opinion
is contained
L.L.P. | in this
Report* | | | | | | (Name -if
individual, state last, first, middle name ) | | | | | | Parkm
12700
Central
Dr.,
STE | Dallas
1400 | TX | 75251 | | | | (Address) | (City) | (State) | (Zip Code) | | | | CHECK
ONE: | | | | | | | /
Certified
Public
Accountant | | | | | | | Public
Accountant | | | | | | | Accountant
not resident | in United States
its possessions.
or
any of | | | | | | | FOR
OFFICIAL
USE | ONLY | | | | | | | | | | | | | | | | | | | | | | | | | *'Claims for exemption from the requirement that the annual report be covered by the opinion of an independent public accountant must be supported by a statement offacts and circumstances relied on as the basis for the exemption. See Section 240.17a-5(e)(2)* **Potential persons who are to respond to the collection of information contained in this form are not required torespond** SEC **unlesstheform displays a currently valid** OMB **control number.** 1410 (11-05) {1}------------------------------------------------ #### **OATH OR AFFIRMATION** | Rosser Newton
I, | , swear (or affirm) that, to the best of | |-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Skystone Securities, LLC | my knowledge and belief the accompanying financial statement and supporting schedules pertaining to the firm of
, as | | 0f December 31 | 0
20^
, are true and correct. I further swear (or affirm) that
^ | | classified solely as that of a customer, except as follows: | neither the company nor any partner, proprietor,principal officer or director has any proprietary interest in any account | | ELVIA JAIMES
V
A
Notary ID #10060051
-/ My Commission Expires
August 21, 2023
V/ | Signature
Managing Member
Title | | ry Public | | | contains (check all applicable boxes):
This report **
ZJ
(a) Facing Page.
7]
(b) Statement of Financial Condition.
/]
7]
(d) Statement of Changes in Financial Condition.
y
(O Statement of Changes in Liabilities Subordinated to Claims of Creditors.
(g) Computation of Net Capital.
7]
(i)
7]
(j)
consolidation.
(1)
An Oath or Affirmation.
(m) A copy of the SIPC Supplemental Report. | (c ) Statement of Income (Loss) or,if there is other comprehensive income in the period(s ) presented, a Statement
of Comprehensive Income (as defined in §210.1-02 of Regulation S-X).
_ (e) Statement of Changes in Stockholders' Equity or Partners' or Sole Proprietors' Capital.
(h) Computation for Determination of Reserve Requirements Pursuant to Rule I5c3-3.
Information Relating to the Possession or Control Requirements Under Rule 15c3-3.
A Reconciliation,including appropriate explanation ofthe Computation ofNet Capital Under Rule 15c3-l and the
Computation for Determination of the Reserve Requirements Under Exhibit A of Rule 15c3-3.
(k) A Reconciliation between the audited and unaudited Statements of Financial Condition with respect to methods of
(n) A report describing any material inadequacies found to exist or found to have existed since the date ofthe previous audit. | | For conditions of
confidential
treatment of
** | thisfiling, see section 240. / 7a-5(e)(3 ).
certain portions of | | | | | | | {2}------------------------------------------------ **Skystone Securities, LLC** **Financial Statements** **and** **Report of Independent Registered Public Accounting Firm** **For the Year Ended December 31, 2020** {3}------------------------------------------------ ## **TABLE OF CONTENTS** | 1 -2
OF
INDEPENDENT
REPORT
REGISTERED
PUBLIC
ACCOUNTING
FIRM | |-----------------------------------------------------------------------------------| | STATEMENT
OF
FINANCIAL
CONDITION
3 | | MEMBER'S
4
STATEMENT
OF
OPERATIONS
AND
CAPITAL | | STATEMENT
OF
CASH
FLOWS
5 | | TO
STATEMENTS
NOTES
FINANCIAL
6-9 | | SCHEDULE
10
I | | 1 1
REPORT
OF
INDEPENDENT
REGISTERED
PUBLIC
ACCOUNTING
FIRM | | EXEMPTION
REPORT
12 | {4}------------------------------------------------ *Your Vision Our Focus* ![](_page_4_Picture_1.jpeg) ## Report of Independent Registered Public Accounting Firm To the Member of Skystone Securities, LLC ## Opinion on the Financial Statements We have audited the accompanying statement of financial condition of Skystone Securities, LLC (the "Company") as of December 31, 2020 and the related statements of operations and member's capital and cash flows for the year then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. ## Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements 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 Company 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 statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. 