# HGP SECURITIES, LLC X-17A-5 (2022-02-14) — Broker-dealer annual report - Company: HGP SECURITIES, LLC - Form: X-17A-5 - Filed: 2022-02-14 - Period: 2021-12-31 - Accession: 0001449653-22-000001 - CIK: 1449653 - File #: 8-68080 - Type: Broker-dealer - Material weakness: No - Auditor: Rubio CPA, PC - Auditor location: Atlanta, GA - Contact: Chris McCord - Phone: 713-955-7935 - Email: chris@hgp.com - Website: hgp.com - Signed by: Christopher McCord (CEO) Original filing: https://www.sec.gov/Archives/edgar/data/1449653/000144965322000001/hgps.pdf --- {0}------------------------------------------------ | | UNITED STATES | | OMO APPROVAL | | |---------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|----------------------|-----------------------------------------------------|--| | | SECURITIES AND EXCHANGE COMMISSION | | 0MB Number: 3235-0123 | | | | Washington, D.C. 20549 | | Expires · Oct. 31, 2023
Estimated av rage burden | | | | | | hours per response. 12 | | | | ANNUAL REPORTS | | SEC FI LE NUMBER | | | | FORM X-17A-5 | | 8-68080 | | | | PART Ill | | | | | | | | | | | | FACING PAGE
Information Required Pursuant to Rules 17a-S, 17a-12, and 18a-7 under the Securities Exchange Act of 1934 | | | | | | | | - | | | FI LI NG FOR THE PERIOD BEG INNING 1 /1 /21 | ---------
MM/DD/YY | AND ENDING 12/31 /21 | --------
-
MM/DD/YY | | | | | | | | | | A. REGISTRANT IDENTIFICATION | | | | | NAME OF FIRM : HGP SECURITIES, LLC | | | | | | | | | | | | TYPE OF REGISTRANT (check all applicable boxes): | | | | | | ~ Broker-dealer
0 Check here if respondent Is also an OTC derivatives dealer | D Security-based swap dealer | | D Major security-based swap participant | | | | | | | | | ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use a P.O. box no.) | | | | | | 2001 Kirby Drive, Suite 814 | | | | | | | (No. and Street) | | | | | Houston | TX | | 77019 | | | (City) | (State) | | (Zip Code) | | | PERSO
TO CONTACT WITH REGARD TO THIS FILING | | | | | | | | | | | | Chris McCord | 713-955-7935 | | chris@hgp.com | | | (Name) | (Area Code -Telephone Number) | (Email Address) | | | | | 8. ACCOUNTANT IDENTIFICATION | | | | | | | | | | | INDEPENDENT PUBLIC ACCOUNTANT whose reports are contained in this fi ling* | | | | | | RUBIO CPA, PC | | | | | | | (Name - if individual, state last, first, and middle name) | | | | | 2727 Paces Ferry Rd SE, Suite 2-1680 Atlanta | | GA | 30339 | | | (Address) | (City) | (State) | (Zip Code) | | | 5/5/09 | | 3514 | | | | | | | (PCADB Reg;ma,;,, N,mb", ;f applkable) I | | | | FOR OFFICIAL USE ONLY | | | | | | | | | | | | | | | | **Persons who are to** respond **to the collection of information contained** in **this form are** not **required to** respond unless the form displays a currently **valid 0MB** control **number.** {1}------------------------------------------------ #### OATH OR AFFIRMATION I, Chnstopher McCord swear (or affirm) t hat, to the best of my knowledge and belief, the financial report pertaining to the firm of HGP SECURITIES, LLC as of December 31 2 02 1 , is true and correct. I further swear (or affirm) that neither the company nor any partner, officer, director, or equivalent person, as t he case may be, has any proprietary interest in any account classified solely as that of a customer. *c:7t£LdL* Notary Public #### **This filing\*\* contains (check all applicable boxes):** - **ii** (a) Statement of financia l condition. - D (b) Notes to consolidated statement of financial condition. - **lij** (c) Statement of income (loss) or, if there is other comprehensive inc9\_mf? in the period(s) presen ted, a statement of comprehensive income (as defined in§ 210.1-02 of Regulation **S-X).** - ~ (d) Statement of cash flows. - **ii** (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. - **ii** (g) Notes to consolidated financial statements. - **ii** (h) Computation of net capita l under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - D (i) Computation of tangible net worth under 17 CFR 240.18a -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 requ irements pursuant to Exhibit B to 17 CFR 240.15c3-3 or Exhibit A to 17 CFR 240.18a-4, as applicable. - D (I) Computation for Determination of PAB Requirements under Exhibit A to§ 240.15c3-3. - D (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - D (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. - **ii** (o) Reconci liations, including appropriate explanations, of the FOCUS Report with computation of net capital or ta ngible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-1, or 17 CFR 240.18a-2, as applicable, and the reserve req uirements 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. - **ii** (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. - D (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - **ii** (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - D (t) Independent public accountant's report based on an examination of the statement of financial condition. - **ii** (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. - 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. - **ii (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. - ~ (x) Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-le or 17 CFR 240.17a-12, as applicable. - **(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). U(z) Other: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ \_ - *"To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e){3) or 17 CFR 240.18a-7(d)(2), os applicable.