# COBRA TRADING, INC. X-17A-5 (2024-03-26) — Broker-dealer annual report - Company: COBRA TRADING, INC. - Form: X-17A-5 - Filed: 2024-03-26 - Period: 2023-12-31 - Accession: 0001293532-24-000004 - CIK: 1293532 - File #: 8-66548 - Type: Broker-dealer - Material weakness: No - Auditor: Sanville & Company LLC - Auditor location: Dallas, TX - Contact: Chadd Hessing - Phone: 9724917999 - Signed by: Chadd Thomas Hessing (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1293532/000129353224000004/publicsec1.pdf --- {0}------------------------------------------------ **" --** **(\*&!)!(H#H,#H\$""!(( \$#H +-C68=5E?=HH H** 0&\$7785?\$/ 0&2cEMr" +oUsMy"2k ,y|VdB}MKBMtCQMFrKMg RlrzpMrrMyplgyM# #### **-** | 2>0',8
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| | | | | | (\_DYfzOmvMMep}WmiOtme}TMsMqYtMeMi}}TB}}TMBiiB^sMpmx|{GMImMsMKG}TMsMpns~zmOBiWiLMpMjLMi}pG`[I BJJmh}Bh}ez}HMzppmtMLGBz}B}MeMi}mPNBI}zBw\LIYsIez}BiIMztM^ZMLmhBz}TMGBzYzmO}TMMMep}Zmh ;MM (.8!B )d7MGqM,q7G,MTDc8MGqMGe7G)%q7Gqd68]q-MVDqW)qGMeqV+Rg7V)%qeMqX)]PMG%qgG=)]]qe6)q1MWEq &9^Q>l\_qq hYZ(Hf>lqiB;&q q NHfZN?qHhF(Zq** {1}------------------------------------------------ #### **OATH OR AFFIRMATION** I, CHADD HESSING swear (or affirm) that, to the best of my knowledge and belief, the financial report pertaining to the firm of cosRA TRADING. INC. as of **12/31** 2~ is true and correct. I further swear ( or affirm) that neither the company nor any partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account classified solely as that of a customer. | ,,,~~~~f:1,,
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~~~.f-;,' | KYLE DOMINIC MITCHELL
~{\ Notary Public, State of Texas
.--:~i Comm. Expires 09-08-2025
Notary ID 133318293 | | |---------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------|--| | Notary Public | | | Signature: ~ Title: Notary Public #### **This filing\*\* contains (check all applicable boxes):** - iii!! (a) Statement of financial condition. - D (b) Notes to consolidated statement of financial condition. - iii (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). - iii (d) Statement of cash flows. - iii (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - D (f) Statement of changes in liabilities subordinated to claims of creditors. - iii!! (g) Notes to consolidated financial statements. - iii!! (h) Computation of net capital under 17 CFR 240.1Sc3-1 or 17 CFR 240.18a-1, as applicable. - D (i) Computation of tangible net worth under 17 CFR 240.18a-2. - iii!! (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - D (kl Computation for determination of security-based swap reserve requirements pursuant to Exhibit B to 17 CFR 240.1Sc3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.1Sc3-3. - iii!! (m) Information relating to possession or control requirements for customers under 17 CFR 240.1Sc3-3. - □ (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.1Sc3-3(p)(2) or 17 CFR 240.18a-4, as applicable. - iii!! (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - D (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - iii (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. - □ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - iii!! (s) Exemption report in accordance with 17 CFR 240.17a-S or 17 CFR 240.18a-7, as applicable. - D (t) Independent public accountant's report based on an examina~ion of the statement of financial condition. - iii (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-S, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - D (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - iii!! (w) Independent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - D (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable. - D (y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). D (z) Other:--------------- ----------------------- - - \*\*To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-S(e)(3) or 17 CFR 240.18a-7(d)(2), as applicable. {2}------------------------------------------------ ![](_page_2_Picture_0.jpeg) #### **Report of Independent Registered Public Accounting Firm** To the Board of Directors and Those Charged With Governance of Cobra Trading, Inc. #### **Opinion on the Financial Statements** We have audited the accompanying statement of financial condition of Cobra Trading, Inc. (the Company) as of December 31 , 2023, the related statements of income, changes in stockholder's equity, and cash flows for the year then ended, and the related notes to the financial statements (collectively, 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 , 2023, 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 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 included 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. #### **Supplemental Information** The supplementary information