What changed in this filing

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Item 9A. Controls and Procedures

2025-03-31 compared with 2024-04-16 · 530 added, 341 removed, 765 unchanged (53% of the section changed)

5 unchanged sentences

Internal Control over Financial Reporting

This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f).

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our assessment under the framework in Internal Control – Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2024.

This Annual Report on Form 10-K does not include an attestation report of our independent registered public accounting firm due to the Company being considered an emerging growth company.

OTHER INFORMATION

8 unchanged sentences

Craig Gould .

Gould is the Chief Executive Officer of Wentworth Management Services, a holding company that acquires and manages businesses in the wealth management industry.

Gould is the Chief Executive Officer of Binah Capital Group, Inc., a holding company that acquires and manages businesses in the wealth management industry.

Craig has over 25 years in senior management roles in the financial services industry, including Chief Executive Officer, National Sales Manager and Head of Investment Banking.

7 unchanged sentences

David Shane .

Shane is acting as the Company’s Chief Financial Officer.

Shane is the Company’s Chief Financial Officer.

Previously, David served as an independent consultant providing financial advisory services including accounting, financial reporting, regulatory reporting and transaction structuring services to companies primarily in the Financial Services Industry.

4 unchanged sentences

David also has experience in mergers and acquisitions, capital raising in both the public and private markets and transaction structuring.

In addition to David’s public accounting experience, he has served as the Chief Financial Officer for financial services companies, with most recently as the Chief Financial Officer of Sanctuary Wealth.

In addition to David’s technical skills and business acumen, he brings an extensive network within the financial services industry to Wentworth.

In addition to David’s technical skills and business acumen, he brings an extensive network within the financial services industry to the Company.

David is a graduate of Indiana University with a degree in finance, a certified public accountant, and holds a Series 27 FINRA registration.

99 unchanged sentences

● reviewing and approving performance goals and objectives relevant to the compensation of the Company’s executive officers and assessing their performance against these goals and objectives;

● making recommendations to the the Board regarding the adoption or amendment of equity and cash incentive plans and approving amendments to such plans to the extent authorized by the the Board;

● reviewing and making recommendations to the the Board regarding the type and amount of compensation to be paid or awarded to the Company’s non-employee board members;

● making recommendations to the Board regarding the adoption or amendment of equity and cash incentive plans and approving amendments to such plans to the extent authorized by the Board;

● reviewing and making recommendations to the Board regarding the type and amount of compensation to be paid or awarded to the Company’s non-employee board members;

● reviewing and assessing the independence of compensation consultants, legal counsel and other advisors as required by Section 10C of the Exchange Act;

● administering the Company’s equity incentive plans, to the extent such authority is delegated by the the Board;

● administering the Company’s equity incentive plans, to the extent such authority is delegated by the Board;

● reviewing and approving the terms of any employment agreements, severance arrangements, change in control protections, indemnification agreements and any other material arrangements for the Company’s executive officers;

38 unchanged sentences

EXECUTIVE COMPENSATION

Wentworth’s named executive officers for the year ended December 31, 2023, which consisted of Wentworth’s principal executive officer and the next two most highly compensated executive officers, were:

● Craig Gould, Wentworth’s President and Cabot Lodge Securities, LLC’s President and Chief Executive Officer;

● Roger Leibowitz, Cabot Lodge Securities, LLC’s Chief Financial Officer;

● Kathrine Flouton, Purshe Kaplan Sterling Investments, Inc.’s Chief Executive Officer.

The Company’s named executive officers for the year ended December 31, 2024, which consisted of the Company’s principal executive officer and the next two most highly compensated executive officers, were:

● Craig Gould, Chief Executive Officer;

● Kathrine Flouton, Purshe Kaplan Sterling Investments, Inc.’s President;

● David Shane, Chief Financial Officer

Summary Compensation Table

The following table sets forth information regarding the compensation of Wentworth’s named executive officers for the years ended December 31, 2023 and 2022.

The following table sets forth information regarding the compensation of the Company’s named executive officers for the years ended December 31, 2024 and 2023.

Name and Principal Position

Wentworth’s President;

Cabot Lodge Securities, LLC’s President and Chief Executive Officer

Wentworth’s Chief Executive Officer

Roger Leibowitz

Cabot Lodge Securities, LLC’s Chief Financial Officer

Kathrine Flouton

Purshe Kaplan Sterling

Investments, Inc.’s President

Craig Gould, CEO

Katherine Flouton, President

Kathrine Flouton, President

David Shane, CFO

Outstanding Equity Awards at Fiscal Year-End

Wentworth had not issued any equity awards as of December 31, 2023 and 2022.

Employment Agreements — Craig Gould and Katherine Flouton

The Company had not issued any equity awards as of December 31, 2024 and 2023.

Employment Agreements — Craig Gould, David Shane and Katherine Flouton

Set forth below is a description of the current employment agreements of Mr.

Gould and Ms.

Shane and Ms.

Flouton as of December 31, 2024.

Gould, as well as certain other key employees of Wentworth, will be entering into new employment agreements in connection with the Business Combination, which are discussed below in detail (see “Employment Agreements Effective as of the Closing”).

Agreement between Mr.

Gould and Wentworth

Wentworth is party to an employment agreement with its President, Mr.

Gould, dated January 31, 2020.

Following the Guaranty Termination Date (as defined in the employment agreement), Wentworth can terminate the employment agreement at any time with or without Cause (as defined below), further to the provisions in Sections 7 and 8 of such agreement;

provided, however, that Mr.

Gould may terminate the employment agreement at any time with or without Cause.

During employment, Mr.

Gould is permitted to manage and/or work on his brokerage, investment banking and investment advisory business (including, but not limited to, all brokerage and advisory accounts that Mr.

Gould receives or shares compensation or fees on) (the “ Book ”) provided that managing the Book does not materially adversely affect performance of Mr.

Gould’s duties to Wentworth under the employment agreement.

Gould’s initial annual base salary was set at $300,000, subject to increase from time to time.

The employment agreement also provides that Mr.

Gould will be paid discretionary bonuses based upon Wentworth’s and Mr.

Gould’s performance.

The employment agreement further provides that Mr.

Gould remains eligible to receive commissions or fees payable in his role as a registered representative or investment advisor of any broker dealer or investment advisor affiliate of Wentworth pursuant to any agreement between Mr.

Gould and such affiliate.

On or after the Guaranty Termination Date, Wentworth may terminate the employment agreement with or without Cause, or due to Mr.

Gould’s death or disability.

The “Guaranty Termination Date” means the date on which any and all personal guarantees by Mr.

Gould in connection with any debt or other obligation or liability of Wentworth or its affiliates (including, but not limited to, any obligation of Wentworth or its affiliates to Oak Street Funding LLC or its affiliates), have been terminated.

In the event that Mr.

Gould’s employment ends due to (i) termination for Cause by Mr.

Gould, (ii) termination without Cause by Wentworth (upon providing 90 days’ prior written notice) or (iii) termination due to the death or disability of Mr.

Gould, Wentworth will pay to Mr.

Gould an amount equal to two times his then-current base salary, payable in 24 equal installments commencing immediately following such termination and every two weeks thereafter.

In addition, if Mr.

Gould timely and properly elects health continuation coverage under COBRA and remains eligible for it, Wentworth will pay monthly COBRA premiums for Mr.

Gould and/or his spouse and dependents in the same amount paid by the Company prior to the termination date until the earliest of:

(x) the one-year period following the termination date;

(y) the date when Mr.

Gould becomes eligible for substantially equivalent health insurance coverage in connection with new employment or self-employment;

or (z) the date Mr.

Gould ceases to be eligible for COBRA continuation coverage for any reason.

Receipt of the severance pay and COBRA benefits is contingent upon Mr.

Gould’s execution of a waiver and release agreement regarding employment related claims in a form satisfactory to Wentworth in its reasonable discretion, and only for so long as Mr.

Gould has not violated his continuing obligations with respect to confidential information and non-solicitation of clients and employees of Wentworth.

For purposes of the foregoing, “Cause” triggering termination by Mr.

(i) any material breach of the employment agreement by Wentworth;

(ii) Wentworth’s or members’ of the Board of Managers commission of any material act of dishonesty or a violation of the rules of FINRA or other regulator of the business of Wentworth;

(iii) Wentworth requires Mr.

Gould to move his principal business location, which is 1185 Avenue of the Americas, New York, NY 10036 as of the date hereof, to a location more than 20 miles one way commute from that location;

or (iv) a material diminution of Mr.

Gould’s base salary, bonus or title relative to his base salary, bonus or title immediately in effect prior to such reduction.

“Cause” triggering termination by Wentworth means a finding by Wentworth that any of the following exist:

Gould’s conviction of a gross misdemeanor or felony which substantially relates

to the business of the company;

or (ii) a finding by FINRA or other securities regulatory body of a material violation by Mr.

Gould of such body’s rules or regulations leading to a suspension of his duties for more than 90 days.

Gould’s employment is terminated for any reason Mr.

Gould (or his estate or personal representative, as applicable) will be entitled to receive within 30 days following the date of termination (i) all compensation earned and all benefits and reimbursements accrued and due through the effective date of termination including any unpaid annual bonus for the year prior to termination or any unpaid annual bonus for the year of termination which Mr.

Gould would have received if he had remained employed, pro-rated based on the time employed during the year and (ii) reimbursement of any unreimbursed business expenses or professional fees that are reimbursable pursuant to the employment agreement.

Upon his termination for any reason, Mr.

Gould is subject to:

(i) ongoing confidentiality and non-disclosure obligations until two years after the last payment required to be paid pursuant to the employment agreement has been paid;

provided, however, that trade secret information will remain a trade secret not subject to disclosure for the longest period allowed by applicable law;

and (ii) restrictive covenants of non-solicitation of employees and non-solicitation of customer and clients, each for a period of 24 months following termination of employment;

provided, however, that if Wentworth breaches its obligations regarding final pay, severance pay and COBRA benefits, then the non-solicitation covenants will no longer apply to Mr.

Further, the restrictive covenants do not prevent Mr.

Gould from accepting employment with an organization that competes with Wentworth, directly or indirectly, or from servicing, managing and/or working in the Book.

Agreement between Mr.

Gould and Cabot Lodge Securities, Inc.

(“Cabot Lodge”)

Gould has entered into an employment agreement with Cabot Lodge, dated January 5, 2015, in which he is employed as Chief Executive Officer and President of Cabot Lodge.

The employment agreement is for an initial four-year term, which shall continue upon expiration unless and until one party provides the other party with 30 days’ prior notice of intent to terminate, or unless otherwise terminated as provided for in the employment agreement.

Gould’s initial annual base salary was set at $250,000, subject to increase from time to time by the Board of Governors of Cabot Lodge.

The employment agreement also provides that Mr.

Gould will be paid discretionary bonuses based upon Wentworth’s and Mr.

Gould’s performance.

Other than through notice of intent to terminate as described above, Mr.

Gould’s employment can also be terminated:

Gould without cause, upon 30 days’ prior written notice to Cabot Lodge;

Gould with Cause (as defied below), if such Cause is not cured by Cabot Lodge within 60 days’ following written notice by Mr.

Gould requesting that Cabot Lodge cure;

(iii) by Cabot Lodge without Cause, upon 90 days’ written notice to Mr.

(iv) by Cabot Lodge for Cause;

or (v) upon Mr.

Gould’s death or disability.

In the event that Mr.

Gould’s employment ends due to (i) termination for Cause by Mr.

Gould, (ii) termination without Cause by Cabot Lodge or (iii) termination due to the disability of Mr.

Gould, Cabot Lodge will pay to Mr.

Gould an amount equal to two times his then-current base salary, payable in 26 equal installments commencing immediately following such termination and every two weeks thereafter.

Receipt of the severance pay is contingent upon Mr.

Gould’s execution of a waiver and release agreement regarding employment related claims in a form satisfactory to Cabot Lodge in its reasonable discretion, and only for so long as Mr.

Gould has not violated his continuing obligations with respect to confidential information and non-solicitation of clients and employees of Cabot Lodge.

For purposes of the foregoing, “Cause” triggering termination by Mr.

(i) any material breach of the employment agreement by Cabot Lodge;

or (ii) Cabot Lodge’s or the members of the Board of Governor’s commission of any material act of dishonesty or a violation of the rules of FINRA or other regulator of the business of Cabot Lodge.

