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UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-K/A


|   |  |                                                                                             
|-- |  | --------------------------------------------------------------------------------------------
|þ  |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
|  
|   |  | For the fiscal year ended December 31, 2004                                                 
|  
|or
|o  |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
|  
|   |  | For the transition period
    from           to              ,      .                       

Commission file no. 1-10024


BKF Capital Group, Inc.


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                     
|------------------------------------------------------------------ |  | ------------------------------------
|DELAWARE                                                           |  | 36-0767530                          
|(State or other jurisdiction of incorporation or
    organization) |  | (I.R.S. Employer Identification No.)

One Rockefeller Plaza


New York, New York 10020


(Address of principal executive offices)


Telephone Number: (212) 332-8400


(Registrants telephone number, including area code)


Securities registered pursuant to Section 12(b) of the
Act:


|                                        |  |                                          
|--------------------------------------- |  | -----------------------------------------
|Title of Each Class                     |  | Name of Each Exchange on Which Registered
|                                        |  |                                          
|Common Stock, par value $1.00 per share |  | New York Stock Exchange                  

Securities registered pursuant to Section 12(g) of the
Act:


None


o þ


þ


þ o


o þ






DOCUMENTS INCORPORATED BY REFERENCE:












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EXPLANATORY NOTE








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PART I




|        |         
|------- | --------
|Item 1. | Business

Introduction








Services










1



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Institutional and Individual Separate Accounts.




Sub-Advisory Relationships.


Wrap Fee Accounts.


2



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Event-Driven Accounts.


Long-Short Equity Accounts.


Short-Biased Accounts.


Other Private Investment Funds.




ASSETS UNDER MANAGEMENT


|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |        |  |  |   |        | 
|------------------------------ |  | --------------- | ------ |  | ---- | - | ------ | ---- |  | - | ------ |  |  | ---- | ------ |  |  | - | ------ | 
|                               |  | At December 31, |       
|                               |  |                 |       
|                               |  | 2004            |        |  | 2003 |   |        | 2002 |  |   | 2001   |  |  | 2000 |       
|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |       
|                               |  | (In millions)   |       
|Long-Only Accounts:            |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |        |  |  |   |        | 
|Institutional Accounts         |  | $               | 2,964  |  |      | $ | 2,953  |      |  | $ | 2,562  |  |  | $    | 3,772  |  |  | $ | 3,262  | 
|Sub-advisory Accounts          |  |                 | 2,641  |  |      |   | 2,306  |      |  |   | 1,861  |  |  |      | 2,169  |  |  |   | 1,802  | 
|Non-institutional Accounts     |  |                 | 1,713  |  |      |   | 1,640  |      |  |   | 1,489  |  |  |      | 2,000  |  |  |   | 2,196  | 
|Wrap Fee Accounts              |  |                 | 2,319  |  |      |   | 2,502  |      |  |   | 2,982  |  |  |      | 4,448  |  |  |   | 2,975  | 
|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |       
|Total Long-Only                |  |                 | 9,637  |  |      |   | 9,401  |      |  |   | 8,894  |  |  |      | 12,389 |  |  |   | 10,235 | 
|Alternative Strategies:        |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |        |  |  |   |        | 
|Event Driven Accounts          |  |                 | 2,568  |  |      |   | 2,418  |      |  |   | 1,849  |  |  |      | 1,533  |  |  |   | 1,071  | 
|Long-Short Accounts            |  |                 | 792    |  |      |   | 434    |      |  |   | 18     |  |  |      |       |  |  |   |       | 
|Short-Biased Accounts          |  |                 | 422    |  |      |   | 340    |      |  |   | 452    |  |  |      | 310    |  |  |   | 179    | 
|Other Private Investment Funds |  |                 | 185    |  |      |   | 67     |      |  |   | 72     |  |  |      | 34     |  |  |   | 23     | 
|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |       
|Total Alternative Strategies   |  |                 | 3,967  |  |      |   | 3,259  |      |  |   | 2,391  |  |  |      | 1,877  |  |  |   | 1,273  | 
|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |       
|Total                          |  | $               | 13,604 |  |      | $ | 12,660 |      |  | $ | 11,285 |  |  | $    | 14,266 |  |  | $ | 11,508 | 
|                               |  |                 |        |  |      |   |        |      |  |   |        |  |  |      |       



3



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Distribution








Portfolio Performance Information




COMPARISON OF ANNUAL RETURNS


(as of December 31, 2004)*


|                         |  |      |       |  |      |  |      |      |  |  |       |           |  |       |      |  |              |  |       |  |  |  |       | 
|------------------------ |  | ---- | ----- |  | ---- |  | ---- | ---- |  |  | ----- | --------- |  | ----- | ---- |  | ------------ |  | ----- |  |  |  | ----- | 
|                         |  |      |       |  |      |  |      |      |  |  |       | Inception | 
|                         |  | 1-Yr |       |  | 3-Yr |  |      | 5-Yr |  |  | 7-Yr  |           |  | 10-Yr |      |  | (Since 1986) | 
|                         |  |      |       |  |      |  |      |      |  |  |       |           |  |       |      |  |              | 
|Levco Composite (net)    |  |      | 14.50 |  |      |  | 2.62 |      |  |  | 3.80  |           |  |       | 7.49 |  |              |  | 12.70 |  |  |  | 13.57 | 
|S&P 500 Index            |  |      | 10.88 |  |      |  | 3.59 |      |  |  | (2.30 | )         |  |       | 4.77 |  |              |  | 12.07 |  |  |  | 12.32 | 
|Russell 1000 Value Index |  |      | 16.49 |  |      |  | 8.57 |      |  |  | 5.27  |           |  |       | 6.99 |  |              |  | 13.82 |  |  |  | 13.03 | 






|  |                                         
|- | ----------------------------------------
|* | Periods greater than 1 Yr are annualized

Past performance is not a guarantee of future
performance.


Notes to Comparison of Annual Returns


Composite:




| |   |                                                                                        
| | - | ---------------------------------------------------------------------------------------
| |  | Immediate family and related accounts.                                                 
|
| |  | Accounts with assets under $1,000,000.                                                 
|
| |  | One account for which only the equity portion of the portfolio
    is managed.         
|
| |  | Certain investment funds and managed accounts with different
    investment strategies.
|
| |  | Accounts managed under a broker-sponsored wrap-fee program.                            

4



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Calculation of Performance:


Contractual Arrangements






Employees




Business Strategy




Attracting and Retaining Experienced Professionals.


5



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Development of Complementary Long-Only Strategies.


Development of Alternative Investment Strategies.


Strengthen Presence in Target Markets.


Development of Operational Infrastructure.


Competition




Regulation




6



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Risk Factors




Levco is dependent on key personnel










7



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Levco is dependent on a limited number of investment
strategies




A decline in the performance of the securities markets
could have an adverse effect on Levcos revenues




Poor investment performance could adversely affect
Levcos financial condition






Adverse developments with regard to significant customers
or relationships could adversely affect Levcos
revenues






8



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A decrease in Levcos management fees, the
cancellation of investment management agreements or poor
investment performance by the Levco private investment funds
could adversely affect Levcos results


Management Fees.


Cancellation of Investment Management Agreements.


Poor Investment Performance of the Private Investment
Funds.


Levco is a relatively small public company in a highly
competitive business




Levco is dependent on information systems and
administrative, back-office and trade execution functions




9



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Conflicts of interest may arise and adversely affect
Levco




Government regulations may adversely affect Levco and
BKF






Terrorist attacks could adversely affect BKF




Special Note Regarding Forward-Looking
Statements




10



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|        |           
|------- | ----------
|Item 2. | Properties







|        |                  
|------- | -----------------
|Item 3. | Legal Proceedings





|        |                                                    
|------- | ---------------------------------------------------
|Item 4. | Submission of Matters to a Vote of Security Holders



PART II




|        |                                                                                                                          
|------- | -------------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for the Registrants Common Equity, Related
    Stockholders Matters and Issuer Purchases of Equity
    Securities



11



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|               |  |                    |       |  |          |   |       |          |  |   |       |    
|-------------- |  | ------------------ | ----- |  | -------- | - | ----- | -------- |  | - | ----- | ---
|               |  | Stock Price Ranges |       |  |         
|               |  |                    |       |  | Dividend |  
|2004           |  | High               |       |  | Low      |   |       | Declared | 
|               |  |                    |       |  |          |   |       |          | 
|First quarter  |  | $                  | 27.00 |  |          | $ | 24.72 |          |  | $ | 0.10  |    
|Second quarter |  | $                  | 29.90 |  |          | $ | 26.40 |          |  |   |       |    
|Third quarter  |  | $                  | 29.40 |  |          | $ | 26.01 |          |  | $ | 0.225 | (a)
|Fourth quarter |  | $                  | 38.00 |  |          | $ | 29.80 |          |  |   |       |    
|2003           |  |                    |       |  |          |   |       |          |  |   |       |    
|               |  |                    |       |  |          |   |       |          | 
|First quarter  |  | $                  | 18.45 |  |          | $ | 16.24 |          |  |   |       |    
|Second quarter |  | $                  | 22.28 |  |          | $ | 15.65 |          |  |   |       |    
|Third quarter  |  | $                  | 24.50 |  |          | $ | 20.15 |          |  |   |       |    
|Fourth quarter |  | $                  | 25.15 |  |          | $ | 21.75 |          |  |   |       |    






|    |  |                                                                                                    
|--- |  | ---------------------------------------------------------------------------------------------------
|(a) |  | reflects dividends of $0.10 declared on July 9, 2004 and
    $0.125 declared on September 23, 2004.







ISSUER PURCHASES OF EQUITY SECURITIES


|                   |  |                   |        |  |                |                   |             |                 |                           |                      |                    |  |  |  |                | 
|------------------ |  | ----------------- | ------ |  | -------------- | ----------------- | ----------- | --------------- | ------------------------- | -------------------- | ------------------ |  |  |  | -------------- | 
|                   |  | (a)               |        |  | (b)            |                   |             | (c)             |                           |                      | (d)                | 
|                   |  |                   |        |  |                | Total Number of   |             |                 | Maximum Number (or        |                     
|                   |  |                   |        |  |                | Shares (or Units) |             |                 | Approximate Dollar Value) |                     
|                   |  |                   |        |  |                | Purchased as Part |             |                 | of Shares (or Units) That |                     
|                   |  | Total Number of   |        |  |                |                   | of Publicly |                 |                           | May Yet Be Purchased |                   
|                   |  | Shares (or Units) |        |  | Average Price  |                   |             | Announced Plans |                           |                      | Under the Plans or | 
|Period             |  | Purchased         |        |  | Paid Per Share |                   |             | or Programs     |                           |                      | Program            | 
|                   |  |                   |        |  |                |                   |             |                 |                           |                      |                    | 
|10/1/04  10/31/04 |  |                   | 50,721 |  |                | $                 | 31.80       |                 |                           |                      | Not Applicable     |  |  |  | Not Applicable | 
|11/1/04  11/30/04 |  |                   | 39,439 |  |                | $                 | 35.12       |                 |                           |                      | Not Applicable     |  |  |  | Not Applicable | 
|12/1/04  12/31/04 |  |                   | 73,107 |  |                | $                 | 37.82       |                 |                           |                      | Not Applicable     |  |  |  | Not Applicable | 

12



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|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data



|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |      |      |      |   |       |      |      | 
|------------------------------------------------------------------------ | -------------- | ----------------------- | ---- | --------- | --------- | - | ---- | --------- | ---- | - | ----------- | ---- | ---- | ----------- | ---- | ---- | ---- | - | ----- | ---- | ---- | 
|                                                                         |                | Year Ended December 31, |     
|                                                                         |                |                         |     
|                                                                         |                |                         |      | Pro Forma |          
|                                                                         |                | 2004                    |      |           | 2003      |   |      | 2002      |      |   | 2001        |      |      | 2000(a)     |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|                                                                         |                | (audited)               |      |           | (audited) |   |      | (audited) |      |   | (unaudited) |      |      | (unaudited) |     
|Revenues:                                                                |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |      |      |      |   |       |     
|Investments Management Fees (IMF):                                       |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |      |      |      |   |       |     
|Advisory                                                                 |                | $                       | 25.4 |           |           | $ | 24.8 |           |      | $ | 29.0        |      |      | $           | 33.0 |      |      | $ | 29.5  |     
|Wrap Accounts                                                            |                |                         | 9.3  |           |           |   | 10.2 |           |      |   | 16.4        |      |      |             | 16.6 |      |      |   | 10.3  |     
|Event-Driven                                                             |                |                         | 28.9 |           |           |   | 18.7 |           |      |   | 12.7        |      |      |             | 8.6  |      |      |   | 4.5   |     
|Long-Short                                                               |                |                         | 9.3  |           |           |   | 2.4  |           |      |   |            |      |      |             |     |      |      |   |      |     
|Short-Biased                                                             |                |                         | 4.6  |           |           |   | 4.0  |           |      |   | 3.4         |      |      |             | 2.0  |      |      |   | 1.2   |     
|Other Alternative Investments                                            |                |                         | 0.8  |           |           |   | 0.2  |           |      |   | 0.3         |      |      |             | 0.3  |      |      |   | 0.1   |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|                                                                         |                | Total IMF Fees          |      |           | 78.3      |   |      |           | 60.3 |   |             |      | 61.8 |             |      |      | 60.5 |   |       |      | 45.6 | 
|Incentive Fees and Allocations:                                          |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |      |      |      |   |       |     
|Event-Driven                                                             |                |                         | 28.6 |           |           |   | 32.2 |           |      |   | 17.4        |      |      |             | 22.2 |      |      |   | 24.4  |     
|Long-Short                                                               |                |                         | 8.8  |           |           |   | 5.2  |           |      |   | 0.1         |      |      |             |     |      |      |   |      |     
|Short-Biased                                                             |                |                         |     |           |           |   | (2.3 | )         |      |   | 6.8         |      |      |             | 2.1  |      |      |   | 1.5   |     
|Other                                                                    |                |                         | 2.2  |           |           |   | 0.6  |           |      |   | 0.1         |      |      |             | 3.3  |      |      |   | 2.7   |     
|Other Alternative Investments                                            |                |                         | 1.3  |           |           |   | 0.6  |           |      |   | 0.2         |      |      |             | 0.8  |      |      |   | 0.7   |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|                                                                         |                | Total Incentive Fees    |      |           | 40.9      |   |      |           | 36.3 |   |             |      | 24.6 |             |      |      | 28.4 |   |       |      | 29.3 | 
|                                                                         | Total Fees     |                         |      | 119.2     |           |   |      | 96.6      |      |   |             | 86.4 |      |             |      | 88.9 |      |   |       | 74.9 |     
|Commission Income and Other                                              |                |                         | 1.5  |           |           |   | 2.0  |           |      |   | 2.9         |      |      |             | 2.5  |      |      |   | 1.7   |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|                                                                         | Total Revenues |                         |      | 120.7     |           |   |      | 98.6      |      |   |             | 89.3 |      |             |      | 91.4 |      |   |       | 76.6 |     
|Expenses:                                                                |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |      |      |      |   |       |     
|Employee Compensation and Benefits                                       |                |                         | 93.8 |           |           |   | 77.8 |           |      |   | 61.8        |      |      |             | 60.1 |      |      |   | 57.4  |     
|Non-Compensation Expenses                                                |                |                         | 19.7 |           |           |   | 25.7 |           |      |   | 20.6        |      |      |             | 15.4 |      |      |   | 11.7  |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|                                                                         | Total Expenses |                         |      | 113.5     |           |   |      | 103.5     |      |   |             | 82.4 |      |             |      | 75.5 |      |   |       | 69.1 |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|Income (loss) before interest, taxes and amortization                    |                |                         | 7.2  |           |           |   | (4.9 | )         |      |   | 6.9         |      |      |             | 15.9 |      |      |   | 7.5   |     
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|Net investment income                                                    |                |                         | 1.6  |           |           |   | 1.5  |           |      |   | 1.0         |      |      |             | 2.9  |      |      |   | 1.5   |     
|Net investment income  consolidated affiliated
    partnerships (CAP) |                |                         | 1.2  |           |           |   | 2.6  |           |      |   | (2.9        | )    |      |             |     |      |      |   |      |     
|Minority interest from CAP                                               |                |                         | (0.7 | )         |           |   | (1.7 | )         |      |   | 3.3         |      |      |             |     |      |      |   |      |     
|Amortization of intangibles                                              |                |                         | (7.0 | )         |           |   | (7.0 | )         |      |   | (7.0        | )    |      |             | (9.5 | )    |      |   | (7.6  | )   
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|Income (loss) before taxes                                               |                |                         | 2.3  |           |           |   | (9.5 | )         |      |   | 1.3         |      |      |             | 9.3  |      |      |   | 1.4   |     
|Income tax expense (benefit)                                             |                |                         | 4.1  |           |           |   | (1.1 | )         |      |   | 3.7         |      |      |             | 7.8  |      |      |   | (0.7  | )   
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|Income (loss) before cumulative effect of accounting
    change          |                |                         | (1.8 | )         |           |   | (8.4 | )         |      |   | (2.4        | )    |      |             | 1.5  |      |      |   | 2.1   |     
|Cumulative effect of accounting change                                   |                |                         |     |           |           |   |     |           |      |   |            |      |      |             |     |      |      |   | (53.4 | )   
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     
|Net income (loss)                                                        |                | $                       | (1.8 | )         |           | $ | (8.4 | )         |      | $ | (2.4        | )    |      | $           | 1.5  |      |      | $ | (51.3 | )   
|                                                                         |                |                         |      |           |           |   |      |           |      |   |             |      |      |             |     

