# CROSS POINT CAPITAL LLC X-17A-5 (2026-05-26) — Broker-dealer annual report - Company: CROSS POINT CAPITAL LLC - Form: X-17A-5 - Filed: 2026-05-26 - Period: 2025-12-31 - Accession: 0001331413-26-000003 - CIK: 1331413 - File #: 8-66989 - Type: Broker-dealer - Material weakness: No - Auditor: Goldman & Company, CPAs PC - Auditor location: Marietta, GA - Contact: Jon Nixon - Phone: 917-703-1704 - Email: jnixon@goldcrestcpa.com - Website: goldcrestcpa.com - Signed by: Ilias Islamov (Co President) Original filing: https://www.sec.gov/Archives/edgar/data/1331413/000133141326000003/Crosspointpublic.pdf --- {0}------------------------------------------------ | | UNITED STATES
SECURITIES AND EXCHANGE COMMISSION | | 0MB APPROVAL
0MB Number. 3235-0123 | |---------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------|---------|--------------------------------------------| | | Expires: Nov. 30, 2026 | | | | | Estimated average burden
hours per response: 12 | | | | | SEC RLE NUMBER | | | | | FORM X-17 A-5 | | 8-66989 | | | PARTIU | | | | | FACING PAGE | | | | | Information Required Pursuant to Rules 17a-5, i7a-12, and 18a-7 under the Securities Exchange Act of 1934 | | | | | FILING FOR THE PERIOD BEGINNlNG Q 1/01/2025 | | AND ENDING 12/31/2025 | | | MM/DD/YY | | MM/DD/YY | | | A. REGISTRANT IDENTIFICATION | | | | | NAME oFFtRM: Cross Point Capital LLC | | | | TYPE OF REGlSTRANT (check all applicable boxes):
0 Broker-dealer | D Security-based swap dealer
□ Check here ifrespondent is also an OT(: derivatives dealer | | D Major security-based swap participant | | | ADDRESS OF PRINCIPAL PLA.CE OF BUSlNESS: {Do not use a P.O. box no.) | | | | 30 E23 Street, 3rd Floor | | | | | | | | | | | (No. ;md Street) | | | | ewYork | NY | | 1
10 | | (City) | (State) | | (Zip Code) | | | | | | | | | | jnixon@goldcrestcpa.com | | PERSON TO CONTACT WITH REGARD TO THIS FILING
Jon Nixon | 917-703-1704
(Area Code-Telephone Number} | | (Email Address) | | (Name) | -------------------------------------
B. ACCOUNTANT IDENTIFICATION | | | | | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this filing*
Goldman & Company, CPA's. P.C. | | | | | {Name - if individual, state last, first, and middle name) | | | | 3535 Roswell Road - | Marietta
Suite 32 | | GA
300Ei2 | | (Address) | (Crty) | [State) | (Zip Code) | | 06/25/2009 | | 1952 | | | T" of """"'"''" | wtth PCAOB )[IT ,pplicable)
FOR OFFICfAl USE ONLY | | (PCAOB Registration Number, if applicable) | Persons who are to respond to the collection of information contained in thls form are not required "to respond unfess "the fom-i. displays a currently valid 0MB: control number. {1}------------------------------------------------ ## OATH ORAFFIRMATION l, }lias lslamov swear (or affirm) that, to the best of my knowledge 2rnd belief, the financial report pertaining to the firm of Cross Point LLC 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 proprjetary interest in any account classified solely as that of a customer. . /~ . ,:1 /J /·/ /,,1 /// Signature: L L t;/v ½\_ L Trtle: L~ Co-President ## ihis filing"'\* contains (check all appliicable boxes):. - Ii!! (a) Statement of financial condition. - Ii!! (b) Notes to consolidated statement of financial condition. - □ (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§ 210.1-02ofRegulation S-X). - D [d) Statement of cash flows. - □ (e) Statement of changes in stockholders' or partners' or sole proprietdr's equity . - . □ (f) Statement of changes in liabilities subordinated to claims of creditors. - D (g) Notes to consolidated financial statements. - D (h) Computation of net capital umler 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as :applicable. - D (i) Computation oftangiblenetworth under17CFR240.18a-2. - D (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. - D { k) Computation for determination of security-based swap reserve requirements pursuantto Exhibi:t; B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240,18a-4, as applicable. - D {l) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3. - D {m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - •□ {n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p )(2) or 17 CFR 240.18a-4, as applicable. - D (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 materfo! differences exist. - D {p) Summary of financial data for sobsidiaries not consolidated in the statement of financial condition. - D (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.183-7, as applicable . - . D (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - D {s) Exemption report in accordance with 17 CFR240.17a-5 or 17 CFR 240.18a-7, as applicable. - f!! (t) Independent public accountant's report based on an examination of the statement of financial condition. - D (u) Independent public accountant's report based on an examination of the financial report or financial statements under 17 CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable, - □ (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 240.18~.