“Cause” triggering termination by Cabot Lodge means a finding by Cabot Lodge that any of the following exist:

Gould’s conviction of a gross misdemeanor or felony which substantially relates to the business of the company;

(ii) a finding by FINRA or other securities regulatory body of a material violation by Mr.

Gould of such body’s rules or regulations leading to a suspension of his duties for more than 90 days;

Gould’s commission of material theft, or fraud, in any way related to Cabot Lodge.

Gould’s employment is terminated for any reason, Mr.

Gould (or his estate or personal representative, as applicable) will be entitled to receive all compensation earned and all benefits and reimbursements accrued and due through the effective date of termination.

Upon his termination for any reason, Mr.

Gould is subject to:

(i) ongoing confidentiality and non-disclosure obligations until two years after the last payment required to be paid pursuant to the employment agreement has been paid;

provided, however, that trade secret information will remain a trade secret not subject to disclosure for the longest period allowed by applicable law;

and (ii) restrictive covenants of non-solicitation of employees and independent contractors, and non-solicitation of customer and clients, each for a period of 24 months following termination of employment;

provided, however, that if Wentworth breaches its obligations under Section 7 of the employment agreement, then the non-solicitation covenants will no longer apply to Mr.

Further, the restrictive covenants do not prevent Mr.

Gould from accepting employment with an organization that competes with Wentworth, directly or indirectly.

Gould Employment Agreement

On August 14, 2024, the Company entered into an executive employment agreement with Craig Gould, the Company’s Chief Executive Officer.

The Gould Agreement is for an initial, five-year term which will automatically renew for additional, consecutive three-year terms unless either party provides the other party with 90 days’ notice of the intent not to renew prior to the expiration of the applicable term.

Notwithstanding the foregoing, Mr.

Gould’s employment is “at-will”, and the Gould Agreement may be terminated at any time, by either party, with or without Cause (as defined below) or advance notice.

Gould’s 2024 annualized base salary is $600,000.

In addition, the Company may provide Mr.

Gould a discretionary year-end performance-based bonus which will not be less than the bonus paid to any other executive of the Company.

Gould’s performance and the Company’s performance are to be primary considerations in determining any such annual bonus, which is subject to his continuous employment December 31 of the relevant bonus year, with such bonus payable no later than March 31 of the year following the relevant bonus year.

No later than September 15, 2025, the Company will grant Mr.

Gould nonqualified stock options to purchase 600,000 shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant, under the terms of the Company’s 2024 Equity Incentive Plan, as may be amended from time to time (the “ Plan ”).

These initial options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these initial options will be equal to the fair market value of the Company’s common Stock on the date of grant.

The vesting schedule of these initial options will be as follows:

(a) one-third of the Initial Options will vest on December 31, 2025, based on continued service through such date;

and (b) two-thirds of the Initial Options will vest ratably on a monthly basis over the remainder of Mr.

Gould’s initial term based on continued service through each vesting date, with the first such vesting date being on January 31, 2025.

The Initial Options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

On each anniversary of the Closing, the Company will grant Mr.

Gould nonqualified stock options to purchase that number of shares of common stock of the Company which have a grant date fair value equal to his then annual base salary amount, as reasonably determined by the Board, under the terms of the Plan.

These additional options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these additional options will be equal to the fair market value of the Company’s common Stock on the date of grant.

The vesting schedule of these additional options will be ratable monthly over three years from the date of the grant.

The additional options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

After the filing of a registration statement on Form S-8 for the Plan, the Company will grant Mr.

Gould, subject to his continuous service, 500,000 restricted stock units settled in shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant, with one-half of the grant vesting on the first anniversary of the date of grant and the remainder of the grant vesting on the second anniversary of the date of grant based on Mr.

Gould’s continued service through each vesting date.

During 2025, after the filing of a registration statement on Form S-8 for the Plan, the Company will grant to Mr.

Gould, subject to his continuous service, a fully vested share grant with a grant date fair market value of $220,000.

If, during 2025, Mr.

Gould continues to provide a personal guarantee on Company debt, the Company will grant Mr.

Gould, subject to his continuous service, a fully vested share grant with a grant date fair market value of $220,000.

All options granted by the Company will be forfeited upon Mr.

Gould’s termination for Cause.

All option grants will be subject to the terms of the applicable option agreement and Plan.

If the Company terminates Mr.

Gould’s employment without Cause, or Mr.

Gould resigns for Good Reason Mr.

Gould is entitled to (i) three times the amount of Mr.

Gould’s base compensation and three times the amount of the annual bonus payment paid to Mr.

Gould for the bonus year prior to the year in which termination occurs, payable in a lump-sum payment on the first regular payday occurring 60 days following the termination date, and (ii) accelerated vesting of all outstanding options as of the effective date of Mr.

Gould’s termination.

In addition, in the event that Mr.

Gould resigns other than for Good Reason, or the Gould Agreement is not renewed upon expiration of the applicable term, Mr.

Gould will receive a payment equal to his then-current annual base salary and target annual bonus, payable in a lump sum payment on the first regular payday occurring 60 days following the termination date, in exchange for Mr.

Gould being bound to a non-competition agreement.

Gould will only receive these severance payments if Mr.

Gould executes a full general and mutual release in a form acceptable to the Company and Mr.

Gould, and such release has become effective in accordance with its terms prior to the 60th day following the termination date.

All other obligations to Mr.

Gould will be automatically terminated and completely extinguished.

Gould’s employment with the Company terminates due to (x) Mr.

Gould’s death, (y) Mr.

Gould’s inability to perform the essential functions of his position with or without reasonable accommodation, (z) termination by the Company for Cause, Mr.

Gould will not be entitled to the severance payments in the prior paragraph and will only be entitled to receive base salary and benefits accrued through the termination date.

Gould’s employment terminates due to Mr.

Gould’s disability or death, Mr.

Gould will also be entitled to accelerated vesting of all stock or other options that are unvested as of the termination date.

For this purpose, “Cause” is defined as any of the following:

(i) conviction of or a plea of nolo contendere to any felony or any misdemeanor that involves crimes of moral turpitude, fraud or theft;

or (i) the material breach by Mr.

Gould of any of his obligations, duties and/or covenants under the Gould Agreement if such breach causes material damage to the Company, which breach, if curable, continues following written notice from the Company describing same with particularity and expiration of a 60-day cure period.

“Good Reason” is defined as any of the following, without Mr.

Gould’s written consent:

(i) a material diminution in Mr.

Gould’s responsibilities, authority or duties;

(ii) a diminution in Mr.

Gould’s base salary or target annual bonus amount;

or (iii) the material breach by the Company of any material provision of the Gould Agreement or other written agreement between the Company and Mr.

Gould, provided that a Good Reason Process has been followed prior to termination.

“Good Reason Process” shall mean that (i) Mr.

Gould reasonably determines in good faith that one of the Good Reason prongs has occurred;

Gould has notified the Company of such occurrence in writing within 30 days of the occurrence;

Gould cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “ Cure Period ”), to remedy the condition;

(iv) notwithstanding such efforts, the occurrence of the Good Reason continues to exist;

Gould terminates his employment within 30 days after the end of the Cure Period.

Gould’s employment is terminated for any reason, he is subject to:

ongoing confidentiality and non-disclosure obligations;

and 12-month, post-termination restrictive covenants of non-solicitation of employees, and customers Mr.

Gould will be subject to a 12-month, post-termination non-competition clause, provided that if his initial or renewal term is not extended or where he resigns without Good Reason, he must be compensated for the restricted period in order for the non-competition clause to be enforceable.

Each of the non-solicitation and non-competition provisions, as applicable, will be extended by one day for each day that Mr.

Gould is deemed by a court or other tribunal to have violated any such restrictive covenants.

Shane Employment Agreement

On August 14, 2024, the Company entered into an executive employment agreement with David Shane, the Company’s Chief Financial Officer (the “ Shane Agreement ”).

The Shane Agreement will be for an initial, three-year term which will automatically renew for additional, consecutive one-year terms unless either party provides the other party with 60 days’ notice of the intent not to renew prior to the expiration of the applicable term.

Notwithstanding the foregoing, Mr.

Shane’s employment is “at-will” and the Shane Agreement may be terminated at any time, by either party, with or without Cause (as defined below) or advance notice.

Shane’s 2024 annualized base salary is $400,000.

In addition, the Company may provide Mr.

Shane a discretionary year-end performance-based bonus with a 2024 bonus target of 100% of his annual base salary.

For calendar year 2024, Mr.

Shane is guaranteed a bonus of no less than $350,000, and Mr.

Shane may be eligible for a bonus of up to 200% of his annual base salary, based on Mr.

Shane’s exceptional performance during such year.

Shane’s performance and the Company’s performance are to be primary considerations in determining any such annual bonus, which is subject to his continuous employment through December 31 of the relevant bonus year, with such bonus payable no later than March 31 of the year following the relevant bonus year.

No later than September 15, 2025, the Company will grant Mr.

Shane nonqualified stock options to purchase 250,000 shares of common stock of the Company, subject to any reasonable capitalization adjustments before the date of grant (the “ Initial Options ”), under the terms of the Plan.

These initial options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these initial options will be equal to the fair market value of the Company’s common stock on the date of grant.

The vesting schedule of these initial options will be as follows:

(a) one-third of the Initial Options will vest on December 31, 2025, based on continued service through such date;

and (b) two-thirds of the Initial Options will vest ratably on a monthly basis over the remainder of Mr.

Shane’s initial term based on continued service through each vesting date, with the first such vesting date being on January 31, 2025.

The Initial Options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

On each anniversary of the Closing, the Company will grant Mr.

Shane nonqualified stock options to purchase that number of shares of common stock of the Company which have a grant date fair value equal to $350,000, as reasonably determined by the Board, under the terms of the Plan.

These additional options will be exercisable for a period of ten (10) years, subject to earlier termination in accordance with the option agreement and Plan.

The exercise price of these additional options will be equal to the fair market value of the Company’s common stock on the date of grant.

The vesting schedule of these additional options will be ratable monthly over three years from the date of the grant.

The additional options will accelerate and be deemed vested in full upon a Change in Control as defined in the Plan.

All options granted by the Company will be forfeited upon Mr.

Shane’s termination for Cause.

All option grants will be subject to the terms of the applicable option agreement and Plan.

If the Company terminates Mr.

Shane’s employment without Cause or Mr.

Shane resigns for Good Reason, Mr.

Shane is entitled to (i) Mr.

Shane’s then current base salary and target annual bonus amounts that would be payable during the greater of (A) the remainder of the applicable term but for such termination, or (B) the Restricted Period (as defined in Section 13.2 of the Shane Agreement), payable in a lump-sum payment on the first regular payday occurring 60 days following the termination date, and (ii) accelerated vesting of all outstanding options as of the effective date of Mr.

Shane’s termination.

In addition, in the event that Mr.

Shane resigns other than for Good Reason, or the Shane Agreement is not renewed upon expiration of the applicable term, Mr.

Shane will receive a payment equal to his then-current annual base salary and target annual bonus, payable in a lump sum payment on the first regular payday occurring 60 days following the termination date, in exchange for Mr.

Shane being bound to a non-competition agreement.

Shane will only receive these severance payments if Mr.

Shane executes a full general and mutual release in a form acceptable to the Company and Mr.

Shane, and such release has become effective in accordance with its terms prior to the 60th day following the termination date.

All other obligations to Mr.

Shane will be automatically terminated and completely extinguished.

Shane’s employment with the Company terminates due to (x) Mr.

Shane’s death, (y) Mr.

Shane’s inability to perform the essential functions of his position with or without reasonable accommodation, or (z) termination by the Company for Cause, Mr.

Shane will not be entitled to the severance payments in the prior paragraph and will only be entitled to receive base salary and benefits accrued through the termination date.

For this purpose, “Cause” is defined as any of the following:

(i) conviction of or a plea of nolo contendere to any felony or any misdemeanor that involves crimes of moral turpitude, fraud or theft;

or (i) the material breach by Mr.

Shane of any of his obligations, duties and/or covenants under the Shane Agreement if such breach causes material damage to the Company, which breach, if curable, continues following written notice from the Company describing same with particularity and expiration of a 30-day cure period.

“Good Reason” is defined as any of the following, without Mr.

Shane’s written consent:

(i) a material diminution in Mr.