* Title: / CEO ![](_page_1_Picture_34.jpeg) {2}------------------------------------------------ ## **HGP SECURITIES, LLC** **(A Limited Liability Company)** Financial Statements For the Year End December 31, 2021 {3}------------------------------------------------ ## **RUBIO CPA, PC** CERTIFIED PUBLIC ACCOUNTANTS 2727 Paces Ferry Road SE Building 2., Suite 1680 Atlanta, GA 30339 Office: 770 690-8995 Fax: 770 838-7123 ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of HGP Securities, LLC Opinion on the Financial Statements We have audited the accompanying statement of financial condition of HGP Securities, LLC (the "Company") as of December 31, 2021 , the related statements of operations, changes in member's equity, 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 , 2021, 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 to 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 information contained in Schedules I, II and III has 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 information in Schedules I, II and III 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 accompanying schedules. In forming our opinion on the accompanying schedules, we evaluated whether the supplemental information, including its form and content, is presented {4}------------------------------------------------ in conformity with 17 C.F.R. §240. l 7a-5. In our opinion, the aforementioned supplemental information is fairly stated, in all material respects, in relation to the financial statements as a whole. We have served as the Company's auditor since 2017. February 14, 2022 Atlanta, Georgia **1>.J,;,UA,~** Rubio CPA, PC {5}------------------------------------------------ ## **HGP Securities, LLC (A Limited Liability Company) Statement of Financial Condition December 31, 2021** #### Assets | Cash
Accounts receivable
Property and equiment, net of accumulated depreciation of \$36,448
Right of use asset
Prepaid expenses
Deposits | \$
3,389,603
270 ,346
5,716
58 ,153
34 ,307
6,034 | |---------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------| | Total Assets | \$
3,764,159 | | Liabilities and Member's Equity | | | Accounts payable
Accrued compensation
Lease Liability | \$
15,435
13,298
64 ,064 | | Total Liabilities | 92 ,797 | | Member's Equity | 3,671 ,362 | | Total Liabilities and Member's Equity | \$
3,764,158 | {6}------------------------------------------------ ## **HGP Securities, LLC (A Limited Liability Company) Statement of Operations For the Year ended December 31, 2021** #### Revenues: | Investment banking
Interest
Forgiveness of PPP loan
Other revenue | \$
4,969,426
794
62,500
35,400 | |---------------------------------------------------------------------------------|----------------------------------------------| | Total Revenues | \$
5,068,120 | | Expenses: | | | Compensation and benefits
Occupancy and equipment
Communications
Other | \$
983,759
77,545
43,416
100,174 | | Total Expenses | \$
1,204 ,894 | | Net Income | \$
3,863,226 | {7}------------------------------------------------ #### **HGP Securities, LLC (A Limited Liability Company) Statement of Changes in Member's Equity For the Year ended December 31, 2021** | Member's Equity - January 1, 2021 | \$
708,136 | |--------------------------------------|---------------| | Distributions to Member | (900,000) | | Net income | 3,863,226 | | Member's Equity - December 31 , 2021 | \$3,671,362 | {8}------------------------------------------------ ## **HGP Securities, LLC (A Limited Liability Company) Statement of Cash Flows For the Year ended December 31, 2021** | Cash used by operating activities: | | |-----------------------------------------------------------------------------------|--------------| | Net income | \$ 3,863,226 | | Items which do not affect cash: | | | Depreciation | 6,163 | | Forgiveness of Paycheck Protection Program loan | (62 ,500) | | Adjustments to reconcile net income to net cash provided by operating activities: | | | Change in | | | Accounts receivable | (133,691) | | Right of use asset | 37,918 | | Prepaid expenses | 10,654 | | Deposits | (130) | | Accounts payable | 7,583 | | Accrued compensation | (494) | | Accrued retirement plan contribution | (28 ,950) | | Lease liability | (41 ,170) | | | | | Net cash provided by operating activities | 3,658,609 | | Cash flows from investing activites: | | | Purchase of equipment | (4 ,856) | | Net cash used by investing activities | (4 ,856) | | | | | Cash flows from financing activities: | | | Distributions to Member | (900 ,000) | | | | | Net cash used by financing activities | (900 ,000) | | | | | Net decrease in cash | 2,753,753 | | Cash - beginning of year | 635,850 | | | | | Cash - end of year | \$ 3,389,603 | {9}------------------------------------------------ #### **NOTE 1 - DESCRPTIONOFOPERATDNSANDSUMIMRYOFSIGNFICANTACCOLMlNGPOUCES** #### Description of Operations HGP Securities, LLC (the Company) was formed on April 9, 2008 and has been a registered brokerdealer with the Financial Industry Regulatory Authority (FINRA) since September 22, 2009. The Company provides capital raising services and merger and acquisition advisory services to companies in the health-care industry. Hawkeye Bay Capital, LLC is the sole owner of HGP Securities, LLC. As a limited liability company, the member's liability is limited to their investment. #### Summary of Significant Accounting Policies Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Revenue Recognition - Revenue from contracts with customers includes investment banking revenue from placement and advisory 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 appropriate measure of the Company's progress under the contract; whether revenue should be presented gross or net of certain costs; and whether constraints on variable consideration should be applied due to uncertain future events. The Company provides placement and advisory services related to capital raising activities and mergers and acquisitions transactions. Revenue for advisory arrangements is generally recognized at the point in time that performance under