-7, as applicable. - D (w) Independent public accounta,nt'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 app'iying-agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e or J..7 CFR 240.172-12, as applicable. - D (y) Report describing any materi:al inadequacies found to exist or found to have existed since tl1e date of the previous audit, or a statement that no material lnadequaci~ exist, under 17 CFR 240.17a-12(k}- □ (z) other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_ "'To request *confidential* treatment of *certain portions of* this *filing,* see 17 CFR240.17a-S(e)(3} or 17 CFR24CU8a-7{d}(2), as applicable. {2}------------------------------------------------ ## REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Members of Cross Point Capital LLC ### Opinion on the Financial Statement We have audited the accompanying statement of financial condition of Cross Point Capital LLC as of December 3 L 2025, and the related notes (collectively referred to as the financial statement). In our opinion. the statement of financial condition presents fairly, in all material respects, the financial position of Cross Point Capital LLC as of December 31, 2025 in conformity with accounting principles generally accepted in the United States of America. ## Emphasis of Matter Cross Point Capital, LLC is adjusting its beginning balance on the Statement of Changes in Member's Equity by recording a prior period adjustment as discussed in Footnote 13. Our opinion is not modified with respect to this matter. ### Basis for Opinion This financial statement is the responsibility of Cross Point Capital LLC's management. Our responsibility is to express an opinion on Cross Point Capital LLC's 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 Cross Point Capital LLC in accordance with the U.S. federal secmities la.vs 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 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. We have served as the Company's auditor since 2018. Goldman & Company, CPA's, P.C. Marietta, Georgia May 22, 2026 {3}------------------------------------------------ # Cross Point Capital, LLC Consolidated Statement of Financial Condition December 31, **2025** #### Assets | Financial instruments owned valued at fair value (Note 1 and Note 11)
Receivable from clearing broker-dealer (Note 1)
Cash and cash equivalents
Right of use assets
Deposit with clearing broker-dealer
Security deposit
Prepaid expenses
Fixed assets (net of accumulated depreciation of \$7,196)
Total Assets | \$
\$ | 34,073,341
8,607,974
1,112,764
319,288
250,000
33,000
26,790
18,813
44,441,970 | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|--------------------------------------------------------------------------------------------------------| | liabilities and members' equity | | | | Lease liability
Accounts payable and accrued expenses
Commission payable
Total liabilities | \$ | 319,288
607,515
344,892
1,271,695 | | Members' equity
Total liabilities and members' equity | \$ | 43,170,275
44,441,970 | The Notes to Financial Statements are an integral part of this statement. {4}------------------------------------------------ ## 1. Organization and Summary of Significant Accounting Policies ## Nature of Business Cross Point Capital, LLC (the "Company") is a broker-dealer and is registered with the Securities and Exchange Commission (the "SEC") and the State Securities Commission of New Jersey. It is also a member of the Financial Industry Regulatory Authority ("FINRA"). The Company is a Delaware limited liability company and has operating location in New York. The Company engages in riskless principal transactions as an agent. A riskless principal transaction is a transaction in which the Company receives an order to buy a security from a customer contemporaneously with an order to sell a security with a different customer. All terms and pricing of the riskless principal transactions are agreed to by all parties prior to the order being executed. In addition, the Company serves as a middle market broker dealer who conducts municipal securities trading and sales. ## Basic of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Cross Point Capital Funding, LLC. All significant intercompany transactions and accounts have been eliminated. See Note 2, Related Party Transactions. ### **Accounting Basis** The consolidated financial statements of the Company have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America, which require the use of estimates by management. #### **Revenue Recognition** The Company recognizes revenue in accordance with ASU 2014-09 Revenue from Contracts with Customers and all subsequent amendments to the ASU (collectively, "ASC 606"), which creates a single