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|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |           |  |  |   |           |  
|----------------------------------------------------------- |  | ----------------------- | --------- | --------- | --------- | - | --------- | --------- |  | - | ----------- | - |  | ----------- | --------- |  |  | - | --------- | -
|                                                            |  | Year Ended December 31, |          
|                                                            |  |                         |          
|                                                            |  |                         |           | Pro Forma |          
|                                                            |  | 2004                    |           |           | 2003      |   |           | 2002      |  |   | 2001        |   |  | 2000(a)     |          
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|                                                            |  | (audited)               |           |           | (audited) |   |           | (audited) |  |   | (unaudited) |   |  | (unaudited) |          
|Per share data:                                             |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |           |  |  |   |           |  
|Basic:                                                      |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |           |  |  |   |           |  
|Income (loss) before cumulative effect of accounting change |  | $                       | (0.25     | )         |           | $ | (1.26     | )         |  | $ | (0.37       | ) |  | $           | 0.23      |  |  | $ | 0.32      |  
|Cumulative effect of accounting change                      |  |                         |          |           |           |   |          |           |  |   |            |   |  |             |          |  |  |   | (8.21     | )
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|Net income (loss)                                           |  | $                       | (0.25     | )         |           | $ | (1.26     | )         |  | $ | (0.37       | ) |  | $           | 0.23      |  |  | $ | (7.89     | )
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|Diluted:                                                    |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |           |  |  |   |           |  
|Income (loss) before cumulative effect of accounting change |  | $                       | (0.25     | )         |           | $ | (1.26     | )         |  | $ | (0.37       | ) |  | $           | 0.20      |  |  | $ | 0.32      |  
|Cumulative effect of accounting change                      |  |                         |          |           |           |   |          |           |  |   |            |   |  |             |          |  |  |   | (8.15     | )
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|Net income (loss)                                           |  | $                       | (0.25     | )         |           | $ | (1.26     | )         |  | $ | (0.37       | ) |  | $           | 0.20      |  |  | $ | (7.83     | )
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|Basic weighted average shares outstanding(1)                |  |                         | 6,949,031 |           |           |   | 6,673,371 |           |  |   | 6,624,313   |   |  |             | 6,546,077 |  |  |   | 6,504,890 |  
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          
|Diluted weighted average shares outstanding(1)              |  |                         | 6,949,031 |           |           |   | 6,673,371 |           |  |   | 6,624,313   |   |  |             | 7,364,333 |  |  |   | 6,549,889 |  
|                                                            |  |                         |           |           |           |   |           |           |  |   |             |   |  |             |          






| |                                                                                                                                                                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1)- Gives effect for reverse stock split of 1 for 6 effectuated
    January 7, 2000. Assumes same amount of shares were
    outstanding throughout period.                                                                                                                                                                                     
|
| | (a)     The amounts reflect Pro forma
    income of the Company assuming that the Company had
    de-registered as an investment company and distributed all of
    its assets as of December 31, 1995 and recasts the
    acquisition of Levco using purchase accounting with the
    cumulative effect of accounting change recorded in 2000.



|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

Introduction








14



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|                               |  |                 |        |  |      |   |        |      |  |   |        | 
|------------------------------ |  | --------------- | ------ |  | ---- | - | ------ | ---- |  | - | ------ | 
|                               |  | At December 31, |       
|                               |  |                 |       
|                               |  | 2004            |        |  | 2003 |   |        | 2002 | 
|                               |  |                 |        |  |      |   |        |      | 
|                               |  | (In millions)   |       
|Long-Only Accounts:            |  |                 |        |  |      |   |        |      |  |   |        | 
|Institutional Accounts         |  | $               | 2,964  |  |      | $ | 2,953  |      |  | $ | 2,562  | 
|Sub-advisory Accounts          |  |                 | 2,641  |  |      |   | 2,306  |      |  |   | 1,861  | 
|Non-institutional Accounts     |  |                 | 1,713  |  |      |   | 1,640  |      |  |   | 1,489  | 
|Wrap Fee Accounts              |  |                 | 2,319  |  |      |   | 2,502  |      |  |   | 2,982  | 
|                               |  |                 |        |  |      |   |        |      | 
|Total Long-Only                |  |                 | 9,637  |  |      |   | 9,401  |      |  |   | 8,894  | 
|Alternative Strategies:        |  |                 |        |  |      |   |        |      |  |   |        | 
|Event Driven Accounts          |  |                 | 2,568  |  |      |   | 2,418  |      |  |   | 1,849  | 
|Long-short Accounts            |  |                 | 792    |  |      |   | 434    |      |  |   | 18     | 
|Short-Biased Accounts          |  |                 | 422    |  |      |   | 340    |      |  |   | 452    | 
|Other Private Investment Funds |  |                 | 185    |  |      |   | 67     |      |  |   | 72     | 
|                               |  |                 |        |  |      |   |        |      | 
|Total Alternative Strategies   |  |                 | 3,967  |  |      |   | 3,259  |      |  |   | 2,391  | 
|                               |  |                 |        |  |      |   |        |      | 
|Total                          |  | $               | 13,604 |  |      | $ | 12,660 |      |  | $ | 11,285 | 
|                               |  |                 |        |  |      |   |        |      | 







Results of Operations




| |                                                                              
| | -----------------------------------------------------------------------------
| | Year Ended December 31, 2004 as Compared to Year
    Ended December 31, 2003.



| |         
| | --------
| | Revenues



15



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i.e.,




| |         
| | --------
| | Expenses







16



---



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| |                        
| | -----------------------
| | Operating Income (Loss)





| |             
| | ------------
| | Income Taxes







| |                                                                              
| | -----------------------------------------------------------------------------
| | Year Ended December 31, 2003 as Compared to Year
    Ended December 31, 2002.



| |         
| | --------
| | Revenues





17



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| |         
| | --------
| | Expenses





18



---



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| |               
| | --------------
| | Operating Loss





| |             
| | ------------
| | Income Taxes





Liquidity and Capital Resources




19



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Off Balance Sheet Risk




20



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Contractual Obligations




|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |       |  |  |   |       | 
|------------------------------------------------------------------ |  | ---------------------- | ------ |  | ---- | - | ----- | --------- |  | - | --------- |  |  | ---------- | ----- |  |  | - | ----- | 
|                                                                   |  | Payments Due by Period |       
|                                                                   |  |                        |       
|                                                                   |  | Total                  |        |  | 2005 |   |       | 2006-2007 |  |   | 2008-2009 |  |  | Thereafter |      
|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |      
|Operating leases                                                   |  | $                      | 22,937 |  |      | $ | 3,002 |           |  | $ | 6,104     |  |  | $          | 7,378 |  |  | $ | 6,453 | 
|Accrued lease loss amendment                                       |  |                        | 3,843  |  |      |   | 415   |           |  |   | 1,048     |  |  |            | 1,074 |  |  |   | 1,306 | 
|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |      
|Total Contractual Obligations                                      |  |                        | 26,780 |  |      |   | 3,417 |           |  |   | 7,152     |  |  |            | 8,452 |  |  |   | 7,759 | 
|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |      
|Operating lease  UK (executed February 2005)                      |  |                        | 997    |  |      |   | 82    |           |  |   | 262       |  |  |            | 262   |  |  |   | 391   | 
|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |      
|Total Contractual Obligations, subsequent to December 31,
    2004 |  | $                      | 27,777 |  |      | $ | 3,499 |           |  | $ | 7,414     |  |  | $          | 8,714 |  |  | $ | 8,150 | 
|                                                                   |  |                        |        |  |      |   |       |           |  |   |           |  |  |            |      

Critical Accounting Policies




| |                                         
| | ----------------------------------------
| | Revenue Recognition and Related Expenses





| |                          
| | -------------------------
| | Purchase Price Allocation





| |                                                  
| | -------------------------------------------------
| | Investments in Affiliated Investment Partnerships





|         |                                                               
|-------- | --------------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures About Market
    Risk



21



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|                                                  |  |            |        |                     |              |   |                     |              |  |   |        | 
|------------------------------------------------- |  | ---------- | ------ | ------------------- | ------------ | - | ------------------- | ------------ |  | - | ------ | 
|                                                  |  |            |        | Fair Value Assuming |              |   | Fair Value Assuming |             
|                                                  |  |            |        | 10% Decrease in     |              |   | 10% Increase in     |             
|                                                  |  | Fair Value |        |                     | Equity Price |   |                     | Equity Price | 
|                                                  |  |            |        |                     |              |   |                     |              | 
|At December 31, 2004                              |  |            |        |                     |              |   |                     |              |  |   |        | 
|Equity price sensitive investments, at fair value |  | $          | 20,295 |                     |              | $ | 18,266              |              |  | $ | 22,325 | 
|At December 31, 2003                              |  |            |        |                     |              |   |                     |              |  |   |        | 
|Equity price sensitive investments, at fair value |  | $          | 14,413 |                     |              | $ | 12,972              |              |  | $ | 15,854 | 



|        |                                           
|------- | ------------------------------------------
|Item 8. | Financial Statements and Supplemental Data





|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure





|         |                        
|-------- | -----------------------
|Item 9A. | Controls and Procedures

Managements Report on Internal Control over Financial
Reporting




Changes in Internal Control over Financial Reporting






22



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




BKF Capital Group, Inc.












23



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|                       | 
|---------------------- | 
|/s/ Grant Thornton LLP | 







PART III




|         |                                  
|-------- | ---------------------------------
|Item 10. | Directors and Executive Officers.



DIRECTORS NOMINATED FOR ELECTION


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |       |      |          |       |               |         |      |  |               |                 |  |                |                |      |  |  |                                                           
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----- | ---- | -------- | ----- | ------------- | ------- | ---- |  | ------------- | --------------- |  | -------------- | -------------- | ---- |  |  | ----------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |       |      |          |       | Expiration of |         |      |  |               |                
|Name, Age, and Principal                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  |       |      | Director |       |               | Current |      |  | Expiration of |                 |  | Other Business
|Occupation During the Last Five Years                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | Since |      |          | Class |               |         | Term |  |               | Term if Elected |  |                | Affiliation(s)
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |       |      |          |       |               |         |      |  |               |                 |  |                |               
|J. Barton Goodwin  age 58
    Managing Director of BCI Partners, Inc. (private capital
    investment group); General Partner of Bridge Associates II
    . (private capital investment group) and Teaneck Associates .
    (private capital investment group) and member of Glenpointe
    Associates, LLC . (private capital investment group),
    Glenpointe V, LLC . (private capital investment group) and
    BCI Investors, LLC . (private capital investment group) since
    1986 |  |       | 1987 |          |       |               | III     |      |  |               | 2005            |  |                |                | 2008 |  |  |                                                           
|John A. Levin  age 66
    Chairman since February 2000; Chief Executive Officer and
    President of the Company and Chairman and Chief Executive
    Officer of Levin Management Co., Inc. and John A.
    Levin & Co., Inc. since June 1996; prior thereto,
    President and Securities Analyst/ Portfolio Manager of the
    predecessor to John A. Levin & Co., Inc.                                                                                                                   |  |       | 1996 |          |       |               | III     |      |  |               | 2005            |  |                |                | 2008 |  |  |                                                           
|Burton G. Malkiel  age 72
    Professor of Economics, Princeton University since 1964                                                                                                                                                                                                                                                                                                                                                                                                       |  |       | 1982 |          |       |               | III     |      |  |               | 2005            |  |                |                | 2008 |  |  | Director of Vanguard Group of Investment Funds (106 funds)

24



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DIRECTORS CONTINUING IN OFFICE


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |       |      |          |       |               |         |      |  |  |                               |     |  |                                                                                                                                                             
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----- | ---- | -------- | ----- | ------------- | ------- | ---- |  |  | ----------------------------- | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |       |      |          |       | Expiration of |         |      | 
|Name, Age, and Principal                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |       |      | Director |       |               | Current |      |  | 
|Occupation During the Last Five Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Since |      |          | Class |               |         | Term |  |  | Other Business Affiliation(s)
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |       |      |          |       |               |         |      |  |  |                              
|Barton M. Biggs  age 72
    Managing Partner, Traxis Partners since June 2003; prior
    thereto, Managing Director, Morgan Stanley since 1973; Chairman,
    Morgan Stanley Asset Management since 1975; Chairman, Morgan
    Stanley Institutional Funds (1996-2003)                                                                                                                                                                                                                                                                                                                                                     |  |       | 2003 |          |       |               | I       |      |  |  | 2006                          |     |  |                                                                                                                                                             
|David D. Grumhaus  age 69
    Travel 100 Group (travel company) and Casey Travel Corporation
    (travel agency) since 1991                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |       | 1988 |          |       |               | I       |      |  |  | 2006                          | (1) |  | Director of Niche Software Systems, Inc. (computer software
    company)                                                                                    
|James S. Tisch  age 52
    President since October 1994 and Chief Executive Officer since
    January 1999 of Loews Corporation (holding company whose
    subsidiaries are engaged in the following lines of business:
    insurance; production and sale of cigarettes; operation of
    hotels; natural gas transmission; operation of offshore oil and
    gas drilling rigs; and distribution and sale of watches and
    clocks) and Chief Executive Officer of Diamond Offshore
    Drilling, Inc. (offshore oil and gas company) since March 1998;
    prior thereto, Chief Operating Officer of Loews Corporation |  |       | 2000 |          |       |               | I       |      |  |  | 2006                          |     |  | Director of CNA Financial Corp. (holding company whose
    subsidiaries consist of insurance companies) and Vail Resorts,
    Inc. (resort operator)        
|Anson M. Beard, Jr.  age 69
    Retired, former investment banker                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |       | 2000 |          |       |               | II      |      |  |  | 2007                          |     |  |                                                                                                                                                             
|Peter J. Solomon  age 66
    Chairman of Peter J. Solomon Company, L.P. and Peter J. Solomon
    Securities Co., Ltd. (investment banking) since 1989                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |       | 2000 |          |       |               | II      |      |  |  | 2007                          |     |  | Director of Monro Muffler Brake, Inc. (automotive repair
    services) and Phillips-Van Heusen Corporation (apparel and
    footwear marketer/ manufacturer)
|Dean J. Takahashi  age 47
    Senior Director of Investments, Yale University, since 1996                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |       | 1997 |          |       |               | II      |      |  |  | 2007                          |     |  |                                                                                                                                                             






|    |                                                      
|--- | -----------------------------------------------------
|(1) | Mr. Grumhaus currently expects to retire in May 2005.