the agreement is completed (the closing date of transaction) or the contract is cancelled. However, for certain contracts, revenue is recognized over time for advisory arrangements in which the performance obligations are simultaneously provided by the Company and consumed by the customer. In some circumstances, significant judgement is needed to determine the timing and measure of progress appropriate for revenue recognition under a specific contract. Retainers and other fees received from customers prior to recognizing the revenue are reflected as contract liabilities. The Company recognizes success fee revenues from capital raising services and merger and acquisition advisory services upon completion of a success fee-based transaction. The Company recognizes certain retainer revenue from contracts with customers upon delivery of a list of possible participants to the transaction and delivery of specified marketing materials as these are the performance obligations identified by the Company. The amount of retainer revenue recognized without the consummation of a success fee-based transaction or formal termination of an engagement was \$132,000 and has been included in investment banking revenue in the accompanying Statement of Operations. {10}------------------------------------------------ #### **NOTE 1** - **DESCRPllON OFOPERATDNSANDSUMMARYOFSIGNFICANT ACCOlM'NGPOUCIES(oonil'IJ8d)** Cash- Cash consists of cash on deposit at a major financial institution. From time to time the account balances may be in excess of amounts insured by the Federal Deposit Insurance Corporation. Management does not believe the Company is exposed to any significant credit risk. Accounts receivable - Accounts receivable are non-interest-bearing uncollateralized obligations receivable in accordance with the terms agreed upon with each customer. The Company regularly reviews its accounts receivable for any uncollectible amounts. The review for uncollectible amounts is based on an analysis of the Company's collection experience, customer credit worthiness, and current economic treads. Based on management's review of accounts receivable, no allowance for credit losses is considered necessary. Property and Equipment - Property and equipment are recorded at cost. Depreciation is provided by use of straight-line methods over the estimated useful lives of the respective assets. Maintenance and repairs are charged to expense as incurred; major renewals and betterments are capitalized. When items of property or equipment are sold or retired , the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in the results of operations. #### **NOTE 2-NET CAPITAL REQUIREMENTS** The Company is subject to the Securities and Exchange Commission Uniform Net Capital Rule (Rule 15c3-1 ), which requires that the Company maintain 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 , 2021 , the Company had net capital of \$3,354,959 which was \$3,349,959 in excess of its required net capital of \$5,000. The Company's ratio of aggregate indebtedness to net capital was .01 to 1.0 as of December 31 , 2021. #### **NOTE 3 -INCOME TAXES** As a limited liability company, the tax consequences of the Company's operations all pass through to the sole member. Accordingly, the Company's financial statements do not include a provision for income taxes. Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 740 Accounting for Income Taxes, requires management to evaluate tax positions taken by the Company and recognize a tax liability (or asset) if the Company has taken an uncertain position that more likely than not would not be sustained upon examination by the taxing jurisdictions. Management has analyzed the tax positions taken by the Company and has concluded that, as of December 31 , 2021 , there were no uncertain tax positions taken or expected to be taken that would require recognition of a liability or asset or disclosure in the Company's financial statements. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. {11}------------------------------------------------ #### **NOTE 4 -LEASE COMMITMENTS** The Company leases office space under a non-cancelable operating lease expinng in 2023. The Company recognizes and measures its leases in accordance with FASB ASC 842, Leases. The Company recognizes the lease liability and a right of use (ROU) asset on its balance sheet by recognizing the lease liability based on the present value of its future lease payments. The Company uses an incremental borrowing rate of 6% based on what it would approximately 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 (present value of the remaining lease payments). | | Year Ending December 31, | | | |-----------------------|-----------------------------------|---------------|--------------| | | 2022 | 47,190 | | | | 2023 | 19,805 | | | | Total | \$
66 ,995 | | | | Total undiscounted lease payments | | \$
66,995 | | Less imputed interest | | | (2,932) | | Total lease liability | | | \$