Shane’s responsibilities, authority or duties;

(ii) a diminution in Mr.

Shane’s base salary or target annual bonus amount;

or (iii) the material breach by the Company of any material provision of the Shane Agreement or other written agreement between the Company and Mr.

Shane, provided that a Good Reason Process has been followed prior to termination.

“Good Reason Process” shall mean that (i) Mr.

Shane reasonably determines in good faith that one of the Good Reason prongs has occurred;

Shane has notified the Company of such occurrence in writing within 30 days of the occurrence;

Shane cooperates in good faith with the Company’s efforts, for a period not less than 30 days following such notice (the “ Cure Period ”), to remedy the condition;

(iv) notwithstanding such efforts, the occurrence of the Good Reason continues to exist;

Shane terminates his employment within 30 days after the end of the Cure Period.

Shane’s employment is terminated for any reason, he is subject to:

ongoing confidentiality and non-disclosure obligations;

and 12-month, post-termination restrictive covenants of non-solicitation of employees and customers.

Shane will be subject to a 12-

month, post-termination non-competition clause, provided that if his initial or renewal term is not extended or where he resigns without Good Reason, he must be compensated for the restricted period in order for the non-competition clause to be enforceable.

Each of the non-solicitation and non-competition provisions, as applicable, will be extended by one day for each day that Mr.

Shane is deemed by a court or other tribunal to have violated any such restrictive covenants.

Agreement between Katherine Flouton and Purshe Kaplan Sterling Investments, Inc.

4 unchanged sentences

Flouton’s initial annual base salary is set at $400,000, less applicable payroll deductions, and the employment agreement also provides that Ms.

Flouton will be paid a past due $100,000 bonus, in equal increments through June 2, 2022 in accordance with periodic payroll practices.

Flouton will be paid a discretionary bonus.

Other than through notice of intent to terminate as described above, Ms.

24 unchanged sentences

The SEC has defined “beneficial ownership” of a security to mean the possession, directly or indirectly, of voting power and/or investment power over such security.

A stockholder is also deemed to be, as of any date, the beneficial owner of all securities that such stockholder has the right to acquire within 60 days after that date through (a) the exercise of any option, warrant or right, (b) the conversion of a security, (c) the power to revoke a trust, discretionary account or similar arrangement, or (d) the automatic termination of a trust, discretionary account or similar arrangement.

conversion of a security, (c) the power to revoke a trust, discretionary account or similar arrangement, or (d) the automatic termination of a trust, discretionary account or similar arrangement.

In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options or other rights (as set forth above) held by that person that are currently exercisable, or will become exercisable within 60 days thereafter, are deemed outstanding, while such shares are not deemed outstanding for purposes of computing percentage ownership of any other person.

1 unchanged sentence

Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to all shares of common stock beneficially owned by them.

The beneficial ownership of common stock is based on 16,602,460 shares of our common stock issued and outstanding as of March 28, 2025

Name of Beneficial Owners (1)

1 unchanged sentence

Number of Shares

Craig Gould (2)

All directors and executive officers as a group

6 unchanged sentences

(1) Unless otherwise noted, the business address of each of those listed in the table above is 80 State Street, Albany, NY 12207.

(2) Represents shares held directly by Craig Gould.

Gould has entered into arrangements under which he has pledged up to 100% of the shares of common stock that he beneficially owns to secure loans with Oak Street Funding LLC.

(2) Represents shares held by MHC Securities, LLC (“MHC”).

Markowitz is the Manager of MHC and therefore he may be deemed to share voting and investment power over the shares held by MHC.

(4) Represents shares held directly by Wentworth Funding, LLC (“Wentworth Funding”).

Wentworth Funding has entered into arrangements under which it has pledged up to 100% of the shares of common stock that it beneficially owns to secure loans with Oak Street Funding LLC.

(3) Represents shares held by PPD Group, LLC (“PPD”).

Peter Purcell, Peter Sheehan and David Purcell are Managing Members of PPD and therefor may be deemed to share voting and investment power over the shares held by PPD.

Peter Purcell, Peter Sheehan and David Purcell are Managing Members of PPD and therefore may be deemed to share voting and investment power over the shares held by PPD.

(4) Represents 1.1 million shares held by Kingswood Global Sponsor LLC (the “Sponsor”) and placed in escrow at Closing with UMB Bank as escrow agent.

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Registration Rights Agreement

At the Closing, the Company entered into that certain Registration Rights Agreement with the PIPE Investor, Wentworth, certain equity holders of Wentworth and certain other parties identified therein (such persons, the “ Holders ”) (the “ Registration Rights Agreement ”).

At the Closing, the Company entered into that certain Registration Rights Agreement with the PIPE Investor, BMS, certain equity holders of BMS and certain other parties identified therein (such persons, the “ Holders ”) (the “ Registration Rights Agreement ”).

Pursuant to the terms of the Registration Rights Agreement, the Holders are entitled to certain piggyback registration rights and customary demand registration rights.

The Registration Rights Agreement provides that the Company will, as soon as practicable, and in any event within 45 days after the Closing, file with the SEC a shelf registration statement.

The Company will use its commercially reasonable efforts to have such shelf registration statement declared effective as soon as practicable after the filing thereof, but no later than the 90th day (or the 150th day if the Securities and Exchange Commission (the “ SEC ”) notifies the Company that it will “review” such shelf registration statement) following the filing deadline, in each case subject to the terms and conditions set forth therein;

that it will “review” such shelf registration statement) following the filing deadline, in each case subject to the terms and conditions set forth therein;

and the Company will not be subject to any form of monetary penalty for its failure to do so.

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Warrant Assumption Agreement

At Closing, Continental Stock Transfer & Trust Company (the “ Transfer Agent ”), KWAC and the Company entered into the Warrant Assumption and Assignment Agreement (the “ Warrant Assumption Agreement ”), pursuant to which, among other things, KWAC assigned to the Company all of KWAC’s right, title and interest in and to, and the Company assumed all of KWAC’s liabilities and obligations under the certain Warrant Agreement, dated as of November 19, 2020, between KWAC and Continental Stock Transfer & Trust Company (the “ Existing Warrant Agreement ”).

As a result, each Warrant automatically ceased to represent a right to acquire KWAC Class A Common Stock and instead represents a right to acquire shares of Company common stock pursuant to the terms and conditions of the Existing Warrant Agreement (as amended by the Warrant Assumption Agreement).

Amendment to Master Credit Agreement

As previously disclosed in the Proxy Statement/Prospectus, on April 2, 2020, Wentworth entered into a debt facility with Oak Street Funding LLC (“ Oak Street ”) in the amount of $25,000,000 (as amended by the First Amendment to Master Credit Agreement dated as of June 19, 2020, the Second Amendment to Master Credit Agreement dated as of March 19, 2021, the Third Amendment to Master Credit Agreement dated as of May 28, 2021, the Fourth Amendment to Master Credit Agreement dated as of October 17, 2022, and as further amended, restated, amended and restated, extended, increased, supplemented or otherwise modified from time to time, the “ Credit Agreement ”).

At Closing, Wentworth and certain other borrowers entered into the Fifth Amendment to the Credit Agreement (the “ Amendment ”) with Oak Street, pursuant to which, Oak Street consented to, among other things (i) the consummation of the Business Combination, (ii) the payoff of certain debt obligations and restructure of the notes, (iii) recognize each of Company, MHC Securities, LLC (“ MHC ”) and KWAC as a “guarantor” under the terms of the Credit Agreement and (iv) amend and restate the existing guarantees executed by Craig Gould and Alexander Markowitz to be unlimited guarantees.

Oak Street and its affiliates have in the past provided, and may from time to time in the future provide, commercial banking and other financial services to the Company.

At Closing, Continental Stock Transfer & Trust Company (the “ Transfer Agent ”), Binah Capital Corp.

and the Company entered into the Warrant Assumption and Assignment Agreement (the “ Warrant Assumption Agreement ”), pursuant to which, among other things, Binah Capital Corp.

assigned to the Company all of Binah Capital Corp.’s right, title and interest in and to, and the Company assumed all of Binah Capital Corp.’s liabilities and obligations under the certain Warrant Agreement, dated as of November 19, 2020, between Binah Capital Corp.

and Continental Stock Transfer & Trust Company (the “ Existing Warrant Agreement ”).

As a result, each Warrant automatically ceased to represent a right to acquire Binah Capital Corp.

Class A Common Stock and instead represents a right to acquire shares of Company common stock pursuant to the terms and conditions of the Existing Warrant Agreement (as amended by the Warrant Assumption Agreement).

Guarantee Agreements

At Closing and in connection with the Amendment, the Company, MHC and KWAC entered into, and Craig Gould and Alexandor Markowitz (the “ Guarantors ”) amended and restated, certain guarantee agreements (each a “ Guarantee Agreement ” and together, the “ Guarantee Agreements ”) with Oak Street, pursuant to which, the Guarantors unconditionally, absolutely and irrevocably guarantee to Oak Street the full and prompt payment and performance when due (whether at maturity by acceleration or otherwise) of any and all of the obligations under Credit Agreement.

At Closing and in connection with the Amendment, the Company, MHC and Binah Capital Corp.

entered into, and Craig Gould and Alexander Markowitz (the “ Guarantors ”) amended and restated, certain guarantee agreements (each a “ Guarantee Agreement ” and together, the “ Guarantee Agreements ”) with Oak Street, pursuant to which, the Guarantors unconditionally, absolutely and irrevocably guarantee to Oak Street the full and prompt payment and performance when due (whether at maturity by acceleration or otherwise) of any and all of the obligations under Credit Agreement.

These Guarantee Agreements were terminated at the time of the re-financing.

In connection with the re-financing and the Byline Bank Credit Agreement Craig Gould (“Guarantor”) entered into a form of a Limited Guaranty of Payment (“Limited Guaranty”) to and for the benefit of Byline Bank.

Under the Limited Guaranty, the Guarantor unconditionally, absolutely and irrevocably guarantee to Byline Bank the full and prompt payment and performance when due (whether at maturity by acceleration or otherwise) of any and all of the obligations under Credit Agreement, subject to the defined Limitation of Liability of $5 million.

Stock Pledge Agreement

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Unless and until an Event of Default Occurs, the Pledgor shall have the right to vote all or any part of the Pledged Interests and to receive and collect or to have paid over all dividends declared or paid on the Pledged Interest, except with respect to any (i) any distributions relating to any redemptions or share repurchase or (ii) liquidating distributions (either partial or complete), provided that any and all such expected dividends shall constitute additional collateral.

This Stock Pledge Agreement was terminated in connection with the re-financing of the Oak Street Funding Facility.

Strategic Alliance Agreement

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and (iv) any other person who maybe a “related person” pursuant to Item 404 of Regulation S-K under the Exchange Act.

Pursuant to the policy, the audit committee will consider (i) the relevant facts and circumstances of each related party transaction, including if the transaction is on terms comparable to those that could be obtained in arm’s-length dealings with an unrelated third party, (ii) the extent of the related party’s interest in the transaction, (iii) whether the transaction contravenes our code of ethics or other policies, (iv) whether the audit committee believes the relationship underlying the transaction to be in the best interests of the company and its stockholders and (v) the effect that the transaction may have on a director’s status as an independent member of the board and on his or her eligibility to serve on the board’s committees.

on a director’s status as an independent member of the board and on his or her eligibility to serve on the board’s committees.

Management will present to the audit committee each proposed related party transaction, including all relevant facts and circumstances relating thereto.

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Audit Fees (1)

Audit-Related Fees (2)

“Audit fees” include fees for audit services primarily related to the audit of our annual consolidated financial statements;

“Audit fees” include fees for audit services primarily relates to the audit of our annual consolidated financial statements;

audit services related to our subsidiaries in connection with statutory and regulatory filings;

the review of our quarterly consolidated financial statements;

assistance with and review of documents filed with the SEC;

and assistance with and review of documents filed with the SEC;

and other accounting and financial reporting consultation and research work billed as audit fees or necessary to comply with the standards of the Public Company Accounting Oversight Board (United States).

“Audit-related fees” primarily consists of fees for procedures performed in connection with service organizational control reports, comfort letters, consents, and for consultation regarding financial accounting and reporting matters.

“Tax Fees” includes fees from the accounting firm’s tax division, except those services related to the audit.

These fees include tax compliance.