25



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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                                              |  |                                               
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------ |  | ----------------------------------------------
|Name, Age, and Principal                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                                              |  | Year First Elected or Became an               
|Occupation During the Last Five Years(1)                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Office                                                       |  | Executive Officer                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                                              |  |                                               
|John A. Levin  age 66
    Chairman since February 2000, Chief Executive Officer and
    President of the Company and Chairman and Chief Executive
    Officer of Levin Management Co., Inc. and John A.
    Levin & Co., Inc. since June 1996; prior thereto,
    President and Securities Analyst/ Portfolio Manager of the
    predecessor to John A. Levin & Co., Inc.                                                                                                          |  | Chairman, Chief Executive Officer and President              |  | 2000 (as Chairman) 1996 (as CEO and President)
|Glenn A. Aigen  age 42
    Senior Vice President, Chief Financial Officer and Treasurer of
    the Company, Levin Management Co., Inc. and John A.
    Levin & Co., Inc. since February 2000; Vice President,
    Chief Financial Officer and Director of Operations of Levin
    Management Co., Inc. and John A. Levin & Co., Inc. from
    June 1996 to February 2000; prior thereto, Director of
    Operations of the predecessor to John A. Levin & Co.,
    Inc. since 1993 |  | Senior Vice President, Chief Financial Officer and Treasurer |  | 2000                                          
|Norris Nissim  age 38
    Vice President, General Counsel and Secretary of the Company and
    Vice President and General Counsel of Levin Management Co., Inc.
    and John A. Levin & Co., Inc. since February 2000;
    Director of Legal Affairs of Levin Management Co., Inc. and John
    A. Levin & Co., Inc. from August 1996 to February 2000                                                                                                                             |  | Vice President, General Counsel and Secretary                |  | 2000                                          
|Henry L. Levin  age 42(2)
    Senior Portfolio Manager of John A. Levin & Co.,
    Inc. and of Levin Management Co., Inc. for the previous five
    years. Mr. Levin joined the John A. Levin & Co.,
    Inc. and Levin Management Co., Inc. in 1991                                                                                                                                                                                                                               |  | Senior Portfolio Manager                                     |  | 2005                                          
|Frank F. Rango  age 49(2)
    Senior Portfolio Manager of John A. Levin & Co., Inc.
    and of Levin Management Co, Inc. for the previous five years.
    Mr. Rango joined John A. Levin & Co., Inc. and
    Levin Management Co., Inc. in 1987                                                                                                                                                                                                                                    |  | Senior Portfolio Manager                                     |  | 2005                                          






|    |                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Each executive officer of the Company generally holds office
    until the first meeting of the Board of Directors after the
    Annual Meeting of stockholders and until his or her successor is
    elected and qualified. Gregory T. Rogers resigned as the
    Companys Executive Vice President and Chief Operating
    Officer effective September 30, 2004.                                      
|   
|(2) | Messrs. Levin and Rango became executive officers of the
    Company for purposes of the SEC regulations on April 19,
    2005 and therefore were not executive officers of the Company
    during fiscal 2004. See the section entitled Employment
    Contracts and Termination of Employment and Change-in-Control
    Arrangements for a description of their respective
    employment agreements.

Audit Committee and Audit Committee Financial Expert




26



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##### Table of Contents







Code of Ethics




SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING
COMPLIANCE




27



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##### Table of Contents





|         |                        
|-------- | -----------------------
|Item 11. | Executive Compensation.

Executive Officer Compensation




SUMMARY COMPENSATION TABLE


|                      |                       |      |      |                     |           |              |                        |          |            |  |                 |            |  |             |           |   |            |  |           |                 |      |  |   |   |  |  |       |        | 
|--------------------- | --------------------- | ---- | ---- | ------------------- | --------- | ------------ | ---------------------- | -------- | ---------- |  | --------------- | ---------- |  | ----------- | --------- | - | ---------- |  | --------- | --------------- | ---- |  | - | - |  |  | ----- | ------ | 
|                      |                       |      |      | Annual Compensation |           |              | Long Term Compensation |         
|                      |                       |      |      |                     |           |              |                        |         
|                      |                       |      |      |                     |           | Restricted   |                        |          | Securities |  |                 |           
|Name and              |                       |      |      |                     |           | Other Annual |                        |          | Stock      |  |                 | Underlying |  |             | All Other |  
|Principal Position    |                       | Year |      |                     | Salary($) |              |                        | Bonus($) |            |  | Compensation(1) |            |  | Award(S)(2) |           |   | Options(#) |  |           | Compensation(3) |     
|                      |                       |      |      |                     |           |              |                        |          |            |  |                 |            |  |             |           |   |            |  |           |                 |     
|John A. Levin         |                       |      | 2004 |                     |           |              | 914,862                |          |            |  | 1,074,946       |            |  |             |          |   |            |  | 1,123,439 | (4)             |      |  |   |   |  |  | 7,000 |       
|                      | Chairman, Chief       |      |      | 2003                |           |              |                        | 894,293  |            |  |                 | 501,269    |  |             |           |  |            |  |           | 514,934         | (5)  |  |   |  |  |  |       | 7,000  | 
|                      | Executive Officer     |      |      | 2002                |           |              |                        | 886,819  |            |  |                 | 218,737    |  |             |           |  |            |  |           | 2,644,204       | (6)  |  |   |  |  |  |       | 12,000 | 
|                      | and President         |      |      |                     |           |              |                        |          |            |  |                 |            |  |             |           |   |            |  |           |                 |      |  |   |   |  |  |       |        | 
|Glenn A. Aigen        |                       |      | 2004 |                     |           |              | 247,665                |          |            |  | 746,465         |            |  |             |          |   |            |  | 59,430    | (7)             |      |  |   |   |  |  | 6,500 |       
|                      | Senior Vice President |      |      | 2003                |           |              |                        | 242,097  |            |  |                 | 673,347    |  |             |           |  |            |  |           | 35,071          | (8)  |  |   |  |  |  |       | 6,000  | 
|                      | and Chief Financial   |      |      | 2002                |           |              |                        | 240,074  |            |  |                 | 942,210    |  |             |           |  |            |  |           | 426,899         | (9)  |  |   |  |  |  |       | 11,000 | 
|                      | Officer               |      |      |                     |           |              |                        |          |            |  |                 |            |  |             |           |   |            |  |           |                 |      |  |   |   |  |  |       |        | 
|Norris Nissim         |                       |      | 2004 |                     |           |              | 237,573                |          |            |  | 255,941         |            |  |             |          |   |            |  | 124,506   | (10)            |      |  |   |   |  |  | 6,500 |       
|                      | Vice President and    |      |      | 2003                |           |              |                        | 232,232  |            |  |                 | 167,768    |  |             |           |  |            |  |           |                |      |  |   |  |  |  |       |       | 
|                      | General Counsel       |      |      | 2002                |           |              |                        | 230,290  |            |  |                 | 169,000    |  |             |           |  |            |  |           | 79,575          | (11) |  |   |  |  |  |       | 11,000 | 
|Gregory T. Rogers(12) |                       |      | 2004 |                     |           |              | 315,779                |          |            |  | 97,677          |            |  |             |          |   |            |  |          |                 |      |  |  |   |  |  | (12   | )     
|                      | Former Executive Vice |      |      | 2003                |           |              |                        | 421,038  |            |  |                 | 598,766    |  |             |           |  |            |  |           |                |      |  |   |  |  |  |       | 6,000  | 
|                      | President and Chief   |      |      | 2002                |           |              |                        | 417,519  |            |  |                 | 910,094    |  |             |           |  |            |  |           | 679,719         | (13) |  |   |  |  |  |       | 11,000 | 
|                      | Operating Officer     |      |      |                     |           |              |                        |          |            |  |                 |            |  |             |           |   |            |  |           |                 |      |  |   |   |  |  |       |        | 






| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | With respect to each of the Named Executive Officers and
    Mr. Rogers, perquisites and other personal benefits did not
    exceed the lesser of $50,000 or 10% of the total of annual
    salary and bonus.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (2) | Holders of restricted stock have the same right to receive
    dividends as holders of other common stock of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | (3) | Represents amounts contributed by the Company to the
    Companys 401(k) plan. The Company did not grant any
    options in 2004 to any Named Executive Officers and
    Mr. Rogers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (4) | Represents the fair market value, as of the grant date, of
    24,465 shares of restricted stock granted on March 10,
    2005 with respect to 2004 bonus compensation. One third of these
    shares will vest on December 31, 2005, December 31,
    2006 and December 31, 2007, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (5) | Represents the fair market value, as of the grant date, of
    20,321 shares of restricted stock granted on March 10,
    2004 with respect to 2003 bonus compensation. The shares of
    restricted stock vest on March 9, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | (6) | Represents the fair market value, as of the grant date, of
    161,725 Restricted Stock Units (RSU) granted on
    March 12, 2003 with respect to 2002 bonus compensation.
    With respect to 71,320 of these RSUs, one third vested on each
    of December 31, 2003 and December 31, 2004 and one
    third will vest on December 31, 2005, but the delivery of
    the shares of common stock underlying the RSUs will not occur
    until December 31, 2005, and delivery may be deferred by
    the Named Executive Officer. With respect to the other
    90,405 RSUs, such RSUs will vest on December 31, 2005,
    but the delivery of shares of common stock underlying the RSUs
    may be deferred by the Named Executive Officer.



28



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##### Table of Contents





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (7) | Represents the fair market value, as of the grant date, of
    1,400 shares of restricted stock granted on March 10,
    2005. One third of these shares will vest on each of
    December 31, 2005, December 31, 2006 and
    December 31, 2007, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (8) | Represents the fair market value, as of the grant date, of
    1,384 shares of restricted stock granted on March 10,
    2004 with respect to 2003 bonus compensation. The shares of
    restricted stock vest on March 9, 2007.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (9) | Represents the fair market value, as of the grant date, of
    26,110 RSUs granted on March 12, 2003 with respect to
    2002 bonus compensation. With respect to 6,110 of these RSUs,
    one third vested on each of December 31, 2003 and
    December 31, 2004 and one third will vest on
    December 31, 2005, but the delivery of the shares of common
    stock underlying the RSUs will not occur until December 31,
    2005, and delivery may be deferred by the Named Executive
    Officer. With respect to the other 20,000 RSUs, such RSUs
    will vest on December 3, 2005, but the delivery of shares
    of common stock underlying the RSUs may be deferred by the Named
    Executive Officer.





|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Represents the fair market value, as of the grant date, of
    2,933 shares of restricted stock granted on March 10,
    2005. One third of these shares will vest on each of
    December 31, 2005, December 31, 2006 and
    December 31, 2007, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    
|(11) | Represents the fair market value, as of the grant date, of
    4,867 RSUs granted on March 12, 2003 with respect to
    2002 bonus compensation. The RSUs will vest on December 3,
    2005, but the delivery of shares of common stock underlying the
    RSUs may be deferred by the Named Executive Officer.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    
|(12) | Mr. Rogers resigned from the Company effective
    September 30, 2004. On September 30, 2004,
    Mr. Rogers entered into a Separation Agreement and General
    Release, dated as of September 29, 2004 with Levin
    Management Co., Inc., a subsidiary of the Company (Levin
    Management). Under such agreement, Mr. Rogers
    received or will receive the following payments: (i) a lump
    sum separation amount of $97,677 to be paid on or about
    September 30, 2004, (ii) a payment of $12,500 on each
    of January 1, 2005, February 1, 2005, March 1,
    2005, April 1, 2005, May 1, 2005 and June 1, 2005
    for consulting services to be rendered to Levin Management for
    the period January 1, 2005 through June 30, 2005 and
    (iii) a payment of $37,500 on each of July 1, 2005 and
    September 1, 2005 for consulting services to Levin
    Management provided that Mr. Rogers has established a bona
    fide consulting business. Levin Management will also pay for
    Mr. Rogers medical benefits until the earlier of
    September 30, 2005 or until Mr. Rogers becomes
    employed and covered by another group insurance plan. Such
    agreement also provided for the delivery to Mr. Rogers,
    within 30 days of September 30, 2004, of an aggregate
    of 76,128 shares of the Companys common stock
    issuable under deferred stock agreements between the Company and
    Mr. Rogers. Mr. Rogers is entitled to receive the cash
    value of 3,334 shares (valued as of September 30,
    2004), in lieu of the receipt of such shares, by giving written
    notice, which Mr. Rogers has provided. In addition,
    pursuant to the terms of an option award agreement,
    Mr. Rogers had 30 days from September 30, 2004 to
    purchase up to 65,049 shares of the Companys common
    stock underlying stock options granted to him at an exercise
    price of $13.03125 per share (the exercise price of the
    options). For all shares of the Companys common stock to
    be delivered to Mr. Rogers under the separation agreement,
    Mr. Rogers is required to grant to persons designated by
    the Company his proxy to vote in accordance with the
    recommendation of management with respect to any matters to be
    voted on by stockholders of the Company. The separation
    agreement also includes a mutual release of claims between
    Mr. Rogers and Levin Management.
|    
|(13) | Represents the fair market value, as of the grant date, of
    41,573 RSUs granted on March 12, 2003 with respect to
    2002 bonus compensation. Under the original terms of such grant,
    (i) with respect to 13,240 of these RSUs, one third vested
    on each of December 31, 2003 and December 31, 2004 and
    one third will vest on December 31, 2005, but the delivery
    of the shares of common stock underlying the RSUs will not occur
    until December 31, 2005, and delivery may be deferred by
    Mr. Rogers.; (ii) with respect to the other
    28,333 RSUs, such RSUs will vest on December 3, 2005,
    but the delivery of shares of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

29



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##### Table of Contents



| |                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------
| | common stock underlying the RSUs may be deferred by
    Mr. Rogers. See footnote (12) above for settlement of
    such RSUs.