64,063 | Maturity of the lease liability under the noncancelable operating lease is as follows: The Company's office space lease requires it to make variable payments for the Company's proportionate share of operating expenses (i.e. , building's property taxes , insurance, and common area maintenance). These variable lease payments are not included in lease payments used to determine the lease liability and are thus recognized as variable costs when incurred. The total lease cost including variable costs associated with this lease for the year ended December 31 , 2021 was \$70,992. The lease liability exceeds the ROU asset due to an unamortized lease incentive. The Company received rental income during 2021 from one related entity in the amount of approximately \$17,000 and from another unrelated entity in the amount of \$12,000 that have been included in other revenue. ## **NOTE 5- EMPLOYEE BENEFITS AND DEFERRED COMPENSATION PLANS** The Company sponsors a profit-sharing plan under Section 401 (k) of the Internal Revenue Code benefiting substantially all employees, as defined. Employees are eligible to participate as of the date of their employment. An employer contribution to the plan totaling approximately \$21 ,300 was expensed by the Company for 2021. {12}------------------------------------------------ ### **NOTE 6- SUBSEQUENT EVENTS** Subsequent events were evaluated through the date the financial statements were issued. #### **NOTE 7** - **CONTINGENCIES** The Company is subject to litigation in the normal course of business. The Company has no litigation in progress at December 31 , 2021. #### **NOTE 8-RELATED PARTY TRANSACTIONS** See Note 4 for a description of a sublease agreement in place with a related party. Financial position and results of operation could differ from the amounts in the accompanying financial statements if these related party transactions did not exist. #### **NOTE 9-PAYCHECK PROTECTION PROGRAM LOAN** In April 2020, the Company borrowed \$62,500 under the Paycheck Protection Program (PPP) established by the Coronavirus Aid , Relief, and Economic Security Act sponsored by the United States and administered by the Small Business Administration (the "SBA"). The loan was forgiven in whole on January 19, 2021and recognized as revenue. #### **NOTE 10-CUSTOMER CONCENTRATIONS** During 2021 , the Company had three customers that accounted for appruximately 7 4% of total revenues. Approximately 93% of accounts receivable at December 31 , 2021 is due from two customers. #### **NOTE 11 -ECONOMIC RISKS** In March 2020, the World Health Organization (WHO) declared COVID-19 a global pandemic. This pandemic event has resulted in significant business disruption and uncertainty in both global and U.S. markets. While the Company believes that it is an appropriate position to sustain the potential shortterm effects of these world-wide events, the direct and long-term impact to the Company and its financial statements is undetermined at this time. {13}------------------------------------------------ ## **HGP Securities, LLC (A Limited Liability Company) Schedule I Computation of Net Capital (Under Rule 15c3-1 of the Securities and Exchange Commission Act of 1934)** #### **December 31, 2021** | Net Capital: | | |----------------------------------------------------------------------------------------------------------------|----------------------------| | Total Member's equity | \$3,671
,362 | | Deductions:
Non-allowable assets:
Accounts receivable
Prepaid expenses
Property and equipment, net | 270,346
34,307
5,716 | | Deposits
Total deductions | 6,034
316,403 | | Net Capital | 3,354,959 | | Minimum Net Capital Requirement | 5,000 | | Excess Net Capital | \$3,349,959 | | Aggregate Indebtedness | \$
34,644 | | Percentage of aggregate indebtedness to net capital | 1.03% | ### **Reconciliation of Computation of Net Capital to Company's Unaudited Form X-17a-5 Part IIA filing** Pursuant to Rule 17a-5(d)(4), no material differences were noted from the Company's computation; therefore, a reconciliation is not considered necessary. {14}------------------------------------------------ ## **HGP Securities, LLC (A Limited Liability Company)** #### **Schedule** II #### **Computation For Determination Of Reserve Requirements Under Rule 15c3-3 Of The Securities And Exchange Commission As Of December 31, 2021** The Company does not claim exemption from SEA Rule 15c3-3 in reliance upon Footnote 74 of the 2013 Release. The Company does not hold customer funds or securities. #### **Schedule** Ill #### **Information Relating To The Possession Or Control Requirements Under Rule 15c3-3 Of The Securities And Exchange Commission As Of December 31, 2021** The Company does not claim exemption from SEA Rule 15c3-3 in reliance upon Footnote 74 of the 2013 Release. The Company does not hold customer funds or securities. {15}------------------------------------------------ #### **EXEMPTION REPORT SEA RULE 17a-5(d)(4)** February 3, 2022 Rubio CPA, P.C. 2727 Paces Ferry Rd. SE Building 2, Suite 1680 Atlanta, GA 30339 To Whom It May Concern: We , as members of management of HGP Securities, Inc. (the "Company ") are responsible for complying with Rule 17a-5, "Reports to be made by certain brokers and dealers". We have performed an evaluation of the Company's compliance with the requirements of Rule 17a-5 and the exemption provisions in Rule 15c3-3(k) (the "exemption provisions ") and of the 2013 Release adopting amendments to Rule 17a-5, including Footnote 7 4 of the 2013 Release. We have determined that the Company does not meet any of the exemption conditions of paragraph (k) of Rule 15c3-3 (i.e., paragraph (k)(l), (k)(2)(i) or (k)(2)(ii) but also (1) does 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 Exchange Act Rule 15c2-4 ("Rule 15c2-4"); (2) does not carry accounts of or for customers; and (3) does not carry PAB accounts (as defined in Rule 15c3-3) and therefore is covered by Footnote 74 of the 2013 Release. Accordingly, based on our evaluation we make the following statements to the best knowledge and belief of the Company: - 1. We reviewed the provi sions of Rule §15c3-3 and related guidance stated in the SEC Staffs FAQ and confirmed that the Company relied on Footnote 74 of the 2013 Release. - 2. The Company conducted business activities involving merger and acquisition advisory services activity throughout the year ended December 31, 2021 without exception. - 3. The Company met the identified conditions for such reliance throughout the period January 1, 2021 to December 31, 2021 