framework for recognizing revenue from contracts with customers that fall within its scope. Services the Company provides as an agent on behalf of customers, and falls within the scope of ASC 606 include: - a. Riskless principal trading as an agent bonds **and CMO/ABS** - b. Fees on repurchase agreements The Company also trades on its own account as proprietary trading. Refer to Revenue Recognition Note: Revenue from Contracts with Customers for further discussion on the Company's accounting policies for revenue sources within the scope of ASC 606. #### **Revenue from Contracts with Customers:** #### Riskless Principal Trading (Gross) (As An Agent): The Company earns trading revenue from riskless principal transactions done with institutional customers and broker-dealers. Fees are transaction based, including trade execution services, are recognized at the point in time that the transaction is executed, i.e., the trade date. This includes riskless principal, asset backed and mortgage backed securities, collateralized debt obligation, collateralized loan obligation, commercial mortgage-backed securities, conduit (pooled multi-borrower loans), comm,:;rcial mortgage backed securities (credit tenant lease), commercial mortgage backed securities (single asset single borrower), collateralized mortgage obligation, commercial real estate collateralized loan obligation transactions in which the company receives a buy order from a customer and the Company purchases the security from another person or entity to offset the sale to the customer. Company buys the bond at a lower price than what it is sold at. The riskless principal revenue is earned at the time the transaction is executed. {5}------------------------------------------------ ## 1. Organization and Summary of Significant Accounting Policies (continued) ### Interest Income on Riskless Principal Trading The Company will occasionally hold the purchase of a bond for 2 to 5 days to accommodate the customers time needed for trustee approvals. This can generate interest income on the debt security purchase and the interest is included in Interest income on principal transactions on the statement of operations. ## Fees on Repurchase Agreements: The Company earns fees from clients on transactions documented under repurchase agreements. The Company assists in facilitating the sale of risk retention securities by the client while the client retains long term exposure to those securities in order to remain in compliance with risk retention regulations. The securities are sold to a third party and the client agrees to re-purchase the securities or compensate for· cashflow losses on those securities at a later date, unless the security matures first or the transactions are terminated. This series of transactions allows the client to comply with their own risk retention requirements, and retain long term exposure to the risk retention securities. The Company is paid an upfront fee on the market value of the initial securities transactions (purchase from the client and sale to the third party), and a recurring fee on the market value of the securities until they are repurchased by the original seller (client) or the transaction terminates. The recurring fees are paid over time, based on the frequency of the interest payments on the underlying security. Depending on the terms of the agreement with the client, the upfront fees range from 0.25% to 0.35% of the market value of the securities, and the recurring fees range from 0.10% to 0.25% of the market value of the securities. The upfront fees are· recognized on a trade date basis, and the recurring fees are recognized over time. ### Proprietary Trading - Financial Instruments Owned: Proprietary securities transactions in regular way trades are recorded on the trade date, as if they had settled. Profit and loss arising from all securities and commodities transactions entered into for the account and risk of the Company are recorded on a trade-date basis. Interest on proprietary trading represent interest earned during the year the firm holds the positions. Amounts receivable and payable for securities transactions that have not reached their contractual settlement date are recorded net on the consolidated statement of financial condition. Securities are recorded at fair value in accordance with FASB ASC 820, Fair Value Measurement. (Note 11) Financial instruments reported on the Consolidated Statement of Financial Condition do not include accrued interest. The Company elected not to record accrued interest separately due to the uncertainty that it will be collected. #### Due from Clearing Broker Dealer The Company clears all of its proprietary and customer transactions through its clearing broker on a fully disclosed basis. Based on the terms and conditions of the Company's agreement with its clearing broker, the amount