Aggregate Option Exercises In Last Fiscal Year And Fiscal
Year-End Option Values




|                     |  |             |        |  |              |                                 |                               |                           |                              |                         |                           |  |  |  |           | 
|-------------------- |  | ----------- | ------ |  | ------------ | ------------------------------- | ----------------------------- | ------------------------- | ---------------------------- | ----------------------- | ------------------------- |  |  |  | --------- | 
|                     |  |             |        |  |              | Number of Securities Underlying |                               |                           | Value of Unexercised In-The- |                        
|                     |  | Shares      |        |  |              |                                 | Unexercised Options at Fiscal |                           |                              | Money Options at Fiscal |                          
|                     |  | Acquired    |        |  | Value        |                                 |                               | Year-End 2004 (#)         |                              |                         | Year-End 2004 ($)(1)      | 
|Name                 |  | on Exercise |        |  | Realized ($) |                                 |                               | Exercisable/Unexercisable |                              |                         | Exercisable/Unexercisable | 
|                     |  |             |        |  |              |                                 |                               |                           |                              |                         |                           | 
|John A. Levin        |  |             | 34,570 |  |              |                                 | 787,116                       |                           |                              |                         | 0/0                       |  |  |  | 0/0       | 
|Gregory T. Rogers(2) |  |             | 65,049 |  |              |                                 | 1,279,433                     |                           |                              |                         | 0/0                       |  |  |  | 0/0       | 
|Glenn A. Aigen       |  |             | 0      |  |              |                                 | 0                             |                           |                              |                         | 19,555/0                  |  |  |  | 440,063/0 | 
|Norris Nissim        |  |             | 0      |  |              |                                 | 0                             |                           |                              |                         | 0/0                       |  |  |  | 0/0       | 






|    |                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------
|(1) | On December 31, 2004, the closing price of the
    Companys common stock on The New York Stock Exchange was
    27.90 per share.
|   
|(2) | Gregory T. Rogers resigned effective as of
    September 30, 2004.                                                               

Employment Contracts and Termination of Employment and
Change-in-Control Arrangements










30



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##### Table of Contents







Compensation Committee Interlocks And Insider
Participation




Directors Compensation






|         |                                                                    
|-------- | -------------------------------------------------------------------
|Item 12. | Security Ownership Of Certain Beneficial Owners And
    Management.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS




31



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##### Table of Contents





|                                                                             |  |                  |          |         |          |  |      |  
|---------------------------------------------------------------------------- |  | ---------------- | -------- | ------- | -------- |  | ---- | -
|                                                                             |  |                  |          | Percent |         
|Name of Beneficial Owner                                                     |  | Number of Shares |          |         | of Class | 
|                                                                             |  |                  |          |         |          | 
|John A. Levin                                                                |  |                  | 695,860  | (1)     |          |  | 9.2  | %
|c/o BKF Capital Group, Inc.
    One Rockefeller Plaza
    New York, NY 10020 |  |                  |          |         |          |  |      |  
|Steel Partners II, L.P.                                                      |  |                  | 669,600  | (2)     |          |  | 8.9  | %
|590 Madison Avenue
    New York, NY 10022                                    |  |                  |          |         |          |  |      |  
|Owl Creek Asset Management, L.P.                                             |  |                  | 463,600  | (3)     |          |  | 6.2  | %
|410 Park Avenue, Suite #420
    New York, NY 10022                           |  |                  |          |         |          |  |      |  
|Mario J. Gabelli                                                             |  |                  | 510,100  | (4)     |          |  | 6.8  | %
|One Corporate Center
    Rye, NY 10580                                       |  |                  |          |         |          |  |      |  
|Cannell Capital LLC                                                          |  |                  | 360,200  | (5)     |          |  | 4.8  | %
|150 Capital Street, Fifth Floor
    San Francisco, CA 94111                  |  |                  |          |         |          |  |      |  
|Anson M. Beard, Jr.                                                          |  |                  | 2,400(6  | )(7)    |          |  | *    |  
|Barton M. Biggs                                                              |  |                  | 2,400(6  | )(7)    |          |  | *    |  
|J. Barton Goodwin                                                            |  |                  | 55,776(6 | )(7)(8) |          |  | *    |  
|David Grumhaus                                                               |  |                  | 11,835(7 | )(9)    |          |  | *    |  
|Burton G. Malkiel                                                            |  |                  | 5,900    | (6)     |          |  | *    |  
|Peter J. Solomon                                                             |  |                  | 3,400(6  | )(7)    |          |  | *    |  
|Dean J. Takahashi                                                            |  |                  | 2,582(6  | )(7)    |          |  | *    |  
|James S. Tisch                                                               |  |                  | 4,400(6  | )(7)    |          |  | *    |  
|Glenn A. Aigen                                                               |  |                  | 22,339   | (10)    |          |  | *    |  
|Norris Nissim                                                                |  |                  | 7,817    | (11)    |          |  | *    |  
|Directors and executive officers as a group (13 persons)                     |  |                  | 814,709  |         |          |  | 10.8 | %






| |   |             
| | - | ------------
| | * | Less than 1%



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Includes 18,907 shares of common stock held by family
    members or trusts, 20,321 shares of restricted stock
    granted on March 10, 2004 which will vest on March 10,
    2007, 26,465 shares of restricted stock granted on
    March 10, 2005 of which one third will vest on
    December 31, 2005, December 31, 2006 and
    December 31, 2007, respectively.                                                                                               
|
| | (2) | The information set forth is based solely on Amendment
    No. 4 to Schedule 13D filed with the SEC on March 24,
    2005.                                                                                                                                                                                                                                                                                                                                          
|
| | (3) | The information set forth is based solely upon the Amendment
    No. 1 to Form 13F filed with the SEC on May 3,
    2005 by Owl Creek Asset Management, L.P.                                                                                                                                                                                                                                                                                                        
|
| | (4) | The information set forth is based solely on Amendment
    No. 10 to Schedule 13D filed with the SEC on April 28,
    2005 and includes 193,500 shares held by Gabelli Funds,
    LLC, 278,700 shares held by GAMCO Investors Inc.,
    3,900 shares held by Gabelli Foundation, Inc.,
    8,000 shares held by Gabelli & Company, Inc.
    Profit Sharing Plan, 11,500 shares held by Gabelli
    Advisors, Inc. and 14,500 shares held by MJG Associates,
    Inc.
|
| | (5) | The information set forth is based solely upon the
    Schedule 13G filed with the SEC on February 11, 2005
    and includes 64,300 shares held by The Anegada Master Fund,
    101,100 shares held by The Cuttyhunk Fund Limited,
    114,900 shares held by Tonga Partners, L.P.,
    54,900 shares held by GS Cannell Portfolio, LLC and
    25,000 shares held by Pleiades Investment Partners, L.P.
    Based upon the                                         

32



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##### Table of Contents



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     | Schedule 13G filing on February 11, 2005, the
    reporting person beneficially owned 5.1% of the total
    outstanding amount of shares of common stock of the Company.                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (6) | Includes 1,200 shares of restricted stock granted on
    May 13, 2004 which vested on January 2, 2005 and
    1,200 shares of restricted common stock granted on
    March 23, 2005 of which one half will vest on April 1,
    2005 and one quarter will vest on each of July 1, 2005 and
    October 1, 2005.                                                                                                                                                                                                                                                               
|
| | (7) | The number of shares does not include any shares underlying the
    restricted stock units granted to Messrs. Beard, Biggs,
    Goodwin, Grumhaus, Solomon, Takahashi and Tisch. Each of these
    directors, with the exception of Mr. Biggs has received
    3,500 restricted stock units (Mr. Biggs has received
    1,125), but the shares underlying these restricted stock units
    are not deliverable, either by the terms of the awards regarding
    vesting and delivery or because of a deferral election by the
    directors, within 60 days of March 31, 2005.
|
| |     | The number of shares listed also does not include any shares
    underlying 161,725 restricted stock units granted to
    Mr. Levin. The shares underlying these restricted stock
    units are not deliverable, either by the terms of the awards
    regarding vesting and delivery or because of a deferral election
    by Mr. Levin, within 60 days of March 31, 2005.
    See Compensation  Executive Officer
    Compensation for a description of these grants.                                                                                                    
|
| | (8) | Includes 53,376 shares of common stock owned by immediate
    family members or trusts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | (9) | Includes 9,303 shares of common stock held by family
    members or trusts and 1,200 shares of restricted stock
    granted on May 13, 2004 which vested on January 2,
    2005.                                                                                                                                                                                                                                                                                                                                                                                              



|     |                                                                                                                                                                                                                                                                                                                                                                                                                                 
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Includes 19,555 shares of common stock relating to options
    which have vested or will vest within 60 days of
    March 31, 2004 and 1,384 shares of restricted stock
    granted on March 10, 2004 which will vest on March 9,
    2007 and 1,400 shares of restricted stock granted on
    March 10, 2005, of which one third will vest on
    December 31, 2005, December 31, 2006 and
    December 31, 2007, respectively.
|    
|(11) | Includes 2,933 shares of restricted stock granted on
    March 10, 2005 of which one third will vest on
    December 31, 2005, December 31, 2006 and
    December 31, 2007, respectively.                                                                                                                                                                                                                                       

EQUITY COMPENSATION PLAN INFORMATION




Equity Compensation Plan Information


|                                                           |  |                            |        |  |                      |   |       |                                           |  |  |         | 
|---------------------------------------------------------- |  | -------------------------- | ------ |  | -------------------- | - | ----- | ----------------------------------------- |  |  | ------- | 
|                                                           |  | (A)                        |        |  | (B)                  |   |       | (C)                                       | 
|                                                           |  | Number of Securities To    |        |  | Weighted Average     |   |       | Number of Securities Available For Future | 
|                                                           |  | Be Issued Upon Exercise of |        |  | Exercise Price of    |   |       | Issuance Under Equity Compensation        | 
|                                                           |  | Outstanding Options        |        |  | Outstanding Options, |   |       | Plans (Excluding Securities Reflected in  | 
|Plan Category                                              |  | Warrants and Rights        |        |  | Warrants and Rights  |   |       | Column (A))                               | 
|                                                           |  |                            |        |  |                      |   |       |                                           | 
|Equity compensation plans approved by security holders     |  |                            | 23,396 |  |                      | $ | 15.01 |                                           |  |  | 549,212 | 
|Equity compensation plans not approved by security holders |  |                            | 0      |  |                      |   |      |                                           |  |  | 0       | 
|Total                                                      |  |                            | 23,396 |  |                      | $ | 15.01 |                                           |  |  | 549,212 | 
|                                                           |  |                            |        |  |                      |   |       |                                           | 



|         |                                                
|-------- | -----------------------------------------------
|Item 13. | Certain Relationships And Related Transactions.



33



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##### Table of Contents













|         |                                        
|-------- | ---------------------------------------
|Item 14. | Principal Accountant Fees and Services.

Audit Fees




Audit-Related Fees




Tax Services




34



---



All Other Fees




Pre-Approval Procedures




PART IV




|         |                                           
|-------- | ------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules

The following documents are filed as part of this
Form 10-K/ A:


Financial Statements









|                                                                                                                    |  |        |      | 
|------------------------------------------------------------------------------------------------------------------- |  | ------ | ---- | 
|                                                                                                                    |  | Page   |     
|                                                                                                                    |  | Number |     
|                                                                                                                    |  |        |     
|Report of Independent Registered Public Accounting
    Firm  Grant Thornton LLP                                    |  |        | F-2  | 
|Report of Independent Registered Public Accounting
    Firm  Ernst & Young LLP                                     |  |        | F-3  | 
|Reports of Independent Registered Public Accounting
    Firm  Eisner LLP                                           |  |        | F-4  | 
|Consolidated Statements of Financial Condition at
    December 31, 2004 and 2003                                    |  |        | F-12 | 
|Consolidated Statements of Operations for the years ended
    December 31, 2004, 2003 and 2002                      |  |        | F-13 | 
|Consolidated Statements of Cash Flows for the years ended
    December 31, 2004, 2003 and 2002                      |  |        | F-14 | 
|Consolidated Statements of Changes in Stockholders Equity
    for the years ended December 31, 2004, 2003 and 2002 |  |        | F-15 | 
|Notes to Consolidated Financial Statements                                                                          |  |        | F-16 | 
|EX-10.4: LEASE                                                                                                     
|EX-10.9: FORM OF RISTRICTED STOCK AWARD AGREEMENT                                                                  
|EX-23.1: CONSENT OF GRANT THORNTON LLP                                                                             
|EX-23.2: CONSENT OF ERNST & YOUNG LLP                                                                              
|EX-23.3: CONSENT OF EISNER LLP                                                                                     
|EX-31.1: CERTIFICATION                                                                                             
|EX-31.2: CERTIFICATION                                                                                             
|EX-32.1: CERTIFICATION                                                                                             
|EX-32.2: CERTIFICATION                                                                                             



Financial Data Schedules




Exhibits


|        |   |    |  |             |  |                                                                                                                                                                                                                              
|------- | - | -- |  | ----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |   |    |  |            
|Number  |   |    |  | Description
|        |   |    |  |            
|        | 3 | .1 |  |            |  | Restated Certificate of Incorporation of Registrant, as amended
    (incorporated by reference to Exhibit 3(i) to
    Registrants Quarterly Reports on Form 10-Q for the
    periods ended June 30, 2000 and June 30, 2001).
|        | 3 | .2 |  |            |  | Bylaws of Registrant (incorporated by reference to
    Exhibit 3(ii) to Registrants Quarterly Report on
    Form 10-Q for the period ended September 30, 2001).                                                             

35



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##### Table of Contents



|        |    |     |  |             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------- | -- | --- |  | ----------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |     |  |            
|Number  |    |     |  | Description
|        |    |     |  |            
|       
|        | 4  | .1  |  |            |  | Specimen of Common Stock Certificate (incorporated by reference
    to Exhibit 4.1 of Registrants Annual Report on
    Form 10-K/A for the period ended December 31, 2000).                                                                                                                                                                                                                                                                                                         
|       
|        | 4  | .2  |  |            |  | Rights Agreement dated as of June 8, 2001 between BKF and
    Mellon Investor Services LLC (as Rights Agent) (incorporated by
    reference to Exhibit 4.1 to BKFs Current Report on
    Form 8-K dated June 11, 2001).                                                                                                                                                                                                                                                             
|       
|        | 10 | .1  |  |            |  | Amendment to Lease dated October 10, 2003 between
    Rockefeller Center Properties and John A. Levin, Inc.
    (incorporated by reference to Exhibit 10.1 of
    Registrants Annual Report on Form 10-K/A for the
    period ended December 31, 2003).                                                                                                                                                                                                                             
|       
|        | 10 | .2  |  |            |  | Lease dated December 20, 1993 between Rockefeller Center
    Properties and John A. Levin & Co., Inc., as amended
    (incorporated by reference to Exhibit 10.1 of
    Registrants Annual Report on Form 10-K/A for the
    period ended December 31, 2000, Exhibit 10.2 to
    Registrants Quarterly Report on Form 10-Q for the
    period ended June 30, 2001, and Exhibit 10.2 to
    Registrants Quarterly Report on Form 10-Q for the
    period ended September 30, 2001).
|       
|        | 10 | .3  |  |            |  | Lease dated September 25, 2002 between River Bend Executive
    Center, Inc. and Levin Management Co., Inc. (incorporated by
    reference to Exhibit 10.1 of Registrants Quarterly
    Report on Form 10-Q for the period ended September 30,
    2002).                                                                                                                                                                                                                           
|       
|        | 10 | .4  |  |            |  | Lease dated February 14, 2005 between Benchmark Group
    Limited and Levco Europe, LLP.*                                                                                                                                                                                                                                                                                                                                                                                            
|       
|        | 10 | .5  |  |            |  | Registrants 1998 Incentive Compensation Plan, as amended
    (incorporated by reference to Exhibit 10.1 to
    Registrants Quarterly Report on Form 10-Q for the
    period ended June 30, 2001).                                                                                                                                                                                                                                                                                  
|       
|        | 10 | .6  |  |            |  | Registrants Deferred Compensation Plan (incorporated by
    reference to Exhibit 10.2 to Registrants Quarterly
    Report on Form 10-Q for the period ended September 30,
    2000).                                                                                                                                                                                                                                                                                               
|       
|        | 10 | .7  |  |            |  | Form of Stock Option Award Agreement (incorporated by reference
    to Exhibit 10.5 to Registrants Annual Report on
    Form 10-K/A for the period ended December 31, 2001).                                                                                                                                                                                                                                                                                                        
|       
|        | 10 | .8  |  |            |  | Form of Deferred Stock Award Agreement (incorporated by
    reference to Exhibit 4.5 to the Registration Statement on
    Form S-8 filed with the Commission on November 17,
    2000).                                                                                                                                                                                                                                                                                              
|       
|        | 10 | .9  |  |            |  | Form of Restricted Stock Award Agreement*                                                                                                                                                                                                                                                                                                                                                                                                                                            
|       
|        | 10 | .10 |  |            |  | Agreement between BKF and Gregory T. Rogers dated
    September 29, 2004 (incorporated by reference to
    Exhibit 10.1 of Registrants Report on Form 8-K
    dated October 6, 2004)                                                                                                                                                                                                                                                                                                
|       
|        | 14 | .1  |  |            |  | Registrants Code of Ethics (incorporated by Reference to
    Exhibit 14.1 of Registrants Annual Report on
    Form 10-K/A for the period ended December 31, 2003).                                                                                                                                                                                                                                                                                                                 
|       
|        | 21 | .1  |  |            |  | Subsidiaries of the Registrant (incorporated by reference to
    Exhibit 21.1 to the Registrants Annual Report on
    Form 10-K/A for the period ended December 31, 2000).                                                                                                                                                                                                                                                                                                          
|       
|        | 23 | .1  |  |            |  | Consent of Grant Thornton LLP.*                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|       
|        | 23 | .2  |  |            |  | Consent of Ernst & Young LLP.*                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|       
|        | 23 | .3  |  |            |  | Consent of Eisner LLP.*                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|       
|        | 24 | .1  |  |            |  | Powers of Attorney (included on the Signature Pages hereto).*                                                                                                                                                                                                                                                                                                                                                                                                                        
|       
|        | 31 | .1  |  |            |  | Section 302 Certification of Chief Executive Officer*                                                                                                                                                                                                                                                                                                                                                                                                                                
|       
|        | 31 | .2  |  |            |  | Section 302 Certification of Chief Financial Officer*                                                                                                                                                                                                                                                                                                                                                                                                                                
|       
|        | 32 | .1  |  |            |  | Section 906 Certification of Chief Executive Officer*                                                                                                                                                                                                                                                                                                                                                                                                                                
|       
|        | 32 | .2  |  |            |  | Section 906 Certification of Chief Financial Officer*                                                                                                                                                                                                                                                                                                                                                                                                                                






|  |               
|- | --------------
|* | Filed herewith

36



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##### Table of Contents



SIGNATURES






| |                        
| | -----------------------
| | BKF Capital Group, Inc.