Policy on Board Pre-Approval of Audit and Permissible Non-Audit Services of the Independent Auditors

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Consolidated Statements of Operations for the years ended December 31, 2024 and December 31, 2023

Consolidated Statements of Changes in Members’ Equity for the years ended December 31, 2023 and December 31, 2022

Consolidated Statements of Changes in Stockholders’ Equity for the years ended December 31, 2024 and December 31, 2023

Consolidated Statements of Cash Flows for the years ended December 31, 2024 and December 31, 2023

Notes to the Consolidated Financial Statements

Agreement and Plan of Merger, dated as of July 7, 2022, by and among Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub Inc., Wentworth Merger Sub Inc., CF OMS LLC and Wentworth Management Services, LLC (incorporated by reference to Exhibit 2.1 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

First Amendment to Agreement and Plan of Merger, dated as of March 20, 2023, between Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub, Inc., Wentworth Merger Sub, LLC and Wentworth Management Services LLC (incorporated by reference to Exhibit 2.2 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Second Amendment to Agreement and Plan of Merger, dated as of September 13, 2023, between Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub, Inc., Wentworth Merger Sub, LLC and Wentworth Management Services LLC (incorporated by reference to Exhibit 2.3 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Agreement and Plan of Merger, dated as of July 7, 2022, by and among Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub Inc., Wentworth Merger Sub Inc., CF OMS LLC and Wentworth Management Services, LLC (incorporated by reference to Exhibit 2.1 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

First Amendment to Agreement and Plan of Merger, dated as of March 20, 2023, between Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub, Inc., Wentworth Merger Sub, LLC and Wentworth Management Services LLC (incorporated by reference to Exhibit 2.2 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Second Amendment to Agreement and Plan of Merger, dated as of September 13, 2023, between Kingswood Acquisition Corp., Binah Capital Group, Inc., Kingswood Merger Sub, Inc., Wentworth Merger Sub, LLC and Wentworth Management Services LLC (incorporated by reference to Exhibit 2.3 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Amended and Restated Certificate of Incorporation of Binah Capital Group, Inc.

(incorporated by reference to Exhibit 3.1 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

(incorporated by reference to Exhibit 3.1 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Amended and Restated Bylaws of Binah Capital Group, Inc.

(incorporated by reference to Exhibit 3.2 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Specimen Warrant Certificate (incorporated by reference to Exhibit 4.2 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

(incorporated by reference to Exhibit 3.2 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Specimen Warrant Certificate (incorporated by reference to Exhibit 4.2 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Existing Warrant Agreement, dated November 19, 2020, between Kingswood Acquisition Corp.

and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.3 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.3 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Warrant Assumption Agreement, dated March 15, 2024, by and among Continental Stock Transfer and Trust Company, Kingswood Acquisition Corp.

and Binah Capital Group, Inc.

(incorporated by reference to Exhibit 4.4 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Certificate of Designations (incorporated by reference to Exhibit 4.5 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

(incorporated by reference to Exhibit 4.4 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Certificate of Designations (incorporated by reference to Exhibit 4.5 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Description of Securities

Subscription Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc., Wentworth Management Funding LLC and Pollen Street Capital Limited (incorporated by reference to Exhibit 10.1 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Subscription Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc., Wentworth Management Funding LLC and Pollen Street Capital Limited (incorporated by reference to Exhibit 10.1 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Registration Rights Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.2 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

and the holders party thereto (incorporated by reference to Exhibit 10.2 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Lock-Up Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.3 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

and the holders party thereto (incorporated by reference to Exhibit 10.3 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Voting Agreement, dated March 15, 2024, by and among Binah Capital Group, Inc.

and the holders party thereto (incorporated by reference to Exhibit 10.4 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Fifth Amendment to the Master Credit Agreement, dated March 15, 2024, by and among Wentworth and certain other borrowers party thereto (incorporated by reference to Exhibit 10.5 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Binah Capital Group, Inc.

Guarantee Agreement (incorporated by reference to Exhibit 10.6 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

MHC Securities LLC Guarantee Agreement (incorporated by reference to Exhibit 10.7 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Kingswood Capital Acquisition Corp.

Guarantee Agreement (incorporated by reference to Exhibit 10.8 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Craig Gould Guarantee Agreement (incorporated by reference to Exhibit 10.9 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

Alexander Markowitz Guarantee Agreement (incorporated by reference to Exhibit 10.10 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

and the holders party thereto (incorporated by reference to Exhibit 10.4 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Stock Pledge Agreement, dated March 15, 2024, by and among Craig Gould, MHC Securities, LLC and Oak Street Funding LLC.

(incorporated by reference to Exhibit 10.11 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

(incorporated by reference to Exhibit 10.11 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Strategic Alliance Agreement, dated March 15, 2024, by and between Binah Capital Group, Inc.

and Kingswood US LLC.

(incorporated by reference to Exhibit 10.12 to Binah Capital Group, LLC’s Form 8-K, filed with the SEC on March 21, 2024).

(incorporated by reference to Exhibit 10.12 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on March 21, 2024).

Credit Agreement, dated December 23, 2024, by and between Binah Capital Group, Inc.

and Byline Bank (incorporated by reference to Exhibit 10.1 to Binah Capital Group, Inc.’s Form 8-K, filed with the SEC on December 23, 2024).

Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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Claw Back Policy

XBRL Instance Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Definition Linkbase Document

X BRL Taxonomy Extension Labels Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(b)(2).

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FORM 10-K SUMMARY

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on this 16 th day of April, 2024.

BINAH CAPITAL GROUP, INC.

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Chief Executive Officer, and Director

April 16, 2024

March 31, 2025

(Principal Executive Officer)

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Chief Financial Officer and Director

April 16, 2024

March 31, 2025

(Principal Financial Officer and Principal Accounting Officer)

/s/ David Crane

April 16, 2024

March 31, 2025

/s/ Daniel Hynes

April 16, 2024

March 31, 2025

/s/ Joel Marks

April 16, 2024

WENTWORTH MANAGEMENT SERVICES LLC

March 31, 2025

BINAH CAPITAL GROUP, INC.

DECEMBER 31, 2024 AND 2023

INDEPENDENT AUDITOR’S REPORT

INDEPENDENT AUDITOR’S REPORT (PCAOB ID 3968 )

CONSOLIDATED FINANCIAL STATEMENTS

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Consolidated Statements of Operations

Consolidated Statements of Changes in Members’ Equity

Consolidated Statements of Changes in Stockholders’ Equity

Consolidated Statements of Cash Flows

Notes to the Consolidated Financial Statements

WENTWORTH MANAGEMENT SERVICES LLC

BINAH CAPITAL GROUP, INC.

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORT

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

To the Audit Committee of

Binah Capital Group, Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of financial condition of Wentworth Management Services LLC (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations, changes in members’ equity, and cash flows for the years ended December 31, 2023 and 2022, and the related notes (collectively referred to as the “consolidated financial statements”).

We have audited the accompanying consolidated statements of financial condition of Binah Capital Group, Inc.

(the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for years ended December 31, 2024 and 2023, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years ended December 31, 2024 and 2023, in conformity with accounting principles generally accepted in the United States of America.

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Chicago, Illinois

April 16, 2024

WENTWORTH MANAGEMENT SERVICES LLC

March 31, 2025

BINAH CAPITAL GROUP, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

DECEMBER 31, 2024 AND 2023

(in thousands)

(in thousands, except share amounts)

Cash, cash equivalents and restricted cash

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Intangible assets, net

LIABILITIES AND MEMBERS' EQUITY

LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable, accrued expenses and other liabilities

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TOTAL LIABILITIES

Members' equity

TOTAL LIABILITIES AND MEMBERS' EQUITY

Mezzanine Equity:

Redeemable Series A Convertible Preferred Stock, par value $ 0.0001 , 2,000,000 shares authorized, 1,555,000 shares outstanding at December 31, 2024

Stockholders’ Equity and Members’ Equity:

Series B Convertible Preferred Stock, par value $ 0.0001 , 500,000 shares authorized, 150,000 shares outstanding at December 31, 2024

Common stock, $ 0.0001 par value, 55,000,000 authorized, 16,602,460 issued and outstanding at December 31, 2024

Additional paid-in-capital

Accumulated deficit

Members’ Equity attributed to Legacy BMS Management Services LLC

Total Stockholders’ Equity, Mezzanine Equity and Members’ Equity Attributable to BMS Management Services LLC

TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY

The accompanying notes are an integral part of these consolidated financial statements.

WENTWORTH MANAGEMENT SERVICES LLC

BINAH CAPITAL GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

(in thousands)

(in thousands, except per share amounts)

Revenue from Contracts with Customers:

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Total expenses

Income before provision (benefit) for income taxes

(Loss) income before provision for income taxes

Provision (benefit) for income taxes

Net (loss) income

Net income attributable to Legacy BMS Management Services LLC members

Net loss attributable to Binah Capital Group, Inc.

Net loss per share basic and diluted

Weighted average shares basic and diluted

The accompanying notes are an integral part of these consolidated financial statements.

WENTWORTH MANAGEMENT SERVICES LLC

CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS’ EQUITY

BINAH CAPITAL GROUP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

(in thousands)

Class B Preferred

Balance January 1, 2022

Distribution of capital

For the Years Ended December 31, 2024 and 2023

Class A Redeemable

Convertible Preferred Stock

Stockholders’

Attributed to

Balance December 31, 2022

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Balance December 31, 2023

Distributions

Net income prior to transaction

Reverse merger and recapitalization of legacy BMS Management Services LLC

Mezzanine Equity - Shares Issued in connection with PIPE financing

Issuance of Class A redeemable convertible preferred stock

Issuance of Class B convertible preferred stock

Dividends - Class A redeemable convertible preferred stock

Dividends - Class B convertible preferred stock

Issuance of common stock in connection with exercise of warrants

Net loss attributable to Binah Capital Group, Inc.

post transaction

Balance, December 31, 2024

The accompanying notes are an integral part of these consolidated financial statements.

WENTWORTH MANAGEMENT SERVICES LLC

BINAH CAPITAL GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

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(in thousands)

For the years ended December 31,

Cash Flows From Operating Activities

Adjustments to reconcile net income to net cash provided by operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:

Depreciation and amortization

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Capitalized interest - due to members

Loss on disposal of property and equipment

Loss on disposal of property and leasehold improvements

Change in allowance for credit losses

Changes in operating assets and liabilities:

Commissions receivable

Due from clearing broker

Commissions receivable

Other receivables

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Commissions payable

Operating lease liabilities

Net Cash Provided By Operating Activities

Operating lease liability

Net Cash (Used in) Provided By Operating Activities

Cash Flows From Investing Activities

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Cash Flows From Financing Activities

Borrowings under note payable

Payment of debt issuance costs

Repayment - notes payable

Proceeds from borrowings from members

Repayment - promissory notes-affiliates

Repayment of promissory notes-affiliates

Repayment of borrowings from members

Net payment for reverse merger and recapitalization

Proceeds from Series A Redeemable Convertible Preferred Stock

Proceeds from Series B Convertible Preferred Stock

Dividends - Series A Redeemable Convertible Preferred Stock

Proceeds from exercise of warrants

Redemption of Class B Preferred Units

Distribution of capital

Net Cash Used In Financing Activities

Net Cash Provided By (Used In) Financing Activities

Net Change in Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted Cash - Beginning of Year

Cash, Cash Equivalents and Restricted Cash - End of Year

Cash Paid During the Year for:

Cash, Cash Equivalents and Restricted Cash - Beginning of Period

Cash, Cash Equivalents and Restricted Cash - End of Period

Supplemental Disclosure of Non-Cash Financing Activities

During the year ended December 31, 2024 and in connection with the reverse merger and recapitalization the Company extinguished amounts related to the promissory notes-affiliates in the approximate amount of $ 3,800 .

During the year ended December 31, 2024 and in connection with the reverse merger and recapitalization the Company extinguished amounts and issued stock in consideration to satisfy these obligations in the approximate amount of $ 4,300 .

As of December 31, 2024, there is an accrued dividend related to the Class B Convertible Preferred Stock in the amount $ 31 .

For the year ended December 31, 2024, the Company paid an in-kind dividend to the Series A Redeemable Convertible Preferred Stockholder in the amount of $ 547 .