contained in The Schedule I, Computation of Net Capital Under SEC Rule 15c3-1, Schedule Ill, Computation for Determination of Reserve Requirements Under Rule SEC 15c3-3 and Schedule IV, Information Relating to the Possession or Control Requirements Under SEC Rule 15c3-3 have been subjected to audit procedures performed in conjunction with the audit of the 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 > 325 North Saint Paul Street Suite 3100 Dallas, Texas 75201 214.738.1998 {3}------------------------------------------------ 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 17 C.F.R. §240.17a-5. In our opinion, the supplementary information contained in the Schedule I, Computation of Net Capital Under SEC Rule 15c3- 1, Schedule Ill, Computation for Determination of Reserve Requirements Under SEC Rule 15c3-3 and Schedule IV, Information Relating to the Possession or Control Requirements Under SEC Rule 15c3-3 are fairly stated, in all material respects, in relation to the financial statements as a whole. s~ 0~LLC We have served as the Company's auditor since 2021. Dallas, Texas March 26, 2024 {4}------------------------------------------------ # COBRA TRADING, INC. Statement of Financial Condition December 31, 2023 #### **ASSETS** | Cash and cash equivalents
Deposit with broker/dealer
Clearing deposit with broker-dealer
Receivable from broker-dealer
Other receivables
Property, equipment and leasehold improvements, net of accumulated
depreciation of \$492,937
Right of use asset
Other assets | \$
15,178,797
4,796,190
318,059
751,220
1,695,573
2,426,811
639,347
371,278 | |-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------| | | \$
26,177,275 | | LIABILITIES AND STOCKHOLDER'S EQUITY | | | Liabilities: | | | Accounts payable and accrued expenses
Loan Payable
Lease liability | \$
6,161,398
1,726,373
639,347 | | | 8,527,118 | | Stockholder's equity: | | | Common stock, no par value, 100,000 shares authorized,
1,000 shares issued and outstanding
Retained earnings | 96,250
17,553,907 | | Total stockholde~s equity | 17,650,157 | | | \$
26,177,275 | {5}------------------------------------------------ # COBRA TRADING, INC. Statement of Income For the Year Ended December 31, 2023 | Revenues: | | |------------------------------------|------------------| | Commissions | \$
10,056,278 | | Interest income | 491,651 | | Fee income | 48,660,934 | | Miscellaneous income | 1,917 | | Total Revenues | 59,210,780 | | Expenses: | | | Employee compensation and benefits | 5,171,650 | | Brokerage and clearance fees | 40,671 ,815 | | Communications | 81,381 | | Occupancy and equipment costs | 732,129 | | Promotional costs | 530,764 | | Interest | 39,122 | | Regulatory fees and expenses | 288,416 | | Professional fees | 4,319,195 | | Other expenses | 1,467,350 | | Total Expenses | 53,301,822 | | Net Income | \$
5,908,958 | {6}------------------------------------------------ # COBRA TRADING, INC. Statement of Changes in Stockholder's Equity For the Year Ended December 31, 2023 | | Shares | Common
Retained
Stock
Earnings | | Total | | |---------------------------------|--------|-----------------------------------------|--|---------------|------------------| | Balance at
December 31, 2022 | 1,000 | \$
96,250 | | \$ 15,641,357 | \$
15,737,607 | | Net income | | | | 5,908,958 | 5,908,958 | | Distributions | | | | (3,996,408) | (3,996,408) | | | | | | | | | Balance at
December 31, 2023 | 1,000 | =\$=====96=,2=50= | | \$ 17,553,907 | \$
17,650,157 | {7}------------------------------------------------ # COBRA TRADING, INC. Statement of Cash Flows For the Year Ended December 31, 2023 | Cash Flow!? from Operating Activities | | |-------------------------------------------------------------|------------------| | Net income | \$
5,908,958 | | Adjustments to reconcile net income (loss) to net | | | cash provided (used) by operating activities: | | | Depreciation | 461 ,220 | | Change in operating assets and liabilities: | | | Decrease in deposit with broker/dealer | 11,975,231 | | Increase in clearing deposit with broker | (166,140) | | Increase in receivable from broker-dealer | (92,222) | | Increase in other receivables | (1,539,852) | | Decrease in right of use asset | 76,977 | | Decrease in other assets | 52,251 | | Increase in accounts payable and accrued expenses | 2,616,759 | | Decrease in loan payable | (307,227) | | Decrease in lease obligations | (76,977) | | Net cash provided by operating activities | 18,908,978 | | Cash Flows from Investing Activities | | | Purchase of furniture, equipment and leasehold improvements | (21,460) | | Net cash used by investing activities | (21,460) | | Cash Flows from Financing Activities | | | Distributions | (3,996,408) | | | | | Net cash used by financing activities | (3,996,408) | | Net increase (decrease) in cash and cash equivalents | 14,891 ,110 | | Cash and cash equivalents at beginning of year | 287,687 | | Cash and cash equivalents at end of year | \$