| |     |                   
| | --- | ------------------
| | By: | /s/ Glenn A. Aigen

| | 
| | 
| | 



| |                            
| | ---------------------------
| | Glenn A. Aigen             
| | Senior Vice President      
| | and Chief Financial Officer





|                                                          |  |                                                                                                    |  |                  |  | 
|--------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------- |  | ---------------- |  | 
|Signature                                                 |  | Title                                                                                              |  | Date            
|                                                          |  |                                                                                                    |  |                 
|                                                         
|/s/ JOHN C. SICILIANOJohn
    C. Siciliano                |  | Director, Chief Executive Officer and President (Principal
    Executive Officer)                  |  | November 3, 2005
|                                                         
|/s/ GLENN A. AIGENGlenn
    A. Aigen                      |  | Senior Vice President and Chief Financial Officer (Principal
    Financial and Accounting Officer) |  | November 3, 2005
|                                                         
|/s/ ANSON M.
    BEARD, JR.Anson
    M. Beard, Jr.        |  | Chairman of the Board and Director                                                                 |  | November 3, 2005
|                                                         
|/s/ RONALD LABOWRonald
    LaBow                          |  | Director                                                                                           |  | November 3, 2005
|                                                         
|/s/ WARREN G.
    LICHTENSTEINWarren
    G. Lichetenstein |  | Director                                                                                           |  | November 3, 2005
|                                                         
|/s/ KURT N. SCHACHTKurt
    N. Schacht                    |  | Director                                                                                           |  | November 3, 2005
|                                                         
|/s/ PETER J. SOLOMONPeter
    J. Solomon                  |  | Director                                                                                           |  | November 3, 2005
|                                                         
|/s/ DEAN J. TAKAHASHIDean
    J. Takahashi                |  | Director                                                                                           |  | November 3, 2005
|                                                         
|/s/ JAMES S. TISCHJames
    S. Tisch                      |  | Director                                                                                           |  | November 3, 2005

37



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##### Table of Contents



INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


|                                                                                                                        |  |        |      | 
|----------------------------------------------------------------------------------------------------------------------- |  | ------ | ---- | 
|                                                                                                                        |  | Page   |     
|                                                                                                                        |  | Number |     
|                                                                                                                        |  |        |     
|Report of Independent Registered Public
    Accounting Firm  Grant Thornton LLP                                        |  |        | F-2  | 
|Report of Independent Registered Public
    Accounting Firm  Ernst & Young LLP                                         |  |        | F-3  | 
|Reports of Independent Registered Public
    Accounting Firm  Eisner LLP                                               |  |        | F-4  | 
|Consolidated Statements of Financial
    Condition at December 31, 2004 and 2003                                        |  |        | F-12 | 
|Consolidated Statements of Operations for
    the years ended December 31, 2004, 2003 and 2002                          |  |        | F-13 | 
|Consolidated Statements of Cash Flows for
    the years ended December 31, 2004, 2003 and 2002                          |  |        | F-14 | 
|Consolidated Statements of Changes in
    Stockholders Equity for the years ended December 31,
    2004, 2003 and 2002 |  |        | F-15 | 
|Notes to Consolidated Financial
    Statements                                                                          |  |        | F-16 | 

F-1



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##### Table of Contents






REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




BKF Capital Group, Inc.












Grant Thornton LLP






F-2



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


















|                          | 
|------------------------- | 
|/s/ Ernst & Young
    LLP | 





F-3



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-4



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-5



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-6



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-7



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-8



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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-9



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-10



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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM












Eisner LLP






F-11



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


(Dollar amounts in thousands)


|                                                                                                                                          |                                                                                   |                            |         |       |              |   |         |       |         | 
|----------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------- | -------------------------- | ------- | ----- | ------------ | - | ------- | ----- | ------- | 
|                                                                                                                                          |                                                                                   | December 31,               |         |       | December 31, |  
|                                                                                                                                          |                                                                                   | 2004                       |         |       | 2003         |  
|                                                                                                                                          |                                                                                   | as restated,               |         |       | as restated, |  
|                                                                                                                                          |                                                                                   | see Note 13                |         |       | see Note 13  |  
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|Assets                                                                                                                                    |                                                                                   |                            |         |       |              |   |         |      
|Cash and cash equivalents                                                                                                                 |                                                                                   | $                          | 3,582   |       |              | $ | 4,947   |      
|U.S. Treasury bills                                                                                                                       |                                                                                   |                            | 40,466  |       |              |   | 32,495  |      
|Investment advisory and incentive fees receivable                                                                                         |                                                                                   |                            | 40,009  |       |              |   | 37,844  |      
|Investments in securities, at value (cost $5,426 and $4,317,
    respectively)                                                            |                                                                                   |                            | 5,788   |       |              |   | 4,379   |      
|Investments in affiliated partnerships                                                                                                    |                                                                                   |                            | 17,362  |       |              |   | 17,042  |      
|Prepaid expenses and other assets                                                                                                         |                                                                                   |                            | 7,048   |       |              |   | 3,890   |      
|Fixed assets (net of accumulated depreciation of $6,756 and
    $4,881, respectively)                                                     |                                                                                   |                            | 6,812   |       |              |   | 6,741   |      
|Deferred tax asset                                                                                                                        |                                                                                   |                            | 8,391   |       |              |   | 8,666   |      
|Goodwill (net of accumulated amortization of $8,566)                                                                                      |                                                                                   |                            | 14,796  |       |              |   | 14,796  |      
|Investment advisory contracts (net of accumulated amortization
    of $59,576 and $52,567, respectively)                                  |                                                                                   |                            | 10,513  |       |              |   | 17,522  |      
|Consolidated affiliated partnerships:                                                                                                     |                                                                                   |                            |         |       |              |   |         |      
|                                                                                                                                          | Due from broker                                                                   |                            |         | 952   |              |   |         | 4,248 |        
|                                                                                                                                          | Investments in securities, at value (cost $5,877 and $3,692,
    respectively)    |                            |         | 6,517 |              |   |         | 3,927 |        
|                                                                                                                                          | Investments in unaffiliated partnerships                                          |                            |         |      |              |   |         | 3,778 |        
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|                                                                                                                                          |                                                                                   | Total assets               |         | $     | 162,236      |   |         | $     | 160,275 | 
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|                                                                                                                                         
|Liabilities, minority interest and stockholders
    equity                                                                               |                                                                                   |                            |         |       |              |   |         |      
|Accrued expenses                                                                                                                          |                                                                                   | $                          | 4,084   |       |              | $ | 3,352   |      
|Accrued bonuses                                                                                                                           |                                                                                   |                            | 42,686  |       |              |   | 39,728  |      
|Accrued lease amendment expense                                                                                                           |                                                                                   |                            | 3,843   |       |              |   | 4,535   |      
|Consolidated affiliated partnerships:                                                                                                     |                                                                                   |                            |         |       |              |   |         |      
|                                                                                                                                          | Securities sold short, at value (proceeds of $1,065 and $1,106,
    respectively) |                            |         | 1,299 |              |   |         | 1,117 |        
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|                                                                                                                                          |                                                                                   | Total liabilities          |         |       | 51,912       |   |         |       | 48,732  | 
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|Minority interest in consolidated affiliated partnerships                                                                                 |                                                                                   |                            | 2,478   |       |              |   | 8,935   |      
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|Stockholders equity                                                                                                                      |                                                                                   |                            |         |       |              |   |         |      
|Common stock, $1 par value, authorized 
    15,000,000 shares, issued and outstanding 
    7,274,779 and 6,826,247 shares, respectively |                                                                                   |                            | 7,275   |       |              |   | 6,826   |      
|Additional paid-in capital                                                                                                                |                                                                                   |                            | 88,458  |       |              |   | 87,937  |      
|Retained earnings                                                                                                                         |                                                                                   |                            | 17,508  |       |              |   | 22,054  |      
|Unearned compensation  restricted stock and
    restricted stock units                                                                   |                                                                                   |                            | (5,395  | )     |              |   | (14,209 | )    
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|                                                                                                                                          |                                                                                   | Total stockholders equity |         |       | 107,846      |   |         |       | 102,608 | 
|                                                                                                                                          |                                                                                   |                            |         |       |              |  
|Total liabilities, minority interest and stockholders
    equity                                                                         |                                                                                   | $                          | 162,236 |       |              | $ | 160,275 |      
|                                                                                                                                          |                                                                                   |                            |         |       |              |  



F-12



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF OPERATIONS


(Dollar amounts in thousands, except per share data)


|                                                                       |                                                        |                         |           |       |         |   |           |       |         |   |           |        |        | 
|---------------------------------------------------------------------- | ------------------------------------------------------ | ----------------------- | --------- | ----- | ------- | - | --------- | ----- | ------- | - | --------- | ------ | ------ | 
|                                                                       |                                                        | Year Ended December 31, |          
|                                                                       |                                                        |                         |          
|                                                                       |                                                        | 2004                    |           |       | 2003    |   |           | 2002  |        
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Revenues:                                                              |                                                        |                         |           |       |         |   |           |       |         |   |           |       
|Investment advisory fees                                               |                                                        | $                       | 78,324    |       |         | $ | 60,324    |       |         | $ | 61,833    |       
|Incentive fees and allocations                                         |                                                        |                         | 40,925    |       |         |   | 36,293    |       |         |   | 24,591    |       
|Commission income (net) and other                                      |                                                        |                         | 1,438     |       |         |   | 2,021     |       |         |   | 2,940     |       
|Net realized and unrealized gain on investments                        |                                                        |                         | 1,020     |       |         |   | 1,022     |       |         |   | 31        |       
|Interest income                                                        |                                                        |                         | 604       |       |         |   | 453       |       |         |   | 655       |       
|From consolidated affiliated partnerships:                             |                                                        |                         |           |       |         |   |           |       |         |   |           |       
|                                                                       | Net realized and unrealized gain (loss) on investments |                         |           | 1,129 |         |   |           | 2,316 |         |   |           | (3,543 | )     
|                                                                       | Interest and dividend income                           |                         |           | 47    |         |   |           | 309   |         |   |           | 904    |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|                                                                       |                                                        | Total revenues          |           |       | 123,487 |   |           |       | 102,738 |   |           |        | 87,411 | 
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Expenses:                                                              |                                                        |                         |           |       |         |   |           |       |         |   |           |       
|Employee compensation and benefits                                     |                                                        |                         | 85,092    |       |         |   | 69,634    |       |         |   | 59,970    |       
|Employee compensation relating to equity grants                        |                                                        |                         | 8,661     |       |         |   | 8,128     |       |         |   | 1,851     |       
|Occupancy and equipment rental                                         |                                                        |                         | 5,990     |       |         |   | 6,322     |       |         |   | 5,872     |       
|Loss on lease amendment                                                |                                                        |                         |          |       |         |   | 5,127     |       |         |   |          |       
|Other operating expenses                                               |                                                        |                         | 13,529    |       |         |   | 14,087    |       |         |   | 14,392    |       
|Other operating expenses from consolidated affiliated
    partnerships |                                                        |                         | 26        |       |         |   | 177       |       |         |   | 363       |       
|Amortization of intangibles                                            |                                                        |                         | 7,009     |       |         |   | 7,009     |       |         |   | 7,009     |       
|Interest expense                                                       |                                                        |                         | 118       |       |         |   |          |       |         |   |          |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|                                                                       |                                                        | Total expenses          |           |       | 120,425 |   |           |       | 110,484 |   |           |        | 89,457 | 
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Operating income (loss)                                                |                                                        |                         | 3,062     |       |         |   | (7,746    | )     |         |   | (2,046    | )     
|Minority interest in consolidated affiliated partnerships              |                                                        |                         | (749      | )     |         |   | (1,710    | )     |         |   | 3,291     |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Income (loss) before taxes                                             |                                                        |                         | 2,313     |       |         |   | (9,456    | )     |         |   | 1,245     |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Income tax expense (benefit)                                           |                                                        |                         | 4,078     |       |         |   | (1,076    | )     |         |   | 3,692     |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Net (loss)                                                             |                                                        | $                       | (1,765    | )     |         | $ | (8,380    | )     |         | $ | (2,447    | )     
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|(Loss) per share:                                                      |                                                        |                         |           |       |         |   |           |       |         |   |           |       
|Basic and Diluted                                                      |                                                        | $                       | (0.25     | )     |         | $ | (1.26     | )     |         | $ | (0.37     | )     
|                                                                       |                                                        |                         |           |       |         |   |           |       |        
|Weighted average shares outstanding                                    |                                                        |                         |           |       |         |   |           |       |         |   |           |       
|Basic and Diluted                                                      |                                                        |                         | 6,949,031 |       |         |   | 6,673,371 |       |         |   | 6,624,313 |       
|                                                                       |                                                        |                         |           |       |         |   |           |       |        