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 statements. We believe that our audit provides a reasonable basis for our opinion. Turner, Stone & Company, L.L.P. Accountants and Consultants 12700 Park Central Drive, Suite 1400 Dallas,Texas 75251 **Telephone:** 972-239-1660/Facsimile: 972-239-1665 Toll Free: 877-853-4195 Web site: turnerstone.com ![](_page_4_Picture_12.jpeg) {5}------------------------------------------------ #### Opinion on Supplemental Information The supplementary information contained in Supplemental Schedule I (Schedules II, III and IV are not applicable) required by Rule 17a-5 under the Securities Exchange Act of 1934 has been subjected to audit procedures performed in conjunction with the audit of Company's financial statements. The supplemental information is the responsibility of the Company's management. Our audit procedures included determining whether the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable, and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with Rule 17a-5 under the Securities Exchange Act of 1934. In our opinion, Schedule I is fairly stated, in all material respects, in relation to the financial statements as a whole. L -L . P Certified Public Accountants February 22, 2021 We have served as the Company's auditor since 2006. {6}------------------------------------------------ ## **SKYSTONE SECURITIES, LLC STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2020** ## Assets ## Current assets: | Cash
Parent
Due
from
expenses
Prepaid | \$
155,573 | |------------------------------------------------------|---------------| | | 25,048 | | | 15,000 | | | \$
115,525 | ## Liabilities and Member's Capital | liabilities:
Current | | |---------------------------------------------------|---------------| | Accounts
and
accrued
expenses
payable | \$
13,618 | | current
Total
liabilities | 13,618 | | Member's
capital | 141,955 | | | \$
155,573 | The accompanying notes are an integral part of the financial statements. {7}------------------------------------------------ ## **SKYSTONE SECURITIES, LLC STATEMENT OF OPERATIONS AND MEMBER'S CAPITAL FOR THE YEAR ENDED DECEMBER 31, 2020** | Revenues: | | |-------------------------------------------------------------|---------------| | Revenues | \$
468,124 | | | | | expenses:
Operating | | | fee
Incremental
services
(Note
2)
allocation | 100,043 | | fees
Registration | 24,093 | | General
and
administrative | 89,688 | | fee
Advisory
to
affiliate
paid | 20,000 | | Bad
debt
expense | 125,000 | | | 358,824 | | Net
operating
income | 109,300 | | Other
(expense)
income | | | Interest
income | 60 | | Total
other
income | 60 | | Net
income | 109,360 | | Member's
at
year
capital
beginning
of | 243,595 | | Distributions | (211,000) | | Member's
at
capital
end
year
of | \$
141,955 | The accompanying notes are an integral part of the financial statements. {8}------------------------------------------------ ## **SKYSTQNE SECURITIES, LLC STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2020** Cash flows from operating activities: | Net
income | \$
109,360 | |----------------------------------------------------------------------|---------------| | cash
Adjustments
to
reconcile
net
to
net
income | | | activities:
operating
provided
by | | | Changes
operating
assets
and
liabilities:
in | | | Accounts
receivable | 185,000 | | Parent
Due
from | (15,000) | | Prepaid
expenses | (15,271) | | accrued
Accounts
and
expenses
payable | (91,855) | | Accrued
state
tax
income | | | Net
cash
provided
operating
activities
by | 172,234 | | activities:
Cash
flows
from
investing | | | cash
Net
provided
investing
activities:
by | | | activities:
Cash
flows
from
financing | | | to
member
Distributions
paid | (211,000) | | activities:
cash
Net
used
in financing | (211,000) | | Decrease
in cash | (38,766) | | Cash
at
year
of
beginning | 154,291 | | at
Cash
end
year
of | \$
115,525 | The accompanying notes are an integral part of the financial statements. {9}------------------------------------------------ #### **1 . SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** #### Business and operations Skystone Securities, LLC, (formerly Petro Capital Securities, LLC) (Company) is a limited liability company organized in the State of Texas, on March 26, 2004 and is a wholly-owned subsidiary of Petro Capital Securities Holdings, LLC (Parent). The Company is a broker-dealer registered with the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). The Company provides private placement of debt and equity securities as well as providing advisory services for mergers and acquisitions and corporate finance. ### Revenue Recognition Revenue from contracts with customers includes fees from investment banking services. The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant judgment is required to determine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple performance obligations are identified; when to recognize revenue based on the appropriate measure of the Company's progress under the contract; and whether constraints on variable consideration should be applied due to uncertain future events. The Company earns fees, commissions and receives financial instruments in exchange for the services it provides and recognizes revenue when the Company has completed its contractual obligations and collection is reasonably assured. #### Customer concentrations For the year ended December 31, 2020, the Company had the following customer concentrations with respect to its revenues: | | Rev.