15,178,797 | | Supplemental disclosures
Cash paid for: | | | Income taxes | \$
0 | | Interest | \$
39,122 | {8}------------------------------------------------ # Note 1 -Organization and Nature of Business The Consolidated Financial Statements include the accounts of Cobra Trading, Inc. and its wholly owned subsidiary, Jet Goals Aviation LLC, in which the firm acquired a 100% ownership. All material intercompany balances and transactions have been eliminated. Cobra Trading, Inc. (the "Company") was organized in June, 2004. The Company became a broker/dealer in securities registered with the Securities and Exchange Commission ("SEC") effective December 17, 2004, and is a member of the Financial Industry Regulatory Authority ("FINRA"), the National Futures Association ("NF A") and Securities Investor Protection Corporation ("SIPC"). The Company operates under the exemption provisions of SEC Rule 15c3-3(k)(2)(ii) which provide that all funds and securities belonging to the Company's customers be handled by a clearing broker-dealer. The Company's customers are primarily individuals trading securities through the Company's online portal. #### Note 2 - Significant Accounting Policies #### **Cash and Cash Equivalents** The Company treats money market mutual funds and all highly liquid debt instruments with original maturities of three months or less as cash equivalents for purposes of the statement of cash flows. #### **Property, Equipment and Leasehold Improvements** Property, equipment and leasehold improvements are stated at cost. Depreciation on office equipment and furniture is computed using the straight line method over useful lives of three to seven years. Leasehold improvements are amortized over the shorter of their useful lives or the remainder of the lease term. #### **Management Estimates** The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") 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 period. Actual results could differ from those estimates. {9}------------------------------------------------ #### Note 2 - Significant Accounting Policies (cont'd) • #### **Revenue From Contracts with Customers** The Company follows Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (ASC 606). ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The guidance requires an entity to follow a five-step model to (a) identify the contract(s) with the customer, (b) identify the performance obligations in the contract, ( c) determine the transaction price, and ( d) allocate the transaction price to the performance obligation, in determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved and (e) recognize revenue when (or as) the Company satisfies a performance obligation. Revenue from contracts with customers include brokerage commissions and fee revenues. The recognition and measurement of revenue is based on the assessment of individual contract items. Significant judgement is required to determine whether performance obligations are satisfied at the point in time or other time; how to allocate transaction process 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 should be applied due to uncertain future events. ### Brokerage Commissions The Company buys and sells securities on behalf of its customers. Each time a customer enters into a buy or sell transaction, the Company charges a commission. Commissions and related clearing expenses are recorded on the trade date (the date that the Company fills the trade order by finding and contracting with a counterparty and confirms the trade with the customer). The Company believes that the performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. #### Fee Revenue The fee revenue consists of two parts. Primarily, the Company charges its customers a short interest charge for short positions in the customer's accounts. This fee is assessed daily. In addition, some customers take advantage of certain software offered by the Company. The fee for this service is charged monthly. The Company believes that the {10}------------------------------------------------ # Note 2- Significant Accounting Policies (cont'd) performance obligation of the Company is satisfied when the charges are made to the customer. The economic conditions which affect the Company's operations are related to overall strength of the financial and commodity markets. #### **Leases** The Company determines if an arrangement is a lease at inception. Leases that have terms of one year or less are deemed to be short term, and are expensed on a straight line basis over their respective terms. Operating leases are included in right-of-use ("ROU") assets, and lease liabilities in the Statement of Financial Condition. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value oflease payment over the lease term. As most of the leases do not provide an implicit rate, the Company generally uses, the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at the commencement date. The operating lease ROU assets also includes any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payment is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. #### **Advertising Costs** All nondirect-response advertising costs are expensed as incurred. Advertising costs were \$530,764 for the year ended December 31, 2023. #### **Deposits with and Receivable from Clearing Broker-Dealer** Deposits with clearing broker-dealer include cash maintained at the clearing broker-dealer for clearing and trading activities. Receivable from clearing broker-dealer is comprised of commissions. Such amounts are normally collected between five and thirty-five days after month end. As such, management has not recorded an allowance for doubtful accounts on {11}------------------------------------------------ # Note 2- Significant Accounting Policies (cont'd) these receivables. Management records an allowance for doubtful accounts based on a collectability review of specific accounts. Any receivables deemed not collectable are written off against the allowance. Receivables were \$1,695,573 at December 31, 2023. # Note 3 - Furniture, Equipment and Leasehold Improvements A summary of furniture, equipment and leasehold improvements at December 31, 2023 were as follows: | Aircraft | \$3,105,659 | |--------------------------------|------------------------| | Furniture and fixtures | 66,718 | | Equipment | 63:,.971 | | Leasehold Improvements | 83,400 | | | 3,319,748 | | Less: accumulated depreciation | 892,937
\$2,426.811 | Depreciation expense was \$461,219 for the year ended December 31, 2023. # Note 4 - Net Capital Requirements Pursuant to the net capital provisions of Rule l 5c3-1 of the Securities and Exchange Act of 1934, a minimum net capital requirement must be maintained, as defined under such provisions. Net capital and the related net capital ratio may fluctuate on a daily basis. At December 31, 2023, the Company had net capital of \$12,855,547 and net capital requirements of\$525,852. The ratio of aggregate indebtedness to net capital was 0.61 to 1 at December 31, 2023. The Securities and Exchange Commission permits a ratio of no greater than 15 to 1. Pursuant to the net capital requirements of Section 1.17 of the Commodity Futures Trading Commission, a minimum net capital requirement must be maintained, as defined under such provisions. As an introducing broker, the Company is required to maintain net capital of\$525,852. At December 31, 2023, the Company had net capital as defined under Section 1. 17 of \$12,855,547 which resulted in an excess. net capital of \$12,329,695. {12}------------------------------------------------ # Note 5 - Defined Contribution Plan The Company adopted a defined contribution plan, effective January 1, 2018, for its eligible employees. The Company may make deferral contributions up to the annual maximum amount allowed by the Internal Revenue Code. The Company expensed \$115,237 during 2023. # Note 6 -Federal Income Taxes The Company, with consent of its stockholder, has elected under the Internal Revenue Code to be an S corporation. In lieu of corporation income taxes, the stockholders of an S corporation are taxed on their proportionate share of the Company's taxable income. Therefore, no provision or liability for federal income taxes has been included in these financial statements. The Company files income tax returns in the US federal jurisdiction and in various state and local jurisdictions. The Company's federal income tax returns for all tax years ended on or after December 31, 2020, remain subject to examination by the Internal Revenue Service. The Company's state and local income tax returns are subject to examination by the respective state and local authorities over various statutes of limitation, most ranging from three to five years from the date of filing. The Company applies F ASB ASC 7 40-10 relating to accounting for uncertain tax positions. ASC 740-10 prescribes a recognition threshold and measurement process for accounting for uncertain tax positions and also provides guidance on various related matters such as derecognition, interest, penalties and disclosures required. The Company does not have any uncertain tax positions. #### Note 7 - Commitments and Contingencies #### **Lease Commitments** The Company has an obligation as a lessee for office space with an initial noncancelable term in excess of one year. The Company classified this as an operating lease. The Company's lease does not include