Supplemental Disclosure of Cash Flow Information

Right of use asset in exchange for operating lease liability

Cash Paid During the Period for:

The accompanying notes are an integral part of these consolidated financial statements.

ORGANIZATION AND NATURE OF BUSINESS

Wentworth Management Services LLC (the “Company” or “WMS”) is a limited liability company organized under the laws of the State of Delaware in March 2016.

WMS is a holding company of multiple businesses that operate in the financial services industry as follows:

Binah Capital Group, Inc.

(“Binah Capital”, “Holdings” or the “Company,” representing the consolidated group), is a Delaware corporation, formed on June 27, 2022 that serves as a holding company for its wholly-owned subsidiaries operating in the retail wealth management business.

Binah Capital through its wholly-owned subsidiary Wentworth Management Services LLC (dba, Binah Management Services, “BMS”) operates multiple businesses in the financial services industry as follows:

● PKS Holdings, LLC (“PKSH”) maintains offices in Albany, New York, and branch offices throughout the United States of America, and includes the following entities (collectively, the “PKSH Entities”):

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(“PKSF”), incorporated in the State of New York, is an insurance entity providing financial services to clients.

PKSF began operating under the dba of Binah Capital Insurance during the year ending 2024.

Representatives Indemnity Company, Inc.

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Wentworth Financial Partners LLC (“WFP”) (f/k/a CL General Agency), a Delaware Limited Liability Company, is an insurance entity providing financial services to clients.

WFP began operating under the dba of Binah Financial Partners during the year ending 2024.

● Michigan Securities, Inc.

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Holdings, Kingswood Merger Sub and Wentworth Merger Sub are newly formed entities that were formed for the sole purpose of entering into and consummating the transactions set forth in the Merger Agreement.

Holdings is a wholly-owned direct subsidiary of KWAC and both Kingswood Merger Sub and Wentworth Merger Sub are wholly-owned direct subsidiaries of Holdings.

Holdings is a wholly-owned direct subsidiary of KWAC.

and both Kingswood Merger Sub and Wentworth Merger Sub are wholly-owned direct subsidiaries of Holdings.

Pursuant to the Merger Agreement, at closing, each of the following transactions will occur in the following order:

(i) Kingswood Merger Sub will merge with and into KWAC (the “ Kingswood Merger ”), with KWAC surviving the Kingswood Merger as a wholly-owned subsidiary of Holdings (the “ Kingswood Surviving Company ”);

(i) Kingswood Merger Sub will merge with and into KWAC.

(the “ Kingswood Merger ”), with KWAC surviving the Kingswood Merger as a wholly-owned subsidiary of Holdings (the “ Kingswood Surviving Company ”);

(ii) simultaneously with the Kingswood Merger, Wentworth Merger Sub will merge with and into the Company (the “ Wentworth Merger ”), with the Company surviving the Wentworth Merger as a wholly-owned subsidiary of Holdings (the “ Surviving Company ”);

and (iii) following the Wentworth Merger, Kingswood Surviving Company will acquire, and Holdings will contribute to Kingswood Surviving Company all of the common units of the Surviving Company directly held by Holdings after the Kingswood Merger (the “ Holdings Contribution ”), such that, following the Holdings Contribution, Surviving Company shall be a wholly-owned subsidiary of the Kingswood Surviving Company (the Kingswood Merger and the Wentworth Merger, together with the other transactions related thereto, the “ Business Combination ”).

On March 15, 2024, the Business Combination will be accounted for as a reverse recapitalization acquisition in accordance with FASB ASC 805-40, Business Acquisitions .

Under this method of accounting, KWAC is expected to be treated as the “acquired” company for financial reporting purposes.

Accordingly, for accounting purposes, the consolidated financial statements of Holdings will represent a continuation of the consolidated financial statements of the Company with the business combination treated as the equivalent of the Company issuing shares for the net assets of KWAC, accompanied by a recapitalization.

The net assets of KWAC will be stated at historical cost, with no goodwill or other intangible assets recorded.

Operations prior to the business combination will be those of the Company in future reports of Holdings.

Under the terms of the Business Combination, the aggregate consideration paid in the Business Combination was approximately $217 million, paid in the form of common stock, par value $0.0001 per share (“Company Common Stock”) and assumed indebtedness.

On March 15, 2024 (the “Closing Date”), the Company consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated July 7, 2022 (as amended, the “Merger Agreement” and the consummation of such contemplated transactions, the “Closing”), by and among Kingswood Acquisition Corp, a Delaware corporation (“KWAC”), Binah Capital, Kingswood Merger Sub, Inc., a Delaware corporation (“Kingswood Merger Sub”), Wentworth Merger Sub, LLC, a Delaware limited liability company (“Wentworth Merger Sub”), and BMS.

Binah Capital, Kingswood Merger Sub and Wentworth Merger Sub were newly formed entities that were formed for the sole purpose of entering into and consummating the transaction set forth in the Merger Agreement.

Binah Capital was a wholly-owned direct subsidiary of KWAC and both Kingswood Merger Sub and Wentworth Merger Sub were wholly-owned direct subsidiaries of Binah Capital.

On the Closing Date, Kingswood Merger Sub merged with and into KWAC, with KWAC continuing as the surviving entity as a wholly-owned subsidiary of Binah Capital and Wentworth Merger Sub merged with and into BMS, with BMS continuing as the surviving entity as a wholly-owned subsidiary of Binah Capital.

Following the BMS merger, KWAC acquired, and Binah Capital contributed to KWAC all of the common units of BMS directly held by Binah Capital after the BMS merger, such that, following the Binah Capital contribution, BMS became a wholly-owned subsidiary of KWAC.

Notwithstanding the legal form of the Merger pursuant to the Business Combination Agreement, the Merger is accounted for as a reverse recapitalization.

Under this method of accounting, KWAC is treated as the “acquired” company for financial reporting purposes.

Accordingly, for accounting purposes, the consolidated financial statements of Binah Capital represents a continuation of the consolidated financial statements of BMS with the business combination treated as the equivalent of the BMS issuing shares for the net assets of KWAC, accompanied by a recapitalization.

The net assets of KWAC were stated at historical cost, with no goodwill or other intangible assets recorded.

Operations prior to the business combination are those of BMS (See Note 4 – Mergers and Recapitalization).

Nasdaq Exchange Listing

The KWAC Class A Common Stock and KWAC Public Warrants are currently listed on the OTC Exchange under the symbols “KWAC” and “KWAC WS,” respectively.

Certain of the shares of KWAC Class A Common Stock and KWAC Public Warrants currently trade as KWAC Units consisting of one share of KWAC Class A Common Stock and three-fourths of one redeemable KWAC Public Warrant and are listed on the OTC Exchange under the symbol “KWAC.U.” The KWAC Units will automatically separate into component securities of Holdings upon consummation of the Business Combination and, as a result, will no longer trade as an independent security.

On March 26, 2024, Holdings received approval for Holding’s securities to be listed on the Nasdaq Stock Market LLC.

Holdings Common Stock is listed on the Nasdaq Global Market and its warrants will be listed on the Nasdaq Capital Market under the symbols “BCG” and “BCG.W”, respectively.

Holdings common stock is listed on the Nasdaq Global Market and its warrants will be listed on the Nasdaq Capital Market under the symbols “BCG” and “BCGWW”, respectively.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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Principles of Consolidation

The accompanying consolidated financial statements include the accounts of WMS and its wholly-owned subsidiaries.

Significant intercompany transactions and accounts have been eliminated in consolidation.

The accompanying consolidated financial statements include the accounts of Holdings and its wholly-owned subsidiaries.

Significant inter-company transactions and balances have been eliminated in consolidation.

Use of Estimates and Assumptions

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Actual results could differ from those estimates.

Significant estimates include the valuation and impairment of intangible assets, the valuation of deferred income taxes, allowance for credit losses, and contingencies.

Significant estimates include the valuation and impairment of intangible assets and deferred income taxes, allowance for credit losses, and contingencies.

Reportable Segment

Management has determined that the Company operates in one segment, given the common nature of its operations, products and services, production and distribution process and regulatory environment.

For additional information, see Note 25 - Segment Information .

Revenue Recognition

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Restricted cash represents cash held by the Company’s lender related to its credit facility.

As of December 31, 2023 and 2022, restricted cash amounted to approximately $0.4 million.

As of December 31, 2024 and 2023, restricted cash amounted to approximately $ 1.0 million and $ 0.4 million, respectively.

The Company regularly maintains cash, cash equivalents and restricted cash that exceed Federal Deposit Insurance Corporation limits.

The Company has not experienced any losses and does not believe it is exposed to any significant credit risk from cash.

Receivables, which amounted to approximately $10.5 and $13.0 million as of January 1, 2023 and 2022, respectively, represent amounts due to the Company from its clearing broker, clients, financial institutions and others.

Receivables, represent amounts due to the Company from its clearing broker, clients, financial institutions and others.

Receivables consists of unconditional amounts due to the Company and are reported at amortized costs.

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Changes in the allowance for credit losses are reported in credit loss expense, if applicable.

Management believes its risk of loss on currently recorded receivables is minimal and accordingly an allowance for credit losses has been recorded as of December 31, 2023, December 31, 2022, and January 1, 2022, in the amount of $0.2 million.

Management believes its risk of loss on currently recorded receivables is minimal and accordingly an allowance for credit losses has been recorded as of December 31, 2024, December 31, 2023, and January 1, 2023, in the amount of $ 0.7 million, $ 0.2 million and $ 0.2 million, respectively.

Property and Equipment, net

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See Note 13 - Leases for additional information.

WMS is treated as a partnership for income tax purposes and therefore not subject to federal taxes.

The Company is subject to certain state and local income taxes.

The PKSH Entities, Cabot Entities and WEG are taxable entities and are subject to federal, state, and local income taxes.

Income taxes are accounted for under an asset and liability approach.

This process involves calculating the temporary and permanent differences between the carrying amounts of the assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

The temporary differences result in deferred tax assets and liabilities, which are recorded on the consolidated balance sheet in accordance with FASC ASC 740, Income Taxes (“ASC 740”), which established financial accounting and reporting standards for the effects of income taxes.

The likelihood that deferred tax assets will be recovered from future taxable income must be assessed and, to the extent that recovery is not likely, a valuation allowance is established.

Changes in the valuation allowance in a period are recorded through the income tax provision in the consolidated statements of operations and comprehensive income.

ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an entity’s consolidated financial statements and prescribes a recognition threshold and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on an income tax return.

Under ASC 740-10, the impact of an uncertain tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority.

An uncertain tax position will not be recognized if it has less than a 50% likelihood of being sustained.

Additionally, ASC 740-10 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

For the periods prior to the Reverse Merger and Recapitalization, BMS was treated as a partnership for income tax purposes and therefore not subject to federal taxes.

BMS was subject to certain state and local income taxes.

Additionally, Binah Capital Corp.

(fka, Kingswood Acquisition Corp.) was treated as a corporation and subject to U.S.

federal income taxes, in addition to state and local income taxes.

Subsequent to the Reverse Merger and Recapitalization, Binah Capital Corp, a wholly-owned subsidiary of Holdings, is the parent company of BMS.

Subsequent to the Reverse Merger and Recapitalization, BMS elected to be treated as a corporation and is subject to U.S.

federal income taxes, in addition to state and local income taxes.

Binah Capital Group, Inc.

Binah Capital Corp., BMS, the PKSH Entities, the Cabot Entities and WEG are taxable entities subject to federal, state, and local income taxes.

Therefore, these consolidated financial statements include an income tax provision for the taxable entities only.

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A valuation allowance may be established to reduce deferred tax assets, if it is more likely than not that all, or some portion, of such deferred tax assets will not be realized.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The Company accounts for taxes in accordance with the asset and liability method of accounting for income taxes.

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The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution.

Net Loss Per Share

Basic earnings per share of common stock is computed by dividing net income attributable to the Company by the weighted-average number of shares of Class A common stock outstanding during the same period.

Diluted net income per share of common stock is computed by dividing net income attributable to the Company by the weighted-average number of shares of common stock outstanding adjusted to give effect to potentially dilutive securities.

Potential shares of common stock consist of incremental shares issuable upon the assumed exercise of stock options and warrants and conversion of the Company’s preferred stock.

Net income (loss) per share is not presented for periods prior to the Merger as such amounts would not be meaningful to users of the consolidated financial statements because the equity structure materially changed in connection with the Merger.