%
of | %
AR
of | |---------------|-----------------|---------------| | Customer
1 | 52% | | | Customer
2 | 27% | | | 3
Customer | 16% | | ^amount below 10% #### Management estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. {10}------------------------------------------------ #### Cash flows The Company maintains deposits in one financial institution. At December 31, 2020, the Federal Deposit Insurance Corporation (FDIC) provided insurance coverage of up to \$250,000, per depositor, per institution. At December 31, 2020, none of the Company's cash was in excess of federally insured limits. For purposes of the statement of cash flows, cash includes demand deposits, time deposits and short-term cash equivalent investments with maturities of less than three months at the date of purchase. At December 31, 2020, the Company had no such cash equivalents included in cash. None of the Company's cash is restricted. ## Fair value measurements The Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 820, *Fair Value Measurement*, definesfair value, establishes a framework for measuring fair value in accordance with U.S. generally accepted accounting principles, and requires certain disclosures about fair value measurements. In general, fair values of financial instruments are based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and the customer's creditworthiness, among other things, as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. #### Fair value of financial instruments In accordance with the reporting requirements of ASC Topic 825, *Financial Instruments*, the Company calculatesthe fair value of its assets and liabilities which qualify as financial instruments under thisstandard and includes this additional information in the notes to the financial statements when the fair value is different than the carrying value of those financial instruments. The estimated fair value of cash and accounts payable approximate their carrying amounts due to the nature and short maturity of these instruments. {11}------------------------------------------------ ## Recent accounting pronouncements During the year ended December 31, 2020 and through February 19, 2021, there were several new accounting pronouncements issued by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company's financial statements. ### Subsequent events In preparing the financial statements, the Company has reviewed, as determined necessary by the Company's management, events that have occurred after December 31, 2020, up until the issuance of the financial statements, which occurred on February 19, 2021. ## 2**. TRANSACTIONS WITH RELATED PARTY** ## Office and administrative services agreement The Company paid a monthly incremental allocation services fee to an affiliate through the Office and Administrative Services Agreement of \$95,480 per month for January through March, \$64,788 for April, \$68,366, for May, \$76,600, for June and \$81,440 for July through December 2020. Such fees amounted to \$984,835 during the year ended December 31, 2020 and which are reflected in the '"Incremental allocation services fee" line item on the accompanying statement of operations and member's capital. The \$984,835 incremental allocation service fees were reduced by the \$884,793 of debt forgiveness expense leaving \$100,043 total expense on the Income Statement for the year ending December 31, 2020. A balance of \$15,000 is Due from Parent for client funds paid to the Parent instead of the Company. ## 3. **INCOME TAXES** The Company is organized as a limited liability company under the provisions of the Internal Revenue Code of 1986 as amended. Accordingly, the financial statements do not include a provision for federal income taxes because the Company does not incur federal income tax liabilities. Instead, its earnings and losses are included in the member's income tax return and are taxed based on the member's income tax rate. As a Texas limited liability company, the Company is subject to a state franchise tax based on the lower of either the cost of goods sold margin, compensation margin or 70% of gross revenues. The Company's franchise tax liability will be included in the member's state franchise tax return. {12}------------------------------------------------ ## 4. **NET CAPITAL REQUIREMENTS** The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (SEC Rule 15c3-1 ), which requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1 (and the rule of the "applicable" exchange also provides that equity capital may not be withdrawn or cash dividends paid if the resulting net capital ratio would exceed 10 to 1 ). At December 31, 2020, the Company was in compliance with aggregate indebtedness of \$13,618 and net capital of \$101,907. ## 5. **RULE 15c3-3 EXEMPTION** The Company is filing this Exemption Report relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 because the Company limits its business activities exclusively to: ( 1 ) effecting securities transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; (2) receiving transaction-based compensation for identifying potential merger and acquisition opportunities for clients, referring securities transactions to other broker-dealers, and the Company ( 1 ) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. {13}------------------------------------------------ ## **SKYSTONE SECURITIES, LLC SCHEDULE I COMPUTATION OF NET CAPITAL UNDER RULE 15c3-l OF THE SECURITIES AND EXCHANGE COMMISSION AS OF DECEMBER 31, 2020** | of:
Requirement,
Capital
the
Greater
Net | | | | | \$ | 5,000 | |----------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|-------|----|--------|----------|--------------------| | 1/15
of
Aggregate
Indebtedness | \$ | 908 | | | | | | Minimum
Dollar
Requirement | \$ | 5,000 | | | | | | Capital
Net | | | | | \$ | 101,907 | | Excess
Net
Capital
(Al):
Aggregate
Indebtedness | | | | | \$
\$ | 96,907
13,618 | | | | | | | | | | Capital:
Ratio
to
of
Aggregate
Indebtedness
Net
Ratio
Indebtedness
to
Debt/Equity
of
Subordinated | Total: | | | | | 13.36%
N/A | | Al
120%
10%
of
Net
Capital
requirement
or
of
in
Excess
Net
Capital
of
120%
of
Required
Net
Capital | | | | | \$
\$ | 6,000.00
95,907 | | Hand,
Assets
Accounts)
Total
(Cash
on
Money
Market | | | | | \$ | 155,573 | | Less:
Total
Liabilities | | | | | | 13,618 | | (Exclusive
of
subordinated
debt) | | | | | | | | Worth
Net | | | | | | 141,955 | | to
Worth:
Deductions
and/or
charges
Net
from | | | | | | | | assets
Total
non-allowable | | | \$ | 40,048 | | | | (Excess
Fidelity
Bond
deductible)
Deductions
Worth
Total
from
Net | | | | | | 40,048 | | Capital
haircuts
on
securities
positions
Net
before | | | | | \$ | 101,907 | | | | | | | | | | securities:
Haircuts
on | | | | | | | | Certificates
of
Deposit
and
Commercial | Paper | | \$ | | | | | U.S.