receivable from the clearing broker represents cash on hand with the clearing broker, plus commission receivables, and less amounts payable for transaction costs on unsettled securities trades. Amounts due from clearing firm are considered fully collectible by management. The amount due from the clearing firm was \$8,607,974 as of December 31, 2025. Due from clearing broker dealer consists of \$7,856,091 of cash held in clearing broker and \$751,883 of accounts receivable as of December 31, 2025. #### **Accounts Receivable** Accounts receivable represents amounts due from consulting income and management fee income earned prior to the year end. The Company had no accounts receivable at December 311, 2025 or 2024. {6}------------------------------------------------ ## 1. Organization and Summary of Significant Accounting Policies (continued) ## Interest Income on Riskless Principal Trading The Company will occasionally hold the purchase of a bond for 2 to 5 days to accommodate the customers time needed for trustee approvals. This can generate interest income on the debt security purchase and the interest is included in Interest income on principal transactions on the statement of operations. ## Fees on Repurchase Agreements: The Company earns fees from clients on transactions documented under repurchase agreements. The Company assists in facilitating the sale of risk retention securities by the client while the c.lient retains long term exposure to those securities in order to remain in compliance with risk retention regulations. The securities are sold to a third party and the client agrees to re-purchase the securities or compensate for cashflow losses on those securities at a later date, unless the security matures first or the transactions are terminated. This series of transactions allows the client to comply with their own risk retention requirements, and retain long term exposure to the risk retention securities. The Company is paid an upfront fee on the market value of the initial securities transactions (purchase from the client and sale to the third party), and a recurring fee on the market value of the securities until they are repurchased by the original seller (client) or the transaction terminates. The recurring fees are paid over time, based on the frequency of the interest payments on the underlying security. Depending on the terms of the agreement with the client, the upfront fees range from 0.25% to 0.35% of the market value of the securities, and the recurring fees range from 0.10% to 0.25% of the market value of the securities. The upfront fees are recognized on a trade date basis, and the recurring fees are recognized over time. ### Proprietary Trading - Financial Instruments Owned: Proprietary securities transactions in regular way trades are recorded on the trade date, as if they had settled. Profit and loss arising from all securities and commodities transactions entered into for the account and risk of the Company are recorded on a trade-date basis. Interest on proprietary trading represent interest earned during the year the firm holds the positions. Amounts receivable and payable for securities transactions that have not reached their contractual settlement date are recorded net on the consolidated statement of financial condition. Securities are recorded at fair value in accordance with FASB ASC 820, Fair Value Measurement. (Note 11) Financial instruments reported on the Consolidated Statement of Financial Condition do not include accrued interest. The Company elected not to record accrued interest separately due to the uncertainty that it will be collected. #### Due from Clearing Broker Dealer The Company clears all of its proprietary and customer transactions through its clearing broker on a fully disclosed basis. Based on the terms and conditions of the Company's agreement with its clearing broker, the amount receivable from the clearing broker represents cash on hand with the clearing broker, plus commission receivables, and less amounts payable for transaction costs on unsettled securities trades. Amounts due from clearing firm are considered fully collectible by management. The amount due from the clearing firm was \$8,608,031 as of December 31, 2025. Due from clearing broker dealer consists of \$7,856,147 of cash held in clearing broker and \$751,884 of accounts receivable as of December 31, 2025. #### Accounts Receivable Accounts receivable represents amounts due from consulting income and management fee income earned prior to the year end. The Company had no accounts receivable at December 31, 2025 or 2024. {7}------------------------------------------------ ## 1. Organization and Summary of Significant Accounting Policies (continued) ## Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. #### Income Taxes The Company is a limited liability company. Therefore, the