without exception. Name: Christopher McCord Title: CEO {16}------------------------------------------------ # **RUBIO CPA, PC** CERTIFIED PUBLIC ACCOUNTANTS 2727 Paces Ferry Road SE Building 2, Suite 1680 Atlanta, GA 30339 Office: 770 690-8995 Fax: 770 838-7123 ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM** To the Member of HGP Securities, LLC We have reviewed management's statements included in the accompanying Broker Dealers Annual Exemption Report in which (1) HGP Securities, LLC did not claim an exemption from Rule 15c3-3 in reliance upon Footnote 74 of the 2013 Release, and (2) HGP Securities, LLC stated that HGP Securities, LLC met the identified conditions for such reliance throughout the most recent fiscal year without exception. HGP 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 HGP 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 Footnote 74 of the 2013 Release. February 14, 2022 Atlanta, GA **~~,fc..** Rubio CPA, PC {17}------------------------------------------------ ## **RUBIO CPA, PC** CERTIFIED PUBLIC ACCOUNTANTS 2727 Paces Ferry Road SE Building 2, Suite 1680 Atlanta, **GA 30339** Office: 770 690-8995 Fax: 770 838-7123 ## **REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON APPL YING AGREED-UPON PROCEDURES** To the Member of HGP Securities, LLC We have performed the procedures included in Rule l 7a-5( e )( 4) under the Securities Exchange Act of 1934 and in the Securities Investor Protection Corporation (SIPC) Series 600 Rules, which are enumerated below and were agreed to by HGP Securities, LLC and the SIPC, solely to assist you and SIPC in evaluating HGP Securities, LLC's compliance with the applicable· instructions of the General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2021. HGP Securities, LLC's management is responsible for its Form SIPC-7 and for its compliance with those requirements. This agreed-upon procedures engagement was conducted in accordance with standards established by the Public Company Accounting Oversight Board (United States) and in accordance with attestation standards established by the American r nstitute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures we performed, and our findings are as follows: - 1) Compared the listed assessment payments in Form SIPC-7 with respective cash disbursement records entries, noting no differences; - 2) Compared the Total Revenue amount reported on the Annual Audited Report Form X-17 A-5 Part III for the year ended December 31, 2021 with the Total Revenue amount reported in Form SIPC-7 for the year ended December 31 , 2021, noting no differences; - 3) Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers, noting no differences; - 4) Recalculated the arithmetical accuracy of the calculations reflected in Form SIPC-7 and in the related schedules and working papers supporting the adjustments, noting no differences. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion or conclusion, respectively, on HGP Securities, LLC's compliance with the applicable instructions of the Form SIPC-7 for the year ended December 31 , 2021. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. This report is intended solely for the information and use of HGP Securities, LLC and the SIPC and is not intended to be and should not be used by anyone other than these specified parties. February 14, 2022 Atlanta, GA **1W,.:.,UM,~** Rubio CPA, PC {18}------------------------------------------------ | SIPC-7 | | |----------------|--| | (36-REV 12/18) | | ## **SECURITIES INVESTOR PROTECTION CORPORATION Mail Code: 8967 P.O. Box 7247 Philadelphia, PA 19170-0001** **SIPC-7** (36-REV 12/18) # **General Assessment Reconciliation** For the fiscal year ended 12131121 (Read carefully the instructions in your Working Copy before completing this Form) ## **TO BE FILED BY ALL SIPC MEMBERS WITH FISCAL YEAR ENDINGS** 1. Name of Member, address, Designated Examining Authority, 1934 Act registration no. and month in which fiscal year ends for purposes of the audit requirement of SEC Rule 17a-5: | | 1068080
HGP SECURITIES, LLC
2001 Kirby Drive | 7 | indicate on the form filed. | Note: If any of the information shown on the
mailing label requires correction, please e-mail
any corrections to form@sipc.org and so | |--------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------|----|-----------------------------|---------------------------------------------------------------------------------------------------------------------------------------------| | | Suite 701
I Houston, TX 77019 | | | Name and telephone number of person to
contact respecting this form. | | | | _J | | Rick Alvarez 770.407.3459 | | 2. A. | General Assessment (item 2e from page 2) | | | | | B. | Less payment made with SIPC-6 filed (exclude interest)
8/3/21 | | | (3,063 | | C. | Date Paid
Less prior overpayment applied | | | | | D. | Assessment balance due or (overpayment) | | | 4,392 | | E. | Interest computed on late payment (see instruction E) for ______ days at 20% per annum | | | 0 | | F. | Total assessment balance and interest due (or overpayment carried forward) | | | \$4,392 | | | □
□
G. PAYMENT:
✓ the box
Check mailed to P.O. Box
Funds Wired
ACQ4,392
Total (must be same as F above) | | ----------- | | | H. | \$ ( 0
Overpayment carried forward | | ----------- | | | 3. Subsidiaries (S) and predecessors (P) included in this form (give name and 1934 Act registration number): | | | | | | The SIPC member submitting this form and the
person by whom it is executed represent thereby
that all information contained herein is true , correct | HGP SECURITIES, LLC | | | | |------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------|--|--|--| | and complete. | (Name of Corp orati on, Partn ership or othe r organi zatio n) | | | | | | ~,J,.u,,m:.