Financial Instruments

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks.

The Company does not hold or issue financial instruments for speculative or trading purposes.

As a result of the Reverse Recapitalization, the Company has issued and has outstanding warrants.

The Company evaluates the warrants, to determine if such instruments should be considered stock-based compensation, pursuant to ASC Topic 718, and if not in the scope of ASC 718, if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC Topic 480 and ASC Topic 815.

The determination of whether the instrument should be classified as stock-based compensation or a derivative instrument, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period.

Warrants issued to non-employees (the “Non-employee Warrants”) are not classified as stock-based compensation as there is no condition of employment such that the granting of the shares does not represent compensation.

The Non-employee Warrants are classified as derivative liabilities under ASC Topic 480 or ASC Topic 815.

Warrants issued to non-employees are measured at fair value on recurring basis, using the market approach based upon the quoted market price of Binah Capital Group, Inc.’s warrants at the end of each reporting period.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Contingent Liabilities

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See Note 19 – Commitments and Contingencies for additional information.

Emerging Growth Company Status

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as modified by the Jumpstart Our Business Startups Act of 2012, and it thus may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies.

Recently Issued Accounting Pronouncements

In November 2024, Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) :

Disaggregation of Income Statement Expenses , which requires public business entities to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to financial statements.

The ASU should be applied prospectively and is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

The Company is currently evaluating the impact on the related disclosures;

however, it does not expect this update to have an impact on its financial condition or results of operations.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740):

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however, it does not expect this update to have an impact on its financial condition or results of operations.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023 - 07, Segment Reporting (Topic 280):

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The ASU should be applied retrospectively to all prior periods presented in the consolidated financial statements and is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The Company is currently evaluating the impact on the related disclosures;

however, it does not expect this update to have an impact on its financial condition or results of operations.

Recently Adopted Accounting Pronouncements

There were no new accounting pronouncements adopted during the years ended December 31, 2023 and 2022 that materially impacted the Company’s consolidated financial statements and related disclosures .

The adoption did not have an impact on the Company’s financial condition or results of operations.

See Note 25 - Segment Information for related disclosures.

MERGER AND RECAPITALIZATION

Upon the consummation of the Business Combination, (i) the holders of shares of KWAC’s common stock (“ KWAC.

Common Stock ”) issued and outstanding immediately prior to the effective time of the Business Combination (other than any redeemed shares) received one share of common stock of Holdings (“ Holdings Common Stock ”) in exchange for each share of KWAC Common Stock held by them, subject to adjustment as more fully described herein, (ii) 1,100,000 shares of Holdings Common Stock issued to Sponsor was placed by Holdings into an escrow account and will not be released to the Sponsor unless the dollar volume-weighted average price of Holdings Common Stock exceeds $ 12.00 for 20 trading days within any 30 -day trading period during the four-year period following the consummation of the Business Combination, (iii) the holders of each whole warrant to purchase KWAC Class A Common Stock received one warrant to purchase Holdings Common Stock at an exercise price of $ 11.50 per share, (iv) 12 million shares of Holdings Common Stock, subject to adjustment as more fully described herein, was issued to the equity holders of BMS in proportion to their ownership interests in BMS, (v) an additional 1,100,000 shares of Holdings Common Stock was issued to certain equity holders of BMS, (vi) 3,084,450 KWAC Private Placement Warrants held by Sponsor were forfeited immediately prior to the effective time of the Business Combination, and (vii) 3,084,450 warrants to purchase Holding Common Stock at an exercise price of $ 11.50 per share were issued to the equity holders of BMS in proportion to their ownership interests in BMS.

As a result of the Business Combination, BMS became an indirect, wholly-owned subsidiary of Holdings.

Additionally, on the Closing Date, Holdings entered into a Subscription Agreement with an investor for the purchase of 1,500,000 shares of Holdings’ Series A Redeemable Convertible Preferred Stock (the “ Holdings Series A Stock ”) in a private placement at $ 9.60 per share, for an aggregate purchase price of $ 14.4 million (the “ Series A PIPE ”).

The Holdings Series A Stock may be converted into shares of Holdings Common Stock after the second anniversary of the closing of the Series A PIPE, which such conversion shall initially be 1.5 shares of Holdings Common Stock for each share of Series A Convertible Preferred Stock, subject to certain adjustments provided in the Certificate of Designations.

Holdings applied to have the Holdings common stock and Holdings warrants listed on the Nasdaq Global Market (the “ Nasdaq ”) under the symbols BCG and BCGWW , respectively.

Prior to the mergers, the KWAC Class A Common Stock and KWAC Public Warrants were listed on the OTC Exchange under the symbols “KWAC” and “KWAC.WS,” respectively.

On March 26, 2024, Holdings received approval for Holding’s securities to be listed on the Nasdaq Stock Market LLC.

Holdings common stock is listed on the Nasdaq Global Market and its warrants will be listed on the Nasdaq Capital Market under the symbols “BCG” and “BCGWW”, respectively.

REVENUES FROM CONTRACTS WITH CUSTOMERS

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Accordingly, total commission revenues are reported on a gross basis.

REVENUES FROM CONTRACTS WITH CUSTOMERS (continued)

The Company generates two types of commission revenues:

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The Company is the principal in these arrangements and recognizes advisory revenues on a gross basis, as the Company is responsible for satisfying the performance obligations and has control over determining the fees.

REVENUES FROM CONTRACTS WITH CUSTOMERS (continued)

The following table presents total revenues from contracts with customers disaggregated by investment product for the years ended December 31 (in thousands) :

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Total Revenue From Contracts With Customers

REVENUES FROM CONTRACTS WITH CUSTOMERS (continued)

The following tables presents sales-based and trailing revenues disaggregated by product category for the years ended December 31 (in thousands) :

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Alternatively, when payment precedes the provision of the related services, the Company records deferred revenues (a contract liability) until the performance obligations are satisfied.

As of December 31, 2023 and 2022, the Company had receivables from contracts with customers totaling approximately $8.9 million and $8.6 million, respectively.

As of December 31, 2024 and 2023, the Company had receivables from contracts with customers, net of an allowance for credit losses, totaling approximately $ 10.1 million and $ 8.9 million, respectively.

The opening balance of receivables from contracts with customers was approximately $ 8.6 million as of January 1, 2023.

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Property and equipment, net

Depreciation and amortization expense related to property and equipment amounted to approximately $0.5 million for the years ended December 31, 2023 and 2022.

Depreciation and amortization expense related to property and equipment amounted to approximately $ 0.4 million and $ 0.5 million for the years ended December 31, 2024 and 2023.

INTANGIBLE ASSETS

The components of intangible assets were as follows as of December 31, 2024 (in thousands) :

Policies and procedures library

Developed technology

The components of intangible assets were as follows as of December 31, 2022:

INTANGIBLE ASSETS (continued)

The components of intangible assets were as follows as of December 31, 2023 (in thousands) :

Policies and procedures library

Developed technology

Amortization expense related to intangible assets amounted to approximately $0.6 million and $1.0 million for the years ended December 31, 2023 and 2022, respectively.

As of December 31, 2023, the estimated future amortization expense for intangible assets over the next four years is as follows (in thousands) :

Amortization expense related to intangible assets amounted to approximately $ 0.6 million for the years ended December 31, 2024 and 2023, respectively.

As of December 31, 2024, the estimated future amortization expense for intangible assets is as follows (in thousands) :

On April 2, 2020, the Company entered into a Credit Agreement (the “Credit Agreement”) with Oak Street Funding LLC (“Oak Street”) in the amount of $ 25 million.

This note payable bears interest at the prime rate (“Prime”) (8.50% as of December 31, 2023) plus 2.25% and has a 10-year term and a 3-month interest only repayment provision.

This note payable bears interest at the prime rate plus 2.25 % and has a 10 -year term and a 3 -month interest only repayment provision.

As of December 31, 2024 and 2023, the outstanding balance of the Oak Street note, net of unamortized debt issuance costs was $ 0.0 million and $ 17.6 million, respectively.

On April 25, 2021, the Company entered into an additional promissory note with Oak Street in the amount of $ 4.1 million related to the acquisition of WEG (“WEG Note”).

This note payable bears interest at Prime plus 2.25% and has a 10-year term.

This note payable bears interest at the prime rate plus 2.25 % and has a 10 -year term.

As of December 31, 2024 and 2023, the outstanding balance of this note, net of unamortized debt issuance costs was $ 0.0 million and $ 3.2 million, respectively.

Under the Oak Street notes, the Company is subject to certain covenants as defined in the agreements.

As of December 31, 2022 and March 31, 2023, the Company did not meet a certain debt service coverage ratio and subsequently obtained a waiver from Oak Street for such covenant violations.

For the period from April 1, 2023 to December 31, 2023, the Company was in compliance with all financial related covenants.

The minimum calendar year payments and maturities of the Oak Street notes as of December 31, 2023, are as follows (in thousands) :

Under the Oak Street notes, the Company was subject to certain covenants as defined in the agreements.

As of December 31, 2023 and during the year ending December 31, 2024 the Company was in compliance with all financial related covenants.

Subsequent to December 31, 2023, and in connection with the closing of the Business Combination, the Company entered into an amendment to the Credit Agreement with Oak Street providing for, among other things, consenting to the Business Combination, and the payoff and restructuring of certain debt obligations.

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Additionally, certain of the members of the Company provide guarantees under the Credit Agreement.

During the year ending December 31, 2024, the Company re-financed the Oak Street credit facility with Byline Bank under the terms outlined below.

DEBT (continued)

On December 23, 2024 (the “ Credit Agreement Closing Date ”), BMS entered into a Credit Agreement (the “ Credit Agreement ”) with Byline Bank, as lender (the “ Lender ”), pursuant to which the Lender agreed, at BMS’s request, to (i) make to BMS a term loan in the original principal amount of $ 20.3 million (the “ Term Loan ”), which was funded on the Credit Agreement Closing Date;

(ii) make to BMS, from time to time, certain non-revolving loans (the “ Non-Revolving Loans ”) in an aggregate principal amount of up to $ 1.0 million (the “ Non-Revolving Loan Commitment ”), to be funded through, but excluding, the Maturity Date (as defined below);

and (iii) issue to BMS, from time to time, letters of credit (the “ Letters of Credit ” and together with the Term Loan and Non-Revolving Loans, the “ Loans ”) until the earliest to occur of (x) the one year from the Credit Agreement Closing Date and (b) the date on which the Non-Revolving Loans are fully drawn.

As of December 31, 2024, the outstanding balance under the Term Loan was $ 19.6 million, net of unamortized debt issuance costs.

Under the terms of the Credit Agreement, to the extent that BMS requests a Letter of Credit, the Non-Revolving Loan Commitment shall be permanently reduced in an amount equal to the amount of such Letter of Credit.

The Non-Revolving Loans may not be requested by BMS and may only be advanced in connection with a repayment of a Letter of Credit (“ LC Payment ”).

As of December 31, 2024, there were no amounts outstanding under the Non-Revolving Loan or Letter of Credit .

The Loans (both principal and interest) made by the Lender to BMS is scheduled to mature and become immediately due and payable in full on December 23, 2029 (“Maturity Date”).

The obligations under the Credit Agreement shall bear interest (i) as to the Term Loan, a per annum variable interest rate equal to the Applicable Margin (as defined in the Credit Agreement) plus the greater of (x) the Term Secured Overnight Financing Rate (“SOFR”) (as defined in the Credit Agreement) and (y) one percent ( 1.00 %) (the “ Term Loan Interest Rate ”);

(ii) as to the Non-Revolving Loans or any reimbursement obligations relating to a Letter of Credit, at an interest rate equal to the Term SOFR plus four percent ( 4.00% ) per annum;

and (iii) if any other obligations is created under the Loan Documents (as defined in the Credit Agreement), at the Term Loan Interest Rate.

As of December 31, 2024, the effective interest rate was 8.3 %.

The Term Loan must be used by BMS to refinance Existing Credit Facilities (as defined in the Credit Agreement) and the Non-Revolving Loans must be used solely to reimburse the Lender with respect to any Letters of Credit issued to BMS.

The Term Loan refinanced the previous Oak Street Funding Facility.