F-13



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CASH FLOWS


(Dollar amounts in thousands)


|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |         |         |  
|--------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------- | ------ | ----- | ------ | - | ------- | ------- | ------- | - | ------- | ------- | ------- | -
|                                                                            |                                                                                            | Year Ended December 31,                                                      |       
|                                                                            |                                                                                            |                                                                              |       
|                                                                            |                                                                                            | 2004                                                                         |        |       | 2003   |   |         | 2002    |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|                                                                            |                                                                                            | as restated, see Note 1                                                      |       
|Cash flows from operating activities                                        |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|Net (loss)                                                                  |                                                                                            | $                                                                            | (1,765 | )     |        | $ | (8,380  | )       |         | $ | (2,447  | )      
|Adjustments to reconcile net (loss) to net cash provided by
    operations: |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|                                                                            | Depreciation and amortization                                                              |                                                                              |        | 9,169 |        |   |         | 8,559   |         |   |         | 8,103   |        
|                                                                            | Expense for vesting of restricted stock and stock units                                    |                                                                              |        | 8,919 |        |   |         | 8,186   |         |   |         | 2,020   |        
|                                                                            | Loss on disposal of fixed assets                                                           |                                                                              |        |      |        |   |         | 127     |         |   |         |        |        
|                                                                            | Tax benefit related to employee compensation plans                                         |                                                                              |        | 4,432 |        |   |         | 633     |         |   |         | 317     |        
|                                                                            | Change in deferred tax asset                                                               |                                                                              |        | 275   |        |   |         | (2,984  | )       |   |         | (793    | )      
|                                                                            | Unrealized (gain) loss on investments in securities                                        |                                                                              |        | (300  | )      |   |         | (319    | )       |   |         | 617     |        
|                                                                            | Changes in operating assets and liabilities:                                               |                                                                              |        |       |        |   |         |         |         |   |         |         |        
|                                                                            |                                                                                            | (Increase) decrease in U.S. Treasury bills                                   |        |       | (7,971 | ) |         |         | (19,056 | ) |         |         | 12,144  |  
|                                                                            |                                                                                            | (Increase) decrease in investment advisory and incentive fees
    receivable |        |       | (2,165 | ) |         |         | (13,698 | ) |         |         | 3,680   |  
|                                                                            |                                                                                            | (Increase) decrease in prepaid expenses and other assets                     |        |       | (3,192 | ) |         |         | (1,794  | ) |         |         | 267     |  
|                                                                            |                                                                                            | Decrease in investments in affiliated investment partnerships                |        |       | 1,604  |   |         |         | 106     |   |         |         | 8,148   |  
|                                                                            |                                                                                            | (Increase) decrease in investments in securities                             |        |       | (1,109 | ) |         |         | (3,013  | ) |         |         | 1,120   |  
|                                                                            |                                                                                            | Increase (decrease) in accrued expenses                                      |        |       | 702    |   |         |         | (1,783  | ) |         |         | 823     |  
|                                                                            |                                                                                            | Increase (decrease) in accrued bonuses                                       |        |       | 2,958  |   |         |         | 8,219   |   |         |         | (6,102  | )
|                                                                            |                                                                                            | Increase (decrease) in accrued lease amendment expense                       |        |       | (692   | ) |         |         | 4,535   |   |         |         |        |  
|                                                                            |                                                                                            | Increase in income taxes payable                                             |        |       |       |   |         |         | (532    | ) |         |         | (50     | )
|                                                                            | Changes in operating assets and liabilities from consolidated
    affiliated partnerships: |                                                                              |        |       |        |   |         |         |         |   |         |         |        
|                                                                            |                                                                                            | Minority interest in income (loss)                                           |        |       | 208    |   |         |         | 1,710   |   |         |         | (3,291  | )
|                                                                            |                                                                                            | (Increase) decrease in due from broker                                       |        |       | (952   | ) |         |         | 10,870  |   |         |         | (31,746 | )
|                                                                            |                                                                                            | (Increase) in securities                                                     |        |       | (6,517 | ) |         |         | (1,080  | ) |         |         | (17,810 | )
|                                                                            |                                                                                            | (Increase) decrease in investments in unaffiliated partnerships              |        |       |       |   |         |         | 497     |   |         |         | (4,275  | )
|                                                                            |                                                                                            | Increase (decrease) in securities sold short                                 |        |       | 1,299  |   |         |         | (1,959  | ) |         |         | 9,395   |  
|                                                                            |                                                                                            | Minority interest in previously unconsolidated affiliated
    partnerships   |        |       |       |   |         |         | 1,111   |   |         |         | 40,961  |  
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Net cash provided by (used in) operating activities                         |                                                                                            |                                                                              | 4,903  |       |        |   | (10,045 | )       |         |   | 21,081  |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Cash flows from investing activities                                        |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|Fixed asset additions                                                       |                                                                                            |                                                                              | (2,234 | )     |        |   | (4,729  | )       |         |   | (1,606  | )      
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Net cash (used in) investing activities                                     |                                                                                            |                                                                              | (2,234 | )     |        |   | (4,729  | )       |         |   | (1,606  | )      
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Cash flows from financing activities                                        |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|Payment of loan principal                                                   |                                                                                            |                                                                              |       |       |        |   |        |         |         |   | (221    | )      
|Issuance of common stock                                                    |                                                                                            |                                                                              | (3,505 | )     |        |   | (1,881  | )       |         |   | 204     |        
|Dividends paid to shareholders                                              |                                                                                            |                                                                              | (2,799 | )     |        |   |        |         |         |   |        |        
|Consolidated affiliated partnerships:                                       |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|                                                                            | Increase (decrease) in partner contributions received in advance                           |                                                                              |        |      |        |   |         | (1,150  | )       |   |         | 1,150   |        
|                                                                            | Partner subscriptions                                                                      |                                                                              |        | 2,270 |        |   |         | 10,065  |         |   |         | 24,609  |        
|                                                                            | Partner redemptions                                                                        |                                                                              |        |      |        |   |         | (13,024 | )       |   |         | (35,750 | )      
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Net cash (used in) financing activities                                     |                                                                                            |                                                                              | (4,034 | )     |        |   | (5,990  | )       |         |   | (10,008 | )      
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Net increase (decrease) in cash and cash equivalents                        |                                                                                            |                                                                              | (1,365 | )     |        |   | (20,764 | )       |         |   | 9,467   |        
|Cash and cash equivalents at the beginning of the year                      |                                                                                            |                                                                              | 4,947  |       |        |   | 25,711  |         |         |   | 16,244  |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Cash and cash equivalents at the end of the year                            |                                                                                            | $                                                                            | 3,582  |       |        | $ | 4,947   |         |         | $ | 25,711  |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Supplemental disclosure of cash flow information                            |                                                                                            |                                                                              |        |       |        |   |         |         |         |   |         |        
|Cash paid for interest                                                      |                                                                                            | $                                                                            | 118    |       |        | $ | 1       |         |         | $ | 8       |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        
|Cash paid for taxes                                                         |                                                                                            | $                                                                            | 961    |       |        | $ | 4,251   |         |         | $ | 4,286   |        
|                                                                            |                                                                                            |                                                                              |        |       |        |   |         |         |        



F-14



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS
EQUITY


(Dollar amounts in thousands)


|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |         |   |  |   |         |  
|---------------------------------------------------- |  | ------ | ----- |  | --------------- | - | ------ | -------- |  | - | ------------ | - |  | ----- | ------- | - |  | - | ------- | -
|                                                     |  | Common |       |  | Additional      |   |        | Retained |  |   | Unearned     |   |  |      
|                                                     |  | Stock  |       |  | Paid-in Capital |   |        | Earnings |  |   | Compensation |   |  | Total |        
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        
|Balance at December 31, 2001 as reported             |  | $      | 6,601 |  |                 | $ | 64,002 |          |  | $ | 32,881       |   |  |       |        |   |  | $ | 103,484 |  
|Restated to reflect grants of restricted stock units |  |        |      |  |                 |   | 641    |          |  |   |             |   |  |       |        |   |  |   | 641     |  
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        
|Balance at December 31, 2001 as restated             |  |        | 6,601 |  |                 |   | 64,643 |          |  |   | 32,881       |   |  |       |        |   |  |   | 104,125 |  
|Restated to reflect grants of restricted stock units |  |        |      |  |                 |   | 13,687 |          |  |   |             |   |  |       | (12,016 | ) |  |   | 1,671   |  
|Issuance of common stock                             |  |        | 41    |  |                 |   | 343    |          |  |   |             |   |  |       |        |   |  |   | 384     |  
|Tax benefit related to employee compensation plans   |  |        |      |  |                 |   | 317    |          |  |   |             |   |  |       |        |   |  |   | 317     |  
|Net (loss)                                           |  |        |      |  |                 |   |       |          |  |   | (2,447       | ) |  |       |        |   |  |   | (2,447  | )
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        
|Balance at December 31, 2002, as restated            |  |        | 6,642 |  |                 |   | 78,990 |          |  |   | 30,434       |   |  |       | (12,016 | ) |  |   | 104,050 |  
|Restated to reflect grants of restricted stock units |  |        |      |  |                 |   | 10,380 |          |  |   |             |   |  |       | (2,193  | ) |  |   | 8,187   |  
|Issuance of common stock                             |  |        | 184   |  |                 |   | (2,066 | )        |  |   |             |   |  |       |        |   |  |   | (1,882  | )
|Tax benefit related to employee compensation plans   |  |        |      |  |                 |   | 633    |          |  |   |             |   |  |       |        |   |  |   | 633     |  
|Net (loss)                                           |  |        |      |  |                 |   |       |          |  |   | (8,380       | ) |  |       |        |   |  |   | (8,380  | )
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        
|Balance at December 31, 2003, as restated            |  |        | 6,826 |  |                 |   | 87,937 |          |  |   | 22,054       |   |  |       | (14,209 | ) |  |   | 102,608 |  
|Restated to reflect grants of restricted stock units |  |        |      |  |                 |   | (4,364 | )        |  |   |             |   |  |       | 9,845   |   |  |   | 5,481   |  
|Grants of restricted stock                           |  |        | 65    |  |                 |   | 1,620  |          |  |   |             |   |  |       | (1,031  | ) |  |   | 654     |  
|Issuance of common stock                             |  |        | 384   |  |                 |   | (1,167 | )        |  |   |             |   |  |       |        |   |  |   | (783    | )
|Tax benefit related to employee compensation plans   |  |        |      |  |                 |   | 4,432  |          |  |   |             |   |  |       |        |   |  |   | 4,432   |  
|Dividend, net of compensation expense(1)             |  |        |      |  |                 |   |       |          |  |   | (2,781       | ) |  |       |        |   |  |   | (2,781  | )
|Net (loss)                                           |  |        |      |  |                 |   |       |          |  |   | (1,765       | ) |  |       |        |   |  |   | (1,765  | )
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        
|Balance at December 31, 2004, as restated            |  | $      | 7,275 |  |                 | $ | 88,458 |          |  | $ | 17,508       |   |  | $     | (5,395  | ) |  | $ | 107,846 |  
|                                                     |  |        |       |  |                 |   |        |          |  |   |              |   |  |       |        






|    |                                                           
|--- | ----------------------------------------------------------
|(1) | compensation expense incurred relating to dividend of $18.



F-15



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES





NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|   |                                                                
|-- | ---------------------------------------------------------------
|1. | Organization and Summary of Significant Accounting
    Policies



| |                                       
| | --------------------------------------
| | Organization and Basis of Presentation



| |             
| | ------------
| | Organization









| |                                  
| | ---------------------------------
| | Consolidation Accounting Policies

Operating Companies.


F-16



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                 
| | ----------------
| | Use of Estimates





| |                    
| | -------------------
| | Revenue Recognition









| |                                                                                  
| | ---------------------------------------------------------------------------------
| | Revenue Recognition Policies for Consolidated Affiliated
    Partnerships (CAP)











| |                                                            
| | -----------------------------------------------------------
| | Cash, Cash Equivalents and United States Treasury
    Bills





| |                                                  
| | -------------------------------------------------
| | Investments in Affiliated Investment Partnerships



F-17



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                          
| | -------------------------
| | Investments in Securities





| |             
| | ------------
| | Income Taxes







| |                  
| | -----------------
| | Long-Lived Assets





| |             
| | ------------
| | Fixed Assets





F-18



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                              |  |                                                              |  |                                                 |  |                                          |  |                                                             
|--------------------------------------------- |  | ------------------------------------------------------------ |  | ----------------------------------------------- |  | ---------------------------------------- |  | ------------------------------------------------------------
|                                              |  |                                                              |  | Leasehold Improvements                          |  |                                         
|                                              |  |                                                              |  |                                                 |  |                                         
|                                              |  | Furniture, Fixtures and                                      |  | Term of Lease Greater                           |  | Term of Lease Less                       |  | Certain Internal Use                                        
|                                              |  | Equipment                                                    |  | Than Useful Life                                |  | Than Useful Life                         |  | Software Costs                                              
|                                              |  |                                                              |  |                                                 |  |                                          |  |                                                             
|Placed in service prior to January 1, 2004    |  | Accelerated cost recovery over the useful life of the asset. |  | Straight-line over the useful life of the asset |  | Straight-line over the term of the lease |  | Accelerated cost recovery over the useful life of the asset.
|Placed in service on or after January 1, 2004 |  | Straight-line over the useful life of the asset              |  | Straight-line over the useful life of the asset |  | Straight-line over the term of the lease |  | Straight-line over the useful life of the asset             





| |                  
| | -----------------
| | Intangible Assets





| |                   
| | ------------------
| | Earnings Per Share





|                                                               |  |                         |           |   |      |   |           |      |  |   |           |  
|-------------------------------------------------------------- |  | ----------------------- | --------- | - | ---- | - | --------- | ---- |  | - | --------- | -
|                                                               |  | Year Ended December 31, |          
|                                                               |  |                         |          
|                                                               |  | 2004                    |           |   | 2003 |   |           | 2002 | 
|                                                               |  |                         |           |   |      |   |           |      | 
|Net (loss)                                                     |  | $                       | (1,765    | ) |      | $ | (8,380    | )    |  | $ | (2,447    | )
|Basic weighted-average shares outstanding                      |  |                         | 6,949,031 |   |      |   | 6,673,371 |      |  |   | 6,624,313 |  
|Dilutive potential shares from stock options
    (See Note 13) |  |                         |          |   |      |   |          |      |  |   |          |  
|                                                               |  |                         |           |   |      |   |           |      | 
|Diluted weighted-average shares outstanding                    |  |                         | 6,949,031 |   |      |   | 6,673,371 |      |  |   | 6,624,313 |  
|                                                               |  |                         |           |   |      |   |           |      | 
|Basic and diluted (loss) per share:                            |  |                         |           |   |      |   |           |      |  |   |           |  
|Net (loss)                                                     |  | $                       | (0.25     | ) |      | $ | (1.26     | )    |  | $ | (0.37     | )
|                                                               |  |                         |           |   |      |   |           |      | 

F-19



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






| |                     
| | --------------------
| | Comprehensive Income





| |                                     
| | ------------------------------------
| | Fair Values of Financial Instruments





| |                  
| | -----------------
| | Business Segments





| |                         
| | ------------------------
| | Stock-Based Compensation



F-20



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |   |   |        |       |  
|------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------- | ---- | ------ | ----- | ---- | - | ------ | ----- | - | - | ------ | ----- | -
|                                                                                                                                                        |                                 | 2004 |        |       | 2003 |   |        | 2002  |  
|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |  
|Net (loss), as reported                                                                                                                                 |                                 | $    | (1,765 | )     |      | $ | (8,380 | )     |   | $ | (2,447 | )    
|Add: Stock-based employee compensation expense included in
    reported net loss, net of related tax effects                                            |                                 |      | 4,873  |       |      |   | 4,611  |       |   |   | 1,036  |      
|Deduct: Total stock-based employee compensation expense
    determined under the fair value based method for all awards, net
    of related tax effects |                                 |      | (4,873 | )     |      |   | (4,674 | )     |   |   | (1,886 | )    
|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |  
|Pro forma net (loss)                                                                                                                                    |                                 | $    | (1,765 | )     |      | $ | (8,443 | )     |   | $ | (3,297 | )    
|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |  
|(Loss) per share:                                                                                                                                       |                                 |      |        |       |      |   |        |       |   |   |        |      
|                                                                                                                                                        | Basic and diluted  as reported |      | $      | (0.25 | )    |   | $      | (1.26 | ) |   | $      | (0.37 | )
|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |  
|                                                                                                                                                        | Basic and diluted  pro forma   |      | $      | (0.25 | )    |   | $      | (1.27 | ) |   | $      | (0.50 | )
|                                                                                                                                                        |                                 |      |        |       |      |   |        |       |  



|                        |  |      |         |  
|----------------------- |  | ---- | ------- | -
|                        |  | 2001 |        
|                        |  |      |        
|Expected dividend yield |  |      | 0.00    | %
|Expected volatility     |  |      | 26.64   | %
|Risk-free interest      |  |      | 4.64    | %
|Expected term           |  |      | 7 years |  
|Fair value              |  | $    | 11.30   |  



| |                  
| | -----------------
| | Reclassifications





| |                                                                                    
| | -----------------------------------------------------------------------------------
| | Significant Accounting Policies of Consolidated Affiliated
    Partnerships (CAP)





| |                                                    
| | ---------------------------------------------------
| | Investments in Unaffiliated Investment Partnerships



F-21



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                  
| | -----------------
| | Minority Interest





| |                                      
| | -------------------------------------
| | Partner Contributions and Withdrawals





| |                               
| | ------------------------------
| | Recent Accounting Developments







|   |                       
|-- | ----------------------
|2. | Off-Balance Sheet Risk









|   |                                    
|-- | -----------------------------------
|3. | Investment Advisory Fees Receivable