~ | | | | | | (A uth orized Sig nature) | | | | | the~
20~
day of February
Dated
, | Managing Director | | | | | | (Titl e) | | | | | This form and the assessment payment is due 60 days after the end of the fiscal year. Retain the Working Copy of this form
for a period of not less than 6 years, the latest 2 years in an easily accessible place. | | | | | | | | | | | | | | | | | | LLI
== LLI | cc: Dates: | Postmarked | Received | Reviewed | | |---------------|----------------|--------------------------------|----------|---------------|--------------| | >
LLI | Calculations | | | Documentation | Forward Copy | | cc:
Cl | c, Exceptions: | | | | | | | | Cl) Disposition of exceptions: | | | | {19}------------------------------------------------ ## **DETERMINATION OF "SIPC NET OPERATING REVENUES" AND GENERAL ASSESSMENT** Amounts for the fiscal period beginning \_1\_111\_21 \_\_\_\_ \_ and ending\_1213 \_ 1\_121 \_\_\_\_ \_ (to page 1, line 2.A.) | | Eliminate cents | |-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------| | Item No.
2a. Total revenue (FOCUS Line 12/Part IIA Line 9, Code 4030) | \$5,068,120 | | 2b. Additions:
(1) Total revenues from the securities business of subsidiaries (except foreign subsidiaries) and
predecessors not included above. | | | (2) Net loss from principal transactions in securities in trading accounts. | | | (3) Net loss from principal transactions in commodities in trading accounts. | | | (4) Interest and dividend expense deducted in determining item 2a. | | | (5) Net loss from management of or participation in the underwriting or distribution of securities. | | | (6) Expenses other than advertising, printing, registration fees and legal fees deducted in determining net
profit from management of or participation in underwriting or distribution of securities. | | | (7) Net loss from securities in investment accounts. | | | Total additions | 0 | | 2c. Deductions:
(1) Revenues from the distribution of shares of a registered open end investment company or unit
investment trust, from the sale of variable annuities, from the business of insurance, from investment
advisory services rendered to registered investment companies or insurance company separate
accounts, and from transactions in security futures products. | | | (2) Revenues from commodity transactions. | | | (3) Commissions, floor brokerage and clearance paid to other SIPC members in connection with
securities transactions. | | | (4) Reimbursements for postage in connection with proxy solicitation. | | | (5) Net gain from securities in investment accounts. | | | (6) 100% of commissions and markups earned from transactions in (i) certificates of deposit and
(ii) Treasury bills, bankers acceptances or commercial paper that mature nine months or less
from issuance date. | | | (7) Direct expenses of printing advertising and legal fees incurred in connection with other revenue
related to the securities business (revenue defined by Section 16(9)(L) of the Act). | | | (8) Other revenue not related either directly or indirectly to the securities business.