income or loss is passed through to the members and no provision or liability for federal income taxes has been included in the financial statements for the Company. State income tax has been accrued under the eligible state pass through entity tax provisions. Each member is individually responsible for reporting income or loss, to the extent required by federal and state income tax laws and regulations, based on its respective share of the company's income and expense as reported for income tax purposes. In accordance with ASC 740-10, the Company has determined it has no uncertain tax positions that require an accruals. The Company is required to file income tax returns in the U.S. federal jurisdiction and various states 1n 2025. The Company is evaluating new Accounting Standards and will implement as required. #### 2. Related Party Transactions The Company paid \$45,950 on behalf of its related party subsidiary related to expenses. This amount is included in expenses on the Consolidated Statement of Operations. ### 3. Concentrations of Credit Risk The Company maintains its cash in bank accounts which, at times, may exceed federally insured limits. The Company has not experienced any loss in these accounts and does not believe it is exposed to any significant credit risk on cash. The Company and its subsidiaries are engaged in carious trading and brokerage activities in which counterparties primarily include broker-dealers, banks, and other financial institutions. In the event counterparties do not fulfill their obligations, the Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparty or issuer of the instrument. It is the Company's policy to review, as necessary, the credit standing of each counterparty. {8}------------------------------------------------ # Cross Point Capital, LLC Notes to Consolidated Financial Statements Year Ended December 31, **2025** #### 4. Leases The Company recognizes and measures its leases in accordance with FASB ASC 842, Leases. The Company is a lessee in a noncancellable operating leases, for office space. The Company determines if an arrangement is a lease, or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Company recognizes a lease liability and a right of use (ROU) asset at the commencement date of the lease. The lease liability is initially and subsequently recognized based on the present value of its future lease payments. Variable payments are included in the future lease payments when those variable payments depend on an index or a rate. The discount rate is implicit rate of it is readily determinable or otherwise the Company uses its incremental borrowing rate. The implicit rates of our leases are not readily determinable and accordingly, we use our incremental borrowing rate based on the information available at the commencement date for all leases. The Company's incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms and in a similar economic environment. The ROU asset is subsequently measured throughout the lease term at the amount of the remeasured lease liability (i.e., present value of the remaining lease payments), plus unamortized initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of l18ase incentives received, and any impairment recognized. Lease cost for lease payments is recognized on a straight-line basis over the lease term. On December 22, 2025, the Company entered into a new lease agreement for office space. The lease is for 36 months with a renewal options. In accordance with Accounting Standards Codification 842 Leases ("ASC 842"), the Company recognized a right of use asset ("ROU asset") and a corresponding lease liability based on the present value of the lease agreement. As of December 31, 2025, operating lease ROU assets were \$319,288 and operating lease liabilities were \$319,288. The ROU asset measurement was calculated using the fixed scheduled rent payments, which included three months of free rent and annual increase specified in the lease agreement, up to the maturity date of November 2028. Rent expense incurred for 2025 was \$159,065. The following summarizes the line items in the balance sheet which include amounts for operating leases as of December 31, 2025: Weighted-average remaining lease term (months): 32 Weighted-average discount rate: 4.2% The maturity of the lease liability on an undiscounted cash flow basis and a reconciliation to the operating lease liability recognized on the Statement of Financial Condition as of December 31, 2025: Year Ending December 31: | 2026 | \$
133,540 | |------------------------|-----------------------------| | 2027 | 136,211 | | 2028 | 57,222 | | Total | 326,973 | | Less: Discount | (7,685) | | Right of Use Liability | \$
319,288