and
Canadian
government
obligations | | | | | | | | State
municipal
and
government
and | obligations | | | | | | | obligations
Corporate | | | | | | | | Stock
and
warrants | | | | | | | | Options | | | | | | | | Arbitrage | | | | | | | | Securities
Other
securities
Total
haircuts
of | | | | | | | | | | | | | | | | Capital
Net | | | | | \$ | 101,907 | There are no material differences between the amounts presented abovs and the amounts reported on the Company's unaudited FOCUS report as of December 31, 2020. {14}------------------------------------------------ *Your Vision Our Focus* ![](_page_14_Picture_1.jpeg) ## Report of Independent Registered Public Accounting Firm To the Member of Skystone Securities, LLC We have reviewed management's statements, included in the accompanying Skystone Securities, LLC Exemption Report, in which ( 1 ) Skystone Securities, LLC does not claim an exemption under paragraph (k) of 17 C.F.R. §240.15c3-3 and (2) Skystone Securities, LLC is filing an Exemption Report relying on Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R §240.17a-5 because the Company limits its business activities exclusively to: ( 1 ) effecting securities transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; (2) receiving transaction-based compensation for identifying potential merger and acquisition opportunities for clients, referring securities transactions to other broker-dealers, and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2- 4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. Skystone Securities, LLC's management is responsible for compliance with the exemption provisions and its statements. Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about Skystone Securities, LLC's compliance with the exemption provisions. A review is substantially less in scope than an examination, the objective of which is the expression of an opinion on management's statements. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to management's statements referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in Rule 15c3-3 under the Securities Exchange Act of 1934 and Footnote 74 of the SEC Release No. 34-70073. L -L . P *\* **v>n/v'-t/LJ** *^* **t** Certified Public Accountants February 22, 2021 Turner, Stone & Company, L.L.P. Accountants and Consultants 12700 Park Central Drive, Suite 1400 Dallas,Texas 75251 **Telephone:** 972-239-1660/Facsimile: 972-239-1665 Toll Free: 877-853-4195 Web site: turnerstone.com ![](_page_14_Picture_11.jpeg) {15}------------------------------------------------ # **Skystone Securities, LLC** **3710 Rawlins Street / Dallas, Texas 75219 214-661-7761** ## **Exemption Report** **Skystone Securities, LLC** (the ''Company") is a registered broker-dealer subject to Rule 17a-5 promulgated by the Securities and Exchange Commission (17 C.F.R. §240.17a-5, "Reports to be made by certain brokers and dealers"). This Exemption Report was prepared as required by 17 C.F.R. § 240.17a-5(d)(1) and (4). To the best of its knowledge and belief, the Company states the following: (1) The Company does not claim an exemption under paragraph (k) of 17 C.F.R. § 240. 15c3-3, and (2) The Company is filing this Exemption Report relying on Footnote 74 of the SEC Release No. 34- 70073 adopting amendments to 17 C.F.R. § 240.17a-5 because the Company limits its business activities exclusively to: (1) effecting securities transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company; (2) receiving transaction-based compensation for identifying potential merger and acquisition opportunities for clients, referring securities transactions to other broker-dealers, and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (bX2) of Rule 15c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. ### **Skystone Securities, LLC.** I, Rosser Newton, swear (or affirm) that, to my best knowledge and belief, this Exemption Report is true and correct. Rosser Newton, Managing Member January' 19, 2021 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.