(See Instruction C): | | | dollar for dollar out of pocket expense reimbursement, rental income and PPP forgiveness | 97,900 | | (Deductions in excess of \$100,000 require documentation) | | | (9) (i) Total interest and dividend expense (FOCUS Line 22/PART IIA Line 13,
__________
Code 4075 plus line 2b(4) above) but not in excess
\$
_
of total interest and dividend income. | | | __________
(ii) 40% of margin interest earned on customers securities
\$
_
accounts (40% of FOCUS line 5, Code 3960). | | | Enter the greater of line (i) or (ii) | 0 | | Total deductions | 97,900 | | 2d. SIPC Net Operating Revenues | \$4,970,220 | | 2e. General Assessment@ .0015 | \$ 7,455 | {20}------------------------------------------------ ## **SIPC-7 Instructions** This form is to be filed by all members of the Securities Investor Protection Corporation whose fiscal years end in 2011 and annually thereafter. The form together with the payment is due no later than 60 days after the end of the fiscal year, or after membership termination. Amounts reported herein must be readily reconcilable with the member's records and the Securities and Exchange Commission Rule 1 ?a-5 report filed. Questions pertaining to this form should be directed to SIPC via e-mail at form@sipc.org or by telephoning 202-371-8300. A. For the purposes of this form , the term "SIPC Net Operating Revenues " shall mean gross revenues from the securities business as defined in or pursuant to the applicable sections of the Securities Investor Protection Act of 1970 ("Act") and Article 6 of SIPC 's bylaws (see page 4) , less item 2c(9) on page 2. B. Gross revenues of subsidiaries , except foreign subsidiaries , are required to be included in SIPC Net Operating Revenues on a consolidated basis except for a subsidiary filing separately as explained hereinafter. If a subsidiary was required to file a Rule 17a-5 annual audited statement of income separately and is also a SIPC member, then such subsidiary must itself file SIPC-7, pay the assessment , and should not be consolidated in your SIPC-7. SIPC Net Operating Revenues of a predecessor member which are not included in item 2a , were not reported separately and the SIPC assessments were not paid thereon by such predecessor, shall be included in item 2b(1). C. Your General Assessment should be computed as follows : - (1) **Line 2a** For the applicable period enter total revenue based upon amounts reported in your Rule 17a-5 Annual Audited Statement of Income prepared in conformity with generally accepted accounting principles applicable to securities brokers and dealers. or if exempted from that rule , use X-17A-5 (FOCUS Report) Line 12 , Code 4030. - (2) Adjustments The purpose of the adjustments on page 2 is to determine SIPC Net Operating Revenues. - (a) Additions Lines 2b(1) through 2b(7) assure that assessable income and gain items of SIPC Net Operating Revenues are totaled , unreduced by any losses (e.g. , if a net loss was incurred for the period from all transactions in trading account securities, that net loss does not reduce other assessable revenues). Thus , line 2b(4) would include all short dividend and interest payments including those incurred in reverse conversion accounts , rebates on stock loan positions and repo interest which have been netted in determining line 2(a). - (b) **Deductions** Line 2c(1) through line 2c(9) are either provided for in the statue , as in deduction 2c(1) , or are allowed to arrive at an assessment base consisting of net operating revenues from the securities business. For example , line 2c(9) allows for a deduction of either the total of interest and dividend expense (not to exceed interest and dividend income), as reported **on FOCUS line 22 /PART IIA line 13 (Code 4075), plus** line 2b(4) or 40% of interest earned on customers ' securities accounts (40% of FOCUS Line 5 Code 3960). Be certain to complete both line (i) and (ii), entering the greater of the two in the far right column. Dividends paid to shareholders are not considered "Expense" and thus are not to be included in the deduction. Likewise , interest and dividends paid to partners pursuant to the partnership agreements would also not be deducted. If the amount reported on line 2c (8) aggregates to \$100,000 or greater, supporting documentation must accompany the form that identifies these deductions. Examples of support information include; contractual agreements, prospectuses, and limited partnership documentation. - (i) Determine your SIPC Net Operating Revenues , item 2d , by adding to item 2a , the total of item 2b , and deducting the total of item 2c. - (ii) Multiply SIPC Net Operating Revenues by the applicable rate. Enter the resulting amount in item 2e and on line 2A of page 1. - (iii) Enter on line 2B the assessment due as reflected on the SIPC-6 previously filed. - (iv) Subtract line 2B and 2C from line 2A and enter the difference on line 2D. This is the balance due for the period. - (v) Enter interest computed on late payment (if applicable) on line 2E. - (vi) Enter the total due on line 2F and the payment of the amount due on line 2G. - (vii) Enter overpayment carried forward (if any) on line 2H. D. Any SIPC member which is also a bank (as defined in the Securities Exchange Act of 1934) may exclude from SIPC Net Operating Revenues dividends and interest received on securities in its investment accounts to the extent that it can demonstrate to SIPC 's satisfaction that such securities are held , and such dividends and interest are received , solely in connection with its operations as a bank and not in connection with its operations as a broker, dealer or member of a national securities exchange. Any member who excludes from SIPC Net Operating Revenues any dividends or interest pursuant to the preceding sentence shall file with this form a supplementary statement setting forth the amount so excluded and proof of its entitlement to such exclusion. E. Interest an Assessments If all or any part of assessment payable under Section 4 of the Act has not been postmarked within 15 days after the due date thereof , the member shall pay, in addition to the amount of the assessment , interest at the rate of 20% per annum on the unpaid portion of the assessment for each day it has been overdue. F. Securities and Exchange Commission Rule 17a-5(e) (4) requires those who are not exempted from the audit requirement of the rule and whose gross revenues are in excess of \$500 ,000 to file a supplemental independent public accountants report covering this SIPC-7 no later than 60 days after their fiscal year ends. **Mail this completed form to SIPC together with a check for the amount due, made payable to SIPC, using the enclosed return PO BOX envelope, pay via ACH Debit Authorization through SIPC 's ACH system at www.sipc.org/for-members/assessments or wire the payment to:** **On the wire identify the name of the firm and its SEC Registration 8-# and label it as "for assessment." Please fax a copy of the assessment form to (202)-223-1679 or e-mail a copy to form@sipc.org on the same day as the wire.