========== | | | | {9}------------------------------------------------ ## 5. Net Capital Requirement As a registered broker and member of the Financial Industry Regulatory Authority, Inc., (FINRA), the Company is subject to SEC Uniform Net Capital 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. At December 31, 2025, the Company had net capital of \$20,227,329 which \$20,127,329 was in excess of its required net capital of \$100,000. The Company's ratio of Aggregate Indebtedness to Net Capital was .05 to 1 at December 31, 2025. ### 6. Date of Managements Review The Company evaluated subsequent events to May 22, 2026, the date the financial statements were issued and there were no additional events or transactions occurring during this subsequent event reporting which require recognition or disclosure in the financial statements. ## 7. Cash and Cash Equivalents The Company defines cash equivalents as highly liquid investments with original maturity of less than 90 days that are not held for sale in the ordinary course of business. ### 8. Fixed Assets Fixed assets include furniture, fixtures and leasehold improvements are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the assets (five to seven years). The Company follow the policy of capitalizing all major additions, renewals, ancl betterments. Minor replacements, maintenance, and repairs are expensed as incurred. Depreciation expense for 2025 was \$5,202. #### 9. Single Reportable Segment The Company is engaged in a single line of business as a securities broker-dealer, which is comprised of several classes of services, including principal transactions, agency transactions and investment banking. The Company has identified its President as the chief operating decision maker ("CODM"), who uses net income to evaluate the results of the business, predominantly in the forecasting process, to manage the Company. Additionally, the CODM uses excess net capital, which is not a measure of profit and loss, to make operational decisions while maintaining capital adequacy, such as whether to reinvest profits or pay dividends. The Company's operations constitute a single operating segment and therefore, a single reportable segment, because the CODM manages the business activities using information of the Company as a whole. The accounting policies used to measure the profit and loss of the segment are the same as those described in the summary of significant accounting policies. The Company does not have intra-entity sales or transfers. #### 10. Retirement Plan Effective May 25, 2021, the Company adopted a defined contribution pooled employer retirement plan under the provisions of Internal Revenue Code section 401 (k). Employees as of the effective date, and future employees of age 21 with three months of service, may participate. Employee initial contributions of 3% with 1 % annual increases, are automatic unless the employee elects otherwise. Th,e Company must match 100% of the employees' contributions up to 1 % of compensation, and 50% of the employees' contributions up to 6% of compensation; these Company contributions vest to the employee at 100% after 2 years. The Company may also make discretionary contributions to the Plan; if made, these vest to the employee at 20% per year over a 6-year period, starting in year 2. There were no employ1ae contributions, and the Company made no contributions in 2025. {10}------------------------------------------------ ## 11. Fair Value Hierarchy FASS ASC 820 defines fair value, establishes a framework for measuring fair value, and establishes a hierarchy of fair value inputs. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market, income or cost approach, as specified by FASS ASC 820, are used to measure fair value. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: • Level 1. Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date. • Level 2. Inputs other than quoted prices included within level 1 that are observable for the asset or liability either directly or indirectly. • Level 3. Unobservable inputs for the asset or liability. The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety. #### Fair Value Measurements Fair value is a market-based measure considered from the perspective of a market participant rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, the Company's own assumptions are set to reflect those that the Company believes market participants would use in pricing the asset or liability at the measurement date. A description of the valuation techniques applied to the company's major categories of assets and liabilities measured at fair value on a recurring basis follows, this includes financial instruments owned. {11}------------------------------------------------ ### 11. Fair Value Hierarchy (Continued) Financial Instruments: The Company's proprietary trading positions consist primarily of mortgage-backed and asset-backed securities, including ABS, CMBS, CMO, COO, HELOC, and other mortgage-backed securities collateralized by pools