F-22



---



##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                     
|-- | --------------------
|4. | Consolidation of CAP







F-23



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |       |         | 
|------------------------------------------------------------------------------------------------------ | ---------------------------------------------------- | ------------------------------------------- | ------- | - | ------- | - | ----- | ------------ | ----- | - | ------------ | - | ------ | - | ------- | ----- | ------- | 
|                                                                                                       |                                                      | December 31, 2004, as restated, see Note 13 |        
|                                                                                                       |                                                      |                                             |        
|                                                                                                       |                                                      | BKF                                         |         |   | CAP     |   |       | Eliminations |       |   | Consolidated |  
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|Assets                                                                                                 |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |      
|Cash and cash equivalents                                                                              |                                                      | $                                           | 3,582   |   |         | $ |      |              |       | $ |             |   |        | $ | 3,582   |      
|U.S. Treasury bills                                                                                    |                                                      |                                             | 40,466  |   |         |   |      |              |       |   |             |   |        |   | 40,466  |      
|Investment advisory and incentive fees receivable                                                      |                                                      |                                             | 40,009  |   |         |   |      |              |       |   |             |   |        |   | 40,009  |      
|Investments in securities, at value (cost $5,426)                                                      |                                                      |                                             | 5,788   |   |         |   |      |              |       |   |             |   |        |   | 5,788   |      
|Investments in affiliated partnerships                                                                 |                                                      |                                             | 21,052  |   |         |   |      |              |       |   | (3,690       | ) |        |   | 17,362  |      
|Prepaid expenses and other assets                                                                      |                                                      |                                             | 7,044   |   |         |   | 4     |              |       |   |             |   |        |   | 7,048   |      
|Fixed assets (net of accumulated depreciation of $6,756)                                               |                                                      |                                             | 6,812   |   |         |   |      |              |       |   |             |   |        |   | 6,812   |      
|Deferred tax asset                                                                                     |                                                      |                                             | 8,391   |   |         |   |      |              |       |   |             |   |        |   | 8,391   |      
|Goodwill (net of accumulated amortization of $8,566)                                                   |                                                      |                                             | 14,796  |   |         |   |      |              |       |   |             |   |        |   | 14,796  |      
|Investment advisory contracts (net of accumulated amortization
    of $59,576)                         |                                                      |                                             | 10,513  |   |         |   |      |              |       |   |             |   |        |   | 10,513  |      
|Consolidated affiliated partnerships:                                                                  |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |      
|                                                                                                       | Due from broker                                      |                                             |         |  |         |   |       | 952          |       |   |              |  |        |   |         | 952   |        
|                                                                                                       | Investments in securities, at value (cost $5,877)    |                                             |         |  |         |   |       | 6,517        |       |   |              |  |        |   |         | 6,517 |        
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|                                                                                                       |                                                      | Total assets                                |         | $ | 158,453 |   |       | $            | 7,473 |   |              | $ | (3,690 | ) |         | $     | 162,236 | 
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|                                                                                                      
|Liabilities, minority interest and stockholders
    equity                                            |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |      
|Accrued expenses                                                                                       |                                                      | $                                           | 4,078   |   |         | $ | 6     |              |       | $ |             |   |        | $ | 4,084   |      
|Accrued bonuses                                                                                        |                                                      |                                             | 42,686  |   |         |   |      |              |       |   |             |   |        |   | 42,686  |      
|Accrued lease amendment expense                                                                        |                                                      |                                             | 3,843   |   |         |   |      |              |       |   |             |   |        |   | 3,843   |      
|Consolidated affiliated partnerships:                                                                  |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |      
|                                                                                                       | Securities sold short, at value (proceeds of $1,065) |                                             |         |  |         |   |       | 1,299        |       |   |              |  |        |   |         | 1,299 |        
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|                                                                                                       |                                                      | Total liabilities                           |         |   | 50,607  |   |       |              | 1,305 |   |              |   |       |   |         |       | 51,912  | 
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|Minority interest in CAP                                                                               |                                                      |                                             |        |   |         |   |      |              |       |   | 2,478        |   |        |   | 2,478   |      
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|Stockholders equity                                                                                   |                                                      |                                             |         |   |         |   |       |              |       |   |              |   |        |   |         |      
|Common stock, $1 par value, authorized 
    15,000,000 shares, issued and outstanding 
    7,274,779 |                                                      |                                             | 7,275   |   |         |   |      |              |       |   |             |   |        |   | 7,275   |      
|Additional paid-in capital                                                                             |                                                      |                                             | 88,458  |   |         |   |      |              |       |   |             |   |        |   | 88,458  |      
|Retained earnings                                                                                      |                                                      |                                             | 17,508  |   |         |   |      |              |       |   |             |   |        |   | 17,508  |      
|Unearned compensation  restricted stock and
    restricted stock units                                |                                                      |                                             | (5,395  | ) |         |   |      |              |       |   |             |   |        |   | (5,395  | )    
|Capital from consolidated affiliated partnerships                                                      |                                                      |                                             |        |   |         |   | 6,168 |              |       |   | (6,168       | ) |        |   |        |      
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|                                                                                                       |                                                      | Total stockholders equity                  |         |   | 107,846 |   |       |              | 6,168 |   |              |   | (6,168 | ) |         |       | 107,846 | 
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  
|Total liabilities, minority interest and stockholders
    equity                                      |                                                      | $                                           | 158,453 |   |         | $ | 7,473 |              |       | $ | (3,690       | ) |        | $ | 162,236 |      
|                                                                                                       |                                                      |                                             |         |   |         |   |       |              |       |   |              |  

F-24



---



##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |       |         | 
|------------------------------------------------------------------------------------------------------ | ---------------------------------------------------- | ------------------------------------------- | ------- | - | ------- | - | ------ | ------------ | ------ | - | ------------ | - | ------- | - | ------- | ----- | ------- | 
|                                                                                                       |                                                      | December 31, 2003, as restated, see Note 13 |        
|                                                                                                       |                                                      |                                             |        
|                                                                                                       |                                                      | BKF                                         |         |   | CAP     |   |        | Eliminations |        |   | Consolidated |  
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|Assets                                                                                                 |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |      
|Cash and cash equivalents                                                                              |                                                      | $                                           | 4,930   |   |         | $ | 17     |              |        | $ |             |   |         | $ | 4,947   |      
|U.S. Treasury bills                                                                                    |                                                      |                                             | 32,495  |   |         |   |       |              |        |   |             |   |         |   | 32,495  |      
|Investment advisory and incentive fees receivable                                                      |                                                      |                                             | 37,856  |   |         |   |       |              |        |   | (12          | ) |         |   | 37,844  |      
|Investments in securities, at value (cost $4,317)                                                      |                                                      |                                             | 4,379   |   |         |   |       |              |        |   |             |   |         |   | 4,379   |      
|Investments in affiliated partnerships                                                                 |                                                      |                                             | 18,965  |   |         |   |       |              |        |   | (1,923       | ) |         |   | 17,042  |      
|Prepaid expenses and other assets                                                                      |                                                      |                                             | 3,856   |   |         |   | 34     |              |        |   |             |   |         |   | 3,890   |      
|Fixed assets (net of accumulated depreciation of $4,881)                                               |                                                      |                                             | 6,741   |   |         |   |       |              |        |   |             |   |         |   | 6,741   |      
|Deferred tax asset                                                                                     |                                                      |                                             | 8,666   |   |         |   |       |              |        |   |             |   |         |   | 8,666   |      
|Goodwill (net of accumulated amortization of $8,566)                                                   |                                                      |                                             | 14,796  |   |         |   |       |              |        |   |             |   |         |   | 14,796  |      
|Investment advisory contracts (net of accumulated amortization
    of $52,567)                         |                                                      |                                             | 17,522  |   |         |   |       |              |        |   |             |   |         |   | 17,522  |      
|Consolidated affiliated partnerships:                                                                  |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |      
|                                                                                                       | Due from broker                                      |                                             |         |  |         |   |        | 4,248        |        |   |              |  |         |   |         | 4,248 |        
|                                                                                                       | Investments in securities, at value (cost $3,692)    |                                             |         |  |         |   |        | 3,927        |        |   |              |  |         |   |         | 3,927 |        
|                                                                                                       | Investments in unaffiliated partnerships             |                                             |         |  |         |   |        | 3,778        |        |   |              |  |         |   |         | 3,778 |        
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|                                                                                                       |                                                      | Total assets                                |         | $ | 150,206 |   |        | $            | 12,004 |   |              | $ | (1,935  | ) |         | $     | 160,275 | 
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|                                                                                                      
|Liabilities, minority interest and stockholders
    equity                                            |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |      
|Accrued expenses                                                                                       |                                                      | $                                           | 3,335   |   |         | $ | 29     |              |        | $ | (12          | ) |         | $ | 3,352   |      
|Accrued bonuses                                                                                        |                                                      |                                             | 39,728  |   |         |   |       |              |        |   |             |   |         |   | 39,728  |      
|Accrued lease amendment expense                                                                        |                                                      |                                             | 4,535   |   |         |   |       |              |        |   |             |   |         |   | 4,535   |      
|Consolidated affiliated partnerships:                                                                  |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |      
|                                                                                                       | Securities sold short, at value (proceeds of $1,106) |                                             |         |  |         |   |        | 1,117        |        |   |              |  |         |   |         | 1,117 |        
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|                                                                                                       |                                                      | Total liabilities                           |         |   | 47,598  |   |        |              | 1,146  |   |              |   | (12     | ) |         |       | 48,732  | 
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|Minority interest in CAP                                                                               |                                                      |                                             |        |   |         |   |       |              |        |   | 8,935        |   |         |   | 8,935   |      
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|Stockholders equity                                                                                   |                                                      |                                             |         |   |         |   |        |              |        |   |              |   |         |   |         |      
|Common stock, $1 par value, authorized 
    15,000,000 shares, issued and outstanding 
    6,826,247 |                                                      |                                             | 6,826   |   |         |   |       |              |        |   |             |   |         |   | 6,826   |      
|Additional paid-in capital                                                                             |                                                      |                                             | 87,937  |   |         |   |       |              |        |   |             |   |         |   | 87,937  |      
|Retained earnings                                                                                      |                                                      |                                             | 22,054  |   |         |   |       |              |        |   |             |   |         |   | 22,054  |      
|Unearned compensation  restricted stock and
    restricted stock units                                |                                                      |                                             | (14,209 | ) |         |   |       |              |        |   |             |   |         |   | (14,209 | )    
|Capital from consolidated affiliated partnerships                                                      |                                                      |                                             |        |   |         |   | 10,858 |              |        |   | (10,858      | ) |         |   |        |      
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|                                                                                                       |                                                      | Total stockholders equity                  |         |   | 102,608 |   |        |              | 10,858 |   |              |   | (10,858 | ) |         |       | 102,608 | 
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  
|Total liabilities, minority interest and stockholders
    equity                                      |                                                      | $                                           | 150,206 |   |         | $ | 12,004 |              |        | $ | (1,935       | ) |         | $ | 160,275 |      
|                                                                                                       |                                                      |                                             |         |   |         |   |        |              |        |   |              |  

F-25



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |             
|-- | ------------
|5. | Fixed Assets



|                                               |  |                 |               |  |              |   |        |      |  |   |        | 
|---------------------------------------------- |  | --------------- | ------------- |  | ------------ | - | ------ | ---- |  | - | ------ | 
|                                               |  | Estimated       |               |  | December 31, |  
|                                               |  | Useful          |               |  |              |  
|                                               |  | Life  in Years |               |  | 2004         |   |        | 2003 | 
|                                               |  |                 |               |  |              |   |        |      | 
|Furniture and fixtures                         |  |                 | 5-7           |  |              | $ | 2,333  |      |  | $ | 2,025  | 
|Computer hardware, software and other          |  |                 | 3-5           |  |              |   | 6,595  |      |  |   | 5,745  | 
|Leasehold improvements                         |  |                 | Life of lease |  |              |   | 4,640  |      |  |   | 3,852  | 
|                                               |  |                 |               |  |              |   |        |      | 
|                                               |  |                 |               |  |              |   | 13,568 |      |  |   | 11,622 | 
|Less accumulated depreciation and amortization |  |                 |               |  |              |   | 6,756  |      |  |   | 4,881  | 
|                                               |  |                 |               |  |              |   |        |      | 
|Fixed assets, net                              |  |                 |               |  |              | $ | 6,812  |      |  | $ | 6,741  | 
|                                               |  |                 |               |  |              |   |        |      | 





|   |                  
|-- | -----------------
|6. | Intangible Assets



|     |  |   |       | 
|---- |  | - | ----- | 
|2005 |  | $ | 7,009 | 
|2006 |  |   | 3,504 | 



|   |                      
|-- | ---------------------
|7. | Significant Customers





|   |                           
|-- | --------------------------
|8. | Related Party Transactions



| |                                              
| | ---------------------------------------------
| | Investment Advisory Fees From Related Parties



F-26



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




| |                                                                          
| | -------------------------------------------------------------------------
| | Investments in Affiliated Investment Partnerships and
    Related Revenue



|                                                                                   |  |              |          |   |      |   |           |  
|---------------------------------------------------------------------------------- |  | ------------ | -------- | - | ---- | - | --------- | -
|                                                                                   |  | December 31, |         
|                                                                                   |  |              |         
|                                                                                   |  | 2004         |          |   | 2003 |  
|                                                                                   |  |              |          |   |      |  
|Total AIP assets                                                                   |  | $            | 837,800  |   |      | $ | 1,023,156 |  
|Total AIP liabilities                                                              |  |              | (223,674 | ) |      |   | (322,931  | )
|Total AIP capital balance                                                          |  |              | 614,126  |   |      |   | 700,225   |  
|AIP net earnings                                                                   |  |              | 19,831   |   |      |   | 23,832    |  
|Companys carrying value (including incentive allocations)                         |  |              | 17,362   |   |      |   | 17,042    |  
|Companys income on invested capital (excluding accrued
    incentive allocations) |  |              | 624      |   |      |   | 1,198     |  











| |                    
| | -------------------
| | Commission Revenues





|   |                     
|-- | --------------------
|9. | Stockholders Equity



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|    |                                       
|--- | --------------------------------------
|10. | Commitment and Contractual Obligations



| |           
| | ----------
| | Commitment



|                                |  |   |        | 
|------------------------------- |  | - | ------ | 
|2005                            |  | $ | 3,002  | 
|2006                            |  |   | 3,019  | 
|2007                            |  |   | 3,085  | 
|2008                            |  |   | 3,688  | 
|2009                            |  |   | 3,690  | 
|Thereafter                      |  |   | 6,453  | 
|                                |  |   |       
|Total minimum payments required |  | $ | 22,937 | 
|                                |  |   |       









| |                        
| | -----------------------
| | Contractual Obligations





|    |                        
|--- | -----------------------
|11. | Net Capital Requirement



F-28



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                       
|--- | ----------------------
|12. | Employee Benefit Plans





|    |                               
|--- | ------------------------------
|13. | Stock-Based Compensation Plans





|   |                       
|-- | ----------------------
|A. | Restricted Stock Units



|                  |                         |     |           |          |  
|----------------- | ----------------------- | --- | --------- | -------- | -
|                  |                         | RSU |          
|                  |                         |     |          
|Outstanding at:   |                         |     |           |         
|December 31, 2001 |                         |     | 710,714   |         
|                  | Granted                 |     |           | 651,980  |  
|                  | Delivered               |     |           | (13,813  | )
|                  | Forfeited               |     |           | (2,334   | )
|                  |                         |     |          
|December 31, 2002 |                         |     | 1,346,547 |         
|                  | Granted                 |     |           | 527,190  |  
|                  | Granted  option tender |     |           | 111,105  |  
|                  | Delivered               |     |           | (262,652 | )
|                  | Forfeited               |     |           | (2,833   | )
|                  |                         |     |          
|December 31, 2003 |                         |     | 1,719,357 |         
|                  | Delivered               |     |           | (367,398 | )
|                  | Forfeited               |     |           | (94,494  | )
|                  |                         |     |          
|December 31, 2004 |                         |     | 1,257,465 |         
|                  |                         |     |          