The Credit Agreement also includes customary covenants for a transaction of this type, including financial covenants whereby BMS and its subsidiaries on a consolidated basis may not have, as of the last day of each fiscal quarter, commencing with fiscal quarter ending on March 31, 2025, (1) a fixed charge coverage ratio as of the last day of the fiscal quarter for the twelve (12) month period then ended of not less than 1.20 to 1.00;

(ii) a senior net leverage ratio as of the last day of such Fiscal Quarter for the twelve (12) month period then ended, of (A) for the fiscal quarter ended March 31, 2025 and each fiscal quarter through and including September 30, 2025, not more than 3.00 to 1.00;

and (B) for the fiscal quarter ended December 31, 2025 and each fiscal quarter ending thereafter, not more than 2.75 to 1.00;

or (iii) an annualized revenue received from custodians of at least $ 18.0 million.

The minimum calendar maturities of the Term Loan as of December 31, 2024, are as follows (in thousands) :

PROMISSORY NOTES – AFFILIATES

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These notes had a maturity date of May 17, 2023 and accrued interest at a rate of 10 % annually.

The interest on these notes has continued to accrue until such time as these notes are paid.

The interest on these notes continued to accrue until such time as these notes were paid.

Additionally, in connection with the acquisition of the PKSH Entities, the Company agreed to pay contingent consideration in the amount of $ 5.0 million to certain sellers.

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These subordinated promissory notes had a maturity date of May 30, 2023, and accrued interest at a rate of 10 % annually.

The interest on these notes has continued to accrue until such time as these notes are paid.

The interest on these notes continued to accrue until such time as these notes were paid.

As of December 31, 2024 and 2023, the amount of principal and accrued interest related to these promissory notes were approximately $ 0.0 million and $ 12.2 million, respectively.

Related interest expense was approximately $0.9 million for each of the years ended December 31, 2023 and 2022.

Related interest expense was approximately $ 0.0 million and $ 0.9 million for the years ended December 31, 2024 and 2023, respectively.

Subsequent to December 31, 2023, and in connection with the closing of the Business Combination, the Company paid approximately $ 3.4 million on these notes.

In addition to the paydown, the noteholders agreed to forgive the remaining accrued but unpaid interest of approximately $3.8 million and entered into a new promissory note in the principal amount of approximately $5.3 million.

The terms of this new promissory note provides for maturity on May 15, 2027 and carries an interest rate of Prime plus 1.00%, but no less than 7.50% per annum.

In addition to the paydown, the noteholders (all of whom are stockholders and/or key employees) agreed to forgive the remaining accrued but unpaid interest of approximately $ 3.8 million and entered into a new promissory note in the principal amount of approximately $ 5.3 million, which is the amount outstanding as of December 31, 2024.

The terms of this new promissory note provides for maturity on May 15, 2027 and carries an interest rate of the prime rate plus 1.00 %, but no less than 7.50 % per annum.

For the year ended December 31, 2024 interest expense related to the new promissory notes amounted to approximately $ 0.4 million of which approximately $ 0.1 million is payable as of December 31, 2024 and paid subsequent to December 31, 2024.

DUE TO MEMBERS

The Company has entered into promissory notes with certain of its members to provide for working capital.

The Company had entered into promissory notes with certain of its members to provide for working capital.

As of December 31, 2024 and 2023, the amount of principal and accrued interest related to these notes were approximately $ 0.0 million and $ 5.2 million, respectively.

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For the years ended December 31, 2024 and 2023, interest expense related to these notes amounted to approximately $ 0.1 million and $ 0.4 million, respectively.

Subsequent to December 31, 2023, and in connection with the closing of the Business Combination, the noteholders agreed to satisfy all outstanding obligations, including the payment of principal and interest, in exchange for an amount of cash equal to approximately $0.9 million, forgiveness of certain other obligations owed to a noteholder and the issuance of 357,000 shares of Company Common Stock of Binah Capital Group, Inc.

Subsequent to December 31, 2023, and in connection with the closing of the Business Combination, the noteholders agreed to satisfy all outstanding obligations, including the payment of principal and interest, in exchange for an amount of cash equal to approximately $ 0.9 million, forgiveness of certain other obligations owed to a noteholder and the issuance of 357,000 shares of common stock of Binah Capital Group, Inc.

The Company has obligations as a lessee for office space with initial noncancelable terms in excess of one year .

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Total lease cost is included rent and occupancy on the consolidated statements of operations.

LEASES (continued)

Amounts reported in the consolidated statements of financial condition as of December 31, 2024 and 2023 were as follows (in thousands) :

Operating leases ROU assets

Operating lease ROU assets

Operating lease liabilities

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Operating leases

Reductions to ROU assets and lease liabilities as a result of lease termination during the year ended December 31, 2022 (in thousands) :

Lease liability

LEASES (continued)

Weighted-average remaining lease term as of December 31, 2024 and 2023:

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Lease liability

CLS entered into an agreement to sublease its former office space which expired September 2022.

Rental income and reimbursement of lease costs for the year ended December 31, 2022 amounted to approximately $0.2 million and is included in other income in the accompanying consolidated statement of operations.

WMS is classified as a partnership for income tax purposes and is therefore not subject to federal, and certain state, and local income taxes.

SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK

On March 15, 2024 (the “Funding Date”), in connection with the consummation of the Business Combination, Holdings and BMS entered into a Subscription Agreement with an investor for the purchase of 1,500,000 shares of Holdings’ Series A Redeemable Convertible Preferred Stock (the “ Holdings Series A Stock ”) in a private placement at $ 9.60 per share, for an aggregate purchase price of $ 14.4 million (the “ Series A PIPE ”).

Additionally, the Holdings Series A Stock carries a cumulative dividend at a rate of nine percent ( 9 %) per annum, payable and compounded quarterly on the last day of each quarter.

At the discretion of Holdings, the payment may be made in cash or up to 50 % of the amount due, in duly authorized, validly issued, fully paid and non-assessable share of Holdings Series A Stock at a value of $ 10 per share.

For the year ended December 31, 2024, the Company paid dividends under the Series A PIPE in the amount of approximately $ 1.1 million of which $ 0.56 million was paid in cash and $ 0.55 was paid in-kind.

The Holdings Series A Stock has liquidation preferences in the event of a voluntary or involuntary liquidation as follows:

● The greater of $ 12.50 per share of Holdings Series A Stock if such liquidation occurs prior to the first anniversary of the Funding Date;

● $ 13.00 per share of Holdings Series A Stock if such liquidation occurs prior to the second anniversary of the Funding Date;

● $ 15.00 per share of Holdings Series A Stock if such liquidation occurs prior to the third anniversary of the Funding Date;

● $ 16.00 per share of Holdings Series A Stock if such liquidation occurs prior to the fourth anniversary of the Funding Date.

Holdings, at its option, may redeem the Series A Stock on any anniversary of the Funding date up to an including the fourth anniversary of the Funding date at the following redemption prices:

● $ 11.50 per share of Series A Stock on the first anniversary of the Funding Date;

● $ 13.00 per share of Series A Stock on the second anniversary of the Funding Date;

● $ 15.00 per share of Series A Stock on the third anniversary of the Funding Date;

● $ 16.00 per share of Series A Stock on the fourth anniversary of the Funding Date;

If the Series A Stock have not previously been redeemed or converted, the Series A Stock will be redeemed by Holdings on the fourth anniversary of the Funding Date.

SERIES B CONVERTIBLE PREFERRED STOCK

On September 4, 2024, the Company entered into a Subscription Agreement with an investor for the purchase of 150,000 shares of Holdings’ Series B Convertible Preferred Stock, par value $ .0001 (the “ Holdings Series B Stock ”) in a private placement at $ 10.00 per share, for an aggregate purchase price of $ 1.5 million.

The Holdings Series B Stock may be converted into shares of Holdings Common Stock, at the option of the investor at a rate equal to the quotient of (i) $ 10.00 divided, by (ii) the product of (A) .80 multiplied by, (B) the volume weighted average price for the 20 trading days during the 30 -day period immediately prior to such conversion, provided that in no event shall the denominator be less than $ 6.00 per share (the “Conversion Rate”).

SERIES B CONVERTIBLE PREFERRED STOCK (continued)

Additionally, the Holdings Series B Stock carries a cumulative dividend at a rate of nine percent ( 7 %) per annum, payable and compounded quarterly on the last day of each quarter.

As of December 31, 2024, included in accounts payable, accrued expenses and other liabilities on the accompanying consolidated statement of financial condition is an accrued dividend in the amount of $ 0.03 million that was paid subsequent to December 31, 2024.

The Company may, at its option, in whole, or part, redeem the Holdings Series B Stock any time after the first anniversary of the date of the Subscription Agreement at a redemption price equal to the greater of (i) $ 12.00 per share of Holdings Series B Stock, plus accrued but unpaid dividends or (A) 1.20 multiplied by (B) the volume weighted average price for 20 trading days during the 30 -day period immediately prior to the redemption;

provided that such price shall not greater than $ 20.00 .

The following table summarizes the warrants outstanding as of December 31, 2024:

Class of Warrants

Number Outstanding

Public warrants

Each whole warrant entitles the registered holder to purchase one share of Class A common stock at a price of $ 11.50 per share.

A holder may exercise its warrants only for a whole number of shares of Class A common stock.

No fractional warrants will be issued upon separation of the units and only whole warrants will trade.

The Company may redeem the warrants at a price of $ 0.01 per share if the closing price of the Company’s Class A common stock equals or exceeds $ 18.00 per share for any 20 trading days within a 30 - trading day period.

The Warrants will expire five years after the Closing Date or earlier upon redemption or liquidation.

The Warrants are classified as derivative liabilities under ASC Topic 480 or ASC Topic 815.

At December 31, 2024 , the fair value of the warrant liabilities is approximately $ 1.0 million and is included in accounts payable, accrued expenses and other liabilities on the accompanying consolidated statement of financial condition as of December 31, 2024.

For the year ended December 31, 2024, included in other expenses on the consolidated statement of operations is unrealized gain on the warrants in the amount of approximately $ 0.6 million.

Prior to the closing the Business Combination BMS was classified as a partnership for income tax purposes and is therefore not subject to federal, and certain state, and local income taxes.

Subsequent to the closing of the Business Combination, BMS elected to be taxed as a corporation and therefore subject to federal, state and local income taxes.

Binah Capital Group, Inc.

and Binah Capital Corp are also corporations and suject to federal, state and local income taxes.

PKSH elected to be taxed as a corporation.

The PKSH Entities and WEG are taxable entities and are subject to federal, state, and local income taxes.

Therefore, these consolidated financial statements include an income tax provision for the taxable entities only, which is the primary reason for the difference between the statutory tax rate and the effective tax rate.

Therefore, these consolidated financial statements include an income tax provision for the all taxable entities, which is the primary reason for the difference between the statutory tax rate and the effective tax rate.

The income tax provision (benefit) for the years ended December 31, consisted of the following:

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Income tax provision (benefit)

INCOME TAXES (continued)

The reconciliation between the U.S.

statutory federal income tax rate and the Company’s effective tax rate for the year ended December 31, 2023 was as follows:

U.S federal statutory rate

statutory federal income tax rate and the Company’s effective tax rate for the years ended December 31, 2024 and 2023 are as follows:

federal statutory rate

State income taxes, net of federal benefit

Non-deductible meals and entertainment

Non-deductible transaction costs

Gain/(loss) on the fair value of warrants

Deferred adjustments

Non-taxable pass through entities

Net operating loss true-up

Other adjustments

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Property, and equipment, net

Intangibles, net

IRC 163(j) interest limitation, carryover

1 unchanged sentence

Valuation Allowance

Net deferred tax liability

INCOME TAXES (continued)

Net deferred tax asset

Net Operating Losses

At December 31, 2023, the Company and its subsidiaries had federal and state net operating loss carry forwards of approximately $4.4 million.

At December 31, 2024, the Company and its subsidiaries had federal and state net operating loss carry forwards of approximately $ 1.0 million and $ 1.8 million, respectively.

At December 31, 2023, the Company had federal and state net operating loss carryforwards of approximately $ 3.7 million and $ 1.2 million, respectively.

These carry forward losses are available to offset future U.S.

4 unchanged sentences

Significant management judgment is required in determining the period in which the reversal of a valuation allowance should occur.

The Company has considered all available evidence, both positive and negative, such as historical levels of income and future forecasts of taxable income amongst other items, in determining its valuation allowance and has concluded that a valuation allowance is not warranted.