of mortgages. The Company measures its proprietary positions at fair value in accordance with ASC 820, Fair Value Measurement. Due to the limited market activity, lack of observable market inputs, and significant judgment involved in estimating fair value for these securities, the Company has classified all proprietary positions within Level 3 of the fair value hierarchy. Certain securities are valued using prices provided by the Company's clearing broker. The Company utilizes these prices as the estimated fair value for those positions. However, management determined that sufficient information regarding the observability of the underlying valuation inputs and methodologies utilized by the clearing broker was not available to support classification within Level 2 of the fair value hierarchy. Accordingly, these securities are classified within Level 3 due to the use of significant unobservable inputs. For securities for which prices are not provided by the clearing broker, the Company estimates fair value based on purchase price adjusted for distributions received. The Company further categorizes securities as either distressed or non-distressed based on the purchase price of the security relative to its face value. Securities purchased below 60% of face value are considered distressed, while securities purchased at or above 60% of face value are considered nondistressed. For distressed securities not priced by the clearing broker, the Company values the securities based on purchase price less any interest and principal distributions received. For non-distressed securities not priced by the clearing broker, the Company values the securities based on purchase price less principal distributions received. Management periodically evaluates the carrying values of these securities based on available information and market conditions. {12}------------------------------------------------ | Cross Point Capital, LL:.C | |-------------------------------| | Notes to Financial Statements | | Year Ended December 31, 2025 | #### **11. Fair Value Hierarchy (continued)** The following table presents the Company's fair value hierarchy for those financial instruments owned measured at fair value on a recurring basis as of December 31, 2025. Fair Value Measurements on a Recurring Basis as of December 31, 2025: | | Level1 | Level 2 | Level 3 | Total | |-------------------------------------------|--------|---------|---------------|----------------------| | Assets | | | | | | Securities owned: | | | | | | Fixed income, residential mortgage backed | | | | | | securities and assets backed securities | \$ | \$ | \$ 34,073,341 | \$
34,073,341 | | | | | | | | | \$ | \$ | \$ 34,073,341 | \$
34_,0'i':3,341 | The following is a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (level 3) during the year ended December 31, 2025: Level 3 Financial Assets and Liabilities, Year ended December 31, 2025: | | Beginning
balance | Unrealized
gains and
(losses)
related to
assets held
at }'.ear- | Realized
gains and
(losses)
related to
assets no
longer held | Investment
banking
realized
gains and
(losses) no
positions | Purchases,
issuances
and
settlements | Transfers in
(out) | Ending balance | |--------------------------------------------------------------------------------------------|----------------------|--------------------------------------------------------------------------------|-----------------------------------------------------------------------------|----------------------------------------------------------------------------|-----------------------------------------------|-----------------------|----------------| | Fixed income, residential
mortgage backed securities
and assets backed securities \$ | 21,194,448 \$ | (3,134,592) \$ | 23,064,006 \$ | | \$
73,136,271 | \$
(80,186,792) \$ | 34,073,341 | | Total | \$
21,194,448 \$ | (3,134,592) \$ | 23,064,006 \$ | | \$
73,136,271 | \$
(80,186,792) \$ | 34,073,341 | {13}------------------------------------------------ ## 12. State Income Tax The Company has elected to pay Connecticut and New York pass through entity tax - PTE on certain pre tax income. The PTE tax for New York and Connecticut are treated as attributable to the owners rather than entity level because owners receive a tax credit on their share of entity level payments, thus payments are considered equity distributions. ## 13. Prior Period Adjustment The Company recorded a prior period adjustment to increase the beginning balance in Member's Equity for \$337,809. This was to recognized interest income in the prior year. The effect of this entry would have increased equity and net income for the year ending December 31, 2024. In the prior year the Company was in compliance with net capital required by SEC Rule 15c3-1 after the prior period adjustment was recorded. Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.