** {21}------------------------------------------------ ## **From Section 16(9) of the Act:** The term "gross revenues from the securities bu siness " means the sum of (but without duplication )- (A) commissions earned in connection with transactions in securities effected for customers as agent (net of commissions paid to other brokers and dealers in connection with such transactions ) and markups with respect to purchases or sales of securities as principal ; (B) charges for executing or clearing transactions in securities for other brokers and dealers ; - (C) the net realized gain , if any , from principal transactions in securities in trading accounts; - (D) the net profit , if any , from the management of or participation in the underwriting or distribution of securities ; - (E) interest earned on customers ' securities accounts ; (F) fees for investment advisory services (except when rendered to one or more registered investment companies or insurance company separate accounts) or account supervision with respect to securities; - (G) fees for the solicitation of pro xies with respect to , or tenders or exchanges of , securities ; - (H) income from service charges or other surcharges with respect to securities ; (I) except as otherwise provided by rule of the Commission , dividends and interest received on securities in investment accounts of the broker or dealer; (J) fees in connection with put , call , and other options transactions in securities ; (K) commissions earned for transactions in (i) certificates of deposit , and (ii) Treasury bills , bankers acceptances , or commercial paper which have a maturity at the time of issuance of not exceeding nine months , exclusive of days of grace , or any renewal thereof , the maturity of which is likewise limited , except that SIPC shall by bylaw include in the aggregate of gross revenues only an appropriate percentage of such commissions based on SIPC 's loss experience with respect to such instruments over at least the preceding five years; and (L) fees and other income from such other categories of the securities business as SIPC shall provide by bylaw. Such term includes revenues earned by a broker or dealer in connection with a transaction in the portfolio margining account of a customer carried as securities accounts pursuant to a portfolio margining program approved by the Commission. Such term does not include revenues received by a broker or dealer in connection with the distribution of shares of a registered open end investment company or unit investment trust or revenues derived by a broker or dealer from the sales of variable annuities , the business of insurance , or transactions in security futures products. ### **From Section 16(14) of the Act:** The term "Security " means any note , stock , treasury stock , bond , debenture , evidence of indebtedness , any collateral trust certificate , preorganization certificate or subscription , transferable share , voting trust certificate , certificate of deposit , certificate of deposit for a security , or any security future as that term is defined in section 78c (a)( 55 )(A) of this title , any investment contract or certificate of interest or participation in any profit-sharing agreement or in any oil , gas or mineral royalty or lease (if such investment contract or interest is the subject of a registration statement with the Commission pursuant to the provisions of the Securities Act of 1933 [15 U.S.C. 77a et seq.]) , any put , call , straddle , option , or privilege on any security , or group or inde x of securities (including any interest therein or based on the value thereof), or any put , call , straddle , option , or privilege entered into on a national securities exchange relating to foreign currency , any certificate of interest or participation in , temporary or interim certificate for , receipt for , guarantee of , or warrant or right to subscribe to or purchase or sell any of the foregoing , and any other instrument commonly known as a secu rity. Except as specifically provided above , the term "security " does not include any currency , or any commodity or related contract or futures contract , or any warrant or right to subscribe to or purchase or sell any of the foregoing. # **From SIPC Bylaw Article 6 (Assessments): Section 1(f):** The term "gross revenues from the securities business " includes the revenues in the definition of gross revenues from the securities business set forth in the applicable sections of the Act. ## **Section 3:** For purpose of this article : (a) The term "securities in trading accounts " shall mean securities held for sale in the ordinary course of business and not identified as having been held for investment. (b) The term "securities in investment accounts " shall mean securities that are clearly identified as having been acquired for investment in accordance with provisions of the Internal Revenue Code applicable to dealers in securities. (c) The term "fees and other income from such other categories of the securities business " shall mean all revenue related either directly or indirectly to the securities business except revenue included in Section 16(9)(A)-(L) and revenue specifically excepted in Section 4(c )( 3)( C)[ltem 2c(1 ), page 2]. Note: If the amou nt of assessment ente red on line 2e of SIPC -7 is greater th an 1/2 of 1% of "gross revenues fro m the secu ri ties busi ness " as defined above , you may submit that calculation along with th e SIPC-7 for m to SIPC and pay the smaller amoun t, subject to review by you r Exami ning Authori ty and by SIPC. **SIPC Ex aminin g Authoritie s·** | ASE | Ame ri can Stock Exchange , LLC | FINRA | Fi nancial In dustr y Reg ulatory Authority | |-----|---------------------------------|-------|---------------------------------------------| | | | | | - CBOE Chicago Board Options Exchange , Incorporated NYSE Arca , Inc. CHX Chicago Stock Exchange , Incorporated **4** NASDAQ OM X PHLX - - SIPC Secu rities Investor Pr otection Corporation Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.