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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|      |  |   |       | 
|----- |  | - | ----- | 
|2005  |  | $ | 4,204 | 
|2006  |  |   | 140   | 
|      |  |   |      
|Total |  | $ | 4,344 | 
|      |  |   |      

B. Restricted Stock




|                  |                     |            |        |        |  
|----------------- | ------------------- | ---------- | ------ | ------ | -
|                  |                     | Restricted |       
|                  |                     | Stock      |       
|                  |                     |            |       
|Outstanding at:   |                     |            |        |       
|December 31, 2003 |                     |            |       |       
|                  | Granted  Employees |            |        | 56,105 |  
|                  | Granted  Directors |            |        | 9,600  |  
|                  | Forfeited           |            |        | (437   | )
|                  |                     |            |       
|December 31, 2004 |                     |            | 65,268 |       
|                  |                     |            |       







|      |  |   |       | 
|----- |  | - | ----- | 
|2005  |  | $ | 470   | 
|2006  |  |   | 470   | 
|2007  |  |   | 91    | 
|      |  |   |      
|Total |  | $ | 1,031 | 
|      |  |   |      

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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


C. Non-Qualified Stock Options




|                  |                          |        |         |          |                |   |       |       | 
|----------------- | ------------------------ | ------ | ------- | -------- | -------------- | - | ----- | ----- | 
|                  |                          | Shares |         |          |               
|                  |                          | Under  |         |          | Weighted-Avg.  |  
|                  |                          | Option |         |          | Exercise Price |  
|                  |                          |        |         |          |                |  
|Outstanding at:   |                          |        |         |          |                |   |       |      
|December 31, 2001 |                          |        | 632,971 |          |                | $ | 21.40 |      
|                  | Exercised                |        |         | (40,975  | )              |   |       | 13.03 | 
|                  | Forfeited                |        |         | (2,000   | )              |   |       | 28.27 | 
|                  |                          |        |         |          |                |  
|December 31, 2002 |                          |        | 589,996 |          |                | $ | 21.95 |      
|                  | Exercised                |        |         | (38,409  | )              |   |       | 13.03 | 
|                  | Forfeited  tender offer |        |         | (333,308 | )              |   |       | 28.27 | 
|                  |                          |        |         |          |                |  
|December 31, 2003 |                          |        | 218,279 |          |                | $ | 13.88 |      
|                  | Exercised                |        |         | (194,883 | )              |   |       | 13.74 | 
|                  |                          |        |         |          |                |  
|December 31, 2004 |                          |        | 23,396  |          |                | $ | 15.01 |      
|                  |                          |        |         |          |                |  



| |  |        |        |  |                |               |           |             |  |  |      | 
| |  | ------ | ------ |  | -------------- | ------------- | --------- | ----------- |  |  | ---- | 
| |  |        |        |  |                | Weighted-Avg. |          
| |  | Shares |        |  |                |               | Remaining |            
| |  | Under  |        |  | Weighted-Avg.  |               |           | Contractual | 
| |  | Option |        |  | Exercise Price |               |           | Life        | 
| |  |        |        |  |                |               |           |             | 
| |  |        | 7,134  |  |                | $             | 13.03     |             |  |  | 5.06 | 
| |  |        | 16,262 |  |                |               | 15.88     |             |  |  | 5.50 | 
| |  |        |        |  |                |               |           |             | 
| |  |        | 23,396 |  |                | $             | 15.01     |             |  |  | 5.19 | 
| |  |        |        |  |                |               |           |             | 



|   |                           
|-- | --------------------------
|D. | Deferred Compensation Plan



|              |  |  |         | 
|------------- |  |  | ------- | 
|January 2005  |  |  | 71,413  | 
|November 2005 |  |  | 65,048  | 
|December 2005 |  |  | 43,952  | 
|January 2006  |  |  | 131,139 | 
|December 2010 |  |  | 15,400  | 
|              |  |  |        
|Total         |  |  | 326,952 | 
|              |  |  |        





F-31



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|    |                      
|--- | ---------------------
|14. | Non-Cash Transactions













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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |             
|--- | ------------
|15. | Income Taxes



|                          |                 |                         |       |       |      |   |        |        |   |   |       |       |  
|------------------------- | --------------- | ----------------------- | ----- | ----- | ---- | - | ------ | ------ | - | - | ----- | ----- | -
|                          |                 | Year Ended December 31, |      
|                          |                 |                         |      
|                          |                 | 2004                    |       |       | 2003 |   |        | 2002   |  
|                          |                 |                         |       |       |      |   |        |        |  
|Current:                  |                 |                         |       |       |      |   |        |        |   |   |       |      
|                          | Federal         |                         | $     | 1,433 |      |   | $      | 1,680  |   |   | $     | 3,081 |  
|                          | State and local |                         |       | 328   |      |   |        | 217    |   |   |       | 1,404 |  
|                          |                 |                         |       |       |      |   |        |        |  
|Total current             |                 |                         | 1,761 |       |      |   | 1,897  |        |   |   | 4,485 |      
|                          |                 |                         |       |       |      |   |        |        |  
|Deferred:                 |                 |                         |       |       |      |   |        |        |   |   |       |      
|                          | Federal         |                         |       | 1,276 |      |   |        | (2,207 | ) |   |       | (446  | )
|                          | State and local |                         |       | 1,041 |      |   |        | (766   | ) |   |       | (347  | )
|                          |                 |                         |       |       |      |   |        |        |  
|Total deferred            |                 |                         | 2,317 |       |      |   | (2,973 | )      |   |   | (793  | )    
|                          |                 |                         |       |       |      |   |        |        |  
|Total provision (benefit) |                 | $                       | 4,078 |       |      | $ | (1,076 | )      |   | $ | 3,692 |      
|                          |                 |                         |       |       |      |   |        |        |  





|                             |                                 |              |        |        |      |   |        |        |  
|---------------------------- | ------------------------------- | ------------ | ------ | ------ | ---- | - | ------ | ------ | -
|                             |                                 | Year Ended   |       
|                             |                                 | December 31, |       
|                             |                                 |              |       
|                             |                                 | 2004         |        |        | 2003 |  
|                             |                                 |              |        |        |      |  
|Deferred tax assets:         |                                 |              |        |        |      |   |        |       
|                             | Compensation                    |              | $      | 8,352  |      |   | $      | 8,031  |  
|                             | Depreciation                    |              |        | 353    |      |   |        | 128    |  
|                             | Lease reserve                   |              |        | 1,732  |      |   |        | 2,164  |  
|                             | Revenue                         |              |        | 83     |      |   |        |       |  
|                             |                                 |              |        |        |      |  
|Gross deferred tax asset     |                                 |              | 10,520 |        |      |   | 10,323 |       
|                             |                                 |              |        |        |      |  
|Deferred tax liabilities:    |                                 |              |        |        |      |   |        |       
|                             | Deferred state income taxes     |              |        | (2,035 | )    |   |        | (1,375 | )
|                             | Deferred revenues               |              |        |       |      |   |        | (237   | )
|                             | Unrealized gains on investments |              |        | (94    | )    |   |        | (45    | )
|                             |                                 |              |        |        |      |  
|Gross deferred tax liability |                                 |              | (2,129 | )      |      |   | (1,657 | )     
|                             |                                 |              |        |        |      |  
|Net deferred tax asset       |                                 | $            | 8,391  |        |      | $ | 8,666  |       
|                             |                                 |              |        |        |      |  



F-33



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                       |                                    |                         |       |       |      |   |        |       |   |   |       |       |  
|-------------------------------------- | ---------------------------------- | ----------------------- | ----- | ----- | ---- | - | ------ | ----- | - | - | ----- | ----- | -
|                                       |                                    | Year Ended December 31, |      
|                                       |                                    |                         |      
|                                       |                                    | 2004                    |       |       | 2003 |   |        | 2002  |  
|                                       |                                    |                         |       |       |      |   |        |       |  
|Expected income tax expense (benefit)  |                                    | $                       | 810   |       |      | $ | (3,310 | )     |   | $ | 436   |      
|Increase in income resulting from:     |                                    |                         |       |       |      |   |        |       |   |   |       |      
|                                       | State and local taxes, net         |                         |       | 890   |      |   |        |      |   |   |       | 687   |  
|                                       | Non-deductible amortization        |                         |       | 2,453 |      |   |        | 2,453 |   |   |       | 2,453 |  
|                                       | Officers life insurance           |                         |       | 105   |      |   |        | 129   |   |   |       | 128   |  
|                                       | Other                              |                         |       | 21    |      |   |        | 9     |   |   |       |      |  
|Decrease in income tax resulting from: |                                    |                         |       |       |      |   |        |       |   |   |       |      
|                                       | State and local taxes, net         |                         |       |      |      |   |        | (357  | ) |   |       |      |  
|                                       | Dividend on employee equity awards |                         |       | (201  | )    |   |        |      |   |   |       |      |  
|                                       | Other                              |                         |       |      |      |   |        |      |   |   |       | (12   | )
|                                       |                                    |                         |       |       |      |   |        |       |  
|Income tax expense (benefit)           |                                    | $                       | 4,078 |       |      | $ | (1,076 | )     |   | $ | 3,692 |      
|                                       |                                    |                         |       |       |      |   |        |       |  





|    |                  
|--- | -----------------
|16. | Subsequent Events



|   |  |                                                                                                                                                                                                                                                                                                                                                                                
|-- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|a. |  | In January 2005, the Board of Directors approved a dividend of
    $0.125 per share payable to shareholders on
    February 15, 2005 totaling $1.05 million.                                                                                                                                                                                                                   
|  
|b. |  | In March 2005, certain executive officers of the Company, who
    are subject to performance based criteria with regard to their
    2004 compensation, and several employees were granted
    75,344 shares of restricted stock with a value of
    approximately $3.2 million.                                                                                               
|  
|c. |  | In February 2005, the Company signed a lease for office space in
    London, England. The Company has obligations that require
    monthly payments plus escalations through December 2012 (with
    the option to terminate the lease by December 2007). The minimum
    annual rental commitments under the operating lease are as
    follows (dollar amounts in thousands):

|                                |  |   |     | 
|------------------------------- |  | - | --- | 
|2005 (starting in May)          |  | $ | 82  | 
|2006                            |  |   | 131 | 
|2007                            |  |   | 131 | 
|2008                            |  |   | 131 | 
|2009                            |  |   | 131 | 
|Thereafter                      |  |   | 391 | 
|                                |  |   |    
|Total minimum payments required |  | $ | 997 | 
|                                |  |   |    

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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |                                              
|--- | ---------------------------------------------
|17. | Selected Quarterly Financial Data (unaudited)



|                                            |         |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |  |   |           |       |  
|------------------------------------------- | ------- | -- | --------- | ----- | -- | - | --------- | ----- | - | - | --------- | ----- | - | ----- | --------- | ----- |  | - | --------- | ----- | -
|2004                                        |         | Q1 |           |       | Q2 |   |           | Q3    |   |   | Q4        |       |   | Total |          
|                                            |         |    |           |       |    |   |           |       |   |   |           |       |   |       |          
|Revenues                                    |         | $  | 29,847    |       |    | $ | 24,619    |       |   | $ | 27,844    |       |   | $     | 41,177    |       |  | $ | 123,487   |      
|Operating income (loss)                     |         | $  | (214      | )     |    | $ | (1,456    | )     |   | $ | 415       |       |   | $     | 4,317     |       |  | $ | 3,062     |      
|Net income (loss)                           |         | $  | (1,058    | )     |    | $ | (1,699    | )     |   | $ | (737      | )     |   | $     | 1,729     |       |  | $ | (1,765    | )    
|Earnings (loss) per share:                  |         |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |  |   |           |      
|                                            | Basic   |    | $         | (0.15 | )  |   | $         | (0.25 | ) |   | $         | (0.11 | ) |       | $         | 0.24  |  |   | $         | (0.25 | )
|                                            | Diluted |    | $         | (0.15 | )  |   | $         | (0.25 | ) |   | $         | (0.11 | ) |       | $         | 0.23  |  |   | $         | (0.25 | )
|Weighted average shares outstanding basic   |         |    | 6,854,289 |       |    |   | 6,908,415 |       |   |   | 6,922,763 |       |   |       | 7,109,185 |       |  |   | 6,949,031 |      
|                                            |         |    |           |       |    |   |           |       |   |   |           |       |   |       |          
|Weighted average shares outstanding diluted |         |    | 6,854,289 |       |    |   | 6,908,415 |       |   |   | 6,922,763 |       |   |       | 7,459,346 |       |  |   | 6,949,031 |      
|                                            |         |    |           |       |    |   |           |       |   |   |           |       |   |       |          
|Common stock price per share:               |         |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |  |   |           |      
|                                            | High    |    | $         | 27.00 |    |   | $         | 29.90 |   |   | $         | 29.40 |   |       | $         | 38.00 |  |   |           |       |  
|                                            | Low     |    | $         | 24.72 |    |   | $         | 26.40 |   |   | $         | 26.01 |   |       | $         | 29.80 |  |   |           |       |  
|                                            | Close   |    | $         | 25.80 |    |   | $         | 29.05 |   |   | $         | 29.30 |   |       | $         | 37.90 |  |   |           |       |  

|                                                      |                   |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |   |   |           |       |  
|----------------------------------------------------- | ----------------- | -- | --------- | ----- | -- | - | --------- | ----- | - | - | --------- | ----- | - | ----- | --------- | ----- | - | - | --------- | ----- | -
|2003                                                  |                   | Q1 |           |       | Q2 |   |           | Q3    |   |   | Q4        |       |   | Total |          
|                                                      |                   |    |           |       |    |   |           |       |   |   |           |       |   |       |          
|Revenues                                              |                   | $  | 21,206    |       |    | $ | 25,107    |       |   | $ | 26,924    |       |   | $     | 29,501    |       |   | $ | 102,738   |      
|Operating income (loss)                               |                   | $  | (1,195    | )     |    | $ | 108       |       |   | $ | (5,999    | )     |   | $     | (660      | )     |   | $ | (7,746    | )    
|Net (loss)                                            |                   | $  | (1,289    | )     |    | $ | (1,074    | )     |   | $ | (4,283    | )     |   | $     | (1,734    | )     |   | $ | (8,380    | )    
|(Loss) per share:                                     |                   |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |   |   |           |      
|                                                      | Basic and diluted |    | $         | (0.19 | )  |   | $         | (0.16 | ) |   | $         | (0.64 | ) |       | $         | (0.26 | ) |   | $         | (1.26 | )
|Weighted average shares outstanding basic and diluted |                   |    | 6,643,918 |       |    |   | 6,646,055 |       |   |   | 6,655,734 |       |   |       | 6,673,371 |       |   |   | 6,673,371 |      
|                                                      |                   |    |           |       |    |   |           |       |   |   |           |       |   |       |          
|Common stock price per share:                         |                   |    |           |       |    |   |           |       |   |   |           |       |   |       |           |       |   |   |           |      
|                                                      | High              |    | $         | 18.45 |    |   | $         | 22.28 |   |   | $         | 24.50 |   |       | $         | 25.15 |   |   |           |       |  
|                                                      | Low               |    | $         | 16.24 |    |   | $         | 15.65 |   |   | $         | 20.15 |   |       | $         | 21.75 |   |   |           |       |  
|                                                      | Close             |    | $         | 16.25 |    |   | $         | 21.83 |   |   | $         | 24.15 |   |       | $         | 24.68 |   |   |           |       |  



|    |                              
|--- | -----------------------------
|18. | Subsequent Events (unaudited)





F-35



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##### Table of Contents



BKF CAPITAL GROUP, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






F-36