termination options for either party to the lease or restrictive financial or other covenants: Payments due under the lease contracts include fixed payments plus variable payments. The Company's office space lease requires variable payments for the Company's proportionate share of the building's property taxes, insurance, and common area maintenance. These variable lease payments are not included in lease payments used to determine lease liability and are recognized as variable costs when incurred. The lease expires August 31, 2030. The Company used a discount rate of 5.4% {13}------------------------------------------------ # Note 7-Commitments and Contingencies (cont'd) to calculate the right of use liability. The undiscounted rent obligation is \$9,594 per month during the term of the lease. Amounts disclosed for ROU assets obtained in exchange for lease obligations and reductions to ROU assets resulting from reductions to lease obligations include amounts added to or reduced from the carrying amount of ROU assets resulting from new leases, lease modifications or reassessments. Maturities of lease liabilities under noncancellable operating leases as of December 31, 2023 are as follows: | | Principal | Discount | |------|------------|-----------| | | Discounted | Interest | | 2024 | 81,401 | 33,735 | | 2025 | 86,078 | 29,058 | | 2026 | 91,024 | 24,112 | | 2027 | 96,254 | 18,882 | | 2028 | 101,785 | 13,351 | | 2029 | 107,634 | 7,502 | | 2030 | 75,170 | 1,587 | | | \$639,346 | \$128,227 | ### **Financial Instruments with Off-Balance-Sheet Risk** In the normal course of business, the Company's customer activities involve the execution, settlement, and financing of various customer securities transactions. These activities may expose the Company to off-balance-sheet risk in the event the customer or other broker is unable to fulfill its contracted obligations and the Company has to purchase or sell the financial instrument underlying the contract at a loss. The majority of the Company's transactions with off-balance sheet risk are short-term in duration. {14}------------------------------------------------ #### Note 7 - Commitments and Contingencies (cont'd) to calculate the right of use liability. The undiscounted rent obligation is \$9,594 per month during the term of the lease. Amounts disclosed for ROU assets obtained in exchange for lease obligations and reductions to ROU assets resulting from reductions to lease obligations include amounts added to or reduced from the carrying amount of ROU assets resulting from new leases, lease modifications or reassessments. Maturities of lease liabilities under noncancellable operating leases as of December 31, 2023 are as follows: | | Principal | Discount | |------|------------|-----------| | | Discounted | Interest | | 2024 | 81,401 | 33,735 | | 2025 | 86,078 | 29,058 | | 2026 | 91,024 | 24,112 | | 2027 | 96,254 | 18,882 | | 2028 | 101,785 | 13,351 | | 2029 | 107,634 | 7,502 | | 2030 | 75,170 | 1,587 | | | \$639,346 | \$127,227 | #### **Financial Instruments with Off-Balance-Sheet Risk** In the normal course of business, the Company's customer activities involve the execution, settlement, and financing of various customer securities transactions. These activities may expose the Company to off-balance-sheet risk in the event the customer or other broker is unable to fulfill its contracted obligations and the Company has to purchase or sell the financial instrument underlying the contract at a loss. The majority of the Company's transactions with off-balance sheet risk are short-term in duration. {15}------------------------------------------------ # Note 7-Commitments and Contingencies (cont'd) #### **Indemnification and Termination Charges** The Company is required to indemnify its clearing broker/dealer if a customer fails to settle a securities transaction, according to its clearing agreement. Management was neither aware, nor had it been notified of any potentially material indemnification loss at December 31,2023. #### **Litigation** During the normal course of operations, the Company, from time to time, may be involved in lawsuits, arbitrations, claims, and other legal or regulatory proceedings. The Company does not believe that these matters will have a material adverse effect on the Company's financial position, results of operations, or cash flows. ### Note 8 -Concentration Risks At various times throughout the year, the Company had cash balances in excess of federally insured limits. # Note 9 -Related Party Transactions The Company has entered into an office lease agreement (See Note 7) with an entity owned by the sole owner of the Company. As of December 31, 2023, the Company had no amounts due to or from the related party. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.