INCOME TAXES (continued)

Unrecognized Tax Benefits

Based on the Company’s evaluation, it has been concluded that there are no material uncertain tax positions requiring recognition in the Company’s consolidated financial statements for the year ended December 31, 2023.

The Company’s policy for recording interest and penalties associated with unrecognized tax benefits is to record such interest and penalties as interest expense and other expense, respectively.

There were no amounts accrued for interest or penalties on unrecognized tax benefits for the year ended December 31, 2023.

There were no amounts accrued for interest or penalties on unrecognized tax benefits for the years ended December 31, 2024 and 2023.

Management does not expect any material changes in its unrecognized tax benefits in the next year.

2 unchanged sentences

The Company is not currently under examination for any tax years.

NET LOSS PER SHARE

The Series A and Series B Preferred Stock does not have similar economic rights to the common stock and management does not consider them to be in substance common shares for earnings per share (“EPS”) purposes.

As a result, the weighted average Series A and Series B Preferred Stock outstanding during the period was not included in the calculation of weighted average common stock outstanding.

The warrants were considered in diluted EPS under the treasury stock method, if dilutive.

Management determined that EPS was not presented for periods prior to the Merger as it was not considered to be meaningful.

The computation of loss per share and weighted average of the Company’s common stock outstanding for the period from the date of transaction close through December 31, 2024 is as follows (in thousands) :

For the year ended

December 31, 2024

Net loss attributable to Binah Capital Group, Inc.

Basic and diluted weighted average shares outstanding, common stock

Basic and diluted loss per share of common stock

The following table details the securities that have been excluded from the calculation of weighted-average shares for diluted earnings per share for the period presented as they were anti-dilutive (in thousands) .

COMMITMENTS AND CONTINGENCIES

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In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein.

COMMITMENTS AND CONTINGENCIES (continued)

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the accompanying consolidated financial statements.

12 unchanged sentences

However, the actual outcomes of such legal proceedings, claims, disputes, or investigations could be material to the Company’s operating results and cash flows for a particular future period as additional information is obtained.

Settlement Agreements

On August 18, 2021, the Company entered into a 2021 Settlement Agreement with the Saginaw Chippewa Indian Tribe of Michigan whereby the Paying Parties, as defined, were to make six payments totaling approximately $3.7 million, which represented the remaining amount due plus interest.

The members of the Company, under the terms of an agreement are jointly and severally liable for the full settlement amount.

The Company entered into a First Amendment to the 2021 Settlement Agreement on February 17, 2022, which stipulated that payment terms of the remaining amount owed of approximately $1.5 million, plus interest to be paid during 2022.

Such amount was satisfied in June 2022 and recorded as a distribution of members’ capital.

COMMITMENTS AND CONTINGENCIES (continued)

Indemnification

8 unchanged sentences

RELATED-PARTY TRANSACTIONS

Certain of the Company’s subsidiaries earn revenue from entities that are controlled by a principal member of the Company as well as from entities controlled or by individuals that are members or officers of the Company.

The revenue earned by the subsidiaries and amounts due to or due from these affiliated entities as of and for the years ended December 31, 2023 and 2022 are as follows (in thousands) :

Certain of the Company’s subsidiaries earn revenue from various related parties controlled by individuals that are members or officers of the Company.

Summarized activity and balance as of and for the years ended December 31, 2024 and 2023 are as follows (in thousands) :

Due from/(Due to)

The revenue amounts and amounts due to and due from are included in commissions on the accompanying consolidated statements of operations and other assets on the consolidated statements of financial condition, respectively.

MEMBERS’ EQUITY

Incentive units

The Company authorized a class of units designated as Incentive Units.

As of December 31, 2023 and 2022, no Incentive Units have been issued.

Voting Rights - Incentive Units will generally have no voting rights, except as required by law.

Profit interest - Incentive Units constitute an interest in the profits of the Company.

All Incentive Units received by a service provider are received in exchange for the provision of services by the service provider for the benefit of the Company.

Call Right - At any time prior to the consummation of a Qualified Public Offering or a Change of Control, following the termination of employment or other engagement of any service provider with the Company, the Company may, at its election, require the service provider to sell to the Company all or any portion of such service provider’s Incentive Units at the following respective purchase prices:

For any Incentive Units that have not vested pursuant to the terms of the incentive plan or any award agreement (“Restricted Incentive Units”), under all circumstances of termination, a price equal to the lesser of their fair value or their initial cost (the “Cause Purchase Price”).

For any Incentive Units that have vested pursuant to the terms of the incentive plan or any associated award agreement (“Unrestricted Incentive Units”), the Cause Purchase Price, in the event of:

● Service provider is terminated with cause;

● Service provider resigns without good reason.

For the Unrestricted Incentive Units, a price equal to their fair value, in the event of:

● Service provider is terminated without cause;

● Service provider resigns for good reason;

● Service provider resigns for any reason after 5 years;

● Death or disability.

Put Right - At any time prior to the consummation of a Qualified Public Offering or a Change of Control, if a service provider’s employment or other engagement with the Company is terminated as a result of such service provider’s death or disability, and the Company has not delivered a repurchase notice within ninety (90) days of such termination, then, subject to certain other provisions, such service provider may elect to sell to the Company all or any percentage of the Unrestricted Incentive Units held by such Person at a price equal to the fair value of such Unrestricted Incentive Units as of the date of termination.

MEMBERS’ EQUITY (continued)

Class A Preferred Units

The Company authorized a class of units designated as Class A Preferred Units.

As of December 31, 2023 and 2022, no Class A Preferred Units have been issued.

Voting Rights - Class A Preferred Units will generally have no voting rights, except as required by law.

Pre-Emptive Rights - Class A Preferred Units will have the right to purchase their applicable pro rata portion of any new securities that the Company may from time to time propose to issue or sell to any party after the consummation of a Qualified Public Offering.

Protective Provisions - For as long as the Class A Preferred Units are outstanding, the holders will be afforded certain protection provisions pursuant to the warrant holders’ rights agreement.

There were no warrants outstanding as of December 31, 2023 and 2022, respectively.

Class B Preferred Units

The Company authorized a class of units designated as Class B Preferred Units.

Effective September 4, 2023, the Company entered into an agreement with the holder of the Class B Preferred Units whereby beginning on September 30, 2023, monthly payments in the amount of $61,676 (inclusive of the principal and the yield) will be made to redeem the Class B Preferred Unit holders.

The payment of the Class B Preferred Units are intended to be completed no later than eighteen months from the date or the agreement or upon the consummation of the contemplated Business Combination .

As of December 31, 2023 and 2022, 260,834 and 277,364 Class B Preferred Units are outstanding at a value of $2.6 million and $2,8 million, respectively.

Voting Rights - Class B Preferred Units will generally have no voting rights, except as required by law, and except that the affirmative vote of the holders of a majority of the then outstanding units of Class B Preferred Units is required to authorize the issuance of any units that are senior in any respect to the Class B Preferred Units.

Pre-Emptive Rights - Class B Preferred Units will have the right to purchase their applicable pro rata portion of any new securities that the Company may from time to time propose to issue or sell to any party between the date of issuance and the consummation of a Qualified Public Offering.

Conversion - Class B Preferred Units are convertible into Common Units (subject to adjustment as provided in the related operating agreements, rights and limitations) at any time at the option of the holder at a conversion price equal to (a) if the conversion notice date is on or prior to the date that is 6 months after the closing date, the result of $10,172,877 divided by the number of Common Units outstanding as of the conversion notice date.

Or (b), if the conversion notice date is after the date that is 6 months after the closing date, the result of (x) enterprise value less net debt less aggregate Class B Preferred unreturned capital value of all outstanding Class B Preferred Units as of the measurement date (all as defined) divided by (y) the number of Common Units as of the conversion notice date.

The Class B Preferred Units are convertible up to only an aggregate of 10% of the fully diluted outstanding equity interests of WMS.

Redemption - Class B Preferred Units are redeemable upon a change in control, the termination of employment of the holder or upon exercise by the holder on the third anniversary of the instrument.

The redemption price of a Class B Preferred Unit shall be equal to the sum of (x) the Class B preferred yield in respect of such Class B Preferred Unit and the Class B Preferred capital value, (all as defined) less (y) the aggregate amount of all distributions made by the Company in respect of such Class B Preferred Unit.

Preferred Yield - Class B Preferred Units are entitled to a cumulative preferred yield of 2.06% per annum and a default rate of 9% per annum, compounded quarterly, on the sum of (a) the Class B Preferred Unit unreturned capital value and (b) the Class B

MEMBERS’ EQUITY (continued)

Preferred unpaid yield accumulated for all prior quarterly compounding periods.

For the year ended December 31, 2022, the cumulative preferred yield amounted to approximately $0.3 million, which was paid during the year ended December 31, 2023.

Subsequent to December 31, 2023, and in connection with the Business Combination, the Class B Preferred units were redeemed in full for approximately $2,5 million.

The Company authorized a class of units designated as Common Units, which have voting rights.

As of December 31, 2023 and 2022, there are 1,325,433 Common Units issued and outstanding at a value of approximately $12.3 million.

Priority of Distributions

The priority of distributions after making any required tax advances is as follows:

Pro rata to the holders of Class A Preferred Units on a fully diluted basis in an amount equal to the product of (a) the aggregate distribution amount;

times (b) this group’s fully diluted membership interest expressed as a percentage of the overall fully diluted membership interest;

Pro rata to the holders of Class B Preferred Units in an amount equal to any unpaid cumulative preferred yield;

Pro rata to the holders of Class B Preferred Units in an amount equal to any unreturned capital contribution;

Pro rata to the holders of Common Units in an amount equal to any unreturned capital contribution;

Pro rata to the holders of Common Units and Incentive Units in an amount equal to any remainder.

STOCKHOLDERS’ EQUITY

The Company is authorized to issue 57,500,000 shares consisting of the following:

● 2,000,000 shares of Series A Preferred Stock, par value $ 0.0001 per share, 1,555,000 shares issued and outstanding as of December 31, 2024;

● 500,000 shares of Series B Preferred Stock, par value $ 0.0001 per share, 150,000 shares issued and outstanding as of December 31, 2024;

● 55,000,000 shares of Common Stock, par value $ 0.0001 per share, 16,602,460 shares issued and outstanding as of December 31, 2024.

RETIREMENT PLAN

8 unchanged sentences

The Company did not make a separate profit-sharing plan contribution for the years ended December 31, 2024 and 2023.

Effective January 1, 2025, the WEG plan was merged into the PKSI plan and the plan was renamed the Binah Management Services 401 (k) Profit Sharing Plan.

NET CAPITAL REQUIREMENTS

6 unchanged sentences

The Company believes that credit risk is limited because the Company routinely assesses the financial strength of its counterparties and, based upon factors surrounding the credit risk of its counterparties, establishes an allowance for credit losses and, consequently, believes that its receivables credit risk exposure beyond such allowances is limited.

SEGMENT INFORMATION

Effective with the consummation of the Business Combination, the Board confirmed Craig Gould as Chief Executive Officer (“CEO”) and David Shane as Chief Financial Officer (“CFO).

The Company has concluded that the its Chief Operating Decision Maker (“CODM”) of the group includes the CEO and CFO of the Company.

Management of the Company has determined that it has one reportable segment, given the common nature of the Company’s operations, products and services, and regulatory environment.

The Company provides a platform of brokerage and investment advisory services to independent financial advisors and advisors at other financial services companies from which the Company derives its revenues and incurs expenses.

See Note 4 – Revenue from Contracts with Customers .

The CODM regularly reviews net income/(loss) before the provision or benefit for income taxes as presented in the Company’s consolidated statements of operations for purposes of assessing performance and making decisions regarding the allocation of resources.

Expenses regularly reviewed by the CODM include those line items reported on the Company’s consolidated statement of operations, the most significant of which includes commissions and fees, employee compensation and benefits and professional fees.

See the consolidated statements of operations and Note 3 – Summary of Significant Accounts Policies for additional information about these lines items and the related accounting policies.

SUBSEQUENT EVENTS

The Company evaluated subsequent events that occurred after the balance sheet date up to April 16, 2024, the date that the consolidated financial statements were available to be issued.

The Company evaluated subsequent events that occurred after the balance sheet date up to March , 2025, the date that the consolidated financial statements were available to be issued.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures